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Godrej Consumer Products
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« Mar 14
Auditor's Report (Godrej Consumer Products) Year End : Mar '15
 Report on the Standalone Financial Statements
 
 We have audited the accompanying standalone financial statements of
 GODREJ CONSUMER PRODUCTS LIMITED (the Company), which comprise the
 Balance Sheet as at March 31, 2015, the Statement of Profit and Loss
 and the Cash Flow Statement for the year then ended, and a summary of
 significant accounting policies and other explanatory information.
 
 Management''s Responsibility for the Financial Statements
 
 The Company''s Board of Directors is responsible for the matters in
 Section 134(5) of the Companies Act, 2013 (the Act) with respect to
 the preparation of these standalone 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 accounting principles
 generally accepted in India, including the Accounting Standards
 specified under Section 133 of the Act, read with Rule 7 of the
 Companies (Accounts) Rules, 2014. This responsibility also includes
 maintenance of adequate accounting records in accordance with the
 provision of the Act for safeguarding the assets of the Company and
 for preventing and detecting frauds and other irregularities; selection
 and application of appropriate accounting policies; making judgments
 and estimates that are reasonable and prudent; and design
 implementation and maintenance of adequate internal financial controls,
 that were operating effectively for ensuring the accuracy and
 completeness of the accounting records, relevant to the preparation
 and presentation of the financial statements that give a true and fair
 view and are free from material misstatement, whether due to fraud or
 error.
 
 Auditor''s Responsibility
 
 Our responsibility is to express an opinion on these financial
 statements based on our audit. We have taken into account the
 provisions of the Act, the accounting and auditing standards and
 matters which are required to be included in the audit report under the
 provisions of the Act and the Rules made thereunder.
 
 We conducted our audit in accordance with the Standards on Auditing
 specified under Section 143(10) of the Act. Those Standards require
 that we comply with ethical requirements and plan and perform the audit
 to obtain reasonable assurance about whether the financial statements
 are free from material misstatement.  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 judgment, 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
 internal financial control relevant to the Company''s preparation of the
 financial statements that give a true and fair view in order to design
 audit procedures that are appropriate in the circumstances, but not for
 the purpose of expressing an opinion on whether the Company has in
 place an adequate internal financial control system over financial
 reporting and the operating effectiveness of such controls. An audit
 also includes evaluating the appropriateness of the accounting policies
 used and the reasonableness of the accounting estimates made by the
 Company''s Directors, as well as evaluating the overall presentation of
 the financial statements.
 
 We believe that the audit evidence we have obtained is sufficient and
 appropriate to provide a basis for our audit opinion on the standalone
 financial statements.
 
 Opinion
 
 In our opinion and to the best of our information and according to the
 explanations given to us, the aforesaid standalone 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, of the state of affairs of the Company as
 at March 31, 2015 and its profit and its cash flows for the year ended
 on that date.
 
 Emphasis of Matter
 
 We draw attention to:
 
 i) Note 12(b) regarding the Scheme of Amalgamation of the erstwhile
 Godrej Household Products Limited with the Company approved by The
 Hon''ble High Court of Judicature at Bombay, whereby an amount of Rs.
 52.75 crore for the year ended March 31, 2015, equivalent to the
 amortisation of the Goodknight and Hit Brands is directly debited to
 the General Reserve Account instead of debiting the same to the
 Statement of Profit and Loss as per the provisions of AS 26,The
 said accounting treatment is in accordance with the accounting
 treatment prescribed in the Order of the High Court of Mumbai dated
 February 28, 2011 under section 394 of the Companies Act, 1956.
 
 Had this amount been charged to the Statement of Profit and Loss, the
 profit for the year ended March 31, 2015, would have been lower by Rs.
 52.75 crore and the General Reserve would have been higher by Rs. 52.75
 crore.
 
 ii) Note 23 on other income for the year ended March 31, 2015 including
 the recovery of loan amounting to Rs. 25.25 crore from GCPL ESOP Trust
 which was earlier written off and debited to Reserves under a Court
 approve Scheme of Amalgamation.
 
 Our opinion is not modified in respect of these matters.
 
 Report on Other Legal and Regulatory Requirements
 
 1.  As required by the Companies (Auditor''s Report) Order, 2015 (the
 Order) issued by the Central Government of India in terms of
 sub-section (11) of section 143 of the Act, we give in the Annexure a
 statement on the matters specified in the paragraph 3 and 4 of the
 Order, to the extent applicable.
 
