2009-10 Annual Report - SPML

SPML INFRA LIMITEDAUDITORS’ REPORTToBoard of DirectorsSPML Infra Limited (formerly Subhash Projects and Marketing Limited)1. We have audited the attached Consolidated Balance Sheet of SPML Infra Limited (Formerly Subhash Projects and Marketing Limited), its subsidiariesand joint ventures as at 31st March 2010 and also the Consolidated Profit and Loss Account and Consolidated Cash Flow Statement for the yearthen ended, annexed thereto and prepared in accordance with the accounting principles generally accepted in India. These consolidated financialstatements are the responsibility of SPML Infra Limited’s management. Our responsibility is to express an opinion on these financial statements basedon our audit.2. We conducted our audit in accordance with the auditing standards generally accepted in India. These standards require that we plan and performthe audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes, examining on a testbasis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used andsignificant estimates made by the management, as well as evaluating the overall financial statements. We believe that our audit provides a reasonablebasis for our opinion.3. Attention is drawn to Note No. 15 on Schedule 20B regarding non-provision of tax liability of Rs.561,400 thousands (including Rs.183,900 thousands forthe year) arising on account of the recent amendment to Section 80IA of the Income Tax Act, 1961 in the Finance Act, 2009. The Company has alreadyfiled a writ with the Hon’ble High Court at Calcutta which has been admitted as well, challenging the validity of the above retrospective amendment whichas per legal opinion obtained, is ultra vires to the main section of the above Act. Till the matter is decided by the Hon’ble High Court, the liability, if any,in this regard is unascertainable. We are unable to comment on the impact of the above non-provision of tax on the Company’s profit for the year and networth at the year end.4. (a) The financial statements of subsidiaries and joint ventures of the Company, whose financial statements reflect total assets of Rs. 3,333,329thousands as at 31st March 2010 and total revenue of Rs. 512,860 thousands and net cash flows of Rs. 60,934 thousands for the year thenended, have been audited by one of the joint auditors and other auditors, whose reports have been furnished to us, and our opinion, in so faras it relates to the amounts included in respect of these subsidiaries and joint ventures, is based solely on these reports, except that the auditedfinancial statements of certain subsidiaries and joint ventures as detailed in Note No. 1(l) on Schedule 20A to the financial statements which reflecttotal assets, total revenue and net cash flows of Rs. 879,553 thousands, Rs. 1,002,358 thousands and Rs. 142,010 thousand respectively, have notbeen received and these have been incorporated in the accounts on the basis of unaudited financial statements produced to us.(b) The audited financial statements in respect of the associates as detailed in Note No. 1(l) on schedule 20A, whose financial statements reflect theCompany’s share of loss of Rs. 21,806 thousands for the year ended March 31, 2010, have not been received and these have been incorporated inthe accounts on the basis of unaudited financial statements produced to us.5. We report that the consolidated financial statements have been prepared by SPML Infra Limited’s management in accordance with the requirementsof Accounting Standard (AS) 21, “Consolidated Financial Statements”, Accounting Standard (AS) 23, “Accounting for Investments in Associates inConsolidated Financial Statements” and Accounting Standard (AS) 27, “Financial Reporting of Interests in Joint Ventures” notified by companies(Accounting Standards) Rules, 2006 (as amended).6. On the basis of information and explanations given to us and on consideration of the separate audit reports on individual audited financial statementsof SPML Infra Limited and its subsidiaries and joint ventures, subject to the impact of the matters given in Para 3 and 4 above, we are of the opinionthat the attached consolidated financial statements give a true and fair view in conformity with the accounting principles generally accepted in India:a. in the case of consolidated balance sheet, of the state of affairs of SMPL Infra Limited, its subsidiaries and joint ventures as at 31st March 2010;b. in the case of consolidated profit and loss account, of the profit of SPML Infra Limited, its subsidiaries and joint ventures for the year ended onthat date; andc. in the case of consolidated cash flow statement, of the cash flows of SPML Infra Limited, its subsidiaries and joint ventures for the year ended onthat date.S.R. BATLIBOI & CO.Firm Registration No.: 301003EChartered AccountantsSUNIL KUMAR GUPTA & CO.Firm Registration No.: 003645NChartered AccountantsPer R. K. AgrawalS. K. Guptaa PartnerPartnerMembership No.: 16667 Membership No.: 82486Place: KolkataPlace: KolkataDate: 31st July, 2010 Date: 31st July, 201070