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Cipla Ltd.

BSE: 500087 Sector: Health care
NSE: CIPLA ISIN Code: INE059A01026
BSE 00:00 | 16 Nov 530.90 11.90
(2.29%)
OPEN

522.00

HIGH

533.75

LOW

522.00

NSE 00:00 | 16 Nov 530.60 11.45
(2.21%)
OPEN

521.70

HIGH

534.00

LOW

521.10

OPEN 522.00
PREVIOUS CLOSE 519.00
VOLUME 271500
52-Week high 678.00
52-Week low 508.10
P/E 25.72
Mkt Cap.(Rs cr) 42,751
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 522.00
CLOSE 519.00
VOLUME 271500
52-Week high 678.00
52-Week low 508.10
P/E 25.72
Mkt Cap.(Rs cr) 42,751
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Cipla Ltd. (CIPLA) - Auditors Report

Company auditors report

To the Members of Cipla Limited

Report on the standalone financial statements

1. We have audited the accompanying standalone financial statements of Cipla Limited(‘the Company') which comprise the Balance Sheet as at 31 March 2018 the Statementof Profit and Loss (including Other Comprehensive Income) the Cash Flow Statement and theStatement of Changes in Equity for the year then ended and a summary of the significantaccounting policies and other explanatory information.

Management's responsibility for the standalone financial statements

2. 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 financial statements that give a true and fair view of the state ofaffairs (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') specified under Section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding the assets of the Company and for preventing and detecting fraudsand other irregularities; selection and application of appropriate accounting policies;making judgments and estimates that are reasonable and prudent; and design implementationand maintenance of adequate internal financial controls that were operating effectivelyfor ensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the standalone financial statements that give a true andfair view and are free from material 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 whetherthese standalone 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 of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial controls relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances. An audit also includes evaluating theappropriateness of the accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof 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 these 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 including Ind AS specified under Section133 of the Act of the state of affairs (financial position) of the Company as at 31 March2018 and its profit (financial performance including other comprehensive income) itscash 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 (‘the Order')issued by the Central Government of India in terms of Section 143(11) of the Act we givein the Annexure I a statement on the matters specified in paragraphs 3 and 4 of the Order.10. Further to our comments in Annexure I as required by Section 143(3) of the Act wereport that: a) we have sought and obtained all the information and explanations which tothe best of our knowledge and belief were necessary for the purpose of our audit; b) Inour opinion proper books of account as required by law have been kept by the Company sofar as it appears from our examination of those books; c) The standalone financialstatements dealt with by this report are in agreement with the books of account; d) In ouropinion the aforesaid standalone financial statements comply with Ind AS specified underSection 133 of the Act; e) On the basis of the written representations received from thedirectors and taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2018 from being appointed as a director in terms of Section164(2) of the Act; f) We have also audited the internal financial controls over financialreporting (IFCoFR) of the Company as on 31 March 2018 in conjunction with our audit of thestandalone financial statements of the Company for the year ended on that date and ourreport dated 22 May 2018 as per Annexure II expressed an unmodified opinion. g) Withrespect to the other matters to be included in the Auditor's Report in accordance withRule 11 of the Companies (Audit and Auditors) Rules 2014 (as amended) in our opinion andto the best of our information and according to the explanations given to us: i. TheCompany as detailed in Note 40 to the standalone financial statements has disclosed theimpact of pending litigations on its financial position; ii. The Company did not have anylong-term contracts including derivative contracts for which there were any materialforeseeable losses; iii. There has no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company. iv. Thedisclosure requirements relating to holdings as well as dealings in specified bank noteswere applicable for the period from 8 November 2016 to 30 December 2016 which are notrelevant to these standalone financial statements. Hence reporting under this clause isnot applicable.

For Walker Chandiok & Co LLP

Chartered Accountants

Firm's Registration No.: 001076N/N500013

Ashish Gupta

Partner

Membership No.: 504662

Place: New Delhi

Date: 22 May 2018

Annexure I to the Independent Auditor's Report of even date to the members of CiplaLimited on the standalone financial statements for the year ended 31 March 2018

Annexure I

Based on the audit procedures performed for the purpose of reporting a true and fairview on the financial statements of the Company and taking into consideration theinformation and explanations given to us and the books of account and other recordsexamined by us in the normal course of audit and to the best of our knowledge and beliefwe report that: (i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of property plant andequipment.

