Understanding Annual ReportNestle India Ltd.

By
Prof Archana Patro

Institute for Financial Management and Research

INTRODUCTION
BRIEF PROFILE OF NESTLE INDIA LTD.

Page -23 pdf

INTRODUCTION
BRIEF PROFILE OF NESTLE INDIA LTD.

FINANCIAL STATEMENTS OF NESTLE INDIA LTD.

Page-54 pdf

Balance Sheet & Income statement

Pg-40-41
UNDERSTANDING THE INTER-LINKAGE OF THE FINANCIAL
STATEMENT

PAT OF 11,846 miilion belong to equity owners and is

transferred to reserves and surplus (note-2 )Balance
sheet.

UNDERSTANDING THE VARIOUS ACCOUNTS OF BALANCE SHEET

AND NOTES THERETO

EQUITY AND LIABILITIES

Shareholders Funds
Share capital

Pg-44
-Apart from year end figure ,the note provides movements in
capital,extent of ownership and major controlling shareholders etc

 Reserves and Surplus

Pg-45

All appropriations towards dividends and

general reserve has been made via this note
instead of statement of profit and loss.

Non-current Liabilities
Long-term borrowings
As compared to its size, long term borrowing of
154.6 million represents a miniscule figure

Non-current Liabilities

Deferred tax liabilities (net)

Policy is in accordance with Indian GAAP.The company has a net

liability towards deffered taxes which will cause cash outflow in future

Other Notes to Accounts

Till Page -66

Other Mandatory Financial

Reports

Introduction
The most common and statutorily required reports are
as under:
1.Auditors report
2.Directors report
3.Corporate governance reportManagement Discussion and analysis reports
4.Report on Corporate social responsibility

Introduction
Auditors report: is an instrument of
discharging attest function and expressing the
truth of discharging attest function and
expressing opinion about the truth and
fairness of financial position and performance
conveyed by the financial statements.by the
company auditors.

AUDITORS REPORT
Requirements of the Companies Act

 Companies (Auditors Report) Order, 2003 or CARO

Applicability
Fixed assets
Inventory
Loans granted to/taken from companies and firms in which
directors
are interested
Internal Control System
Transactions (other than loans) with companies and firms in
which
directors are interested
Public Deposits
Internal audit system
Cost accounts and records
Statutory dues
Accumulated losses:Cost accounts and records
Default in repayment of loans

Loans granted against securities (shares etc.)

Chit fund, Nidhi/mutual benefit fund/societies
Companies dealing in securities
Third party guarantees
Application of loans for the intended purpose
Use of short term funds for long term investment
Preferential allotment
Creation of charge on debentures
End use of public issue
Frauds

Reasons to be stated for unfavorable or qualified answers

Significance and implications of auditor report

 Go through the Auditors report of Nestle and

Find out the compliance requirements of the
companies act.-Pg-35 pdf

DIRECTORS REPORT
Requirements of the Companies Act

DIRECTORS REPORT

Pg-24 Pdf

Questions
What information does the directors report
provide ?

 CORPORATE GOVERNANCE REPORT

Objective and Importance of Corporate
Governance
Suggested List of Items for Corporate Governance
Report(SEBI)
A brief statement on companys philosophy on code
of governance.
Board of Directors
Audit Committee
Nomination and Remuneration Committee
Stakeholders Grievance Committee
General Body meetings
Disclosures
Means of communication
General Shareholder information

 Non-mandatory Requirements
The Board
Shareholder Rights
Audit Qualifications
Separate posts of Chairman and CEO
Reporting of Internal Auditor
Review of Nestls Report on Corporate
Governance-

Annex-1

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Report and Its Contents

Significance of MD&A
Review of Nestls MD&A
Report-74 pg

REPORT ON CORPORATE SOCIAL RESPONSIBILITY

(CSR) ACTIVITIES
Requirements of the Companies Act, 2013

Review of Nestls Report on CSR

Activities-72-Annex-3 82