 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 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 it 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) Except for the matters descried in sub-paragraph (i) of Emphasis of
 Matter paragraph above, in our opinion, the aforesaid standalone
 financial statements comply with the Accounting Standards specified
 under Section 133 of the Act, read with Rule 7 of the Companies
 (Accounts) Rules, 2014.
 
 e) On the basis of the written representations received from the
 directors as on March 31, 2015 taken on record by the Board of
 Directors, none of the directors is disqualified as on March 31, 2015
 from being appointed as a director in terms of Section 164 (2) of the
 Act.
 
 f) With respect to the other matters to be included in the Auditor''s
 Report in accordance with Rule 11 of the Companies (Audit and Auditors)
 Rules, 2014, in our opinion and to the best of our information and
 according to the explanations given to us:
 
 i.  The financial statements disclose the impact of pending litigations
 on the financial position of the Company - Refer Note 32 to the
 financial statements.
 
 ii.  The Company did not have any material foreseeable losses on long
 term contracts including derivative contracts requiring provision under
 the applicable law or accounting standards.
 
 iii. There has been no delay in transferring amounts, required to be
 transferred, to the Investor Education and Protection Fund by the
 Company.
 
 Annexure to the Independent Auditors'' Report
 
 The Annexure referred to in Para 1 ''Report on Other Legal and
 Regulatory Requirements'' in our Independent Auditors'' Report to the
 members of the Company on the standalone financial statements for the
 year ended March 31, 2015 :
 
 i) a) The Company has maintained proper records showing full
 particulars, including quantitative details and situation of fixed
 assets;
 
 b) The Company has a program for physical verification of fixed assets
 at periodic intervals. In our opinion, the period of verification is
 reasonable having regard to the size of the Company and the nature of
 its assets.The discrepancies reported on such verification are not
 material and have been properly dealt with in the books of account.
 
 ii) a) The Management has conducted physical verification of inventory
 (excluding stocks lying with third parties) at reasonable intervals. In
 respect of inventory lying with third parties, these have substantially
 been confirmed by them. In our opinion, the frequency of verification
 is reasonable.
 
 b) The procedures of physical verification of inventories followed by
 management are reasonable and adequate in relation to the size of the
 Company and the nature of its business.
 
 c) The Company is maintaining proper records of inventory and no
 material discrepancies were noticed on verification between the
 physical stocks and the book records.
 
 iii) The Company has not granted any loans, secured or unsecured, to
 companies, firms or other parties listed in the register maintained
 under section 189 of the Companies Act. Therefore, the provisions of
 sub-clause (a) and (b) of paragraph 3 (iii) of the Order are not
 applicable.
 
 iv) In our opinion and according to the information and explanations
 given to us, there is an adequate internal control system commensurate
 with the size of the Company and the nature of its business, for the
 purchases of inventory, fixed assets and for the sale of goods and
 services. During the course of our audit, we have not observed any
 continuing failure to correct major weaknesses in the internal
 control system.
 
 v) In our opinion and according to the information and explanations
 given to us, the Company has not accepted any deposits from the public
 within the meaning of section 73 to 76, or any other relevant
 provisions of the Companies Act and the rules framed thereunder.
 No order has been passed by the Company Law Board, or National Company
 Law Tribunal, or Reserve Bank of India, or any Court, or any other
 Tribunal.
 
 vi) We have broadly reviewed the books of accounts and records
 maintained by the Company in respect of manufacture of products covered
 under the Rules made by the Central Government for maintenance of
 cost records, under section 148 (i) of the Companies 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 determine whether they are
 accurate or complete.
 
 vii) a) According to the information and explanation given to us and
 the records examined by us, the Company is generally regular in
 depositing undisputed statutory dues, including dues pertaining to
 provident fund, Employees'' State Insurance, income-tax, sales-tax,
 wealth tax, service tax, duty of customs, duty of excise , value added
 tax, cess and any other statutory dues with the appropriate
 authorities. According to the information and explanations given to us,
 there are no undisputed dues which have remained outstanding as at the
 end of the financial year, for a period of more than six months from
 the date they became payable.
 
 b) According to the information and explanations given to us and the
 records of the Company examined by us, dues of income tax, sales tax,
 service tax, customs duty and excise duty not deposited on account of
 dispute are as follows:
 
 Name of Statute Nature of Dues
 
 Central Excise      Duty on one to one correlation in terms of
 Act, 1944           excisable material purchased and cleared final
                     product with reference to the said material wherein
                     the benefit under notification No. 32 of 99 availed
                     CENVAT credit availed on Capital Goods
 
                     Advertisement Service - Credit availed as Input
                     Input Service Tax Distribution Credit availed
                     Service Tax not paid on Royalty (Foreign Payment)
                     Cenvat credit availed on GTA
                     Cenvat credit availed on goods received from
                     Emox
 
                     Valuation of Soap Noodles transferred from
                     Malanpur factory to Himachal Pradesh factories
                     Cenvat credit on input services availed based on
                     the invoices issued by suppliers to the branches
                     prior to registration.
 
