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Suzlon Energy Ltd.

BSE: 532667 Sector: Engineering
NSE: SUZLON ISIN Code: INE040H01021
BSE LIVE 15:56 | 17 Nov 13.75 0.30
(2.23%)
OPEN

13.60

HIGH

13.85

LOW

13.55

NSE 15:59 | 17 Nov 13.70 0.25
(1.86%)
OPEN

13.65

HIGH

13.85

LOW

13.55

OPEN 13.60
PREVIOUS CLOSE 13.45
VOLUME 9303702
52-Week high 22.25
52-Week low 12.80
P/E 11.55
Mkt Cap.(Rs cr) 7,315
Buy Price 0.00
Buy Qty 0.00
Sell Price 13.75
Sell Qty 180752.00
OPEN 13.60
CLOSE 13.45
VOLUME 9303702
52-Week high 22.25
52-Week low 12.80
P/E 11.55
Mkt Cap.(Rs cr) 7,315
Buy Price 0.00
Buy Qty 0.00
Sell Price 13.75
Sell Qty 180752.00

Suzlon Energy Ltd. (SUZLON) - Auditors Report

Company auditors report

To the Members of Suzlon Energy Limited

Report on the Financial Statements

1. We have audited the accompanying standalone financial statements of Suzlon EnergyLimited ("the Company") which comprise the Balance Sheet as at March 31 2016the Statement of Profit and Loss and Cash Flow Statement for the year then ended and asummary of significant accounting policies and other explanatory information in which areincorporated the returns for the year ended on that date audited by the branch auditors ofthe Company’s branches at Netherlands and Germany.

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 withaccounting 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. This responsibility includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and the design implementation and maintenance of adequateinternal financial control that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from materialmisstatement 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. We have taken into account the provisions of the Act the accountingand auditing standards and matters which are required to be included in the audit reportunder the provisions of the Act and the Rules made thereunder. We conducted our audit inaccordance with the Standards on Auditing issued by the Institute of Chartered Accountantsof India as specified under Section 143(10) of the Act. Those Standards require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the financial statements are free from material misstatement.

4. An audit involves performing procedures to obtain audit evidence about the amountsand 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. An audit also includesevaluating the appropriateness of accounting policies used and the reasonableness of theaccounting estimates made by the Company’s Directors as well as evaluating theoverall presentation of the financial statements. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide a basis for our audit opinion onthe standalone financial statements.

Opinion

5. In our opinion and to the best of our information and according to the explanationsgiven to us the standalone financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2016 its profit and its cash flows for the year ended on that date.

Emphasis of Matter

6. We draw attention to Note 5 of the accompanying financial statements in respect ofcontingency related to 'compensation payable in lieu of bank sacrifice' the outcome ofwhich is materially uncertain and cannot be determined currently. Our opinion is notqualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

7. As required by the Companies (Auditor’s report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the Annexure 1 a statement on the matters specified inparagraphs 3 and 4 of the Order.

8. 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 and proper returnsadequate for the purposes of our audit have been received from branches not visited by us;

(c) The reports on the accounts of the branch offices of the Company audited undersection 143 (8) of the Act by branch auditor has been sent to us and have been properlydealt by us in preparing this report;

(d) The Balance Sheet Statement of Profit and Loss and Cash Flow Statement dealt withby this Report are in agreement with the books of account and with the returns receivedfrom branches not visited by us;

(e) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014;

(f) The matter described under the Emphasis of Matters paragraph above in our opinionmay have an adverse effect on the functioning of the Company;

(g) On the basis of written representations received from the directors as on March 312016 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2016 from being appointed as a director in terms of section 164 (2) ofthe Act;

(h) 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 2" to this report;

(i) 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. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements – Refer Note 36 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 includingderivative contracts – Refer Note 11 to the financial statements;

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

Other Matter

9. The accompanying financial statements include net total assets of Rs 16.67 Crore asat March 31 2016 and net total revenues of Rs Nil for the year ended on that date inrespect of two branches which have been audited by branch auditors which financialstatements other financial information and auditor’s reports have been furnished tous. Our opinion in so far as it relates amounts and disclosures included in respect ofthese branches is based solely on the reports of such branch auditors. Our opinion is notqualified in respect of this matter.

For SNK & Co. For S. R. Batliboi & Co.LLP
Chartered Accountants Chartered Accountants
ICAI Firm registration number: 109176W ICAI Firm registration number: 301003E/E300005
per Sanjay Kapadia per Paul Alvares
Partner Partner
Membership No. : 38292 Membership No. : 105754
Place : Mumbai Place : Mumbai
Date : May 30 2016 Date : May 30 2016

Annexure 1 referred to in paragraph 7 of our report of even date under heading"Report on Other Legal and Regulatory Requirements"

Re: Suzlon Energy Limited

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

(b) All fixed assets have not been physically verified by the management during theyear but there is a regular programme of verification which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. No materialdiscrepancies were noticed on such verification.

(c) According to the information and explanations given by the management the titledeeds of immovable properties included in fixed assets are held in the name of theCompany.

(ii) The inventory has been physically verified by the management during the year. Inour opinion the frequency of verification is reasonable. No material discrepancies werenoticed on such physical verification. Inventories lying with third parties have beenconfirmed by them as at March 31 2016 and no material discrepancies were noticed inrespect of such confirmations.

(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms or other parties covered bysection 184 of the Companies Act 2013 and which are required to be entered in theregister maintained under section 189 of the Companies Act 2013. In our opinion thetransactions of granting loans are not covered in the specified list of transactions undersection 188 (1) of the Companies Act 2013. Accordingly the provisions of clause 3(iii)(a) (b) and (c) of the Order are not applicable to the Company and hence not commentedupon.

