Jyothy Consumer Products Ltd Merged Auditor Reports

JYOTHY CONSUMER PRODUCTS LIMITED [FORMERLY KNOWN AS HENKEL INDIA LIMITED] ANNUAL REPORT 2011-2012 AUDITORS REPORT TO THE MEMBERS OF HENKEL INDIA LIMITED We have audited the attached Balance Sheet of Henkel India Limited as at March 31, 2012, the Profit and Loss Account and also the Cash Flow Statement for the period ended on that date annexed thereto. 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. 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 the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As required by the Companies (Auditors Report) Order 2003, issued by the Department of Company Affairs on June 12, 2003 and as amended under Notification dated November 25, 2004 in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the annexure a statement on the matters specified in paragraph 4 and 5 of the said Order. Further to our comments in the annexure referred to 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 purpose of the audit; ii. In our opinion, proper books of accounts have been kept as required by law so far as appears from our examination of those books; iii. The Balance Sheet, Profit and Loss Account and Cash Flo Statement dea with by this report are in agreement with books of account; iv. In our opinion, Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956 to the extent applicable. v. On the basis of written representations received from Directors, as on March 31, 2012 and taken on record by the Board of Directors, we report that, none of the Directors are disqualified as on March 31,2012 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956. vi. In our opinion and to the best of our information and according to the explanation given to us, the said accounts 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 in conformity with the accounting principles generally accepted in India a. in the case of Balance Sheet, the state of affairs of the Company as at March 31, 2012. b. in the case of Profit and Loss Account, of the Loss for the period ended on that date and c. in the case of Cash Flow Statement, of the cash flows for the period ended on that date. For CNGSN & ASSOCIATES Chartered Accountants F.R. No. 04915S C.N. GANGADARAN Place: Chennai Partner Date : May 22, 2012 Memb. No. 11205 ANNEXURE TO THE AUDITORS REPORT Annexure referred to in paragraph 3 of the repon ot even aate of the Auditors to the Members of Henkel India Limited on the accounts for the period ended March 31, 2012 i)a) The Company is maintaining proper records, showing full particulars including quantitative details and situation of fixed assets. b) The Company has a programme of physical verification of fixed assets, which in our opinion is reasonable having regard to the size of the Company and the nature of its business. c) None of the fixed assets have been revalued during the period. d) A substantial part of the fixed assets have not been disposed of during the period. ii)a) Physical verification of inventory was conducted at reasonable intervals by the management during the period. b) In our opinion, procedures for physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business. c) The Company is maintaining proper records of inventory and the discrepancies noticed on verification were not material. iii)a) The Company has taken unsecured loan of Rs. 26,395/- lacs during the year fron a party listed in the Register maintained under Section 301 of the Companies Act, 1956. The year end balance is Rs.14,204/- lacs and the maximum outstanding amount during the year is Rs.26,395/-. No loans have been granted to any such parties. b) In our opinion rates of interest and other terms and conditions are not prejudicial to the interest of the Company. c) The repayment of the principal amounts and interest wherever applicable are regular. d) The loans taken by the Company are repayable on demand and therefore the question of overdue amounts does not arise. iv) In our opinion, and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business with regards to purchase of inventories and fixed assets and for the sale of goods. During the course of audit no continuing failure to correct major weaknesses in internal control system was observed. v)a) According to the information and explanation given to us, we are of the opinion that the particulars of contracts or arrangements that need to be entered into a Register in pursuance of Section 301 of the Companies Act, 1956 have been duly entered. b) In our opinion and according to the information and explanation given to us, transactions exceeding Rs. 5 lacs in respect of each party which have been made in pursuance of contracts or arrangements entered in the Register maintained under Section 301 of the Companies Act, 1956 have been made at prices which are reasonable, having regard to the prevailing market prices at the relevant time. vi) The Company has not accepted any Fixed Deposits from the public during the period and therefore, the question of compliance with the directives issued by the Reserve Bank of India and the provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the rules framed thereunder does not arise. vii) The Company does not have an adequate Internal Audit commensurate with the size and nature of its business. viii) The cost accounts and the records prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Companies Act, 1956 have been made and maintained. ix)a) According to the records of the Company, undisputed statutory dues including Provident Fund, Employees State Insurance Fund, Income-tax, Wealth tax, Service tax, Sales tax, Customs duty, Excise duty, Cess and other statutory dues have been deposited regularly during the period with the appropriate authorities. According to the information and explanation given to us, there are no undisputed amounts payable which are outstanding as on March 31, 2012 for a period of more than six months from tne date they became payable. b) The following amounts have not been deposited with respective authorities because of disputes. Statute Year Amount Forum where pending (Rs.) Income Tax 1990-2000 to 32,82,050 Commissioner (Appeal) 2001-02 Income Tax Total 32,82,050 Central 1996-1997 to 15,52,086 CESTAT Excise-KKL 2002-2003 Ambattur 2003-2004 4,36,187 CESTAT Excise Total 19,88,273 Sales Tax-MP 2000-2001 to 18,47,888 CTO 2002-03 Grand Total 1,18,45,119 x) At the end of the financial period, the accumulated loss of the Company is less than 50% of its Net worth. The Company has incurred cash loss during the financial period but not in the immediately preceding financial period. xi) The Company has not defaulted in repayment of dues to Banks during the period. xii) No loans or advances have been granted by the Company against pledge of Shares and Debentures and other securities. xiii) The Company is not a chit fund or a nidhi mutual benefit fund/society. xiv) The Company is not dealing in or trading in Shares, Securities, Debentures and other instruments. xv) According to the information and explanation given to us, the Company has not given any Corporate Guarantee during the period. xvi) The Company has received long term loan during the period and has applied it for the purpose for which it has been raised. xvii) According to the information and explanations given to us by the management, the funds raised on short term basis have not been used for long term investment. xviii) During the period the Company has not made any preferential allotment to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. xix) The Company has not issued any debentures during the period and therefore the question of creation of security or charge does not arise. xx) During the period, the Company has not raised any money by way of public issue and the question of disclosing the end use of money by the management does not arise. xxi) According to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the course of our audit. For CNGSN & ASSOCIATES Chartered Accountants F.R. No. 04915S C.N. GANGADARAN Place: Chennai Partner Date : May 22, 2012 Memb. No. 11205