 Central Excise      Allegations of non- manufacturing of shoe polish
 Act, 1944           brush
                     Valuation of Mosquito Repellent supplied from
                     Guwahati factories to Emox Puducherry
                     Excise valuation dispute on account of non-
                     compete fees and trademark license fees paid
                     by PGG (JV between Godrej Soaps Limited and
                     Proctor and Gamble) to Godrej
                     Distribution of Cenvat Credit by Head Office to
                     Other Factories
                     Valuation of Soap Noodles transferred from
                     Malanpur factory to Himachal Pradesh factories
                     Valuation of PHD - Differential demand between
                     Section 4 and 4A valuation
                     Valuation of Combipack which are marked as
                     Goods for Export
                     Violation of Target Plus Scheme of Customs
                     CENVAT credit availed on Transportation Services
                     CENVAT credit     availed on the grounds of
                     valuation methodology adopted by one plant while
                     transferring goods from Lokhra plant
                     CENVAT credit     availed on supplementary invoices
                     issued by GCPL to Emox upon payment of
                     differential duty by GCPL.
                     CENVAT credit     availed on account of trading
                     activity conducted
                     CENVAT credit availed   on Capital Goods because
                     same is not availed in the month which it pertains
                     to Others
 
 Central Sales       Sales Tax Dues on account of Classification Head
 Tax Act, 1956 &
 Value Added Tax
 Act of Various      Sales Tax Dues
 States
                     Central Sales Tax Dues
                     Sales Tax  Dues on account of Classification Head
 
                     Sales Tax Dues on account of Classification Head
 
                     Central Sales Tax Dues
                     Central Sales Tax Dues
                     Sales Tax  Dues on account of   Classification Head
                     Sales Tax  Dues on account of   Classification Head
                     Sales Tax  Dues on account of   Classification Head
                     Sales Tax  Dues on account of   Classification Head
                     EntryTax
                     Entry Tax
 
                     Sales Tax Dues on account of  Classification Head
 
                     Sales Tax  Dues on account  of Classification Head
                     Central Sales Tax Dues
                     Sales Tax    Dues
 
                     Sales Tax Dues
                     Sales Tax Dues
                     Sales Tax Dues
 
                     Sales Tax    Dues
                     Central Sales Tax Dues
                     Interest on Sales Tax Dues
                     Sales Tax    Dues
                     Sales Tax    Dues
                     Central Sales Tax Dues & Others
 
                     Sales Tax    Dues
                     Sales Tax Dues on account of Classification Head
                     Sales Tax Dues on account of Classification Head
 
                     Sales Tax Dues on account  of Classification Head
 
                    Sales   Tax Dues  on  account of Classification Head
                    Sales   Tax Dues
                    Sales   Tax Dues
                    Checkpost
                    Sales   Tax Dues
                    Sales   Tax Dues  on  account of Classification Head
 
                    Sales   Tax Dues  on  account of Classification Head
 
                    Sales   Tax Dues  on  account of Classification Head
 
                    Sales Tax Dues on account of Classification Head
 
                    Central Sales Tax Dues
 
                    Sales   Tax Dues
 
                    Sales   Tax Dues  on  account of Classification Head
 
                    Sales   Tax Dues  on  account of Classification Head
 
                    Sales   Tax Dues  on  account of Classification Head
 
                    Entry Tax
 
                    Entry Tax
 
                    Entry Tax
 
                    Other Sales Tax Dues
 
 Income Tax Act,    Demand based on the order of regular assessment
 1961               u/s 143(3) of the Act.
                    Demand based on the order of regular assessment
                    u/s 143(3) of the Act.
                    Income-tax in dispute pertaining to erstwhile Godrej
                    Household Products Limited.
 
 Name of Statute Nature of Dues           Amount            Period
                                           (Rs.)
 
