File_2012_Document1

110 Jindal Steel & Power Limited Business Leadership Sustainable Operations Excellent Governance Robust FinancialsStandaloneAnnual Report 2011-12111Auditors’ Report to the Members of Jindal Steel & Power Limited1. We have audited the attached Balance Sheet of Jindal Steel& Power Limited, as at 31st March, 2012, the Statement ofProfit & Loss and the Cash Flow statement for the year endedon that date, annexed thereto. These financial statementsare the responsibility of the Company’s management. Ourresponsibility is to express an opinion on these financialstatements based on our audit.2. We conducted our audit in accordance with the auditingstandards generally accepted in India. Those standards requirethat we plan and perform the audit to obtain reasonableassurance about whether the financial statements are freeof material misstatement. An audit includes examining, on atest basis, evidence supporting the amounts and disclosuresin the financial statements. An audit also includes assessingthe accounting principles used and significant estimates madeby the management, as well as evaluating the overall financialstatement presentation. We believe that our audit provides areasonable basis for our opinion.3. As required by the Companies (Auditors’ Report) order,2003 as amended by the Companies (Auditors’ Report)(Amendment) Order 2004 (Collectively the Order), issuedby the Central Government of India in terms of section227 (4A) of the Companies Act, 1956 and on the basis ofsuch checks as we considered appropriate and according tothe information and explanations given to us, we enclosein the Annexure a statement on the matters specified inparagraphs 4 and 5 of the said Order.4. Further to our comments in the Annexure referred toabove, we report that:(i)(ii)We have obtained all the information and explanations,which to the best of our knowledge and belief werenecessary for the purposes of our audit;In our opinion, proper books of account as requiredby law have been kept by the Company so far asappears from our examination of those books;(iii) The Balance Sheet, Statement of Profit & Loss andCash Flow statement dealt with by this report are inagreement with the books of account;(iv) In our opinion and read with sub note (a) of Note 4regarding accounting for sales tax included in salesprice of products sold out of sales tax exempted unitunder Sales Tax Subsidy / Capital Reserve accountin the circumstances as explained in the Note, theBalance Sheet, Statement of Profit & Loss and CashFlow statement dealt with by this report comply withthe accounting standards referred to in sub - section(3C) of section 211 of the Companies Act, 1956;(v)On the basis of written representations received fromthe Directors, as on 31st March, 2012 and taken onrecord by the Board of Directors, we report that noneof the Directors is disqualified as on 31st March, 2012from being appointed as a Director in terms of clause(g) of sub section (1) of section 274 of the CompaniesAct, 1956;(vi) In our opinion and to the best of our informationand according to the explanations given to us, thesaid accounts read with the Accounting Policies andNotes thereon give the information required by theCompanies Act, 1956 in the manner so requiredand give a true and fair view in conformity with theaccounting principles generally accepted in India:(a)(b)(c)Place: New Delhiin the case of Balance Sheet, of the state ofaffairs of the Company as at 31st March, 2012;in the case of Statement of the Profit & Loss ofthe Profit for the year ended on that date; andin the case of Cash Flow statement, of the CashFlows for the year ended on that date.For S. S. KOTHARI MEHTA & CO.Chartered AccountantsFRN No. 000756N(Arun K. Tulsian)PartnerDated: 27th April, 2012 Membership No. 89907AnnexureRe: Jindal Steel & Power LimitedReferred to in paragraph 3 of our report of even date1. (a) The Company has maintained proper records showingfull particulars including quantitative details andsituation of fixed assets.(b)(c)The Company has a phased programme of physicalverification of its fixed assets which, in our opinion, isreasonable having regard to the size of the Companyand the nature of its assets. As part of this programme,the management has physically verified certain fixedassets during the year. Discrepancies noticed onsuch verification as compared to book records werenot material and have been properly adjusted in thebooks of account.Fixed assets disposed off during the year were notsubstantial.2. (a) As explained to us, physical verification has beenconducted by the management at reasonableintervals in respect of finished goods, stores andspare parts and raw materials. Further, stocks in thepossession and custody of third parties and stockin transit as at 31st March, 2012 have been verifiedby the management with reference to confirmationor statement of account or correspondence withthe third parties or subsequent receipts of goods.In our opinion, the frequency of such verification isreasonable.(b)(c)The procedures for the physical verification ofinventories followed by the management are, in ouropinion, reasonable and adequate in relation to thesize of the Company and the nature of its business.In our opinion, the Company is maintaining properrecords of inventory. The discrepancies noticed onphysical verification of inventory as compared to bookrecords were not material and have been properlydealt with in the books of account.3. (a) The Company has not granted any loans, secured orunsecured, to companies, firms or other parties listedin the register maintained under section 301 of theCompanies Act, 1956.(b)Since there are no such loans, comments regardingterms & conditions, repayment of the principalamount, interest due thereon and overdue amountsare not required.(c)(d)The Company has not taken any loans, secured orunsecured, from companies, firms or other partieslisted in the register maintained under section 301 ofthe Companies Act, 1956.Since there are no such loans, comments regardingterms & conditions, repayment of the principalamount, interest due thereon and overdue amountsare not required.4. In our opinion and according to the information &explanations given to us during the course of audit, thereare adequate internal control systems commensurate withthe size of the Company and the nature of its business withregard to purchase of inventories and fixed assets and forthe sale of goods and services. Further, on the basis of ourexamination of the books and records of the Company,carried out in accordance with the generally acceptedauditing practices in India, we have neither come acrossnor have we been informed of any instance of a majorweakness in the aforesaid internal control systems.5. (a) To the best of our knowledge and according tothe information and explanations given to us, weare of the opinion that the particulars of contractsor arrangements that need to be entered intothe register maintained under section 301 of theCompanies Act, 1956 have been so entered.(b)In our opinion and according to the information andexplanations given to us, the transactions enteredinto in pursuance of contracts or arrangements, withwhom transactions exceeding the value of ` Five lacsin respect of each party have taken place during thefinancial year, are at prices which are reasonablehaving regard to the prevailing market prices at therelevant time where such market prices are available.6. In respect of fixed deposits accepted from the public, theprovisions of section 58A and 58AA or any other relevantprovisions of the Companies Act, 1956 including theCompanies (Acceptance of Deposits) Rules, 1975 havebeen complied with. We have been informed that no Orderhas been passed by the Company Law Board or NationalCompany Law Tribunal or RBI or any Court or any otherTribunal in this regard.7. In our opinion, the Company has an internal audit systemcommensurate with the size and nature of its business.