Mar 31, 2022
INEOS Styrolution India LimitedReport on the audit of the financial statementsOpinion
We have audited the accompanying financial statements of INEOS Styrolution India Limited (âthe Companyâ), which comprise the Balance Sheet as at 31st March 2022, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Companies Act, 2013 (âthe Actâ) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (âInd ASâ) and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March 2022, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of the financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Act (SAs). Our responsibilities under those Standards are further described in the Auditor''s Responsibility for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence obtained by us, is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. we have determined the matters described below to be the key audit matters to be communicated in our report.
Key audit matter |
Auditor''s Response |
Assessment of ongoing income tax and indirect tax litigations [Refer to 1(s) Significant accounting policies) and Note 38 (Contingent liabilities) to the financial statements] |
Our procedures on the management''s assessment of these matters included: ⢠Understanding and evaluating process and controls designed and implemented by the management including testing operating effectiveness of relevant controls |
Key audit matter |
Auditor''s Response |
As at 31st March 2022, the Company is subjected to a |
⢠Gaining an understanding of the tax related litigations |
number of indirect tax litigations relating to disallowance |
through discussions with the management, including |
of CENVAT credit in respect of payment of countervailing |
the significant developments, additions and |
duty and special additional duty through Duty Entitlement |
settlements during the year; |
Passbook (DEPB) in respect of import of raw materials and availing of CENVAT credit, disallowance of service |
⢠Inspecting demand notices, assessment/transfer |
tax credit on certain input services and income tax |
pricing orders including documents related to filing of |
litigations relating to disallowance of expenses, transfer |
appeals with various authorities/courts, if any, |
pricing adjustments etc. (together referred to as |
received from tax authorities and evaluating the |
âlitigationsâ). These matters are in appeal before various |
Companyâs response to those matters; |
judicial forums. |
⢠Obtaining independent confirmations from the |
The eventual outcome of these litigations is uncertain, |
Companyâs external tax experts including the status of |
and the positions taken by the management are based on |
the significant litigations, their views regarding the |
the application of significant judgement and estimation. |
likely outcome and magnitude of the potential |
The review of these matters requires application and |
exposure; |
interpretation of tax laws and reference to applicable judicial pronouncements. Based on management |
⢠Evaluating the managementâs assessment on the |
judgement and the advice from external legal and tax |
likely outcome and potential magnitude by involving |
consultants and considering the merits of the case, the |
auditorâs experts on complex or significant matters as |
Company has recognized provisions wherever required and for the balance matters, where the management |
considered necessary; and |
expects favourable outcome, these litigations have been |
⢠Assessing the adequacy of the Companyâs |
disclosed as contingent liabilities in the financial statements unless the possibility of outflow of resources is considered to be remote. |
disclosures in the financial statements |
Given the uncertainty and application of significant judgment in this area in terms of the eventual outcome of litigations, we determined this to be a key audit matter. |
Information Other than the Financial Statements and Auditor''s Report Thereon
⢠The Companyâs Board of Directors is responsible for the other information. The other information comprises the information included in the Directorâs report of even date and annexure thereof, but does not include the financial statements and our auditorâs report thereon.
⢠Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
⢠In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.
⢠If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Management''s Responsibility for the Financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the
preparation of these financial statements that give a true and fair view of the financial position, financial including other
comprehensive income, cash flows and changes in equity of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
Auditorâs Responsibility for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(I) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management.
⢠Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the financial statements.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act, based on our audit we report, to the extent applicable that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Statement of Cash Flows and Statement of Changes in Equity dealt with by this Report are in agreement with the relevant books of account.
d) In our opinion, the aforesaid financial statements comply with the Ind AS specified under Section 133 of the Act.
e) On the basis of the written representations received from the directors as on 31st March, 2022 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2022 from being appointed as a director in terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial reporting.
g) With respect to the other matters to be included in the Auditorâs Report in accordance with the requirements of section 197(16) of the Act, as amended,
In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.
h) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements;
ii. The Company has made provision, as required under the applicable law or accounting standards, for material
foreseeable losses, if any, on long-term contracts including derivative contracts
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and
Protection Fund by the Company
iv. (a) The Management has represented that, to the best of itâs knowledge and belief, no funds have been
advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(b) The Management has represented, that, to the best of itâs knowledge and belief, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities(âFunding Partiesâ), with the understanding whether recorded in writing or otherwise, that the company shall, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (âUltimate beneficiariesâ) or provide any guarantee, security or the like on behalf of the ultimate beneficiaries.
(c) Based on the audit procedures that has been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (I) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.
v. (a) The final dividend proposed in the previous year, declared and paid by the Company during the year is in accordance with section 123 of the Act, as applicable.
(b) The 1st interim dividend declared and paid by the Company during the year and until the date of this report is in accordance with section 123 of the Companies Act 2013.
(c) The 2nd interim dividend declared by the Company is in accordance with section 123 of the Companies Act 2013 to the extent it applies to declaration of dividend. However, the said dividend was not due for payment on the date of this audit report
2. As required by the Companies (Auditorâs Report) Order, 2020 (âthe Orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in âAnnexure Bâ a statement on the matters specified in paragraphs 3 and 4 of the Order.
Chartered Accountants (Firm''s Registration No. 117365W)
Hardik Sutaria Partner
Place: Vadodara (Membership No.116642)
Date: 26 May 2022 (UDIN: 22116642AJPYEN6326)
Mar 31, 2018
Independent Auditorsâ Report
TO THE MEMBERS OF
INEOS Styrolution India Limited
Report on the Indian Accounting Standards (Ind AS) Financial Statements
1. We have audited the accompanying Ind AS financial statements of INEOS Styrolution India Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Ind AS Financial Statements
2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the
Companies Act, 2013 (âthe Actâ) with respect to the preparation of these Ind AS financial statements to give a true and fair view of the financial position, financial performance (including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorsâ Responsibility
3. Our responsibility is to express an opinion on these Ind AS financial statements based on our audit.
4. We have taken into account the provisions of the Act and the Rules made there under including the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
5. We conducted our audit of the Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Ind AS financial statements are free from material misstatement.
6. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the Ind AS financial statements. The procedures selected depend on the auditors'' judgment, including the assessment of the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the Ind AS financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the Ind AS financial statements.
7. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Ind AS financial statements.
Opinion
8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2018, and its total comprehensive income (comprising of profit and other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
Report on Other Legal and Regulatory Requirements
9. As required by the Companies (Auditor''s Report) Order, 2016, issued by the Central Government of India in terms of subsection (11) of section 143 of the Act (âthe Orderâ), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order.
10. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.
(e) On the basis of the written representations received from the directors as on March 31, 2018 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164(2) of the Act.
(f) With respect to the adequacy of the internal financial controls with reference to Ind AS financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in Annexure A.
(g) With respect to the other matters to be included in the Auditors'' Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our knowledge and belief and according to the information and explanations given to us:
i The Company has disclosed the impact, if any, of pending litigations as at March 31, 2018 on its financial position in its Ind AS financial statements - Refer Note 36;
ii. The Company has long-term contracts as at March 31, 2018 for which there were no material foreseeable losses. The Company did not have any long-term derivative contracts as at March 31, 2018;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2018; and
iv. The reporting on disclosures relating to Specified Bank Notes is not applicable to the Company for the year ended March 31, 2018.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Act
1. We have audited the internal financial controls over financial reporting of INEOS Styrolution India Limited (âthe Companyâ) as of March 31, 2018 in conjunction with our audit of the Ind AS financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
2. The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
Auditorsâ Responsibility
3. Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing deemed to be prescribed under section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
6. A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
7. Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
8. In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
i. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.
(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of two years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.