 Central Excise
 Act, 1944                              1,912,132           2002-04
 
                                       3,651,495            2000-03
 
                                       1,755,920            2009-10
                                        86,115              2002-03
 
                                        1,418,981           2008-09
                                        1,609,987           2006-08
                                       27,167,930           2004-08
                                        2,475,925           2006-08
                                       64,146,884           2007-08
 
                                      155,393,836           2007-11
                                          543,416           2007-12
 
 Central Excise
 Act, 1944                               6,174,082           2007-12
 
                                       55,307,174           2008-12
 
                                       51,800,000           1993-96
 
 
 
                                      121,564,838           2008-12
 
                                       31,851,841           2011-12
 
                                       66,897,878           2011-13
 
                                        1,522,705           2007-08
 
                                        4,124,764           2007-08
                                          311,754           2011-12
                                       73,881,431           2008-12
 
 
                                         1,114,212          2009
 
 
                                        18,922,839         2008-12
 
                                            940,000         Aug-12
 
                                           976,000         2007-08
                                          212,528          2007-08
                                          141,191          2008-09
                                          221,133          2003-04
                                          877,690          2006-07
 
 Central Sales
 Tax Act, 1956 &                        39,157,279        2006-07
 Value Added Tax                                          2007-08
 Act of Various                                           2008-09
 States                                 689,121           2004-05
 
                                         579,562         2004-05
                                         642,305         1999-00
                                                         2001-02
                                        6,340,450        2003-04
                                                         2004- 05
                                                         2005- 06
 
                                         789,432         2006-07
                                       6,600,000         2005-06
                                       6,000,940         2000-01
                                       9,009,696         2001-02
                                       3,607,688         2002-03
                                         497,261         2005-06
                                       1,000,585         2005-08
                                       2,254,849         1999-00
                                                         2005- 06
                                                         2006-07
                                        16,580,938       2005-06
                                                         2006-07
                                                         2007-08
                                                         2008-09
 
                                        22,449,405       2009-10
                                         160,178         2004-05
                                       1,406,850         2005-06
                                                         2006-07
                                         700,728         2005-06
                                         258,056         2006-07
                                       1,146,028         2002-03
                                                         2003-04
                                                         2004-05
                                       1,465,192         2005-06
                                         256,482         2005-06
                                       1,207,000         2001-02
                                         510,000         2002-03
                                       1,757,925         2006-07
                                       1,190,919         2005-06
 
                                                         2006-07
 
                                                         2007-08
                                                         2013-14
 
                                      10,641,000         2004-05
                                  16,838,252             2007-08
                                   4,838,279             2008-09
                                                         2009-10
                                                         2010-11
                                    9,044,088            2005-06
                                                         2006-07
                                                         2007-08
                                                         2008-09
 
 
                                    25,809,827           2010-11
                                    11,693,000           2006-07
                                       394,000           2006-07
                                     1,610,000           2010-11
                                     3,073,427           2009-10
                                   228,973,669           2010-11
                                                         2011-12
                                    86,380,815           2010-11
                                                         2011-12
                                    27,155,975           2012-13
                                                         2013-14
                                    63,651,140           2011-12
 
                                                         2012-13
                                        57,681           2011-12
                                       539,028           2008-09
                                       555,281           2013-14
                                       650,541           2011-12
                                       883,023           2012-13
                                    10,985,048           2005-06
                                    12,586,720           2006-07
                                     8,601,779           2007-08
                                     5,502,678           2002-13
 
 Income Tax Act,
 1961                                8,101,491          AY   2009-10
                                       11,020           AY   2007-08
                                    3,266,327           AY   2005-06
 
 Name of Statute         Forum where Dispute is pending
 Nature of Dues
 
 Central Excise           The Hon''ble Supreme Court of India
 Act, 1944
                          The Hon''ble Supreme Court of India
 
                          Commissioner of Central Excise (Appeals)
 
                          Commissioner of    Central  Excise  (Appeals)
                          Commissioner of    Central  Excise  (Appeals)
                          Commissioner of    Central  Excise  (Appeals)
                          Assessing Authority
                          CESTAT, Chennai
                          Adjudicating Authority
                          Commissioner of Central Excise (Appeals)
 
 
 Central Excise           Commissioner of Central Excise (Appeals)
 Act, 1944
                          CESTAT, Kolkata
                          The Hon''ble Supreme Court of India
 
