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Mahindra CIE Automotive Ltd.

BSE: 532756 Sector: Engineering
NSE: MAHINDCIE ISIN Code: INE536H01010
BSE LIVE 15:40 | 21 Nov 235.90 -2.60
(-1.09%)
OPEN

239.00

HIGH

241.50

LOW

235.20

NSE 15:41 | 21 Nov 235.20 -3.55
(-1.49%)
OPEN

240.70

HIGH

241.95

LOW

234.60

OPEN 239.00
PREVIOUS CLOSE 238.50
VOLUME 7625
52-Week high 266.50
52-Week low 174.45
P/E 136.36
Mkt Cap.(Rs cr) 8,926
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 239.00
CLOSE 238.50
VOLUME 7625
52-Week high 266.50
52-Week low 174.45
P/E 136.36
Mkt Cap.(Rs cr) 8,926
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Mahindra CIE Automotive Ltd. (MAHINDCIE) - Auditors Report

Company auditors report

To the Members of

Mahindra CIE Automotive Limited

Report on the Standalone Financial Statements

1. We have audited the accompanying standalone financial statements of Mahindra CIEAutomotive Limited ("the Company") which comprise the Balance Sheet as at March31 2015 and the Statements of Profit and Loss and Cash Flow for the year then ended anda summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statements

2. The Company’s Board of Directors is responsible for the matters stated inSection 134(5) of the Companies Act 2013 ("the Act") with respect to thepreparation of these standalone financial statements that give a true and fair view of thefinancial position financial performance and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014 (as amended). This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting frauds and other irregularities;selection and application of appropriate accounting policies; making judgments andestimates that are reasonable and prudent; and design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

Auditor’s Responsibility

3. Our responsibility is to express an opinion on these standalone financial statementsbased on our audit.

4. We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder.

5. We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.

6. An audit involves performing procedures to obtain audit evidence about the amountsand the disclosures in the financial statements. The procedures selected depend on theauditor’s judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal financial control relevant to the Company’spreparation of the financial statements that give a true and fair view in order to designaudit procedures that are appropriate in the circumstances but not for the purpose ofexpressing an opinion on whether the Company has in place an adequate internal financialcontrols system over financial reporting and the operating effectiveness of such controls.An audit also includes evaluating the appropriateness of the accounting policies used andthe reasonableness of the accounting estimates made by the Company’s Directors aswell as evaluating the overall presentation of the financial statements.

7. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone financial statements.

Opinion

8. In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2015 and its profit and cash flows for the year ended on that date.

Emphasis of matter

9. We draw attention to Note X to the financial statements and for the reasons detailedtherein management of the Company does not perceive any permanent diminution in the valueof long term investment of Rs. 7349.3 million in the wholly owned subsidiaries namelyMahindra Forgings Global Limited and Mahindra Forgings International Limited in view ofthe measures for improving financial performance being taken by the management of theCompany.

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 theCentral Government of India in terms of sub-section (11) of Section 143 of the Act (the"Order") and on the basis of such checks of the books and records of theCompany as we considered appropriate and according to the information and explanationsgiven to us we give in the Annexure a statement on the matters specified in paragraphs 3and 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 bestof 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 theCompany 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 thisReport are in agreement with the books of account;

d. In our opinion the aforesaid financial statements comply with the AccountingStandards 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 312015 taken on record by the Board of Directors none of the directors is disqualified ason March 31 2015 from being appointed as a director in terms of Section 164(2) of theAct.

f. 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(as amended) inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements – Refer Note XXVI to the financial statements.

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts. The Company didnot have any derivative contracts.

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

For B. K. Khare & Co.
Chartered Accountants
Firm’s Registration Number 105102W
Himanshu Chapsey
Partner
Membership Number: 105731
Place: Mumbai
May 11 2015

ANNEXURE TO THE AUDITOR’S REPORT

Referred to in paragraph 10 of our report of even date on the financial statements ofMahindra CIE Automotive Limited for the year ended March 31 2015

1. (i) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(ii) The Company has a rotational programme for verification of its fixed assets over aperiod of 3 years. A portion of the fixed assets have been physically verified by themanagement during the year in accordance with the program. In our opinion the frequencyof verification is reasonable having regard to the size of the Company and the nature ofits assets. The discrepancies reported on such verification have been properly dealt inthe books of account.

2. (i) The management has conducted physical verification of inventory at reasonableintervals during the year.

(ii) The procedures of physical verification of inventory followed by the managementare reasonable and adequate in relation to the size of the Company and the nature of itsbusiness.

(iii) The Company is maintaining proper records of inventory and no materialdiscrepancies were noticed on physical verification.

