To the Members of Maruti Suzuki India Limited
REPORT ON THE FINANCIAL STATEMENTS
1. We have audited the accompanying financial statements of Maruti Suzuki India Limited(the "Company"), which comprise the Balance Sheet as at 31st March2013, and the Statement of Profit and Loss and Cash Flow Statement for the year thenended, and a summary of significant accounting policies and other explanatory information,which we have signed under reference to this report.
MANAGEMENT'S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
2. The Company's Management is responsible for the preparation of these financialstatements that give a true and fair view of the financial position, financial performanceand cash flows ofthe Company in accordance with the Accounting Standards referred to insub-section (3C) of section 211 of 'the Companies Act, 1956' of India (the 'Act") andAccounting Standard 30, Financial Instruments: Recognition and Measurement issued bytheInstitute of Chartered Accountants of India to the extent it does not contradict any otheraccounting standard referred to in sub-section (3C) of Section 211 of the Act. Thisresponsibility includes the design, implementation and maintenance of internal controlrelevant to the preparation and presentation of the financial statements that give a trueand fair view and are free from material misstatement, whether due to fraud or error.
3. Our responsibility is to express an opinion on these financial statements based onour audit. We conducted our audit in accordance with the Standards on Auditing issued bythe Institute of Chartered Accountants of India. Those Standards require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout 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 theauditors' judgment, including the assessment of the risks of material misstatement of thefinancial statements, whether due to fraud or error. In making those risk assessments.theauditors consider internal control relevant to the Company's preparation and fairpresentation ofthe financial statements in order to design audit procedures that areappropriate in the circumstances. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made byManagement,as well as evaluating the overall presentation of the financial statements.
5. We believe thatthe audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion.
6. In our opinion,and to the best of our information and according to the explanationsgiven to us, the accompanying financial statements give the information required by theAct in the manner so required and give a true and fairview in conformity with theaccounting principles generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31stMarch 2013;
(b) in the case of the Statement of Profit and Loss, of the profit for the year endedon that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the year ended onthat date.
EMPHASIS OF MATTER
7. We draw attention to Note 32(a)(vii) of the financial statements regarding demandsreceived from Haryana State Industrial & Infrastructure Development CorporationLimited towards enhanced compensation for Company's freehold land at Manesar amounting toRs. 5,012 million,X 1,376 million and Rs. 86 million; against the demand of Rs. 5,012million the Company's impleadment application has been heard and the order has beenreserved bythe Hon'ble Supreme Court of India; against the demand of Rs. 1,376 million,theCompany has filed an appeal with the Hon'ble High Court of Punjab and Haryana; and againstthe demand of Rs. 86 million, the Company is in the process of obtaining more information.Accordingly, no provision is considered necessary towards enhanced compensation for theaforesaid freehold land. Our opinion is not qualified in respect of this matter.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
8. As required by 'the Companies (Auditor's Report) Order, 2003', as amended by'theCompanies (Auditor's Report) (Amendment) Order,2004', issued bythe Central Government ofIndia in terms of sub-section (4A) of section 227 of the Act (hereinafter referred to asthe "Order"), and on the basis of such checks ofthe 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 paragraphs4and 5 ofthe Order.
9. As required by section 227(3) ofthe Act, we reportthat:
(a) We have obtained all the information and explanations which, to the best of ourknowledge 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 bytheCompany so faras appears from our examination of those books;
(c) The Balance Sheet, Statement of Profit and Loss, and Cash FLow Statement dealt withby this Reportare in agreement with the books ofaccount;
(d) In ouropinion.the Balance Sheet, StatementofProfitand Loss, and Cash Flow Statementdealt with by this report comply with the Accounting Standards referred to in subsection(3C) of section 211 of the Act and Accounting Standard 30, Financial Instruments:Recognition and Measurement issued by the Institute of Chartered Accountants of India tothe extent it does not contradict any other accounting standard referred to in sub-section(3C) of Section 211 ofthe Act;
(e) On the basis of written representations received from the Directors as on 31stMarch 2013, and taken on record by the Board of Directors, none of the Directors isdisqualified as on 31st March 2013, from being appointed as a Director in termsof clause (g) of sub-section (1) of section 274 of the Act.
