TO THE MEMBERS OF ALEMBIC LIMITED
Report on the Standalone Ind AS Financial Statements
We have audited the accompanying standalone Ind AS financial statements of AlembicLimited ("the Company") which comprise the Balance Sheet as at 31st March2017 and the Statement of Profit and Loss (including Other Comprehensive Income) theCash Flow Statement and the Statement of Changes in Equity for the year then ended and asummary of the significant accounting policies and other explanatory information.
Management's Responsibility for the Standalone Financial Statements
The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone Ind AS financial statements that give a true and fair view of the stateof affairs (financial position) profit or loss (financial performance including othercomprehensive income) cash flows and changes in equity of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) prescribed under section 133 of the Act.
This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit. We have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder.
We conducted our audit of the standalone Ind AS financial statements in accordance withthe Standards on Auditing specified under Section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone Ind AS financial statements are freefrom material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the standalone Ind AS financial statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the standalone Ind ASfinancial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone Ind AS financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India including the Ind AS of thestate of affairs (financial position) of the Company as at 31st March 2017 and itsprofit (financial performance including other comprehensive income) its cash flows andthe changes in equity 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 in terms of Section 143(11) of the Act we give in"Annexure A" a statement on the matters specified in paragraphs 3 and 4 of theOrder.
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 bestof 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 theCompany so far as it appears from our examination of those books.
(c) The Balance Sheet the Statement of Profit and Loss the Cash Flow Statement andStatement of Changes in Equity dealt with by this Report are in agreement with the booksof account.
(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Indian Accounting Standards prescribed under section 133 of the Act.
(e) On the basis of the written representations received from the directors as on 31stMarch 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2017 from being appointed as a director in terms of Section164(2) of the Act.
(f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B".
(h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us: i. TheCompany has disclosed the impact of pending litigations on its financial position in itsstandalone Ind AS financial statements; ii. The Company did not have any long-termcontracts including derivative contracts for which there were any material foreseeablelosses. iii. There has been no delay in transferring amounts required to be transferredto the Investor Education and Protection Fund by the Company. iv The Company has providedrequisite disclosures in its financial statements as to holdings as well as dealings inSpecified Bank Notes during the period from 8th November 2016 to 30th December 2016 atNote No. 31(L) and these are in accordance with the books of accounts maintained by theCompany.
ANNEXURE A Re: Alembic Limited.
Referred to in paragraph 1 on Report on Other Legal and Regulatory Requirements of ourreport.
(i) (a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) These fixed assets have been physically verified by the management during the yearas per the phased programme of physical verification of fixed assets. As informed to usthe programme is such that all the fixed assets will get physically verified in three yeartime. In our opinion the same is reasonable having regard to the size of the Company andthe nature of its fixed assets. No material discrepancies were noticed on suchverification.
(c) The title deeds of immovable properties are held in the name of the company.
(ii) Physical verification of inventory has been conducted at reasonable intervals bythe management and No material discrepancies were noticed on physical verification. (iii)The Company has not granted any secured or unsecured loans to companies firms limitedliability partnership or other parties covered in the register maintained under section189 of the Companies Act 2013. Therefore the requirements of sub-clause (a) (b) and (c)of clause (iii) are not applicable to the Company.
(iv) In respect of loans investments guarantees and security provisions of section185 and 186 of the Companies Act 2013 have been complied with.
(v) The Company has not accepted any deposits during the year. Therefore the questionof complying with directives issued by the Reserve Bank of India and the provisions ofsections 73 to 76 or any other relevant provisions of the Companies Act 2013 and therules framed thereunder do not arise. (vi) The Central Government has specified themaintenance of cost records under sub-section (1) of section 148 of the Companies Act2013. Such accounts and records have been made and maintained by the Company.
(vii) (a) The Company is generally regular in depositing undisputed statutory duesincluding provident fund employees' state insurance income tax sales-tax service taxduty of customs duty of excise value added tax cess and any other statutory dues withthe appropriate authorities. (b) Dues of income tax or sales tax or service tax or duty ofcustoms or duty of excise or value added tax that have not been deposited on account ofany dispute are as under.
|Nature of dues. ||Amount not deposited Rs ||Forum where dispute is pending ||Period to which the amount relates |
|Sales Tax interest and penalty. ||8016782 ||Joint Commissioner Appeals ||2000-2001 |
| ||1442264 ||Joint Commissioner Appeals ||2011-12 |
| ||1730797 ||Joint Commissioner Appeals ||2012-13 |
|Excise Duty Interest & Penalty. ||172556 ||CESTAT ||2011 |
| ||500000 ||CESTAT ||2001-02 |
| ||3521786 ||Supreme Court. ||2003-04 |
| ||44106 ||CESTAT ||2011-12 |
(viii) The Company has not defaulted in repayment of loans or borrowings to a financialinstitution bank government or dues to debenture holders.
(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) or any term loans during the year. (x) Any fraudby the Company or any fraud on the Company by its officers or employees has not beennoticed or reported during the year. (xi) Managerial remuneration has been paid orprovided in accordance with the requisite approvals mandated by the provisions of section197 read with Schedule V to the Companies Act.
(xii) The Company is not a Nidhi Company and therefore the compliance requirementsrelevant to a Nidhi Company are not applicable.
(xiii) All transactions with related parties are in compliance with section 177 and 188of the Companies Act 2013 where applicable and the details have been disclosed in thestandalone financial statements etc. as required by the applicable accounting standards.
(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review thereforethe compliance of the requirement of section 42 of the Companies Act 2013 are notapplicable. (xv) Pursuant to the provisions of section 192 of the Companies Act 2013 theCompany has not entered into any non-cash transactions with directors or persons connectedwith him/her.
(xvi) The Company is not required to be registered under section 45-1(A) of the ReserveBank of lndia Act 1934.
ANNEXURE B TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONE FINANCIALSTATEMENTS OF ALEMBIC LIMITED
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of ALEMBICLIMITED ("the Company") as of March 31st 2017 in conjunction with our audit ofthe standalone 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 internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.
Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness.
Our audit of internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgement including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the Company's internal financial controls system over financialreporting.
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany'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 financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlswere operating effectively as at March 31st 2017 based on the internal control overfinancial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.
| ||For K. S. AIYAR & CO. |
| ||Chartered Accountants |
| ||Firm's Registration No.: 100186W |
| ||RAJESH S. JOSHI |
|Place: Vadodara ||Partner |
|Date: 9th May 2017 ||Membership No. 38526 |