3. The Company has not granted any loans secured or unsecured to companies firms orother parties covered in the register maintained under Section 189 of the Act.Accordingly the provisions of para 3(iii) of the Order are not applicable to the Company.

4. In our opinion and according to the information and explanations given to us thereis an adequate internal control system commensurate with the size of the Company and thenature of its business for the purchases of inventory fixed assets and for the sale ofgoods and services. In our opinion and according to the information and explanations givento us there is no continuing failure to correct major weaknesses in internal controlsystem.

5. In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public within the meaning of Section 73 to76 the Act and the rules framed thereunder.

6. As informed to us the maintenance of cost records has been prescribed by theCentral Government under Section 148(1) of the Companies Act 2013 in respect of theactivities carried on by the Company. We have broadly reviewed the books of accountrelating to materials labour and other items of cost maintained by the company pursuantto the Rules made by the Central Government for the maintenance of cost records undersection and we are of the opinion that prima facie the prescribed accounts and recordshave been made and maintained.

7. (i) According to the records of the Company the Company is generally regular indepositing with the appropriate authorities undisputed statutory dues including ProvidentFund Employees’ State Insurance Income Tax Sales Tax Wealth Tax Excise DutyService Tax Customs Duty value added tax and other statutory dues applicable to it.

(ii) According to the information and explanations given to us there are no undisputedamounts payable in respect of Provident Fund Employees’ State Insurance Income taxSales Tax Wealth Tax Excise Duty Service Tax Customs Duty and Value Added Tax thatwere outstanding at the year-end for a period of more than six months from the date theybecame payable.

(iii) According to the information and explanations given to us dues of income-taxsales tax service tax excise duty customs duty and work contract tax which have notbeen deposited on account of any dispute are as follows:

Name of Statute Nature of dues Rs. in million Period to which amount relates Forum where pending
Forgings Division (erstwhile Mahindra CIE Automotive Limited)
Central Excise Act 1944 Excise Duty 3.0 2002-03 to 2003-04 CESTAT Mumbai
Excise Duty 6.1 2002-03 to 2003-04 CESTAT Mumbai
Excise Duty 8.2 2010-11 to 2012-13 CESTAT Mumbai
Excise Duty 1.1 2012-13 Additional Commissioner of Central Excise
Stampings Division (erstwhile Mahindra Ugine Steel Company Limited)
Sales Tax Laws Sales Tax 30.5 2008-09 2010-11 2011-12 Joint Commissioner Appeals
Sales Tax 96.0 2006-07 2007-08 Maharashtra Sales Tax Tribunal
Central Excise Act 1944 Excise Duty 7.1 2012-13 Commissioner Appeals
Excise Duty 85.3 1999-00 Customs Excise and Service Tax Appellate Tribunal
Service Tax 1.8 2010-11 to 2012-13 Commissioner Appeals
Service Tax 54.8 2008-09 to 2011-12 Customs Excise and Service Tax Appellate Tribunal
Casting and Magnetic Product Division (erstwhile Mahindra Hinoday Limited)
Central Excise Act 1944 Excise Duty 0.01 1999-00 CESTAT
Excise Duty 0.97 2012-13 CESTAT
Excise Duty 6.9 2013-14 CESTAT
Excise Duty 17.7 2014-15 CESTAT
Service Tax 0.9 2009-10 Commissioner Appeals
Service Tax 3.3 2010-11 to 2012-13 Commissioner Appeals
Service Tax 0.9 2013-14 Commissioner Appeals
Service Tax 1.0 2014-15 Commissioner Appeals
Others Others 15.3 - -
Composites Division (erstwhile Mahindra Composites Limited)
Income Tax Act 1961 Appeals against Income Tax Claims 2.7 2010-11 Commissioner of Income Tax (Appeals) – Pune
Central Excise Act 1944 Service Tax 0.5 2009-10 Commissioner of Central Excise and Customs (Appeals) – Mumbai

8. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company.

9. The Company does not have any accumulated losses at the end of the Financial Yearand it has not incurred any cash losses in the current year and in the immediatelypreceding Financial Year.

10. According to the information and explanations given to us and based on thedocuments and records produced before us the Company has not defaulted in repayment ofdues to a financial institution banks or debenture holders.

11. In our opinion and according to the information and explanation given to us thereis no outstanding guarantee for loans taken by others from banks and financialinstitutions at balance sheet date.

12. In our opinion and according to the information and explanations given to us theterm loans were applied for the purposes for which they were obtained.

13. Based on the audit procedures performed and as per the information and explanationsgiven to us by management no fraud on or by the Company has been noticed or reportedduring the year.

For B. K. Khare & Co.
Chartered Accountants
Firm’s Registration Number 105102W
Himanshu Chapsey
Partner
Membership Number: 105731
Place: Mumbai
May 11 2015