For Price Waterhouse
Firm Registration Number: 301112E
Membership Number: 077779
Place : New Delhi
Annexure to Auditors' Report
Referred to in paragraph 8 of the Auditors'Report of even date to the members of MarutiSuzuki India Limited on the financial statements as of and for the year ended 31stMarch 2013
i. (a) The Company is maintaining proper records showing full particulars, includingquantitative details and situation, of fixed assets.
(b) The fixed assets are physically verified bythe Management according to a phasedprogramme designed to cover all the items, except furniture and fixtures, officeappliances and certain other assets having an aggregate net book value of Rs. 1,299million, over a period of three years which, in our opinion, is reasonable having regardto the size ofthe Company and the nature of its assets. Pursuant to the programme, aportion ofthe fixed assets has been physically verified by the Management during the yearand no material discrepancies have been noticed on such verification.
(c) In our opinion, and according to the information and explanations given to us, asubstantial part of fixed assets has not been disposed off bythe Company during the year.
ii. (a) The inventory (excluding stocks with third parties) has been physicallyverified by the Management during the year. In respect of inventory lying with thirdparties, these have substantially been confirmed by them. In our opinion, the frequency ofverification is reasonable.
(b) In our opinion,the procedures of physical verification of inventory followed by theManagement are reasonable and adequate in relation to the size of the Company and thenature of its business.
(c) On the basis of our examination of the inventory records, in our opinion, theCompany is maintaining proper records of inventory. The discrepancies noticed on physicalverification of inventory as compared to book records were not material.
iii. The Company has not taken/ granted any loans, secured or unsecured, from/ tocompanies, firms or other parties covered in the register maintained under Section 301 ofthe Act. Therefore, the provisions of Clause 4(iii)[(b),(c) and (d) /(f) and (g)] of thesaid Order are not applicable to the Company.
iv. In our opinion, and according to the information and explanations given to us,having regard to the explanation that for certain items of inventory purchased which areof special nature for which suitable alternative sources do not exist for obtainingcomparative quotations, there is an adequate internal control system commensurate with thesize of the Company and the nature of its business for the purchase of inventory, fixedassets and for the sale of goods and services. Further, on the basis of our examinationofthe books and records ofthe Company, and according to the information and explanationsgiven to us, we have neither come across, nor have we been informed of any continuingfailure to correct major weaknesses in the aforesaid internal control system.
v. (a) Accordingtotheinformationandexplanationsgiven to us, we are ofthe opinion thatthe particulars of all contracts or arrangements that need to be entered into the registermaintained under Section 301 ofthe Act have been so entered.
(b) In our opinion and according to the information and explanations given to us, thetransactions made in pursuance of such contracts or arrangements and exceeding the valueof Rupees Five lakhs amounting to Rs. 49,485 million in respect of purchase of goodsincluding components and services from the holding company where we are unable to commentas there are no comparable market prices available being goods including components andservices of specialised nature.
vi. The Company has not accepted any deposits from the public within the meaning ofSections 58A and 58AA of the Act and the rules framed there under.
vii. In our opinion, the Company has an internal audit system commensurate with itssize and the nature of its business.
viii. We have broadly reviewed the books of account maintained by the Company inrespect of products where, pursuant to the rules made by the Central Government of India,the maintenance of cost records has been prescribed under clause (d) of subsection (1) ofSection 209 of the Act, and are of the opinion that, prima facie,the prescribed accountsand records have been made and maintained. We have not, however, made a detailedexamination of the records with a view to determine whether they are accurate or complete.
ix. (a) According to the information and explanations given to us and the records ofthe Company examined by us, in our opinion, the Company is regular in depositing theundisputed statutory dues, including provident fund, investor education and protectionfund, employees'state insurance, income tax, sales tax, wealth tax, service tax, customsduty, excise duty and other material statutory dues, as applicable, with the appropriateauthorities.