                          CESTAT, Delhi
 
                           Adjudicating Authority
 
                           CESTAT,    Kolkata
 
                           CESTAT,    Chennai
 
                           CESTAT,    Chennai
                           Adjudicating Authority
                           CESTAT, Chennai
                           Adjudicating Authority
 
                           CESTAT, Chennai
 
                           Adjudicating Authority
 
                           CESTAT
                           Sales Tax Authority
                           CESTAT, Kolkata
                           Commissioner of Central Excise (Appeals)
                           CESTAT, Chennai
 
 Central Sales           Jaipur High Court
 Tax Act, 1956 &
 Value Added Tax
 Act of Various          Uttar Pradesh Tribunal
 States
                         Uttar Pradesh Tribunal
                         Jammu Tribunal
 
                         The Hon''ble Supreme Court of India
 
                         Assessing Authority
                         Appellate Revision Board
                         Bihar Tribunal
                         Bihar Tribunal
                         Bihar Tribunal
                         Assessing Authority
                         OrissaTribunal
                         Madhya Pradesh High Court
 
                         Andhra Pradesh High Court
 
                         Andhra Pradesh High Court
                         Deputy Commissioner (A)
                         Deputy Commissioner (A)
 
                         Deputy Commissioner     (A)
                         Deputy Commissioner     (A)
                         Deputy Commissioner     Sales Tax Nagpur
 
 
                         Joint Commissioner (A)
                         Deputy Commissioner     (A)
                         Chennai High Court
                         Additional Commissioner (Appeals)
                         Joint Commissioner (A)
                         West Bengal Tribunal
 
                         Appellate Revision Board
 
                         Allahabad High Court
 
                         Assessing Authority
 
                         Andhra Pradesh High Court
 
                      Andhra Pradesh High     Court
                      Deputy Commissioner
                      Assessing Authority
                      Additional Commissioner (Appeals)
                      Assessing Authority
                      Orissa Tribunal
 
                      Orissa Tribunal
 
                      Orissa Tribunal
 
                      Andhra Pradesh High Court
 
                      Deputy Commissioner (Appeals), Jaipur
 
                      Deputy Commissioner     (Appeals),  Jammu
 
                      Deputy Commissioner     (Appeals), Hyedrabad
 
                      Deputy Commissioner     III, Haldwani
 
                      Deputy Commissioner     III, Haldwani
 
                      Deputy    Commissioner (Appeals)
 
                      Deputy    Commissioner (Appeals)
 
                      Deputy    Commissioner (Appeals)
 
                      Uttar Pradesh Tribunal,
 
                      Deputy Commissioner (A),
 
                      Commissioner of Commercial Taxes,
 
                      Addt Commissioner (A),
 
                      Jammu Tribunal,
 
                      Assessing Authority,
 
                      Madhya Pradesh High Court,
 
                      Joint Commissioner (A),
 
                      Delhi Tribunal,
 
                      West Bengal Tribunal,
 
                      Addl. Commissioner (A)Mohali.
 
 
 Income Tax Act,      Income - tax    Appellate Tribunal
 1961
                      High Court
 
                      CIT (Appeal)
 
 c) According to the information and explanations given to us, the
 amounts which were required to be transferred to the investor education
 and protection fund in accordance with the relevant provisions of the
 Companies Act, 1956 (1 of 1956) and rules there under has been
 transferred to such fund within time.
 
 viii) The Company does not have accumulated losses as at the end of the
 financial year, nor has it incurred cash losses in the current
 financial year, or in the immediately preceding financial year.
 
 ix) According to the information and explanations given to us and based
 on the documents and records produced before us, there has been no
 default in repayment of dues to banks or debenture holders. There were
 no dues to financial institutions during the year.
 
 x) According to the information and explanations given to us and based
 on the documents and records produced before us, the terms and
 conditions of guarantees given by the Company for loans taken by its
 subsidiaries from banks are prima facie not prejudicial to the interest
 of the Company
 
 xi) According to the information and explanations given to us and the
 records examined by us, the Company has not obtained any term loans.
 
 xii) Based upon the audit procedures performed by us, to the best of
 our knowledge and belief and according to the information and
 explanations given to us by the Management, no fraud on, or by the
 company, has been noticed or reported during the year.
 
 For KALYANIWALLA & MISTRY
 CHARTERED ACCOUNTANTS
 Firm Registration No. 104607W
 
 
 ROSHNI R. MARFATIA
 PARTNER
 M. No.: 106548
 Mumbai: April 28, 2015
 
Source : Dion Global Solutions Limited
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