(c) The title deeds of immovable properties other than self-constructed immovable properties (buildings), as disclosed in Note 2 on property, plant and equipment to the Ind AS financial statements, are held in the name of the Company (INEOS Styrolution India Limited), except for the following:
Name of entity on the title deed |
Category of Asset |
Total Number of Agreements |
Net Block Value (in INR Lakhs) |
INEOS ABS (India) Limited (*) |
Freehold Land |
1 |
24.87 |
Lanxess ABS Limited |
Leasehold Land |
1 |
129.74 |
Styrolution India Private Limited |
Leasehold Land |
1 |
75.53 |
Lanxess ABS Limited (*) |
Building |
2 |
12.66 |
Total |
5 |
242.80 |
(*) The Company has made application for transferring property in its name.
ii. The physical verification of inventory excluding stocks lying with third parties have been conducted at reasonable intervals by the Management during the year. In respect of inventory lying with third parties, these have substantially been confirmed by them. The discrepancies noticed on physical verification of inventory as compared to book records were not material.
iii. The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of Clause 3(iii),
(iii)(a), (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.
iv. In our opinion, and according to the information and explanations given to us, the Company has not granted any loans or made any investments, or provided any guarantees or security to the parties covered under Section 185 and 186. Therefore, the provisions of Clause 3(iv) of the said Order are not applicable to the Company.
v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.
vi. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of its products.
We have broadly reviewed the same, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.
vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues in respect of income tax and professional tax, though there has been a slight delay in a few cases, and is regular in depositing undisputed statutory dues, including provident fund, employees'' state insurance, sales tax, service tax, duty of customs, duty of excise, value added tax, cess, goods and service tax with effect from July 1, 2017 and other material statutory dues, as applicable, with the appropriate authorities.
(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of goods and service tax which have not been deposited on account of any dispute. The particulars of dues of income tax, value added tax, sales tax, service tax, duty of customs and duty of excise duty as at March 31, 2018 which have not been deposited on account of a dispute, are as follows:
Name of the statute |
Nature of dues |
Amount (INR in Lakhs) |
Period to which the amount relates |
Forum where the dispute is pending |
The Income Tax Act, 1961 |
Fringe Benefits Tax |
0.13 |
AY 2006-07 |
ITAT |
The Income Tax Act, 1961 |
Income Tax |
1,311.46 |
AY 2010-11 to 2015-16 |
Commissioner of Income Tax (A) |
The Central Sales Tax Act, 1956 |
Sales Tax |
87.79 |
2002 to 2004 |
Joint Commissioner Commercial Tax |
The Central Excise Act, 1944 |
Excise Duty |
25.56 |
April 2009 to March 2015 |
CESTAT |
The Central Excise Act, 1944 |
Excise Duty |
9.86 |
June 2011 to December 2011 |
The Assistant Commissioner, Central Excise |
Finance Act, 1994 |
Service Tax |
1,798.91 |
July 2006 to June 2016 |
CESTAT |
Finance Act, 1994 |
Service Tax |
39.55 |
January 2006 to June 2016 |
Commissioner Central Excise (A) |
Finance Act, 1994 |
Service Tax |
0.49 |
March 1996 |
The Deputy Commissioner, Central Excise |
Finance Act, 1994 |
Service Tax |
9.82 |
September 2000 to February 2003 |
The Joint Commissioner, Central Excise |
The Customs Tariff Act, 1975 |
Customs duty |
39.28 |
2011-12 |
CESTAT |
The Central Excise Act, 1944 |
CVD claimed as credit as per exemption under DEPB Scheme |
1,321.87 |
January 2005 to December 2011 |
Commissioner, Central GST and Central Excise |
viii. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of loans or borrowings to any banks as at the balance sheet date. The Company did not have any outstanding loans or borrowings to any financial institution or Government or debenture holders as at the balance sheet date.
ix. The Company has not raised any moneys by way of initial public offer, further public offer (including debt instruments) and term loans. Accordingly, the provisions of Clause 3(ix) of the Order are not applicable to the Company.
x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.
xi. The Company has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 1 77 and 188 of the Act. The details of such related party transactions have been disclosed in the Ind AS financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act.
xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.
xv. The Company has not entered into any non cash transactions with its directors or persons connected with him. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.
xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.
For Price Waterhouse
Chartered Accountants
LLP Firm Registration Number: 012754N / N500016
Pankaj Khandelia
Place: Vadodara Partner
Date: May 15, 2018 Membership Number: 102022
Mar 31, 2017
Independent Auditorsâ Report
To the Members of
INEOS Styrolution India Limited
(Formerly known as Styrolution ABS (India) Limited)
Report on the Indian Accounting Standards (Ind AS) Financial Statements
1. We have audited the accompanying Ind AS financial statements of INEOS Styrolution India Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2017 the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement, the Statement of Changes in Equity for the year then ended and a summary of the significant accounting policies and other explanatory information.
Management''s Responsibility for the Ind AS Financial Statements
2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these Ind AS financial statements to give a true and fair view of the financial position, financial performance (including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditors'' Responsibility
3. Our responsibility is to express an opinion on these Ind AS financial statements based on our audit.
4. We have taken into account the provisions of the Act and the Rules made there under including the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
5. We conducted our audit of the Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Ind AS financial statements are free from material misstatement.
6. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the Ind AS financial statements. The procedures selected depend on the auditors'' judgment, including the assessment of the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the Ind AS financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the Ind AS financial statements.
7. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Ind AS financial statements.
Opinion
8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2017, and its profit (including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
Other Matter
9. The comparative financial information of the company for the year ended March 31, 2016 and the transition date opening balance sheet as at April 1, 2015 prepared in accordance with Ind AS included in these Ind AS financial statements have been audited by the predecessor auditor who had audited the statutory financial statements for the years ended March 31, 2016 and March 31, 2015. The predecessor auditor has expressed an unmodified opinion on the comparative financial information and the opening balance sheet vide report dated May 26, 2017.
Our opinion is not qualified in respect of these matters.
Report on Other Legal and Regulatory Requirements
10. As required by the Companies (Auditor''s Report) Order, 2016, issued by the Central Government of India in terms of subsection (11) of Section 143 of the Act (âthe Orderâ), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order.
11. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.
(e) On the basis of the written representations received from the directors as on March 31, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164 (2) of the Act.
(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in Annexure A.
(g) With respect to the other matters to be included in the Auditors'' Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our knowledge and belief and according to the information and explanations given to us:
i. The Company has disclosed the impact, if any, of pending litigations as at March 31, 2017on its financial position in its Ind AS financial statements - Refer Note 35;
ii. The Company did not have any long-term contracts including derivative contracts as at March 31, 2017.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2017.
iv. The Company has provided requisite disclosures in the financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016. Based on audit procedures and relying on the management representation we report that the disclosures are in accordance with books of account maintained by the Company and as produced to us by the management - Refer Note 42.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Act
1. We have audited the internal financial controls over financial reporting of INEOS Styrolution India Limited (âthe Companyâ) as of March 31, 2017 in conjunction with our audit of the Ind AS financial statements of the Company for the year ended on that date.
Management''s Responsibility for Internal Financial Controls
2. The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
Auditors'' Responsibility
3. Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing deemed to be prescribed under Section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
6. A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
7. Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
8. In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
i. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.
(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of two years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.
(c) The title deeds of immovable properties other than self-constructed immovable properties (buildings), as disclosed in Note 2 on fixed assets to the Ind AS financial statements, are held in the name of the Company (INEOS Styrolution India Limited), except for the following:
Name of entity on the title deed |
Category of Asset |
Total Number of Agreements |
Net Block Value (in INR Lakhs) |
INEOS ABS (India) Limited (*) |
Freehold Land |
1 |
24.87 |
ABS (Industries) Limited (*) |
Building |
1 |
13.59 |
ABS Plastics Limited (**) |
Building |
2 |
5.79 |
Lanxess ABS Limited (***) |
Building |
3 |
21.94 |
Lanxess ABS Limited |
Leasehold Land |
1 |
131.96 |
Styrolution India Private Limited |
Leasehold Land |
1 |
76.46 |
Total |
9 |
274.61 |
(*) The Company is in process of transferring property in their name.
