Annual Report 2010-2011 - Gammon India

112
AUDITOR’S REPORT
TO
THE BOARD OF DIRECTORS OF GAMMON INDIA LIMITED
ON THE CONSOLIDATED FINANCIAL STATEMENTS
1. We have audited the attached Consolidated Balance Sheet of Gammon India Limited (GIL) and its subsidiaries
(‘GIL Group’), joint ventures and associates, as at 31 st March 2011, and also the Consolidated Profit and Loss account and
the Consolidated Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are
the responsibility of the GIL's management and have been prepared by the management on the basis of separate financial
statements and other financial information of the components of GIL group. Our responsibility is to express an opinion on
these financial statements based on our audit.
2. We conducted our audit in accordance with the 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. We did not audit the financial statements of:
a. Certain Subsidiaries whose financial statements reflect total assets of ` 5,860.25 Crores, total revenue of ` 1,299.52
Crores and net cash flows of ` 16.67 Crores; and,
b. Certain joint ventures whose financial statements reflect total assets of ` 3,180.39 Crores, total revenue of ` 4,857.01
Crores and cash flows amounting to ` (58.73) Crores, the Company’s share of such assets, revenues and cash flows
being ` 1,548.39 Crores, ` 2,427.46 Crores and ` (29.22) Crores respectively.
c. Certain associates whose financial statements reflect a net total profit of ` 1.38 Crores. The group’s share of profit of
such associates being ` 0.35 Crores.
4. The abovementioned financial statements have been audited by other auditors whose reports have been furnished to us,
and our opinion is based solely on the report of other auditors.
5. apart from the above the following have been incorporated based on Un-audited Financial Statements:
(a) Certain other Subsidiaries whose financial statements reflect total assets of ` 206.10 Crores, total revenues of
` 0.00 Crores and net cash flows of ` 1.55 Crores.
(b) Certain joint ventures, whose financial statements reflect total assets of ` 106.00 Crores as at March 31, 2011, total
revenues of ` 16.48 Crores and cash flows of ` 3.81 Crores for the year then ended, and the Group’s share of such
assets, revenues and cash flows being ` 56.85 Crores, ` 9.89 Crores and ` 2.15 Crores respectively, which are based
on un-audited financial statements certified by management of the said joint ventures.
(c) Certain associates whose financial statements reflect a net total profit of ` 0.76 Crores. The group’s share of profit of
such associates being ` 0.38 Crores.
6. The subsidiaries referred in para 3 (a) above does not include the standalone financial statements of Gammon Infrastructure
Projects Limited, where the audit has been conducted by us as the joint statutory auditors of the Company.
7. We report that the consolidated financial statements have been prepared by the GIL's management in accordance with
the requirements of accounting Standards (aS) 21, Consolidated financial statements, accounting Standards (aS) 23,
accounting for Investments in associates in Consolidated Financial Statements and accounting Standard (aS) 27, Financial
Reporting of Interests in joint ventures as notified under the Companies (accounting Standards) Rules, 2006.
8. The statutory auditors of one of the components of the group have issued a modified report stating that the accounts and
other receivables included amounts totaling to aED 61.1 Million i.e. ` 75.34 Crores including retention and other dues
for which. they stated their inability to satisfy themselves to the extent of recoverability of receivables totaling to aED
61.1 million i.e. ` 75.34 Crores and have stated their view that a substantial portion of the same needs to be considered
as impaired.
9. Without qualifying our report, we draw attention to:
(a) Note No. 2(d) to the notes to accounts relating to “Going concern assumption” of one of the joint ventures of the
group which illustrates the measures taken by the management of the joint venture during the year, the uncertainties
A NNUAL R EPORT I 2010/11