(b) According to the information and explanations given to us and the records of theCompany examined by us, the particulars of dues of income tax, sales tax, wealth tax,service tax, customs duty and excise duty as at 31st March 2013 which have notbeen deposited on account of a dispute,are as follows:
|Name of the statute (Nature of dues) ||Amount under dispute ||Amount deposited under dispute ||Period to which the amount relates ||Forum where the dispute is pending |
|Income Tax Act, 1961 (Tax & Interest) ||13,795 ||6,766 ||1991 to 2012 ||Income Tax Appellate Tribunal/ High Court/AO (Tax Deducted at Source) |
|Wealth Tax Act, 1957 (Tax) ||1 ||1 ||1997 to 1998 ||High Court |
|Haryana General Sales Tax Act (Tax & Interest) ||3 ||- ||1983tol988 ||Assessing Authority |
|Delhi Sales Tax Act (Tax) ||47 ||2 ||1987 to 1991 ||Additional Commissioner |
|The Central Excise Act, 1944 (Duty, Interest & Penalty) ||10,680 ||377 ||May 1989 to August 2012 ||Customs Excise & Service Tax Appellate 1 Tribunal/ High Court/ Supreme Court |
|The Finance Act, 1994 (Service Tax, Interest & Penalty) ||2,782 ||14 ||September 2004 to December 2012 ||Customs Excise & Service Tax Appellate 1 Tribunal/Commissioner (Appeals) |
|Customs Act, 1962 (Duty & Interest) ||27 ||22 ||February 2003to August 2003 ||Customs Excise & Service Tax Appellate 1 Tribunal |
For detailed listing refer Note 55 annexed to the financial statements
x. The Company has no accumulated losses as at the end of the financial year and it hasnot incurred any cash losses in the financial year end on that date or in the immediatelypreceding financial year.
xi. According to the records of the Company examined by us and the information andexplanation given to us, the Company has not defaulted in repayment of dues to anyfinancial institution or bank or debenture holders as at the balance sheet date.
xii. The Company has not granted any loans and advances on the basis of security by wayof pledge of shares, debentures and other securities. Therefore the provisions of Clause4(xii) of the Order are not applicable to the Company.
xiii. As the provisions of any special statute applicable to chit fund/ nidhi/ mutualbenefit fund/societies are not applicable to the Company, the provisions of Clause 4(xiii)ofthe Order are not applicable to the Company.
xiv. In our opinion,the Company is not dealing in or trading in shares, securities,debentures and other investments. Accordingly, the provisions of Clause 4(xiv) of theOrder are not applicable to the Company.
xv. In our opinion.and according to the information and explanations given to us, theCompany has not given any guarantee for loans taken by others from banks or financialinstitutions during the year. Accordingly, the provisions of Clause 4(xv) ofthe Order arenot applicable to the Company.
xvi. In our opinion, and according to the information and explanations given to us, theterm loans have been applied, on an overall basis, for the purposes for which they wereobtained.
xvii. According to the information and explanations given to us and on an overallexamination ofthe balance sheet ofthe Company, we report that, no funds raised onshort-term basis have been used for long-term investment.
xviii. The Company has not made any preferential allotment of shares to parties andcompanies covered in the register maintained under Section 301 of the Act during the year.Accordingly, the provisions of Clause 4(xviii) of the Order are not applicable to theCompany.
xix. The Company has not issued any debentures during the year and does not have anydebentures outstanding as at the beginning ofthe year and at the year end.Accordingly, theprovisions of Clause 4(xix) of the Order are not applicable to the Company.
xx. The Company has not raised any money by public issues during the year.Accordingly,the provisions of Clause 4(xx) of the Order are not applicable to the Company.
xxi. 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, andaccording to the information and explanations given to us, we have neither come across anyinstance of fraud on or by the Company, noticed or reported during the year, nor have webeen informed ofany such case bythe Management.
For Price Waterhouse
Firm Registration Number: 301112E
Membership Number: 077779
Place : New Delhi