Indian Aluminium Company Ltd Auditor Reports

INDIAN ALUMINIUM COMPANY LIMITED ANNUAL REPORT 2006-2007 AUDITORS REPORT To The members of, Indian Aluminium Company, Limited 1. We have audited the attached Balance Sheet of Indian Aluminium Company, Limited as at 31st March, 2007 and the related Profit and Loss Account and Cash Flow Statement for the year ended on that date annexed thereto which we have signed under reference to this report. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit. 2. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as, evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 3. As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report)(Amendment) Order, 2004 (together the Order) issued by the Central Government of India in terms of sub- section(4A) of Section 227 of the Companies Act, 1956 of India (the Act) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we report that: i) (a) The Company has maintained proper records to show full particulars including quantitative details and situation of its fixed assets. (b) The fixed assets of the Company are physically verified by the management according to a phased programme designed to cover all the items over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to such programme, a portion of the fixed assets has been physically verified by the management during the year and no material discrepancies between the book records and the physical inventory have been noticed. (c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets have not been disposed of by the Company during the year. ii) (a) The inventory has been physically verified by the management during the year. In our opinion the frequency of verification is reasonable, (b) In our opinion, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business, (c) On the basis of our examination of inventory records, in our opinion, the Company has maintained proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material. iii) (a) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the Register maintained under Section 301 of the Act. Accordingly, the clauses (iii)(b), (iii)(c) and (iii)(d) of the paragraph 4 of the Order are not applicable. (b) The Company has not taken any loans, secured or unsecured, from companies, firms or other parties covered in the Register maintained under Section 301 of the Act. Accordingly, the clauses (iii)(f) and (iii)(g) of the paragraph 4 of the Order are not applicable. iv) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory, fixed assets and for the sale of goods. The Company has not sold any service during the year. Further, on the basis of our examination of the books and records of the Company and according to the information and explanations given to us, we have neither come across nor have been informed of any instance of continuing failure to correct major weaknesses in the aforesaid internal control system. v) According to the information and explanations given to us, there have been no contracts or arrangements during the year referred to in Section 301 of the Act, the particulars of which are required to be entered in the Register maintained under that Section. Further, there have been n o transactions made in pursuance of such contracts and exceeding the value of rupees five lakhs in respect of any party during the year. vi) The Company has not accepted any deposits from the public within the meaning, of Sections 58A and 58AA of the Act and the rules framed thereunder. vii) In our opinion, the Company has an internal audit system commensurate with its size and nature of its business. viii) We have broadly reviewed the books of account maintained by the Company in respect 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 sub-section(1) of Section 209 of the Act and are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determining whether they are accurate or complete. ix) (a) According to the information and explanations given to us and records of the Company examined by us, in our opinion, the Company has been regular in depositing during the year undisputed statutory dues including provident fund, investor education protection fund, employees state insurance, income-tax, sales tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues, as applicable, with the appropriate authorities. (b) According to the information and explanations given to us and records of the Company examined by us, there are no disputed dues as at 31st March 2007 in respect of wealth tax, service tax, custom duty, excise duty and cess other than certain income tax and sales tax demands aggregating, Rs.504,192 thousand, disputed at various forums as indicated in Note (d) on Schedule 19 to the Accounts. x) The accumulated losses of the Company as at 31st March 2007 do not exceed fifty percent of its year end net worth. Further it has not incurred any cash losses during the financial year ended on that date and in the immediately preceding financial year. xi) According to the records of the Company examined by us, it has not defaulted in repayment of its dues to any bank during the year. The Company has neither any outstanding dues to any financial institutions or debenture holders at the beginning of the year nor it has obtained any loans from such parties during the year. xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. xiii) The provisions of any special statute applicable to chit fund/nidhi/mutual benefit fund/societies are not applicable to the Company. xiv) In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments. xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions during the year. xvi) The Company has not obtained any term loans. xvii) On the basis of an overall examination of the Balance Sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on short term basis which have been used for long term investment. xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Act during the year. xix) The Company does not have any outstanding debentures at the year end. xx) The Company has not raised any money by public issue during the year. 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 and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management. 4. Further to our comments in paragraph 3 above, we report that: (i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit; (ii) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books; (iii) The Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in agreement with the books of account; (iv) In our opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report comply with the applicable accounting standards referred to in sub-section(3C) of Section 211 of the Act; (v) On the basis of written representations received from the directors, and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2007 from being appointed as a director in terms of clause (g) of sub-section(1) of Section 274 of the Act; (vi) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements together with the notes thereon and attached thereto and the Statement on Significant Accounting Policies give in the prescribed manner the information required by the. Act and also give a true and-fair view in conformity with the accounting principles generally accepted in India: (a) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2007; (b) In the case of the Profit and Loss Account, of the loss for the year ended on that date; and (c) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date. (P. Law) Membership No.: 51790 Partner For and on behalf of Place: Mumbai PRICE WATERHOUSE Dated: 5 May, 2007 Chartered Accountants