Adani Enterprises Ltd

BSE: 4244 | NSE: 512599 | ISIN: INE423A01024 
Market Cap: [Rs.Cr.] 53,758.22 | Face Value: [Rs.] 1
Industry: Trading

Auditor's Report
INDEPENDENT AUDITOR

To the Members of Adani Enterprises Limited

Report on the Financial Statements

We have audited the accompanying financial statements of Adani Enterprises Limited(“the Company”), which comprise the Balance Sheet as at March 31, 2014, and theStatement of Profit and Loss and Cash Flow Statement for the year then ended, and asummary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give atrue and fair view of the financial position, financial performance and cash flows of theCompany in accordance with accounting principles generally accepted in India, includingthe Accounting Standards notified under the Companies Act, 1956 read with General CircularNo. 15/2013 dated 13th September, 2013, issued by the Ministry of Corporate Affairs, inrespect of Section 133 of the Companies Act, 2013. This responsibility includes thedesign, implementation and maintenance of internal control relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit. We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India. Those Standards require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgment, including the assessment of the risks of material misstatement of the financialstatements, whether due to fraud or error. In making those risk assessments, the auditorconsiders internal control relevant to the Company's preparation and fair presentation ofthe financial statements in order to design audit procedures that are appropriate in thecircumstances, but not for the purpose of expressing an opinion on the effectiveness ofthe Company's internal control. 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.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us, the financial statements give the information required by the Act in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India:

a)in the case of the Balance Sheet, of the state of affairs of the Company as at March31, 2014;

b)in the case of the Statement of Profit and Loss, of the loss for the year ended onthat date; and

c)in the case of the Cash Flow Statement, of the cash flows for the year ended on thatdate.

Emphasis of Matter

Without qualifying our opinion:

1. We draw attention to Note no. 49 of the Financial Statements with regards to theclaim receivable from the Insurance Company and outstanding of Rs. 22.54 Crores as on thebalance sheet date. The Management of the Company is confident of recovery of the fullamount and therefore no provision has been made.

2.We also draw attention to Note no. 48 of the financial statements relating to excessmanagerial remuneration of Rs. 6.33 Crores charged to the Statement of Profit and Loss ofthe current year, against which the Company is in the process of obtaining approval of theCentral Government.

Other Matter

The attached financial statements include the Company's share of net assets andliabilities of Rs. 139.32 Crores and Rs. 3.06 Crores respectively in two unincorporatedJoint Ventures not operated by the Company or its subsidiaries, the unaudited accounts ofwhich have been certified by the management and relied upon by us.

Report on Other Legal and Regulatory Requirements

1.As required by the Companies (Auditor's Report) Order, 2003 (“the Order”)issued by the Central Government of India in terms of sub-section (4A) of Section 227 ofthe Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and5 of the Order.

2.As required by Section 227(3) of the Act, we report that:

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 by theCompany so far as appears from our examination of those books;

c)the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt withby this Report are in agreement with the books of account;

d)in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash FlowStatement comply with the Accounting Standards notified under the Companies Act, 1956 readwith General Circular No. 15/2013 dated 13th September, 2013, issued by the Ministry ofCorporate Affairs, in respect of Section 133 of the Companies Act, 2013;

e)on the basis of written representations received from the directors as on March 31,2014, and taken on record by the Board of Directors, none of the directors is disqualifiedas on March 31, 2014, from being appointed as a director in terms of clause (g) ofsub-section (1) of Section 274 of the Companies Act, 1956.

For Dharmesh Parikh & Co.,
Chartered Accountants
Firm Reg. No: 112054W
Anuj Jain
Place : Ahmedabad Partner
Date : 17th May, 2014 Membership No. 119140

ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT RE: ADANI ENTERPRISES LIMITED

(Referred to in Paragraph 1 of our Report of even date.)

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

(b) As explained to us, fixed assets, according to the practice of the Company, arephysically verified by the management at reasonable intervals, in a phasedverification-programme, which, in our opinion, is reasonable, looking to the size of theCompany and the nature of its business. No material discrepancies were noticed on suchverification.

(c) As the Company has disposed off, an insignificant part of the fixed assets duringthe year, provisions of clause 4 (i) (c) of the Order are not applicable.

(ii)(a) During the year, the inventories, except transit stock have been physicallyverified by the management.

For stocks lying with third parties, which have, however, been confirmed by them. Inour opinion, the frequency of verification is reasonable.

(b) In our opinion and according to the information and explanations given to us, theprocedures of physical verification of inventories followed by the management arereasonable and adequate in relation to the size of the Company and the nature of itsbusiness.

