Statutory Reports
Corporate Overview
69th Annual Report 2013-14
98
Financial Statements
systems or from external events. This includes, among other things,
losses that are caused by lack of controls within internal procedures,
violation of internal policies by employees, disruption or malfunction
of IT systems, computer networks and telecommunication systems,
mechanical or equipment failures, human error, natural disasters or
malicious acts by third parties. Any unauthorized access to or misuse
of data processed on our IT systems, human errors associated with
therewith or technological failures of any kind could disrupt the
Company’s operations, including the manufacturing, design and
engineering processes and, consequently the Company’s financial
conditions.
Deterioration in the performance of any of our subsidiaries,
joint ventures and affiliates:
The Company has made and may
continue to make capital commitments to subsidiaries, joint
ventures and affiliates, and if the business or operations of any
of these subsidiaries, joint ventures and affiliates deteriorates, the
value of the Company’s investments may be adversely affected.
OUTLOOK
While the start of the new fiscal has continued from the moderate
performance of last year, there is a cautious optimism that FY 2014-
15 would see the start of the revival in the global and domestic
economies. The Indian economy is also expected to look up
marginally from growth in GDP of 5% in the last year.
Growth in first half of FY 2014-15 is unlikely to be much different
than in FY 2013-14 as industrial and services sector growth is still
weak. It is expected to be in the range 5% to 5.5%.
A new stable Government will take steps to improve investor
confidence and thereby leading to revival of economy in the
second half of FY 2014-15. M&HCV truck sales, which are reflective
of the economic sentiment, have seen an arrest in the declining
trend in the start of the new fiscal. Infrastructure spending as well
as regulation in areas like mining is expected to receive a positive
shot in the arm
While current account deficit is under control, fiscal deficit will
continue to be priority for the Government and striking a balance
between controlling expenditure and encouraging growth will be
key for this year.
On the background of pressure on volumes in India and limited
headroom in pricing due to the intensely competitive market
dynamics, the focus will be on effective cost management- both
direct and indirect to maintain margins. Even in this challenging
environment, as envisioned in its Mission statement, the Company
is looking to ‘passionately anticipate’ and provide vehicles and
solutions that ‘excite customers globally’. The objective remains to
be the ‘most admired’ Company by all our stakeholders.
One of the key elements of this strategy would be to improve the
relationship with the customer – the experience the customer has
with the Company at each touch point from sale to service and
replacement sales experiences. This would include improving the
physical look of the setup, setting up right processes and forums
for speedy resolution of customer issues.
The Company will also actively pursue growth in the right
International markets and look to consolidate its position in markets
where it is already present.
While Europe remains uncertain in the short term, JLR will continue
to focus on growth from other markets, in particular the emerging
markets. With entry been established in China last year, growing and
consolidating presence in this market would be key to JLR’s strategy
for the coming year. Investment in new products and technologies
along with enhancing capacity as required in the right geographies
would continue for both Jaguar and Land Rover.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an adequate system of internal controls in place.
It has documented policies and procedures covering all financial
and operating functions. These controls have been designed to
provide a reasonable assurance with regard to maintaining of proper
accounting controls for ensuring reliability of financial reporting,
monitoring of operations, protecting assets from unauthorized
use or losses, compliances with regulations. The Company has
continued its efforts to align all its processes and controls with
global best practices.
Some significant features of the internal control of systems are:
Audit Committee of the Board of Directors, comprising
independent directors, which is functional since August 1988,
regularly reviews the audit plans, significant audit findings,