(**) Out of two buildings above, for one building the Company is in process of transferring it on their name and for the other building the Company is in the process of complying with the terms of the lease cum sale agreement so as to execute the final sale agreement and obtain the right to ownership.
(***) Out of three buildings, the Company is in process of transferring one building it on their name.
ii. The physical verification of inventory excluding goods-in-transit and stocks lying with third parties have been conducted at reasonable intervals by the Management during the year. In respect of inventory lying with third parties, these have substantially been confirmed by them. The discrepancies noticed on physical verification of inventory as compared to book records were not material.
iii. The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of Clause 3(iii), (iii)(a), (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.
iv. In our opinion, and according to the information and explanations given to us, the Company has not granted any loans or provided any guarantees or security in respect of any loans to any party covered under Section 185 of the Act. In respect of investments made in body corporate by the Company, the provisions of Section 186 of the Act has been complied with.
v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.
vi. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of its products.
We have broadly reviewed the same, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.
vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues in respect of Sales Tax, Service Tax, value added tax, though there has been a slight delay in a few cases, and is regular in depositing undisputed statutory dues, including provident fund, employees'' state insurance Income Tax, duty of customs, duty of excise, cess and other material statutory dues, as applicable, with the appropriate authorities.
(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of value added tax which have not been deposited on account of any dispute. The particulars of dues of income tax, sales tax, service tax, duty of customs, duty of excise, as at March 31, 2017 which have not been deposited on account of a dispute, are as follows:
Name of the statute |
Nature of dues |
Amount (INR in Lakhs) |
Period to which the amount relates |
Forum where the dispute is pending |
The Central Sales Tax Act, 1956 |
Sales Tax |
57.39 |
2001-02 |
Commissioner of Sales Tax (Appeals) |
The Central Sales Tax Act, 1956 Tax |
Sales Tax |
121.39 |
2002-03, 2003-04 and 2011-12 |
Joint Commissioner Commercial Tax |
The Central Excise Act, 1944 |
Service Tax |
147.21 |
Nov-2015 to June-2016 |
CESTAT, Ahmadabad |
The Central Excise Act, 1944 |
Service Tax |
8.97 |
March-2014 to January-2015 |
Asst. Commissioner Central Excise (A), Surat |
The Central Excise Act, 1944 |
Service Tax |
198.89 |
January-2006 to June-2016 |
Commissioner of Central Excise (A), Surat |
The Central Excise Act, 1944 |
Service Tax |
8.28 |
September-2004 to December 2004 |
Joint Commissioner Excise, Surat |
The Central Excise Act, 1944 |
Service Tax |
683.77 |
April-2011 to October-2015 |
CESTAT, Mumbai |
The Central Excise Act, 1944 |
Excise Duty |
18.81 |
October-2005 to June-2015 |
CESTAT, Ahmadabad |
The Central Excise Act, 1944 |
Excise Duty |
48.34 |
August-2010 to June-2015 |
Joint Commissioner Excise, Ahmadabad |
The Customs Tariff Act, 1975 |
Customs Duty claimed as credit as per exemption under DEPB Scheme |
7,776.06 |
January-2005 to December-2011 |
CESTAT, Ahmadabad |
The Customs Tariff Act, 1975 |
Customs duty |
39.28 |
2011-12 |
CESTAT, Ahmadabad |
The Income Tax Act, 1961 |
Income Tax |
7.68 |
2005-06 to 2009-10 |
ITAT, Ahmadabad |
The Income Tax Act, 1961 |
Income Tax |
316.10 |
2008-09, 2011-12 and 2012-13 |
Commissioner (Appeals), Vadodara |
The Income Tax Act, 1961 |
Income Tax |
452.79 |
2008-09 to 2011-12 |
Commissioner (Appeals), Mumbai |
viii. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowings to any financial institution or bank or Government or dues to debenture holders as at the balance sheet date.
ix. The Company has not raised any moneys by way of initial public offer, further public offer (including debt instruments) and term loans. Accordingly, the provisions of Clause 3(ix) of the Order are not applicable to the Company.
x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.
xi. The Company has paid / provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the Ind AS financial statements as required under Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.
xv. The Company has not entered into any non-cash transactions with its directors or persons connected with him. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.
xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.
For Price Waterhouse
Chartered Accountants
LLP Firm Registration Number: 012754N / N500016
Uday Shah
Place: Mumbai Partner
Date: May 26, 2017 Membership Number: 046061
Mar 31, 2016
We have audited the accompanying financial statements of INEOS Styrolution India Limited (Formerly known as Styrolution ABS (India) Limited)(âthe Companyâ), which comprise the Balance Sheet as at 31 March 2016, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
The Company''s board of directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation and presentation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Act, read with rule 7 of the Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2016, and its profit and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 (''the Order'') issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under section 133 of the Act, read with rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the directors as on 31 March 2016, taken on record by the board of directors, none of the directors are disqualified as on 31 March 2016, from being appointed as a director in terms of section 164(2) of the Act.
(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure B"; and
(g) With respect to the other matters to be included in the Auditor''s Report in accordance with rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 28 to the financial statements.
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be transferred, to the investor education and protection fund by the Company.
i. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of two years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company except in respect of the lease cum sale agreement for one of the Company''s sales office location (gross block: Rs 3.75 lakhs and net block Rs 2.66 lakhs included under building), wherein the Company is in the process of complying with the terms of the lease cum sale agreement so as to execute the final sale agreement and obtain the right to ownership. In addition to the above asset, Company is in the process of transferring title deeds in its name for 14 properties (gross block Rs 662.29 lakhs and net block Rs 472.47 lakhs included under land and building).
ii. The inventory, except goods-in-transit and stocks lying with third parties, has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable. For stocks lying with third parties at the year-end, written confirmations have been obtained. The discrepancies noticed on verification between the physical stocks and the book records were not material.
iii. The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013(âthe Act"). Accordingly, paragraphs 3 (iii) (a), (b) and (c) of the Order are not applicable to the Company.
vi. In our opinion and according to the information and explanations given to us, the Company has not given any loan, made any investment, given any guarantee, or provided any security under section 185 and 186 of the Act. Accordingly, paragraph 3 (iv) of the Order is not applicable to the Company.
v. In our opinion, and according to the information and explanations given to us, the Company has not accepted deposits as per the directives issued by the Reserve Bank of India under the provisions of sections 73 to 76 or any other relevant provisions of the act and the rules framed there under. Accordingly, paragraph 3(v) of the Order is not applicable to the Company.
vi. We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the central government for maintenance of cost records under section 148 (1) of the Act and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.
vii. (a) According to the information and explanations given to us and on the basis of our examination of the
records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues i including Provident Fund, Employees'' State Insurance, Income-tax, Sales-tax, Service tax, Duty of Customs, Duty of Excise, Value added tax, Cass and other material statutory dues have been generally regularly deposited during the year by the Company with the appropriate authorities.
