Profit & loss mandatory?

I have just come across an Auditor's Report whereby, he has certified that "No P&L Account has been drawn, since the commercial oparations of the Company have not commenced and thus all expenses are capitalised". 

The Company in question has made expenses in the tune of 15-20 Cr. which includes Depriciation.

I would be obliged if anyone can confirm if this correct or not. If yes, under which Act / Law / Standard is this allowed. Also the same if it is 'not allowed'.

Thanks