(iv) In our opinion and according to the information and explanations given to usprovisions of section 185 and 186 of the Companies Act 2013 in respect of loans todirectors including entities in which they are interested and in respect of loans andadvances given investments made and guarantees and securities given have been compliedwith by the Company.

(v) The Company has not accepted any deposits from the public. Accordingly theprovisions of clause 3(v) of the Order are not applicable to the Company and hence notcommented upon.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Companies Act 2013 related to the manufacture of products of theCompany and are of the opinion that prima facie the specified accounts and records havebeen made and maintained. We have not however made a detailed examination of the same.

(vii) (a) Undisputed statutory dues including provident fund employees’ stateinsurance income-tax sales-tax service tax duty of custom duty of excise value addedtax cess and other statutory dues have generally been regularly deposited with theappropriate authorities though there has been a slight delay in a few cases.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees’ state insurance income-taxwealth-tax service tax sales-tax duty of custom duty of excise value added tax cessand other material statutory dues were outstanding at the year end for a period of morethan six months from the date they became payable.

(b) According to the records of the Company the dues outstanding of income-taxsales-tax wealth-tax service tax duty of custom duty of excise value added tax andcess on account of any dispute are as follows:

Name of the Statute Nature of dues Amount (Rs in Crore) Period to which the amount relates Forum where dispute is pending
Finance Act 1994 Service Tax 71.22 1999-2000 to 2002-2003 CESTAT
Finance Act 1994 Service Tax 4.03 2007-2008 to 2011-2012 CESTAT
Maharashtra Value Added Tax Act 2002 Value added tax 0.17 2010-2011 Deputy Commissioner of Sales Tax Maharashtra
Maharashtra Value Added Tax Act 2002 Value added tax 0.04 2006-2007 Joint Commissioner (Appeals) Maharashtra
Tamil Nadu Value Added Tax Act 2006 Value added tax 1.07 2011-2012 Assistant Commissioner Tamil Nadu
Tamil Nadu Value Added Tax Act 2006 Value added tax 0.04 2015-2016 Joint Commissioner Tamil Nadu
Customs Act 1962 Custom duty 0.24 2008-2009 2011-2012 2012-2013 and 2014-2015 CESTAT
Customs Act 1962 Custom duty 0.04 2011-2012 Assistant Commissioner of Customs Chennai

(viii) According to information and explanations given by the management the Companyhas delayed in repayment of dues to banks and financial institution during the yearaggregating to of Rs. 80.22 Crore (the delay in such repayments being for less than 45days in each individual case) and Rs. Nil of such dues were in arrears as on the balancesheet date. The Company has not defaulted in repayment to bondholders.

(ix) Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management and on an overall examination of the balance sheet the Companyhas not raised any money by way of initial public offer / further public offer / debtinstruments. Based on the information and explanations given to us by the management termloans were applied for the purpose for which the loans were obtained.

(x) According to the information and explanations given by the management we reportthat no fraud on or by the officers and employees of the Company has been noticed orreported during the year.

(xi) According to the information and explanations given by the management we reportthat the managerial remuneration has been paid / provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) In our opinion the Company is not a nidhi company. Therefore the provisions ofclause 3(xi) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given by the management theCompany has complied with provisions of section 42 of the Companies Act 2013 in respectof the preferential allotment during the year. The Company has not made private placementof shares or fully or partly convertible debentures during the year.

Based on our audit procedures performed for the purpose of reporting the true and fairview of the financial statements and according to the information and explanations givenby the management we report that out of the amounts raised of Rs 1800 Rs 1395 Crorehave been used for the purposes for which the funds were raised. The remaining amount ofRs 405 Crore was available with the company as part of its treasury balances and waspending utilization as on March 31 2016.

(xv) Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management the Company has not entered into any non-cash transactions withdirectors or persons connected with him as referred to in section 192 of Companies Act 2013.

(xvi) According to the information and explanations given to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company andhence not commented upon.

For SNK & Co. For S. R. Batliboi & Co.LLP
Chartered Accountants Chartered Accountants
ICAI Firm registration number: 109176W ICAI Firm registration number: 301003E/E300005
per Sanjay Kapadia per Paul Alvares
Partner Partner
Membership No. : 38292 Membership No. : 105754
Place : Mumbai Place : Mumbai
Date : May 30 2016 Date : May 30 2016

Annexure 2 – Annexure referred to in paragraph 8(h) of our report of even dateunder the heading "Report on Other Legal and Regulatory Requirements"

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

1. We have audited the internal financial controls over financial reporting of SuzlonEnergy Limited ("the Company") as of March 31 2016 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

Management’s Responsibility for Internal Financial Controls

2. The Company’s Management is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to the Company’s policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

Auditor’s Responsibility

3. 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 as specified under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls both applicable to an audit of internal financial controls and bothissued by the Institute of Chartered Accountants of India. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor’s judgement including the assessment of the risks ofmaterial 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 toprovide a basis for our audit opinion on the internal financial controls system overfinancial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

6. A company's internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures 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

7. 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.

Opinion

8. In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 2016 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For SNK & Co. For S. R. Batliboi & Co.LLP
Chartered Accountants Chartered Accountants
ICAI Firm registration number: 109176W ICAI Firm registration number: 301003E/E300005
per Sanjay Kapadia per Paul Alvares
Partner Partner
Membership No. : 38292 Membership No. : 105754
Place : Mumbai Place : Mumbai
Date : May 30 2016 Date : May 30 2016