According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees'' State Insurance, Income-tax, Sales-tax, Service tax, Duty of Customs, Duty of Excise, Value added tax, Cass and other material statutory dues were in arrears as at 31 March 2016 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us, there are no dues of Income-tax, Sales-tax, Service tax, Duty of Customs, Duty of Excise and Value added tax which have not been deposited with the appropriate authorities on account of any dispute other than those mentioned in the Appendix A to this report.
viii. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks. The Company does not have any loans or borrowings from government, financial institutions or dues to debenture holders during the year.
ix. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments).In our opinion and according to the information and explanations given to us, the term loans taken by the Company have been applied for the purpose for which they are raised.
x. According to the information and explanations given to us, no fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.
xi. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the Act.
xii. In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the Order is not applicable to the Company.
xiii. According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.
xiv. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, paragraph 3 (xiv) of the Order is not applicable to the Company.
xv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable to the Company.
xvi. According to the information and explanations given to us, the Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.Accordingly, paragraph 3(xvi) of the Order is not applicable to the Company.
Name of the statute |
Nature of dues |
Demand (Rs. in lakhs) |
Amount paid under protest (Rs. in lakhs) |
Period to which the amount relates |
Forum where the dispute is pending |
The Central Sales Tax Act, 1956 |
Sales Tax including interest and penalty as applicable. |
57.39 |
- |
January 2001 to December 2001 |
Commissioner of Sales Tax (Appeals) |
The Central Sales Tax Act, 1956 |
Sales Tax including interest and penalty as applicable. |
159.23 |
8.65 |
2002-03, 2003-04 and 2011-12 |
Joint Commissioner |
The Central Excise Act, 1944 |
Excise Duty including interest and penalty as applicable |
8.28 |
- |
September 2014 to December 2014 |
Appeal with CESTAT |
The Central Excise Act, 1944 |
Excise Duty including interest and penalty as applicable |
189.11 |
- |
August 2008 to March-2012 |
Commissioner - Vadodara |
The Central Excise Act, 1944 |
Excise Duty including interest and penalty as applicable |
5.88 |
- |
October 2005 to September 2009 |
Deputy Commissioner Appeals - Vadodara |
The Central Excise Act, 1944 |
Excise Duty including interest and penalty as applicable |
48.34 |
- |
Aug-2010 to June-2015 |
Joint Commissioner - Vadodara |
The Central Excise Act, 1944 |
Excise Duty including interest and penalty as applicable |
595.50 |
- |
2009 to 2015 |
Assistant Commissioner - Vadodara |
The Customs Tariff Act, 1975 |
Customs duty |
39.28 |
- |
2010-11 |
Commissioner of Customs (Appeals) - Ahmedabad |
The Income Tax Act, 1961 |
Income Tax including interest and penalty as applicable |
112.20 |
112.20 |
1994-1995 |
Honourable High Court of Gujarat |
The Income Tax Act, 1961 |
Penalty |
164.00 |
164.00 |
2008-2009, 2009-2010 and 2010-11 |
Income Tax Appellate - Ahmedabad |
Report on the internal financial controls under clause (i) of sub-section 3 of section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of INEOS Styrolution India Limited (formerly known as Styrolution ABS (India) Limited) (âthe Company") as of 31 March 2016 in conjunction with our audit of the financial statements of the Company for the year ended on that date.
Management''s Responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (''ICAI''). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditors'' Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the âGuidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For B S R & Co. LLP Chartered Accountants
Firm''s Registration No:101248W/W-100022
Mumbai Vijay Bhatt
16 May 2016 Partner
Membership No: 036647
Mar 31, 2015
Report on the Financial Statements
We have audited the accompanying financial statements of Styrolution
ABS (India) Limited ('the Company'), which comprise the Balance Sheet
as at 31 March 2015, the Statement of Profit and Loss and Cash Flow
Statement for the period from 1 January 2014 to 31 March 2015, and a
summary of significant accounting policies and other explanatory
information.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards notified under the Companies Act, 1956 ('the
Act') read with General Circular 15/2013 dated 13 September 2013 issued
by the Ministry of Corporate Affairs in respect of Section 133 of the
Companies Act 2013. This responsibility includes the design,
implementation and maintenance of internal control relevant to the
preparation and presentation of the financial statements that give a
true and fair view and are free from material misstatement, whether due
to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatements.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor's judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company's preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances but not for the
purpose of expressing an opinion on the effectiveness of the entity's
internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of the accounting
estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the said financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India;
i. in case of the Balance Sheet, of the state of affairs of the
Company as at 31 March 2015;
ii. in case of the Statement of Profit and Loss, of the profit of the
Company for the period from 1 January 2014 to 31 March 2015;
and
iii in case of the Cash Flow Statement, of the cash flows of the
Company for the period from 1 January 2014 to 31 March 2015.
Report on Other Legal and Regulatory Requirements
1. The MCA had on 01 April 2014, vide its General Circular number
07/2014, 'Dissemination of information with regards to the
provisions of the Companies Act, 2013 as Notified till date vis a vis
corresponding provisions of the Companies Act, 1956' identified such
sections of the Companies Act, 1956 that would cease/ continue to have
effect from 01 April 2014.
Accordingly, in terms of the aforesaid Circular, our reporting in
respect of sections 227(3)(f) of the Companies Act, 1956, and clauses
(iii), (v)(a) and (b), (vi), (viii), (xiv), (xviii) of the Companies
(Auditor's Report) Order, 2003 ('the Order')(dealing with sections 49,
58A, 58AA, 209(1)(d) and 301 of the Companies Act, 1956) is only for the
period beginning from 1 January 2014 till 31 March 2014 since as per the
aforementioned MCA Circular these sections have ceased to have effect
from 01 April 2014.
2. As required by the Companies (Auditor's Report) Order, 2003 ('the
Order') issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
3. As required by Section 227 (3) of the Act, we report that:
a. we have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
b. in our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
c. the Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
d. in our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement dealt with by this report comply with the Accounting
Standards notified under the Act read with General Circular 15/2013
dated 13 September 2013 issued by the Ministry of Corporate Affairs in
respect of Section 133 of the Companies Act, 2013; and
e. on the basis of written representation received from the directors
of the Company, as on 31 March 2015, and taken on record by the Board
of Directors, we report that none of the directors of the Company are
disqualified during 1 January 2014 till 31 March 2014 from being
appointed as a director in terms of clause (g) of sub-section (1) of
Section 274 of the Act.
Annexure to the Independent Auditors' Report- 31 March 2015
(Referred to in our report of even date)
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The Company has a regular programme of physical verification of its
fixed assets by which the fixed assets are physically verified in a
phased manner over a period of two years In our opinion, this
periodicity of physical verification is reasonable having regard to the
size of the Company and the nature of its assets In accordance with
this programme the Company has physically verified certain fixed assets
during the year. No material discrepancies were noticed upon such
verification.
(c) Fixed assets disposed off during the period were not substantial,
and therefore, do not affect the going concern assumption.
(ii) (a) The inventory, except goods-in-transit and stocks lying with
third parties, has been physically verified by the management during the
year. In our opinion, the frequency of such verification is reasonable.
For stocks lying with third parties at the year-end, written
confirmations have been obtained.
(b) The procedures for physical verification of inventories followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory.The
discrepancies noticed on verification between the physical stocks and
the book records were not material.
(iii) The Company has neither granted nor taken any loans, secured or
unsecured, to or from companies, firms or other parties covered in the
register maintained till 31 March 2014 under Section 301 of the Act.
(iv) In our opinion and according to the information and explanations
given to us, and having regard to the explanation that purchases of
certain items of inventories and services are for the Company
specialised requirements and similarly certain goods sold and services
rendered are for the specialised requirement of the buyers and suitable
alternative sources are not available to obtain comparable quotations,
there is an adequate internal control system commensurate with the size
of the Company and the nature of its business with regard to purchase
of inventories and fixed assets and with regard to the sale of goods
and services. We have not observed any major weakness in the internal
control system during the course of the audit.
