TO THE MEMBERS OF ORIENT GREEN POWER COMPANY LIMITED
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of ORIENT GREEN POWERCOMPANY LIMITED ("the Company"), which comprise the Balance Sheet as at 31March, 2015, the Statement of Profit and Loss, the Cash Flow Statement, and a summary ofthe significant accounting policies and other explanatory information for the year thenended.
Management's Responsibility for the Financial Statements
The Companys 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 financialposition, financial performance and cash flows of the Company in accordance with theaccounting 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 also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding 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 design, implementation and maintenance of adequate internalfinancial controls, 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.
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 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.
An audit involves performing procedures to obtain audit evidence about the amounts andthe 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 control 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, but not for the purpose of expressing anopinion on whether the Company has in place an adequate internal financial control systemover financial reporting and the operating effectiveness of such controls. An audit alsoincludes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors, as well asevaluating the overall presentation of the financial statements.
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.
In our opinion and to the best of our information and according to the explanationsgiven to us, the aforesaid standalone financial statements, read with the notes thereon,give the information required by the Act in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India, of thestate of affairs of the Company as at 31 March, 2015, and its loss and its cash flows forthe year ended on that date.
Emphasis of Matter
As explained in Note 39 of the standalone financial statements, the Company is carryingnet investments aggregating to Rs. 411,664,726 in five Indian subsidiaries and hasoutstanding net loans aggregating to Rs. 772,705,393 provided to these subsidiaries whosenetworth is fully eroded as at 31 March, 2015, as per the audited financial statements ofthese entities.
No adjustment to the carrying values of the aforesaid investments and loans isconsidered necessary by the Management in view of the continuing plant operations andexpected higher cash flows based on future business projections and the strategic natureof these investments.
Our opinion is not modified in respect of the above matter.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order, 2015 ("theOrder") issued by the Central Government in terms of Section 143(11) of theAct, we give in the Annexure a statement on the matters specified in paragraphs 3and 4 of the Order.
2. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which tothe best of our knowledge and belief were necessary for the purposes of our audit.
(b) In our opinion, proper books of account as required by law have been kept bythe Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash FlowStatement dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid standalone financial statements comply withthe Accounting Standards specified under Section 133 of the Act, read with Rule 7of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the directors ason 31 March, 2015 taken on record by the Board of Directors, none of the directors isdisqualified as on 31 March, 2015 from being appointed as a director in terms of Section164 (2) of the Act.
(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, in ouropinion and to the best of our information and according to the explanationsgiven to us:
i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements Refer Note 29(i)(a) of the financialstatements.
ii. The Company does not have any long-term contracts including derivativecontracts for which there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred during the yearto the Investor Education and Protection Fund by the Company.
|For Deloitte Haskins & Sells|
|(Firms Registration No. 008072S)|
|Date: May 27, 2015||Membership No. 206834|
ANNEXURE TO THE INDEPENDENT AUDITORS REPORT ON THE STANDALONE FINANCIALSTATEMENTS
(Referred to in paragraph (1) under Report on Other Legal and RegulatoryRequirements section of our report of even date)
(i) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,including quantitative details and situation of fixed assets.
(b) Some of the fixed assets were physically verified during the year by theManagement in accordance with a programme of verification, which in our opinion providesfor physical verification of all the fixed assets at reasonable intervals.According to the information and explanations given to us, no materialdiscrepancies were noticed on such verification.
(ii) In respect of its inventories:
(a) As explained to us, the inventories were physically verified during the yearby the Management at reasonable intervals, duly considering the technical assessmentof a surveyor appointed by the Management.
(b) In our opinion and according to the information and explanations given tous, the procedures of physical verification of inventories followed by theManagement were generally reasonable and adequate in relation to the size ofthe Company and the nature of its business.
(c) In our opinion and according to the information and explanations given tous, the Company has maintained proper records of its inventories and no materialdiscrepancies were noticed on physical verification.
(iii) As certified by the Management, the Company has not granted any loans,secured or unsecured, to companies, firms or other parties covered in the Registermaintained under Section 189 of the Companies Act, 2013.
(iv) In our opinion and according to the information and explanations given tous, having regard to the explanations that some of the items purchased are ofspecial nature and suitable alternative sources are not readily available for obtainingcomparable quotations, there is an adequate internal control system commensuratewith the size of the Company and the nature of its business with regard to purchasesof inventory and fixed assets and the sale of power and services. During the courseof our audit, we have not observed any major weakness in such internal controlsystem.
(v) The Company has not accepted any deposits during the financial year.
(vi) We have broadly reviewed the cost records maintained by the Companypursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended,prescribed by the Central Government under sub-section (1) of Section 148 ofthe Companies Act, 2013, and are of the opinion that, prima facie, the prescribedcost records have been made and maintained. We have, however, not made a detailedexamination of the cost records with a view to determine whether they are accurateor complete.
(vii) According to the information and explanations given to us, in respect ofstatutory dues;
a. The Company has generally been regular in depositing undisputed statutorydues, including Provident Fund, Employees State Insurance, Income Tax, SalesTax, Wealth Tax, Service Tax, Value Added Tax, Cess and other material statutorydues applicable to it with the appropriate authorities.
b. There were no undisputed amounts payable in respect of Provident Fund,Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax,Value Added Tax, Cess and other material statutory dues in arrears as at 31March 2015 for a period of more than six months from the date they became payable.
c. Details of dues of Income Tax which have not been deposited as on 31 March, 2015on account of disputes are given below:
|Statute||Nature of Dues||Forum where the Dispute is pending||Period to which the amount relates (Financial year)||Amount involved (Rupees)|
|Income Tax Act, 1961||Income Tax||The Commissioner of Income tax, Appeals||2008-09||138,740|
*The amount has been adjusted suo-motto by the Income Tax Department with therefund for other financial years.
Also Refer Note 11(i) of the standalone financial statements.
d. There are no amounts that are due to be transferred to the Investor Educationand Protection Fund in accordance with the relevant provisions of the CompaniesAct, 1956 (1 of 1956) and Rules made thereunder.
(viii) In our opinion and according to the information and explanations given tous, the accumulated losses of the Company at the end of the financial year are lessthan fifty percent of its net worth. The Company has incurred cash lossesduring the current financial year covered by our audit and in the immediatelypreceding financial year.
(ix) In our opinion and according to the information and explanations given tous, the Company has not been regular in repayment of dues to banks and there weredefaults during the year to the extent of Rs. 293,909,702 in respect ofprincipal and interest repayments. Out of the same, an amount of Rs. 213,958,569has been paid by the Company during the year. The balance amount of Rs.79,951,133 of principal and interest is outstanding as at 31 March 2015. Also ReferNote 11(iv) of the standalone financial statements. The Company has not borrowed fromfinancial institutions and has not issued any debentures during the current year.
(x) In our opinion and according to the information and explanations given tous, the terms and conditions of the guarantees given by the Company for loans takenby subsidiaries from banks are not, prima facie, prejudicial to theinterests of the Company.
(xi) In our opinion and according to the information and explanations given tous, the term loans have been applied by the Company during the year for thepurposes for which they were obtained, other than temporary deployment pendingapplication.
(xii) To the best of our knowledge and according to the information andexplanations given to us, no fraud by the Company and no material fraud on theCompany has been noticed or reported during the year.
|For Deloitte Haskins & Sells|
|(Firms Registration No. 008072S)|
|Date: May 27, 2015||Membership No. 206834|