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Mahindra and Mahindra

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« Mar 15
Auditor's Report (Mahindra and Mahindra) Year End : Mar '16
1.  We have audited the accompanying standalone financial statements of
 Mahindra & Mahindra Limited (the Company), which comprise the Balance
 Sheet as at 31st March, 2016, the Statement of Profit and Loss and the
 Cash Flow Statement for the year then ended, and a summary of the
 significant accounting policies and other explanatory information.
 
 Management''s Responsibility for the Standalone Financial Statements
 
 2.  The Company''s Board of Directors is responsible for the matters
 stated 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 prescribed under Section 133 of the Act as
 applicable. This responsibility also includes maintenance of adequate
 accounting records in accordance with the provisions 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
 
 3.  Our responsibility is to express an opinion on these standalone
 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 and the Order under
 Section 143(11) of the Act.  We conducted our audit of the standalone
 financial statements 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.
 
 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 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. 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.
 
 5.  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
 
 6.  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 31st March, 2016, and its profit and its
 cash flows for the year ended on that date.
 
 Report on Other Legal and Regulatory Requirements
 
 7.  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) In our opinion, the aforesaid standalone financial statements comply
 with the Accounting Standards prescribed under Section 133 of the Act,
 as applicable.
 
 (e) On the basis of the written representations received from the
 directors as on 31st March, 2016 taken on record by the Board of
 Directors, none of the directors is disqualified as on 31st March, 2016
 from being appointed as a director in terms of Section 164(2) of the
 Act.
 
 (f) With respect to the adequacy of the internal financial controls
 over financial reporting of the Company and the operating effectiveness
 of such controls, refer to our separate Report in Annexure A. Our
 report expresses an unmodified opinion on the adequacy and operating
 effectiveness of the Company''s internal financial controls over
 financial reporting.
 
 (g) 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 Company has disclosed the impact of pending litigations on its
 financial position in its financial statements in accordance with
 generally accepted accounting practice – also Refer Note 34 to the
 financial statements.  ii. The Company has made provision, where
 required under any law or accounting standard for material foreseeable
 losses on long-term contracts including derivative contracts.
 
 iii. There has been no delay in transferring amounts, required to be
 transferred, to the Investor Education and Protection Fund by the
 Company.
 
 8. As required by the Companies (Auditor''s Report) Order, 2016 (the
 Order) issued by the Central Government in terms of Section 143(11) of
 the Act, we give in Annexure B a statement on the matters specified
 in paragraphs 3 and 4 of the Order.
 
 (Referred to in paragraph 7(f) under ''Report on Other Legal and
 Regulatory Requirements'' of our report of even date)
 
 i. (a) The Company has maintained proper records showing full
 particulars, including quantitative details and situation of the fixed
 assets.
 
 (b) The fixed assets were physically verified during the year by the
 Management in accordance with a regular programme of verification
 which, in our opinion, provides for physical verification of all the
 fixed assets at reasonable intervals.  According to the information and
 explanations given to us, no material discrepancies were noticed on
 such verification.
 
 (c) With respect to immovable properties of acquired land and buildings
 that are freehold, according to the information and explanations given
 to us and the records examined by us and based on the examination of
 the registered sale deed/ transfer deed/conveyance deed/court orders
 approving schemes of arrangements/amalgamations provided to us, we
 report that, the title deeds of such immovable properties are held in
 the name of the Company as at the balance sheet date. In respect of
 immovable properties of land and buildings that have been taken on
 lease and disclosed as fixed assets in the financial statements, the
 lease agreements are in the name of the Company, where the Company is
 the lessee in the agreement.
 
 ii. As explained to us, the inventories were physically verified during
 the year by the Management at reasonable intervals and no material
 discrepancies were noticed on such physical verification.
 
 iii. The Company has not granted any loans, secured or unsecured, to
 companies, firms, Limited Liability Partnerships or other parties
 covered in the Register maintained under Section 189 of the Companies
 Act, 2013.
 
 iv. In our opinion and according to the information and explanations
 given to us, the Company has complied with the provisions of Sections
 185 and 186 of the Companies Act, 2013 in respect of grant of loans,
 making investments and providing guarantees and securities, as
 applicable.
 
 v. According to the information and explanations given to us, the
 Company has not accepted any deposit during the year and accordingly
 the question of complying with Section 73 and 76 of the Companies Act,
 2013 does not arise. In respect of unclaimed deposits, the Company has
 complied with the provisions of Sections 74 and 75 or any other
 relevant provisions of the Companies Act, 2013. According to the
 information and explanations given to us, no order has been passed by
 the Company Law Board or the National Company Law Tribunal or the
 Reserve Bank of India or any Court or any other Tribunal on the
 Company.
 
 vi. The maintenance of cost records has been prescribed by the Central
 Government under Section 148(1) of the Companies Act, 2013 in respect
 of specified products of the Company. For such products, we have
 broadly reviewed the cost records maintained by the Company, pursuant
 to the Companies (Cost Records and Audit) Rules, 2014, as amended, and
 are of the opinion that, prima facie, the prescribed 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.
 
 vii. According to the information and explanations given to us, in
 respect of statutory dues:
 
 (a) The Company has been regular in depositing undisputed statutory
 dues, including Provident Fund, Employees''State Insurance, Income-Tax,
 Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax,
 Cess and other material statutory dues applicable to it with the
 appropriate authorities.
 