(v) In our opinion, and according to the information and explanations
given to us, there are no contracts and arrangements the particulars of
which need to be entered into the register maintained till 31 March
2014 under Section 301 of the Act. Accordingly, paragraph 4(v)(a) and
(b) of the Order is not applicable.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules prescribed by the Central Government for
maintenance of cost records under Section 209(1)(d) of the Act till 31
March 2014 and are of the opinion that prima facie, the prescribed
accounts and records have been made and maintained. However, we have
not made a detailed examination of the records.
(ix) (a) According to the information and explanations given to us and
on the basis of our examination of the records of the Company, amounts
deducted/accrued in the books of account in respect of undisputed
statutory dues including Provident Fund, Employees' State Insurance,
Income tax, Value added tax, Wealth tax, Service tax, Customs duty,
Excise duty, Investor Education and Protection Fund and other material
statutory dues have been generally regularly deposited during the period
by the Company with the appropriate authorities.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, Employees'
State Insurance, Income tax, Sales tax, Value added tax, Wealth tax,
Service tax, Customs duty, Excise duty, Investor Education and
Protection Fund and other material statutory dues were in arrears as at
31 March 2015 for a period of more than six months from the date they
became payable.
(b) According to the information and explanations given to us, there
are no dues of Income tax, Sales tax/Value added tax, Wealth tax,
Service tax, Customs duty and Excise duty which have not been deposited
with the appropriate authorities on account of any dispute other than
those mentioned in the Appendix 1 to this report.
(x) The Company does not have any accumulated losses as at end of the
financial year and has not incurred cash losses in the financial year
and in the immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to its
bankers. The Company did not have any outstanding debentures or dues to
financial institutions during the period.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion and according to the information and explanations
given to us, the Company is not a chit fund or a nidhi/ mutual benefit
fund/ society.
(xiv) According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks or financial institutions.
(xvi) The Company did not have any term loans outstanding during the
year.
(xvii) According to the information and explanations given to us and on
an overall examination of the Balance Sheet of the Company, we are of
the opinion that funds raised on short-term basis have not been used
for long-term investment.
(xviii) The Company has not made any preferential allotment of shares
to companies/firms/parties covered in the register maintained under
Section 301 of the Act till 31 March 2014.
(xix) The Company did not have any outstanding debentures during the
year.
(xx) The Company has not raised any money by public issues during the
year.
(xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For BSR & Co. LLP
Chartered Accountants
Firm's Registration No: 101248W/W-100022
Bhavesh Dhupelia
Mumbai Partner
18 May 2015 Membership No:042070
Dec 31, 2013
We have audited the accompanying financial statements of Styrolution
ABS (India) Limited (''the Company''), which comprise the Balance Sheet
as at 31 December 2013, the Statement of Profit and Loss and Cash Flow
Statement for the year ended 31 December 2013, and a summary of
significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards referred to in sub-section (3C) of Section 211
of the Companies Act, 1956 (''the Act''). This responsibility includes
the design, implementation and maintenance of internal control relevant
to the preparation and presentation of the financial statements that
give a true and fair view and are free from material misstatement,
whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatements.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor''s judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company''s preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances but not for the
purpose of expressing an opinion on the effectiveness of the entity''s
internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of the accounting
estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the said financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India;
i. in case of the Balance Sheet, of the state of affairs of the
Company as at 31 December 2013;
ii. in case of the Statement of Profit and Loss, of the profit of the
Company for the year ended on that date; and
iii in case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 (''the
Order'') issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by Section 227 (3) of the Act, we report that:
a. we have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
b. in our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
c. the Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
d. in our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C) of Section 211 of
the Act; and
e. on the basis of written representations received from the directors
of the Company, as at 31 December 2013, and taken on record by the
Board of Directors, none of the directors is disqualified as on 31
December 2013, from being appointed as a director in terms of clause
(g) of sub-section (1) of Section 274 of the Act.
Annexure to the Independent Auditors'' Report  December 31, 2013
(Referred to in our report of even date)
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The Company has a regular programme of physical verification of its
fixed assets by which the fixed assets are physically verified in a
phased manner over a period of two years. In our opinion, this
periodicity of physical verification is reasonable having regard to the
size of the Company and the nature of its assets. No material
discrepancies were noticed upon such verification.
(c) Fixed assets disposed off during the year were not substantial, and
therefore, do not affect the going concern assumption.
(ii) (a) The inventory, except goods-in-transit and stocks lying with
third parties, has been physically verified by the management during
the year. In our opinion, the frequency of such verification is
reasonable. For stocks lying with third parties at the year-end,
written confirmations have been obtained.
(b) The procedures for physical verification of inventories followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory. The
discrepancies noticed on verification between the physical stocks and
the book records were not material.
(iii) The Company has neither granted nor taken any loans, secured or
unsecured, to or from companies, firms or other parties covered in the
register maintained under Section 301 of the Act.
(iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventories and fixed assets and with regard to the sale
of goods and services. We have not observed any major weakness in the
internal control system during the course of the audit.
(v) According to the information and explanations given to us, we are
of the opinion that there are no companies, firms or other parties
covered in the register required under Section 301 of the Act.
Accordingly, paragraph 4(iii) of the Order is not applicable.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules prescribed by the Central Government for
maintenance of cost records under Section 209(1)(d) of the Act and are
of the opinion that prima facie, the prescribed accounts and records
have been made and maintained. However, we have not made a detailed
examination of the records.
(ix) (a) According to the information and explanations given to us and
on the basis of our examination of the records of the Company, amounts
deducted/accrued in the books of account in respect of undisputed
statutory dues including Provident Fund, Employees'' State Insurance,
Income tax, Sales-tax, Value added tax, Wealth tax, Service tax,
Customs duty, Excise duty, Investor Education and Protection Fund and
other material statutory dues have been generally regularly deposited
during the year by the Company with the appropriate authorities though
there have been slight delay in few cases.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, Employees''
State Insurance, Income tax, Sales tax, Value added tax, Wealth tax,
Service tax, Customs duty, Excise duty, Investor Education and
Protection Fund and other material statutory dues were in arrears as at
31 December 2013 for a period of more than six months from the date
they became payable other than those disclosed below:
Name of
the statute Nature of dues Amount Period
to which Due Date of
(Rs. Lakhs) the amount
relates Date Payment
Income Tax,
Act 1961 Tax deducted
at source 281.87 May 2012
to June
2013 Various Not yet
paid
(b) According to the information and explanations given to us, there
are no dues of Income tax, Sales tax/Value added tax, Wealth tax,
Service tax, Customs duty and Excise duty which have not been deposited
with the appropriate authorities on account of any dispute other than
those mentioned in the Appendix to this report.
(x) The Company does not have any accumulated losses as at end of the
financial year and has not incurred cash losses in the financial year
and in the immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to its
bankers. The Company did not have any outstanding debentures or dues to
financial institutions during the year.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion and according to the information and explanations
given to us, the Company is not a chit fund or a nidhi/ mutual benefit
fund/society.
(xiv)According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks or financial institutions.
(xvi)The Company did not have any term loans outstanding during the
year.
(xvii) According to the information and explanations given to us and on
an overall examination of the Balance Sheet of the Company, we are of
the opinion that funds raised on short term basis have not been used
for long-term investment.
(xviii) The Company has not made any preferential allotment of shares
to companies/firms/parties covered in the register maintained under
Section 301 of the Act.
(xix)The Company did not have any outstanding debentures during the
year.
(xx) The Company has not raised any money by public issues during the
year.
(xxi)According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For B S R & Co. LLP
Chartered Accountants
Firm''s Registration No: 101248W
Sanjay Aggarwal
Mumbai Partner
February 17, 2014 Membership No: 40780
Dec 31, 2012
We have audited the attached Balance Sheet of Styrolution ABS (India)
Limited (formerly INEOS ABS (India) Limited) (''the Company'') as at 31st
December, 2012, and the related Statement of Profit and Loss and the
Cash Flow Statement for the year ended on that date, annexed thereto.
