Gillette India Ltd has informed that in the limited review report of the Company for the quarter ended December 31, 2007, the Auditors of the Company have made the following observations:
The Auditors draw attention to Note 2 of the Statement. Pursuant to the sanction given by the High Court of Rajasthan dated August 22, 2006 and December 04, 2006 to the Scheme of Arrangement filed under Section 391 of the Companies Act, 1956, for charging off of business restructuring expenses, gross of tax, to the capital reserve, the Company has been allowed to transfer an amount of upto Rs 8500 lakhs from the Capital Reserve to a Reconstruction Reserve Account. The balance in the Restructuring Reserve account as at September 30, 2007 was Rs 1977 lakhs. The total expenses charged to Reconstruction Reserve Account for the three months ended December 31, 2007 amounted to Rs 92 lakhs and for six months ended December 31, 2007 amounted to Rs 142 lakhs. Had the restructuring expenses not adjusted to Capital Reserve under the order of the High Court of Rajasthan and the restructuring expenses were debited to the Profit and Loss account as per generally accepted accounting principles, the net profit after tax (inclusive of the effect of deferred tax) would have been lower for the three months and six months ended December 31, 2007 by Rs 134 lakhs and Rs 237 lakhs respectively.
The Auditors draw attention to Note 2 of the Statement. Pursuant to the sanction given by the High Court of Rajasthan dated August 22, 2006 and December 04, 2006 to the Scheme of Arrangement filed under Section 391 of the Companies Act, 1956, for charging off of business restructuring expenses, gross of tax, to the capital reserve, the Company has been allowed to transfer an amount of upto Rs 8500 lakhs from the Capital Reserve to a Reconstruction Reserve Account. The balance in the Restructuring Reserve account as at September 30, 2007 was Rs 1977 lakhs. The total expenses charged to Reconstruction Reserve Account for the three months ended December 31, 2007 amounted to Rs 92 lakhs and for six months ended December 31, 2007 amounted to Rs 142 lakhs. Had the restructuring expenses not adjusted to Capital Reserve under the order of the High Court of Rajasthan and the restructuring expenses were debited to the Profit and Loss account as per generally accepted accounting principles, the net profit after tax (inclusive of the effect of deferred tax) would have been lower for the three months and six months ended December 31, 2007 by Rs 134 lakhs and Rs 237 lakhs respectively.
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