(c) On the basis of our examination of the record of inventories, we are of the opinionthat, the Company is maintaining proper records of inventories. The discrepancies noticedon physical verification of inventories as compared to book records were not material andhave been properly dealt with in the books of account.

(iii)(a) The Company has given loans to five Companies (Subsidiaries) covered in theRegister maintained under Section 301 of the Companies Act, 1956. In respect of the saidloans, the maximum amount outstanding at any time during the year was Rs. 8,025.83 Croresand the year-end balance is Rs. 6692.73 Crores (including interest free loan of Rs. 704.61Crores). The Company has not given any loans to firms or other parties covered in theRegister maintained under Section 301 of the Companies Act, 1956.

(b) In our opinion and explanation given to us, the rate of interest, where applicableand the other terms and conditions, are not prima facie prejudicial to the interest of theCompany.

(c) The principal amounts are repayable as per the terms of the loan, while theinterest where applicable is payable annually at the discretion of the Company.

(d) In respect of the said loans and interest thereon, there are no overdue amounts.

(e) According to the information and explanation given to us and record produced to usfor verification, the Company has not taken any loan, secured or unsecured, fromcompanies, firms or other parties covered in the register maintained under Section 301 ofthe Companies Act, 1956. Accordingly, the provisions of clause 4(iii)(e) to (g) of theOrder are not applicable to the company and hence not commented upon.

(iv) According to the information and explanations given to us, there is an adequateinternal control system commensurate with the size of the Company and the nature of itsbusiness for the purchase of inventory and fixed assets and for the sale of goods andservices. During the course of our audit, no major weakness has been noticed in theinternal control system.

(v) (a) In our opinion and according to the information and explanations given to us,the transactions made in pursuance of contracts or arrangements, that need to be enteredin Register maintained under Section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, thetransactions made in pursuance of contracts or arrangements referred to in (a) above andexceeding the value of Rs. 5,00,000 in respect of each party during the year have beenmade at prices which appear reasonable as per information available with the Company.

(vi) The Company has not accepted deposits from the public within the meaning ofSection 58A & 58AA of the Companies Act, 1956 or any other relevant provisions of theAct and the Rules framed there under. We are informed that no order has been passed by theCompany Law Board or National Company Law Tribunal or Reserve Bank of India or any Courtor any other Tribunal.

(vii) In our opinion, the Company has an internal audit system commensurate with thesize of the Company and nature of its business.

(viii) We have broadly reviewed the cost records maintained by the Company pursuant tothe Companies (Cost Accounting Records) Rules 2011 prescribed by the Central Governmentunder Section 209(1)(d) of the Companies Act, 1956 in respect of the Company's products/services to which the said rules are made applicable and are of the opinion that primafacie the prescribed cost records have been made and maintained. However, we have not madea detailed examination of the cost records with a view to determine whether they areaccurate or complete.

(ix) (a) As explained to us, the statutory dues payable by the Company comprises ofProvident Fund, Investors Education Protection Fund, Employees State Insurance, IncomeTax, Sales Tax/VAT, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess, Octroi, EntryTax, Purchase Tax, Municipal Tax and other applicable statutory dues. According to therecords of the Company, the Company is generally regular in depositing undisputedstatutory dues with the appropriate authorities; however there has been delay in few caseswhich is not in arrears for more than six months at the end of financial year.

There are no undisputed statutory dues as referred to above as at March 31, 2014outstanding for a period of more than six months from the date they become payable.

(b) According to the records of the Company and representation made by the Management,the following are the disputed amounts in respect of various statutes:

Name of Statute Nature of the dues Forum where dispute is pending Amount(*)(Rs. in Crores) Amount paid under protest(Rs. in Crores) Period to which the amount relates
Income Tax Appellate Authority upto Commissioner's Level 81.74 11.33 2005-06, 2006-07, 2008-09& 2009-102001-02, 2003-
Act, 1961 Income Tax Appellate Tribunal 30.85 16.56 04, 2004-05, 2006-07 to2009-10
High Court 1.38 0.00 1988-89, 1989-90 & 2008-09
Appellate Authority upto Commissioner's Level 1.00 0.23 2007-08 to2009-10
Service Tax Act Service Tax Appellate Tribunal 31.94 17.95 2004-05 to2009-10
Appellate Authority upto Commissioner's Level 184.23 13.90 1999-2000, 2002-03 to2013-14
Sales Tax Acts Sales Tax Appellate Tribunal 18.58 1.12 2001-02, 2004-05 & 2008-092005-06, 2006-
High Court 8.85 1.58 07, 2011-12 &2012-13
Supreme Court 11.47 1.91 2006-07 to2010-11
Excise Act Excise Duty High Court 0.61 0.00 1998-99, 1999-2000