These financial statements are the responsibility of the Company''s man-
agement. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in India. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
1 As required by the Companies (Auditor''s Report) Order, 2003 (''the
Order''), issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Companies Act, 1956 (''the Act''),
we enclose in the Annexure a statement on the matters specified in
paragraphs 4 and 5 of the said Order.
2 Further to our comments in the Annexure referred to above, we report
that:
a) we have obtained all the information and explanations, which to the
best of our knowledge and belief were neces- sary for the purposes of
our audit;
b) in our opinion, proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books;
c) the Balance Sheet, the Statement of Profit and Loss and the Cash
Flow Statement dealt with by this report are in agreement with the
books of account;
d) in our opinion, the Balance Sheet, the Statement of Profit and Loss
and the Cash Flow Statement dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C) of Section 211 of
the Act;
e) on the basis of written representations received from the directors
of the Company, as on 31st December, 2012, and taken on record by the
Board of Directors, we report that none of the directors is
disqualified as on 31st December, 2012 from being appointed as a
director in terms of clause (g) of sub-section (1) of Section 274 of
the Act; and
f) in our opinion, and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Act, in the manner so required, and give a true and
fair view in conformity with the accounting principles generally
accepted in India:
i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st December, 2012;
ii) in the case of the Statement of Profit and Loss, of the profit of
the Company for the year ended on that date; and
iii) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Annexure to the Auditors'' Report - 31st December, 2012 (Referred to in
our report of even date)
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The Company has a regular programme of physical verification of its
fixed assets by which the fixed assets are physically verified in a
phased manner over a period of two years. In our opinion, this
periodicity of physical verification is reasonable having regard to the
size of the Company and the nature of its assets. No material
discrepancies were noticed upon such verification.
(c) Fixed assets disposed off during the year were not substantial, and
therefore, do not affect the going concern assumption.
(ii) (a) The inventory, except goods-in-transit and stocks lying with
third parties, has been physically verified by the management during
the year. In our opinion, the frequency of such verification is
reasonable. For stocks lying with third parties at the year-end,
written confirmations have been obtained.
(b) The procedures for physical verification of inventories followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory. The
discrepancies noticed on verification between the physical stocks and
the book records were not material.
(iii) The Company has neither granted nor taken any loans, secured or
unsecured, to or from companies, firms or other parties covered in the
register maintained under Section 301 of the Act.
(iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventories and fixed assets and with regard to the sale
of goods and services. We have not observed any major weakness in the
internal control system during the course of the audit.
(v) (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act have been entered in the register
required to be maintained under that section.
(b) In our opinion, and according to the information and explanations
given to us, the transactions made in pursuance of contracts and
arrangements referred to in (a) above and exceeding the value of Rupees
Five lakh with any party during the year have been made at prices which
are reasonable having regard to the prevailing market prices at the
relevant time except for purchases of certain services which are for
the Company''s specialised requirements and for which suitable
alternative sources are not available to obtain comparable quotations.
However, on the basis of information and explanations provided, the
same appear reasonable.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules prescribed by the Central Government for
maintenance of cost records under Section 209(1 )(d) of the Act and are
of the opinion that prima facie, the prescribed accounts and records
have been made and maintained. However, we have not made a detailed
examination of the records.
(ix) (a) According to the information and explanations given to us and
on the basis of our examination of the records of the Company, amounts
deducted/accrued in the books of account in respect of undisputed
statutory dues including Provident Fund, Employees'' State Insurance,
Income tax, Sales-tax, Value added tax, Wealth tax, Service tax, Custom
duty, Excise duty, Investor Education and Protection Fund and other
material statutory dues have been generally regularly deposited during
the year by the Company with the appropriate authorities.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, Employees''
State Insurance, Income tax, Sales tax, Value added tax, Wealth tax,
Service tax, Custom duty, Excise duty, Investor Education and
Protection Fund and other material statutory dues were in arrears as at
31st December, 2012 for a period of more than six months from the date
they became payable.
(b) According to the information and explanations given to us, there
are no dues of Income tax, Sales taxA/alue added tax, Wealth tax,
Service tax, Customs duty and Excise duty which have not been deposited
with the appropriate authorities on account of any dispute other than
those mentioned in the appendix to this report.
(x) The Company does not have any accumulated losses as at end of the
financial year and has not incurred cash losses in the financial year
and in the immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to its
bankers. The Company did not have any outstanding debentures or dues to
financial institutions during the year.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion and according to the information and explanations
given to us, the Company is not a chit fund or a nidhi/ mutual benefit
fund/ society.
(xiv) According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks or financial institutions.
(xvi) The Company did not have any term loans outstanding during the
year.
(xvii) According to the information and explanations given to us and on
an overall examination of the Balance Sheet of the Company, we are of
the opinion that funds raised on short term basis have not been used
for long-term investment.
(xviii) The Company has not made any preferential allotment of shares
to companies/firms/parties covered in the register maintained under
Section 301 of the Act.
(xix) The Company did not have any outstanding debentures during the
year.
(xx) The Company has not raised any money by public issues during the
year.
(xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
Appendix
Name of the statute Nature of dues Amount
under dispute
(Rs. In lakhs)
The Central Sales Tax including 57.39
Sales Tax Act, 1969 interest and penalty as applicable.
The Central Excise Duty including 25.56
Excise Act, 1944 interest and penalty
as applicable.
32.99
5.27
9.82
The Income Income Tax including 8.17
Tax Act, 1961 interest and penalty
as applicable 17.12
271.76
Name of the Statute Period to which Forum where the
the amount dispute is
relates pending
The Central Sales
Tax Act, 1969 January 2001 to Commissioner of Sales Tax
December 2001 (Appeals)
The Central Excise
Act, 1944 2005 to August 2012 Assistant Commissioner-
Vadodara
September 2004 Additional Commissioner-
to January 2010 Vadodara
March 1996 to Deputy Commissioner Appeals
September 2009 - Vadodara
September 2000 to Joint Commissioner -
February 2003 Vadodara
The Income Tax Act,
1961 1991-1992 and
1993-1994 Assessing Officer
2005-2006 and Commissioner of Income Tax-
2006-2007 Appeals
1994-1995,
1999-2000 Honourable High Court of
Gujarat
and 2005-2006
For B S R & Co.
Chartered Accountants
Firm''s Registration number 101248W
Mumbai Vijay Mathur
February 26, 2013 Partner
Membership No.046476
Dec 31, 2011
1. We have audited the attached Balance Sheet of INEOS ABS (India)
Limited (the "Company") as at December 31, 2011, and the related Profit
and Loss Account and Cash Flow Statement for the year ended on that
date annexed thereto, which we have signed under reference to this
report. These financial statements are the responsibility of the
Company's Management. Our responsibility is to express an opinion on
these financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by Management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditor's Report) Order, 2003, as
amended by the Companies (Auditor's Report) (Amendment) Order, 2004
(together the "Order"), issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of 'The Companies Act, 1956'
of India (the 'Act') and on the basis of such checks of the books and
records of the Company as we considered appropriate and according to
the information and explanations given to us, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of Section 211 of the Act;
(e) On the basis of written representations received from the
directors, as on December 31, 2011 and taken on record by the Board of
Directors, none of the directors is disqualified as on December 31,
2011 from being appointed as a director in terms of clause (g) of
sub-section (1) of Section 274 of the Act;
(f) In our opinion and to the best of our information and according to
the explanations given to us, the said financial statements together
with the notes thereon and attached thereto give, in the prescribed
manner, the information required by the Act, and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at December 31, 2011;
(ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
ANNEXURE TO AUDITORS' REPORT
Referred to in paragraph 3 of the Auditors' Report of even date to the
members of INEOS ABS (India) Limited on the financial statements for the
year ended December 31, 2011
1. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(b) The fixed assets are physically verified by the Management
according to a phased programme designed to cover all the items over a
period of 2 years which, in our opinion, is reasonable having regard to
the size of the Company and the nature of its assets. Pursuant to the
programme, a portion of the fixed assets has been physically verified
by the Management during the year and no material discrepancies between
the book records and the physical inventory have been noticed.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
of by the Company during the year.
