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INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BLISS GVS PHARMA LIMITED
Report on the Standalone Financial Statements
1. We have audited the accompanying standalone financial statements of Bliss GVS Pharma Limited ("the Company"), which comprise the balance sheet as at March 31, 2015, and the related statements of profit and loss and cash flow for the year then ended, and a summary of the significant accounting policies and other explanatory information ("standalone financial statements").
Management's Responsibility for the Financial Statements
2. The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone 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 (as amended). 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 standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
3. Our responsibility is to express an opinion on these standalone financial statements based on our audit.
4. 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.
5. 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 standalone 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 standalone financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the standalone 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 standalone 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 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 standalone 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 standalone financial statements.
8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone 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, 2015, and its profit and its cash flows for the year ended on that date.
Emphasis of matter
9. We draw attention to Note XI(a) to the standalone financial statements in respect of our reliance on the management representation in respect of the recoverability of the Company's investment in and loans to two of its subsidiaries aggregating Rs. 6,990.24 lakhs.
Our opinion is not modified in respect of this matter
Report on Other Legal and Regulatory Requirements
10. As required by the Companies (Auditor's Report) Order, 2015, issued by the Central Government of India in terms of subsection (11) of section 143 of the Act (the "Order"), 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 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 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 it appears from our examination of those books;
c. the Balance Sheet, the Statement of Profit and Loss and Cash Flow dealt with by this Report are in agreement with the books of account;
d. In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended);
e. on the basis of written representations received from the directors as on March 31, 2015, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015, from being appointed as a director in terms of Section 164(2) of the Act.
f. 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 (as amended), in our opinion and to the best of our information and according to the explanations given to us:
i. The Company does not have any pending litigations which would impact its financial position as at balance sheet date.
ii. The Company has long–term contracts including derivate contracts as at March 31, 2015 for which there were no 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 during the year ended March 31, 2015.
Annexure to Independent Auditors' Report
Referred to in paragraph 10 of the our report of even date on the standalone financial statements as at and for the year ended March 31, 2015
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 three 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.
ii. (a) The inventory has been physically verified by the Management during the year. In respect of inventory lying with third parties, these have been substantially 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.
iii. According to the information and explanations given to us, the Company has granted unsecured loans to six companies covered in the register maintained under Section 189 of the Act aggregating to Rs. 9,193.92 lacs as at March 31, 2015
(a) The above loans have been given without stipulation as to installments of interest payments and repayment of principal. Hence we are unable to comment on the regularity of payment of principal and interest.
(b) In view of the above, we are also unable to comment on the overdue amounts, if any.
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 for the purchase of inventory and 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.
In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits to which the directives issued by the Reserve Bank of India and the provisions of Sections 73–76 of the Act and the Rules framed thereunder apply. Accordingly, the provisions of clause 3(v) of the Order are not applicable to the Company.
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 specified under sub–section (1) of Section 148 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.
(a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, except for advance income tax payable for the year ended March 31, 2015, the Company is generally regular in depositing the undisputed statutory dues, including provident fund, employees' state insurance, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, with the appropriate authorities. Of the total advance tax, outstanding as at March 31, 2015, an amount of Rs 1,183.47 lakhs (excluding interest thereon) is outstanding at March 31, 2015 for a period of more than 6 months from the date it became payable.
(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of income–tax, sales–tax, wealth–tax, service–tax, duty of customs, and duty of excise or value added tax or cess which have not been deposited on account of any dispute.
(c) The amounts required to be transferred to the Investor Education and Protection Fund has been transferred within the stipulated time in accordance with the provisions of the Companies Act, 1956 and the rules made there under.
viii. The Company has no accumulated losses as at the end of the financial year and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.
ix. 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 as at the balance sheet date. Further, the Company has not issued any debentures during the year.
x. In our opinion, and according to the information and explanations given to us, the terms and conditions of the guarantees aggregating Rs 3217.15 lacs given by the Company for loans taken by its two subsidiary companies from banks are not prejudicial to the interest of the Company.
xi. In our opinion, and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.
xii. 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 any such case by the management.
For B K Khare & Co
Firm Registration Number: 105102W
Membership Number 105731
Date: May 29, 2015