Pharmaceutical Products Of India Ltd.
Date: 2002.12.31. Auditor's report
AUDITORS' REPORT FOR THE YEAR ENDED 31ST DECEMBER, 2002.
We have audited the attached Balance Sheet of THE PHARMACEUTICAL PRODUCTS
OF INDIA LIMITED as at 31st December, 2002 and the annexed Profit & Loss
Account of the Company for the year ended on that date and report that:
1. We have obtained all information and explanations which to the best of
our knowledge and belief were necessary for the purpose of our audit.
2. In our opinion proper books of accounts as required by law have been
kept by the Company as far as it appears from our examination of these
3. The Balance Sheet and Profit &.Loss Account dealt with by this report
are in agreement with the books of accounts and are, subject to Note 10 &
Note 11 in respect of loans & advances and in respect of non-provision of
interest,'in compliance with the Accounting Standards prescribed under
Section 211 (3C) of the Companies Act, 1956.
4. In our opinion and to the best of our information and according to the
explanation given to us the said accounts read together with the notes
thereon,give the information required by the companies Act, 1956, in the
manner so required and give a true and fair view, subject to Note 10 & Note
11 to respect of non-provision of interest and loans & advances, .
i) In the case of the Profit and Loss Account, of the Loss for the year
ended on 31st December, 2002 and
ii.) In the case of the Balance Sheet of the Company's affairs as at 31st
5. Further as required by the Manufacturing and Other Companies (Auditors
Report) Order, 1988, issued by the Central Government in terms of Section
227 (4A) of the Companies Act,1956, and on the basis of such checks as we
considered appropriate, we report that:
i) As explained to us the records of quantitative details and situation of
fixed assets are being updated. These.fixed assets have been physically
verified by the management at reasonable intervals and no material
discrepancies were noticed on such verification.
ii) In respect 'of finished goods, stores & spares and raw materials other
than stocks lying with third .parties, physically verification has been
conducted by the management at reasonable intervals:
iii) The procedure of physical verification of stocks followed by the
management are reasonable and adequate in relation to the size of the
company and the nature of its business.
iv) The discrepancies noticed on physical verification of stocks as
compared to book records which were not material, have been properly dealt
with in the books of accounts.
v) On the basis of our examination and in our opinion, the valuation of
stock is fair and proper in accordance with the normally accepted
accounting principles and is on the same basis as in the preceding year and
effect has been given in the accounts in respect of decline in values of
vi) The Company has not taken any loans from companies, firms and other
parties listed in the register maintained under Section 301 of the
Companies Act, 1956, or from companies under the same management as defined
under 370 (1 B) of the companies Act, 1956.
vii) In respect of loans and advances in the nature of loans given by the
Company, the amounts are being recovered regularly.
viii) The company has not granted any loans and advances in the nature of
loans to companies, firms and other parties listed in the register
maintained u/s 301 of the Companies Act , 1956 or to Companies under the
same management as defined under section 370(1B) of the Companies Act,
ix) In our opinion and according to the information given to us, there are
adequate internal control procedures commensurate with the size of the
Company and the nature of the business with regard to purchase of stores,
raw materials including components, plant and machinery, equipments and
other assets and for the sale of goods.
x) The Company has not made purchase of goods in excees of Rs. 50,000 in
value from companies in which Directors are interested as listed in the
register maintained under Section 301 of the Companies Act, 1956.
xi) Unserviceble or damaged stores, raw materials and finished goods are
determined and provision for loss, if any, has been made in the accounts.
xii) In our opinion and according to the explanation given to us, the
Company has not complied with Section 58A of the Companies Act, 1956 and
rules framed thereunder specifically in respect of non-maintenance of
liquid assets and in respect of repayment of deposits.
xiii) In our opinion, reasonable records have been maintained commensurate
with the size and nature of its business.
xiv) In our opinion, the Company has an internal audit system commensurate
with the size and nature of its business.
xv) The Company is not maintaining cost records under Section 209 (1) (d)
of the Companies Act, 1956.
xvi) The Company has been generally regular in depositing Provident Fund
dues with appropriate authorities.
xvii) There were undisputed amounts in respect of Customs Duty, Excise
Duty, Income-tax & Sales tax as at 31st December, 2002 which were
outstanding for more than six months.
xviii) As per explanations given to us, personal expenses have not been
charged to revenue accounts other than those payable under contractual
obligations or in accordance with generally accepted business practices.
xix) The Company is a sick Industrial Company within the meaning of Clause
(0) of the subsection (1) of Section 3 of the Sick Industrial Companies
(special Provisions) Act, 1985 and as such, reference has been made to the
Board for Industrial & Financial Reconstruction.
xx.) In respect of the Company's trading activities, damaged goods have
been determined and necessary provision for loss, if any has been made in