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INDEPENDENT AUDITORS' REPORT
TO THE MEMBERS OF ASHOK LEYLAND LIMITED
Report on the Financial Statements
1. We have audited the accompanying Financial Statements of Ashok Leyland Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2014, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended and a summary of significant accouning policies and other explanatory informaion.
Management's Responsibility for the Financial Statements
2. The Company's Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accouning Standards referred to in Section 211(3C) of the Companies Act, 1956 ("the Act") (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs) and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance
of internal control relevant to the preparaion and presentation of the financial statements that give a true and fair view and are free from material misstatements, whether due to fraud or error.
3. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Audiing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with the ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
4. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. An audit also includes evaluaing the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluaing the overall presentation of the financial statements.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
6. In our opinion and to the best of our information and according to the explanaions given to us, the aforesaid financial statements give the information required by the Act 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 the Balance Sheet, of the state of affairs of the Company as at March 31, 2014;
(b) in the case of the Statement of Profit and Loss, of the profit of the Company for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.
Report on Other Legal and Regulatory Requirements
7. As required by the Companies (Auditor's Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of Section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.
8. As required by Section 227(3) of the Act, we report that:
(a) we have obtained all the information and explanaions which to the 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 by the Company so far as appears from our examination of those books;
(c) the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;
(d) in our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accouning Standards referred to in Secion 211(3C) of the Act (which continue to be applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs).
(e) on the basis of writen representaions received from the directors as on March 31, 2014 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014 from being appointed as a director in terms of Section 274(1)(g) of the Act.
ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 7 under 'Report on Other Legal and Regulatory Requirements' section of our Report of even date
In our opinion and on the basis of such checks as we considered appropriate, and according to the informaion and explanaions given to us, the nature of the Company's business/ activities/ results during the year are such that clauses (vi), (xiii), (xiv), (xviii), and (xx) of paragraph 4 of the Order are not applicable to the Company. Further, in respect of other clauses, on the basis of such checks as we considered appropriate, we report that:
1. In respect of its fixed assets:
(i) the Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets.
(ii) the fixed assets were physically verified by the Management during the year under a phased programme of verification, which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals having regard to the size of the Company, nature and value of its assets. According to the information and explanations given to us, no material discrepancies have been noiced during the year on such verification.
(iii) the fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.
2. In respect of its inventories:
(i) the inventories have been physically verified during the year by the Management at reasonable intervals.
(ii) in our opinion and according to the information and explanaions given to us, the procedures of physical verification of the inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business.
(iii) in our opinion and according to the informaion and explanations given to us, the Company is generally maintaining proper records of its inventories and no material discrepancies were noticed on physical verification.
3. On the basis of our examination of the books of account, the Company has neither granted nor taken any loans, secured or unsecured, to / from companies, firms or other paries covered in the register maintained under secion 301 of the Act.
4. In our opinion and according to the informaion and explanaions given to us, there is generally an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventories and fixed assets, for payment of expenses and for sale of goods and services. Further, on the basis of our examination of the books and records of the Company, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.
5. In respect of contracts or arrangements entered in the Register maintained in pursuance of Section 301 of the Companies Act, 1956, to the best of our knowledge and belief and according to the information and explanations given to us:
a) the particulars of contracts or arrangements referred to in Secion 301 of the Act that needed to be entered into the register, maintained under the said secion have been so entered.
b) where each of such transacions is in excess of Rs.5 lakhs in respect of any party, the transactions have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant ime.
6. In our opinion, the Company has an internal audit system commensurate with its size and nature of its business.
7. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accouning Records) Rules, 2011 prescribed by the Central Government of India under Section 209(1)(d) of the Act and are of the opinion that, prima facie, the prescribed accounts and cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
8. According to the informaion and explanaions given to us and the books of account examined by us, in respect of statutory dues:
(i) the Company is generally regular in deposiing undisputed statutory dues including provident fund, investor educaion and protecion 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 authoriies during the year.
(ii) there were no undisputed amounts payable in respect of such statutory dues outstanding as at March 31, 2014 for a period of more than six months from the date they became payable.
(iii) there are no dues of wealth–tax and customs duty which have not been deposited on account of any dispute. Details of dues towards income tax, sales tax, service tax, excise duty and cess that have not been deposited as at March 31, 2014 on account of disputes are as stated below:
9. The Company does not have any accumulated losses as at March 31, 2014 and has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.
10. In our opinion, the Company has not defaulted in repayment of dues to any financial institutions, banks or debenture holders during the year.
11. In our opinion and according to the information and explanations given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.
12. In our opinion and according to the information and explanaions given to us, the terms and condiions of the guarantees given by the Company, for loans taken by others from banks or financial institutions, are not, prima facie, prejudicial to the interest of the Company.
13. In our opinion and according to the information and explanaions given to us, the term loans availed by the Company were, prima facie, applied for the purpose for which they were obtained.
14. In our opinion and according to the information and explanaions given to us, and on an overall examinaion of the financial statements of the Company, funds raised during the year on short–term basis have, prima facie, not been used for long–term investment.
15. According to the informaion and explanaions given to us, during the period covered by our audit report, the Company has created securities / charges in respect of debentures issued.
16. To the best of our knowledge and belief, and according to the information and explanations given to us, and considering the size and nature of the Company's operations, no fraud of material significance on or by the Company has been noiced or reported during the year.
For M.S. Krishnaswami & Rajan
Chartered Accountants Registraion No. 01554S
Membership No. 26453
For Deloitte Haskins & Sells LLP
Firm's Registration No. 117366W/W–100018
Membership No. 31467
May 22, 2014 Chennai