2. (a) The inventory (excluding stocks with third parties) has been
physically verified by the Management during the year. In respect
of inventory lying with third parties, these have substantially been
confirmed by them. In our opinion, the frequency of verification is
reasonable.
(b) In our opinion, the procedures of physical verification of
inventory followed by the Management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
3. (a) The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under Section 301 of the Act.
(b) The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act.
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanations given to us, we have neither come across nor have been
informed of any continuing failure to correct major weaknesses in the
aforesaid internal control system.
5. (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act have been entered in the register
required to be maintained under that section.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. The Company has not accepted any deposits from the public within
the meaning of Sections 58A and 58AA of the Act and the rules framed
there under.
7. In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the Rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub- section (1) of Section 209 of the
Act, and are of the opinion that prima facie, the prescribed accounts
and records have been made and maintained. We have not, however, made a
detailed examination of the records with a view to determine whether
they are accurate or complete.
9. (a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion, the
Company is regular in depositing the undisputed statutory dues
including provident fund, investor education and protection fund,
employees' state insurance, income-tax, sales-tax, wealth tax, service
tax, customs duty, excise duty, cess and other material statutory dues
as applicable with the appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, the particulars of dues of
income-tax, sales-tax, wealth-tax, service-tax, customs duty, excise
duty and cess as at December 31, 2011 which have not been deposited on
account of a dispute, are as follows:
Amount under Period to
Name of the
statute Nature of
dues dispute* which the Forum whe
-re the
dispute
is pending
(Rs. in
Lakhs) amount
relates
The Central
Sales Sales Tax
including 57.39 2001 Commission
-er of
Sales
Tax
(Appeals)
Tax Act
1969 interest and
penalty
as
applicable.
The Central Excise Duty 21.36 2005 to
July
2011 Assistant
Commissio
-ner Ã
Vadodara
Excise Act,
1944 including
interest and
penalty as
applicable.
32.99 September
2004 Additiona
-l Commiss
-ioner Ã
Vadodara
to
January
2010
5.27 March
1996 Deputy
Commissio
-ner Appeals Ã
to
September
2009 Vadodara
9.82 September
2000 Joint
Commiss
-ioner Ã
Vadodara
to
February
2003
The
Income Income
Tax
including 6.64 1991-1992 Assessing
Officer
Tax
Act, 1961 interest
and penalty
as
applicable. 30.86 2005-06
and Commissio
-ner of
Income
Tax Ã
2006-
2007 Appeals
114.24 1999-
2000
and Honourab
-le High
Court of
Gujarat
2005-2006
* Net of amount deposited under protest.
10. The Company has no accumulated losses as at December 31, 2011 and
it has not incurred any cash losses in the financial year ended on that
date or in the immediately preceding financial year.
11. According to the records of the Company examined by us and the
information and explanations given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit fund /
nidhi / mutual benefit fund/ societies are not applicable to the
Company.
14. In our opinion, the Company is not a dealer or trader in shares,
securities, debentures and other investments.
15. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions during the year.
16. The Company has not obtained any term loans.
17. On the basis of an overall examination of the balance sheet of the
Company, in our opinion and according to the information and
explanations given to us, there are no funds raised on a short-term
basis which have been used for long-term investment.
18. The Company has not made any preferential allotment of shares to
parties and Companies covered in the register maintained under Section
301 of the Act during the year.
19. The Company has not issued any debentures.
20. The Company has not raised any money by public issues during the
year.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of such case by the management.
For and on behalf of
Price Waterhouse
Firm Registration Number: 301112E
Chartered Accountants
Uday Shah
Mumbai Partner
February 14, 2012 Membership Number F-46061
Dec 31, 2010
1. We have audited the attached Balance Sheet of Ineos ABS (India)
Limited (the "Company") as at December 31,2010, and the related Profit
and Loss Account and Cash Flow Statement for the year ended on that
date annexed thereto, which we have signed under reference to this
report. These financial statements are the responsibility of the
Companys Management.Our responsibility is to express an opinion on
these financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by Management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003, as
amended by the Companies (Auditors Report) (Amendment) Order, 2004
(together the "Order"), issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of The Companies Act, 1956
of India (the Act) and on the basis of such checks of the books and
records of the Company as we considered appropriate and according to
the information and explanations given to us, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of Section 211 of the Act;
(e) On the basis of written representations received from the
directors, as on December 31, 2010 and taken on record by the Board of
Directors, none of the directors is disqualified as on December 31,
2010 from being appointed as a director in terms of clause (g) of
sub-section (1) of Section 274 of the Act;
(f) In our opinion and to the best of our information and according to
the explanations given to us, the said financial statements together
with the notes thereon and attached thereto give, in the prescribed
manner, the information required by the Act, and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(i) in the case of the Balance Sheet, of the state of affairs of the
company as at December 31, 2010;
(ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Annexure to Auditors Report
Referred to in paragraph 3 of the Auditors Report of even date to the
members of Ineos ABS (India) Limited on the financial
statements for the year ended December 31, 2010.
1. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(b) The fixed assets are physically verified by the Management
according to a phased programme designed to cover all the items over a
period of 2 years which, in our opinion, is reasonable having regard to
the size of the Company and the nature of its assets. Pursuant to the
programme, a portion of the fixed assets has been physically verified
by the Management during the year and no material discrepancies between
the book records and the physical inventory have been noticed.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
of by the Company during the year.
2. (a) The inventory (excluding stocks with third parties & materials
in transit) has been physically verified by the Management
during the year. In respect of inventory lying with third parties,
these have substantially been confirmed by them. In our opinion, the
frequency of verification is reasonable.
(b) In our opinion, the procedures of physical verification of
inventory followed by the Management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
3. (a) The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the
register maintained under Section 301 of the Act.
(b) The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act.
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanations given to us, we have neither come across nor have been
informed of any continuing failure to correct major weaknesses in the
aforesaid internal control system.
5. (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act have been entered in the register
required to be maintained under that section.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. The Company has not accepted any deposits from the public within
the meaning of Sections 58A and 58AA of the Act and the rules framed
there under.
7. In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the Rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act, and are of the opinion that prima facie, the prescribed accounts
and records have been made and maintained. We have not, however, made a
detailed examination of the records with a view to determine whether
they are accurate or complete.
9. (a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion,
the Company is regular in depositing the undisputed statutory dues
including provident fund, investor education and protection fund,
employees state insurance, income-tax, sales-tax, wealth tax, service
tax, customs duty, excise duty, cess and other material statutory dues
as applicable with the appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, the particulars of dues of
income-tax, sales-tax, wealth-tax, service-tax, customs duty, excise
duty and cess as at December 31, 2010 which have not been deposited on
account of a dispute, are as follows:
Amount under
Name of the statute Nature of dues dispute*
(Rs. in lakhs)
The Central Sales Sales Tax including 57.39
Tax Act,1969 interest and penalty
as applicable.
The Central Excise Duty 8.48
Excise Act, 1944 including interest and
penalty as applicable.