 (b) Details of dues of Income-Tax, Sales Tax, Service Tax, Customs
 Duty, Excise Duty and Value Added Tax which have not been deposited as
 on 31 March, 2016 on account of disputes are given below:
 
 Nature of Statute Nature of Dues  Forum where 
                                   dispute is 
                                   pending      Period to 
                                                which            Amount
                                                the amount
                                                relates         (Rs. in
                                                                crores)
                                               (Various 
                                                years
                                                covering the
                                                period)
 
 Income Tax Act,   Income Tax      High Court   1999-2000         0.03
 1961 ,
 
                                   Income-Tax 
                                   Appellate 
                                   Tribunal     2005-2012       158.28
 
                                   Commissioner
                                   of
                                   Income-Tax
                                  (Appeals)     2006-2014        22.78
 
 Central Excise 
 Act,              Excise          High Court   2004-2008        26.98
 
 
                                   Appellate 
                                   Authority -
                                   Tribunal 
                                   Level        1988-2015       956.66
 
                                   Appellate
                                   Authority - 
                                   Commissioner 1991-2016       646.14
 
 Sales Tax and 
 Value              Sales Tax      High Court   2005-2016       182.25
 
 Added Tax Laws 
 
                                   Appellate 
                                   Authority - 
                                   Tribunal 
                                   Level        1987-2013        30.38
 
                                   Appellate 
                                   Authority - 
                                   Commissioner 1994-2016       621.08
 
                                   Appellate
                                   Authority - 
                                   Revisional
                                   Board        2006-2010        17.02
 
 Finance Act, 
 1994               Service Tax    High Court   2005-2012         0.11
 
                                   Appellate 
                                   Authority - 
                                   Commissioner 2003-2015         2.07
 
                                   Appellate 
                                   Authority - 
                                   Tribunal
                                   Level        2001-2014        72.77
 
 Customs Act, 
 1962                Custom Duty   High Court   1996-2001         1.49
 
                                   Appellate
                                   Authority - 
                                   Tribunal 
                                   Level        1990-1994         1.14
 
 viii. In our opinion and according to the information and explanations
 given to us, the Company has not defaulted in the repayment of loans or
 borrowings to financial institutions, banks and government and dues to
 debenture holders.
 
 ix. The Company has not raised moneys by way of initial public offer or
 further public offer (including debt instruments) during the year.
 According to the information and explanations given to us, the term
 loans raised have been applied by the Company during the year for the
 purposes for which they were raised.
 
 x. To the best of our knowledge and according to the information and
 explanations given to us, no fraud by the Company and no material fraud
 on the Company by its officers or employees has been noticed or
 reported during the year.
 
 xi. In our opinion and according to the information and explanations
 given to us, the Company has paid/provided managerial remuneration in
 accordance with the requisite approvals mandated by the provisions of
 Section 197 read with Schedule V to the Companies Act, 2013.
 
 xii. The Company is not a Nidhi Company and hence reporting under
 clause (xii) of the Order is not applicable.
 
 xiii. In our opinion and according to the information and explanations
 given to us, the Company is in compliance with Sections 177 and 188 of
 the Companies Act, 2013, where applicable, for all transactions with
 the related parties and the details of related party transactions have
 been disclosed in the financial statements etc. as required by the
 applicable accounting standards.
 
 xiv. During the year the Company has not made any preferential
 allotment or private placement of shares or fully or partly convertible
 debentures and hence reporting under clause (xiv) of the Order is not
 applicable to the Company.
 
 xv. In our opinion and according to the information and explanations
 given to us, during the year the Company has not entered into any
 non-cash transactions with its directors or directors of its holding,
 subsidiary or associate company or persons connected with them and
 hence provisions of Section 192 of the Companies Act, 2013 are not
 applicable.
 
 xvi. The Company is not required to be registered under Section 45-IA
 of the Reserve Bank of India Act, 1934.
 
 
 
                                        For DELOITTE HASKINS & SELLS
 
                                              Chartered Accountants
 
  (Firm''s Registration No. 117364W)
 
 Shyamak R Tata
 
 Partner Mumbai, 30th May, 2016 (Membership No. 38320)
Source : Dion Global Solutions Limited
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