(b) The Company has a regular program of physical verification of its fixed assetsunder which fixed assets are verified in a phased manner over a period of three yearswhich in our opinion is reasonable having regard to the size of the Company and thenature of its assets. In accordance with this program certain fixed assets were verifiedduring the year and no material discrepancies were noticed on such verification. (c) Thetitle deeds of all the immovable properties (which are included under the head‘Property plant and equipment') are held in the name of the Company.

(ii) In our opinion the management has conducted physical verification of inventory atreasonable intervals during the year and no material discrepancies between physicalinventory and book records were noticed on such verification. Discrepancies noticed onphysical verification have been properly dealt with in the books of account. (iii) TheCompany has granted interest free unsecured loans to one company covered in the registermaintained under Section 189 of the Act; and with respect to the same: (a) In our opinionthe terms and conditions of grant of such loans are not prima facie prejudicial to thecompany's interest.

(b) The schedule of repayment of principal has been stipulated and the receipts of theprincipal amount are regular; (c) There is no overdue amount in respect of loans granted.

(iv) In our opinion the Company has complied with the provisions of Sections 185 and186 of the Act in respect of loans given investments made guarantees and security.

(v) In our opinion the Company has not accepted any deposits within the meaning ofSections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules 2014 (asamended). Accordingly the provisions of clause 3(v) of the Order are not applicable.

(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 undersub-section (1) of Section 148 of the Act in respect of Company's products and are of theopinion that prima facie the prescribed accounts and records have been made andmaintained. However we have not made a detailed examination of the cost records with aview to determine whether they are accurate or complete.

(vii) (a) The Company is regular in depositing undisputed statutory dues includingprovident fund employees' state insurance income-tax goods and service tax sales-taxservice tax duty of customs duty of excise value added tax cess and other materialstatutory dues as applicable to the appropriate authorities. Further no undisputedamounts payable in respect thereof were outstanding at the year-end for a period of morethan six months from the date they become payable.

(b) There are no dues in respect of sales-tax service tax and duty of customs thathave not been deposited with the appropriate authorities on account of any dispute.

Annexure I to the Independent Auditor's Report of even date to the members of CiplaLimited on the standalone financial statements for the year ended 31 March 2018

The dues outstanding in respect of income-tax duty of excise and value added tax onaccount of any dispute are as follows:

Statement of Disputed Dues
Name of the statute Nature of dues Amount (J in crore) Amount paid under Protest (J in crore) Period to which the amount relates Forum where dispute is pending
Income Tax Act 1961 Income tax 265.13 183.08 2008-09 to 2014-15 CIT Appeals
The Central Excise Act 1944 Excise duty 65 2 2008-09 to 2015-16 CESTAT Bangalore Commissioner
The Central Excise Act 1944 Excise duty 3 - 2007-08 to 2014-15 Appeals
The Central Excise Act 1944 Excise duty 40 2 2007-08 to 2015-16 CESTAT Mumbai
The Central Excise Act 1944 Excise duty 7 1 2011-12 to 2013-14 CESTAT Kolkata
Additional
The Central Excise Act 1944 Excise duty 1 - 2015-16 to 2016-17 Commissioner
Principal
The Central Excise Act 1944 Excise duty 8 - 2015-16 to 2017-18 Commissioner
Bihar Vat Act 2005 VAT 1 - 2013-14 Tribunal
Bihar Vat Act 2005 VAT 1 - 2014-15 to 2016-17 Appeal Court
Gujarat Vat Act 2005 VAT 14 - 2013-14 JCCT- Ahmedabad
Maharashtra Value
Added Tax 2002 VAT 1 - 2002-03 to 2012-13 DY. Commissioner of Sales tax-LTU Rajasthan Tax
Rajasthan Vat Act 2003 VAT 1 - 2002-03 to 2012-13 Board - Ajmer Rajasthan Tax
Rajasthan Vat Act 2003 VAT 3 - 2008-09 to 2012-13 Board - Ajmer

(viii) The Company has not defaulted in repayment of loans or borrowings to any bank orfinancial institutions or government during the year. The Company did not have anyoutstanding debentures during the year.