32.99
7.13
9.82
The Income Income Tax including 15.73
Tax Act, 1961 interest and penalty
as applicable. 14.69
Period to
Name of the which the Forum where the dispute is
Statute amount relates pending
The Central Sales
Tax Act, 1969 2001 Commissioner of Sales Tax
(Appeals)
The Central
Excise Act, 1944 2005 to April 2010 Assistant Commissioner -
Vadodara
September 2004 Additional Commissioner -
Vadodara
to January 2010
March 1996 Deputy Commissioner Appeals -
to September 2009 Vadodara
September 2000 Joint Commissioner - Vadodara
to February 2003
The Income
Tax Act, 1961 1991-2000 Assessing Officer
1999-2000 Honourable High Court of
Gujarat
* Net of amount deposited under protest.
10. The Company has no accumulated losses as at December 31, 2010 and
it has not incurred any cash losses in the financial year ended on that
date or in the immediately preceding financial year.
11. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit fund /
nidhi / mutual benefit fund/ societies are not applicable to the
Company.
14. In our opinion, the Company is not a dealer or trader in shares,
securities, debentures and other investments.
15. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions during the year.
16. The Company has not obtained any term loans.
17. On the basis of an overall examination of the balance sheet of the
Company, in our opinion and according to the information and
explanations given to us, there are no funds raised on a short-term
basis which have been used for long-term investment.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under Section
301 of the Act during the year.
19. The Company has not issued any debentures.
20. The Company has not raised any money by public issues during the
year.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of such case by the Management.
For and on behalf of
Price Waterhouse
Firm Registration Number: 301112E
Chartered Accountants
Uday Shah
Mumbai Partner
February 17, 2011 Membership Number F-46061
Dec 31, 2009
1. We have audited the attached Balance Sheet of INEOS ABS (India)
Limited , as at December 31, 2009, and the related Profit and Loss
Account and Cash Flow Statement for the year ended on that date annexed
thereto, which we have signed under reference to this report. These
financial statements are the responsibility of the companys
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003, as
amended by the Companies (Auditors Report) (Amendment) Order, 2004,
(together the Order) issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of The Companies Act, 1956
of India (the Act) and on the basis of such checks of the books and
records of the Company as we considered appropriate and according to
the information and explanations given to us, we give in the Annexure,
a statement on the matters specified in paragraphs 4 and 5 of the said
Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of Section 211 of the Act;
(e) On the basis of written representations received from the
directors, as on December 31,2009 and taken on record by the Board of
Directors of the Company, none of the directors is disqualified as on
December 31, 2009 from being appointed as a director in terms of clause
(g) of sub-section (1) of Section 274 of the Act;
(f) In our opinion and to the best of our information and according to
the explanations given to us, the said financial statements together
with the notes thereon and attached thereto give in the prescribed
manner the information required by the Act and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(i) in the case of the Balance Sheet, of the state of affairs of the
company as at December 31, 2009;
(ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
ANNEXURE TO AUDITORS REPORT
[Referred to in paragraph 3 of the Auditors Report of even date to the
members of INEOS ABS (INDIA) LIMITED on the financial statements for
the year ended December 31, 2009]
1. (a) The company is maintaining proper records showing full
particulars including quantitative details and situation of fixed
assets.
(b) The fixed assets are physically verified by the management
according to a phased programme designed to cover all the items over a
period of two years, which in our opinion, is reasonable having regard
to the size of the company and the nature of its assets. Pursuant to
the programme, a portion of the fixed assets has been physically
verified by the management during the year and no material
discrepancies between the book records and the physical inventory have
been noticed.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
of by the company during the year.
2. (a) The inventory (excluding stocks with third parties and
materials in transit) has been physically verified by the management
during the year. In respect of inventory lying with third parties,
these have substantially been confirmed by them. In our opinion, the
frequency of verification is reasonable.
(b) In our opinion, the procedures of physical verification of
inventory followed by the management are reasonable and ad- equate in
relation to the size of the company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material and have been properly dealt within
the books of account.
3. (a) The company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Accordingly, clauses (iii)(b) to (iii)(d)
of paragraph 4 of the Order are not applicable to the company for the
current year.
(b) The company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Accordingly, clauses (iii)(f) and
(iii)(g) of paragraph 4 of the Order are not applicable to the company
for the current year.
4. In our opinion and according to the information and explanations
given to us, having regard to the explanation that certain items
purchased are of special nature for which suitable alternative sources
do not exist for obtaining comparative quotations, there is an adequate
internal control system commensurate with the size of the company and
the nature of its business for the purchase of inventory, fixed assets
and for the sale of goods and services. Further, on the basis of our
examination of the books and records of the company, and according to
the information and explanations given to us, we have neither come
across nor have been informed of any continuing failure to correct
major weaknesses in the aforesaid internal control system.
5. (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act have been entered in the register
required to be maintained under that section.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. The company has not accepted any deposits from the public within
the meaning of Sections 58A and 58AA of the Act and the rules framed
there under.
7. In our opinion, the company has an internal audit system
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
company in respect of products where, pursuant to the Rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act and are of the opinion that prima facie, the prescribed accounts
and records have been made and maintained. We have not, however, made a
detailed examination of the records with a view to determine whether
they are accurate or complete.
9. (a) According to the information and explanations given to us and
the records of the company examined by us, in our opinion, the company
is generally regular in depositing the undisputed statutory dues
including provident fund, investor education and protection fund,
employees state insurance, income-tax, sales-tax, wealth tax, service
tax, customs duty, excise duty, cess and other material statutory dues
as applicable, with the appropriate authorities.
(b) According to the information and explanations given to us and the
records of the company examined by us, there are no dues of wealth tax,
service tax, customs duty and cess which have not been deposited on
account of any dispute. The particulars of dues of sales-tax, excise
duty and income-tax as at December 31, 2009 which have not been
deposited on account of a dispute, are as follows -
Amount under Period to
Name of the
statute Nature of dues dispute * which the
(Rs. in Lakhs) amount relates
The Central
Sales Central Sales Tax 57.39 2001
Tax Act, 1969
The Central Excise Duty 0.49 1996
Excise
Act, 1944
9.82 September 2000
to February 2003
5.40 September 2004
to December 2006
1.86 October 2005
to September 2008
The Income
Tax Act, 1961 Income Tax 14.69 1999-2000
98.88 2001-02
239.37 2005-06
Name of the Statue Forum where the dispute is pending
The Central Sales
Tax Act, 1969 Commissioner of Sales Tax (Appeals)
The Central
Excise Act, 1944 Deputy Commissioner Appeals -
Vadodara
Additional Commissioner - Vadodara
Additional Commissioner - Vadodara
Deputy Commissioner Appeals -
Vadodara
The Income Tax Act, 1961 Honourable High Court of Gujarat
Income Tax Appellate Tribunal
Commissioner of Income Tax (Appeals)
* Net of amount deposited under protest.
10. The company has no accumulated losses as at December 31, 2009 and
it has not incurred any cash losses in the financial year ended on that
date or in the immediately preceding financial year.
11. According to the records of the company examined by us and the
information and explanations given to us, the company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
12. The company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit fund /
nidhi / mutual benefit fund/ societies are not applicable to the
company.
14. In our opinion, the company is not a dealer or trader in shares,
securities, debentures and other investments.
15. In our opinion and according to the information and explanations
given to us, the company has not given any guarantee for loans taken by
others from banks or financial institutions during the year.
16. The company has not obtained any term loans.
17. On the basis of an overall examination of the balance sheet of the
company, in our opinion and according to the information and
explanations given to us, there are no funds raised on a short-term
basis which have been used for long-term investment.
18. The company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under Section
301 of the Act during the year.
19. The company has not issued any debentures.
20. The company has not raised any money by public issues during the
year.
21. During the course of our examination of the books and records of
the company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
year, nor have we been informed of such case by the management.
Uday Shah
Partner
Membership Number F-46061
For and on behalf of
Price Waterhouse
Mumbai,
Dated: February 26, 2010 Chartered Accountants
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