 

Name of Statute Nature of the dues Forum where dispute is pending Amount(*)(INR in Crores) Amount paid under protest(INR in Crores) Period to which the amount relates
Assessing Authority 32.15 0.07 1997-98, 1999- 2000 to2008-09
Appellate Authority upto Commissioner's Level 1.77 0.00 2004-05 &2005-061992-93, 1993-94, 1995-96,
Customs Act, 1962 Customs Duty Appellate Tribunal 307.20 121.19 1997-98, 2003-04 to 2007-08, 2011-12 &2012-13
High Court 1.74 0.87 1996-97
Jt. Secretary, Ministry of Finance 0.84 0.00 2006-10
Foreign Supreme Court 2.28 0.00 1997-2000
Exchange Management Act Penalty Appellate Tribunal 4.10 0.00 2000-01
Foreign Exchange Regulation Act Penalty Appellate Authority upto Commissioner's Level 0.16 0.00 1997-98

* Amount as per Demand orders including interest and penalty wherever applicable.

(x) The Company has no accumulated losses at the end of the financial year. The Companyhas incurred cash loss during the year. In the immediately preceding financial year theCompany had not incurred cash loss.

(xi) Based on our audit procedures and on the information and explanations given by themanagement, we are of the opinion that the Company has not defaulted in repayment of duesto a bank or financial institution during the year. The Company has not borrowed any sumsthrough debentures.

(xii) According to the information and explanations given to us, the Company has notgranted loans and advances on the basis of security by way of pledge of shares, debenturesand other securities.

Accordingly, the provisions of Clause 4(xii) of the Order are not applicable.

(xiii) According to the information and explanations given to us, the Company is not achit fund or a nidhi/mutual benefit fund/society. Accordingly, the provisions of Clause4(xiii) of the Order are not applicable.

(xiv) In respect of dealing in securities and other investments, in our opinion andaccording to the information and explanations given to us, proper records have beenmaintained of the transactions and contracts and timely entries have been made therein.All investments at the end of the year are held in the name of the company and itsnominees, wherever required.

(xv) In respect of guarantees given by the Company for loans taken by others frombanks, the terms and conditions are prima facie not prejudicial to the interest of theCompany.

(xvi) To the best of our knowledge and as explained, the term loans raised during theyear have been applied for the purpose for which they were raised.

(xvii) According to the Cash-flow statement and other records examined by us and theinformation and explanations given to us, on an overall basis, funds raised on short termbasis have not, prima facie, been used during the year for long term investment exceptpermanent working capital.

(xviii) The Company has not made any preferential allotment of shares to parties andcompanies covered in the Register maintained under Section 301 of the Companies Act.Accordingly, the provisions of Clause 4(xviii) of the Order are not applicable.

(xix) The Company has not issued any debentures during the year and does not have anydebentures outstanding as at the beginning of the year and at the year end. Accordingly,the provisions of Clause 4(xix) of the Order are not applicable.

(xx) During the year, the Company has not raised money by way of public issue.Accordingly, the provisions of Clauses 4 (xx) of the Order are not applicable.

(xxi) During the course of our examination of the books and records of the company,carried out in accordance with the generally accepted auditing practice in India, andaccording to the information and explanation 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 of any such case by the management.

For Dharmesh Parikh & Co.,
Chartered Accountants
Firm Reg. No: 112054W
Anuj Jain
Place : Ahmedabad Partner
Date : 17th May, 2014 Membership No. 119140
   
Futures & Options Quote
Expiry Date :
430.75    5.75 (1.35%)
Instrument: FUTSTK
Expiry Date: 31-Jul-2014
Open Price: 428.10
Average Price: 431.75
No. of Contracts Traded: 6,635
Open Interest: 68,22,000
Underlying: ADANIENT
Market Lot: 1,000
Previous Close: 430.75
Day's High | Low: 437.50 | 427
Turnover (Cr.): 286.47
Open Int. Change: 0,12,80,000 ([15.80]% )
Key Information

Key Executives:

Gautam S Adani , Chairman

Rajesh S Adani , Managing Director

Vasant S Adani , Director

Anil Ahuja , Director


Company Head Office / Quarters:

Adani House Shrimali Society,
Mithakhali Six Rd Navrangpura,
Ahmedabad,
Gujarat-380009
Phone : Gujarat-91-79-26565555/25555555 / Gujarat-
Fax : Gujarat-91-79-26565500/25555500 / Gujarat-
E-mail : investor@adani.in
Web : http://www.adani.com

Registrars:

Sharepro Services India Pvt Lt
Devnandan Mega Mall,Office No 416-420,4th Floor Ashram Rd,Ahmedabad-380006

 
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