(ix) The Company did not raise moneys by way of initial public offer or further publicoffer (including debt instruments) and did not have any term loans outstanding during theyear. Accordingly the provisions of clause 3(ix) of the Order are not applicable.

(x) According to the information and explanation given us no fraud by the Company oron the company by its officers or employees has been noticed or reported during the periodcovered by our audit.

(xi) Managerial remuneration has been paid and provided by the company in accordancewith the requisite approvals mandated by the provisions of Section 197 of the Act readwith Schedule V to the Act. (xii) In our opinion the Company is not a Nidhi Company.Accordingly provisions of clause 3(xii) of the Order are not applicable.

(xiii) In our opinion all transactions with the related parties are in compliance withSections 177 and 188 of Act where applicable and the requisite details have beendisclosed in the financial statements etc. as required by the applicable Ind AS. (xiv)During the year the company has not made any preferential allotment or private placementof shares or fully or partly convertible debentures. Accordingly provision of clause3(xiv) of the order are not applicable.

(xv) In our opinion the company has not entered into any non-cash transactions withthe directors or persons connected with them covered under Section 192 of the Act.

(xvi) The company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.

For Walker Chandiok & Co LLP

Chartered Accountants

Firm's Registration No.: 001076N/N500013

Ashish Gupta

Partner

Membership No.: 504662

Place: New Delhi

Date: 22 May 2018

Independent Auditor's Report on the Internal Financial Controls under Clause (i) ofSubsection 3 of Section 143 of the Companies Act 2013 (‘the Act')

1. In conjunction with our audit of the standalone financial statements of CiplaLimited (‘the Company') as at and for the year ended 31 March 2018 we have auditedthe internal financial controls over financial reporting (‘IFCoFR') of the Company asat that date.

Management's responsibility for internal financial controls

2. The Company's Board of Directors is responsible for establishing and maintaininginternal financial controls based on internal control financial reporting criteriaestablished by the company considering the essential components of internal control statedin the guidance note on audit of Internal Financial Control over Financial Reporting("the Guidance Note") issued by the Institute of Chartered Accountant of India(ICAI). These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of the Company's business including adherence to theCompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditor's responsibility

3. Our responsibility is to express an opinion on the Company's IFCoFR based on ouraudit. We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India (‘ICAI') and deemed to be prescribedunder Section 143(10) of the Act to the extent applicable to an audit of IFCoFR and theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting (‘theGuidance Note') issued by the ICAI. Those Standards and the

Guidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate IFCoFR were established andmaintained and if such controls operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the IFCoFR and their operating effectiveness. Our audit of IFCoFR includes obtaining anunderstanding of IFCoFR assessing the risk that a material weakness exists and testingand evaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgement including theassessment of the risks of material misstatement of the financial statements whether dueto 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 Company's IFCoFR.

Meaning of internal financial controls over financial reporting

6. Acompany'sIFCoFRisaprocessdesignedtoprovide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles. A company'sIFCoFR include 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

7. Because of the inherent limitations of IFCoFR including the possibility ofcollusion or improper management override of controls material misstatements due to erroror fraud may occur and not be detected. Also projections of any evaluation of the IFCoFRto future periods are subject to the risk that the IFCoFR may become inadequate because ofchanges in conditions or that the degree of compliance with the policies or proceduresmay deteriorate.

Opinion

8. In our opinion the Company has in all material respects adequate internalfinancial controls over financial reporting and such controls were operating effectivelyas at 31 March 2018 based on internal control financial reporting criteria established bythe company considering the essential components of internal control stated in theguidance note on audit of Internal Financial Control over Financial Reporting issued bythe Institute of Chartered Accountant of India.

For Walker Chandiok & Co LLP

Chartered Accountants

Firm's Registration No.: 001076N/N500013

Ashish Gupta

Partner

Membership No.: 504662

Place: New Delhi

Date: 22 May 2018