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CIpla, originally founded by Khwaja Abdul Hamied as The Chemical, Industrial & Pharmaceutical Laboratories is a prominent Indian pharmaceutical

company, best-known outside its home country for producing low-cost antiAIDS drugs for HIV-positive patients in developing countries.

its products are distributed in more than 180 countries worldwide. Indias second largest pharmaceutical firm Cipla Ltd, edged out the multinational giant GlaxoSmithKline which was reigning supreme in the country for long, in terms of drug sales last year.

Objectives of this standard To promote better understanding of the financial statements through disclosure of significant accounting policies including the manner.

This standard also helps for meaningful comparison between financial statements of different organization and different periods of the same.

Disclosure of Particulars As required by the Companies (Disclosure of Particulars in the Report of Board ofDirectors) Rules, 1988, the relevant information and data are annexed to this report. Responsibility Statement Pursuant to Section 217 (2AA) of the Companies Act, 1956, your Directors confirm :that the applicable accounting standards have been followed in the Preparation of the annual accounts The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period.

The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities that the Directors have prepared the annual accounts on a going concern basis.

A primary issue in accounting for inventories is the determination of the value at which inventories are carried in the financial statements until the related revenues are recognized. This Standard deals with the determination of such value, including the ascertainment of cost of inventories and any write-down thereof To net realizable value.

The stocks of finished goods and materials have been physically verified by the management at reasonable intervals during the year. The verification was made on the basis of the perpetual inventory system operated by the Company. In case of materials lying with third parties, certificates confirming stocks have been obtained by the Company.

In our opinion and on the basis of the information and explanations given to us, the procedures for physical verification of stocks followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

The discrepancies noticed on physical verification of stocks as compared to the book records were not material. In our opinion and on the basis of our examination of the stock records, the valuation of stocks is fair and proper in accordance with the normally accepted accounting principles.