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Auditor Report of AK Spintex Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of AK SPINTEX LIMITED ("the company") which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss and Cash Flow Statement for the year ended, and a company of significant accounting policies and other explanatory information.

Management's Responsibility for the financial Statements

The company Board of directors is responsible for the matters in section U4(5) of the Companies Act.20!3 ("the Act") with respect to the preparation of these financial statements. that give a true and fair view of the financial portion, financial performance and cash flows of the Company in accordance with the Accounting peoples generally accepted in India including the Accounting Standards referred 6 in Section 135 of the Companies Act, 2014 with Rule 7 of the Companies (Accounts) Rules, 2014. This spoils Ability includes the design. explanation and maintenance of adequate internal economical that were operating effectively tor ensuring the accuracy and completeness of the accounting records, relevant to die optimum and presentation of the financial statements that give a true and fair view animate free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is in express an opinion on these standalone financial statements based on our audit. We nave taken into account the prevision of the Act, the accounting and auditing standards and mailers which etc required to he included in the audit report under the provision of die Act and the Rules made there under.

We conducted our audit in accordance with the Standard Auditing specified under section 143(10) of die All.. Those Standards require that we employee with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and dishallows in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or click. making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures (are appropriate in the substances. in audit also includes counting the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial! statements,

We believe that the audit evidence we ha obtained is sufficient and appropriate to provide u he is for our audit opinion

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the Information regarded by the Act of the manner of required and festive a true and fair view in conformity with the accounting principles year are accepted in India:

(a) in the case of the balance Sheet, of the state of affairs of the Company as at March 31st, 2015


(c) in (he case of the Cash Flow Statement, of the cash flows fur the year ended on that date.

Report on Other Legal And regulatory Requirements

1 As required by the Companies (Auditors Report) Officer, 2015 ("the Order) issued by the Central Government of India. in terms of sub- section (11) Section 143 of the Companies, Act, 2012, we give in the Annexure a statement But the matters specified in 3 and 4 of the Order, to the extent applicable.

2, As required by section 143(3) of the Act. we report that

(a), we have sought, and obtained all the information and explanations which to the basis of our knowledge and behind necessary for the purpose of the audit,

(b). in our opinion, proper books as required by law have been kept by the Company so far as appears from our examination of those books;

(c) the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement deal with by this Report are in agreement with the books of account and records,

(d). in our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 1/33 of the Ad, read with Rule 7 of the Companies (Account*,) Rules, 2011 to the extent applicable.

(4) on the basis of written representations received from the directors as on March, 2015 taken on record by the Board of Directors, none of the director* is disqualified as the March 31, 2015, from being appointed as a director in terms of Section 164 (2) of the, and any.

(f). with respect to the other matters to be included in the auditors report m accordance with Rule 11 of the Companies (Audit and auditors) Rules,2014, in our opinion and to the best of our information and according to the explanations given to us

i. Since the Central Government has not issued any notification to the rate at which the. is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

ii. As the company has not declared any dividend in the past years & there is no unpaid dividend, so here is no requirement of transfer of amount in Investor Education &. Protection fund, (IEPF)

{Referred to in paragraph 1 under the heading of Report on the her Leagal and Regulatory Requirements" of our report .of even date)

On the basis of such checks of the books and records as we consider appropriate and as per the information and explanations given to us during the course of out audit, we further report that:-

(A) The Company has maintained proper records Showing full particulars including quantitative details and situation of fixed assets on the basis, or available information.

(B) An explained To us, the feed asset have been physically verified by the financial during the year in a phased periodic manner which in our opinion & reasonable, having regard to the size of the Company aid Taken of its assets. No material discrepancies were noticed on such physical verification.

(A) As explained to us, the inventories have been physically verified by the management at reasonable interval during the rear.

(B) In our opinion and according to the information and explanation given to us. tin: procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the Company and nature of its business.

(C) The Company has maintained proper records of inventories. As explained to us, no material discrepancies were noticed on physical verification of inventory as compared to the book record.

iii. According to the information &, explanations given to n* and on the basis of our examination of the hooks of account, the Company hax not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under Section 189 of the Companies Act, 2013 Hence clause (iii) (a) & (b) is tot applicable of the company ax the company has not granted any such loans

iv. In our opinion and according to the information and explanation given to us, there is generally an adequate internal control procedure commensurate with the size of the company and the nature of is business for the purchase of inventories & fixed assets for sale of goods and service During the course of our audit, no instance of continuing failure to correct any weakness in the internal control system has been noticed.

v. The companies has no I accepted any loans/deposits from public, in our opinion and according to the information and explanation given to us the provision of section 13 and 76 of the Companies .Act, 2013 and the Rules named here there under, wherever applicable, are being complied with. No order has been passed by company law board against the company.

vi. As per information and explanations given to u& the Central Government has not prescribed maintenance of cost records under section of(i) of the Companies Act for company's products

vii a. According to the records of the company, undisputed statutory dues including Provident fund, employee State Insurance, income Tax, Wealth tax, Custom Duty. Sales Tax, Excise duty, VAT Cess and of the statutory dues have been regularly deposited with the appropriate authorities. According to the information and explanation given to us, no undisputed amounts payable in account of any dispute other then the disputed statutory dues at Rs. 110.53 Lac Lac that have not been deposited on account or mails pending before appropriate authorities are as under;

Name of the Statute Financial year to which Nature of the Forum where dispute Is Amount the matter pertains dues pending
Textile fuss Act 1997-2G&7 TC Cess Textile Cess Tribunal. 46.26

Central Excise Act 2002-2003 Excise Duty Commissioner ( Appeals) 5.44 1944

Entry Tax Act 2012-2015 Entry Tax Company in disputing &. 58.83 challenging the liabilities based on the legal opinion sought by the company.

b. As the company has not declared any dividend in the past year & there is no unpaid dividend, so there is no requirement of transfer of amount in Investor Education A'. Protection fund (TFPT).

Viii The Company does not have any accumulated losses and has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

ix, Based on oar audit procedures and on the Information and explanation given by the management, we are of the opinion that the company has not defaulted in repayment of dues to financial institution, Bank or debenture holder

x. In our opinion and avoiding to the information and the explanation given to ns, the company has not given any guarantee for loans taken by others from banks or financial institution.

xi Raised on our audit procedures and on the information & explanations given by the management- we report that the term loans have been applied for the purpose tor which they were raised.

xii In our opinion and according to the information & explanations given to us, we report that no material fraud on or by the company has been noticed or reported during the year, nor have we been informed of such case by the management

FOR O.P. DAD & COMPANY

CHARTERED ACCOUNTANTS

[O.P.DAD]

PARTNER

M. NO 35373

PLACE: BH1LWARA

DATED: 30th MAY, 3015


Mar 31, 2013

We have audited the accompanying financial statements of AK SPINTEX LIMITED ("the Company"), which comprise the Balance Sheet as at March 31. 2013, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that the a true and far view of The financial position, financial performance and cash flows of the Company in accordance with The Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1BSS ("the Act"), This responsibility includes the design, implementation and maintenance of Internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit In accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India Those Standards require that we comply with ethical requirements and plan and perform the' audit to obtain reasonable assurance about whether the financial statement are free from material misstatement An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the informal on required by the Act in the manner of required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31,2013;

(b) in the case of the Profit and Loss Account, of the profit/ loss for the year ended on that date; and

(c) in the case of the Cash flow Statement, of the cash flows far the year ended on that dale,

Report on Other Legal and Regulatory Requirements

(1) A3 required by the Companies (Auditor's Report) Order, 2003 {ire Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

(2) As required bisection 227(3) of the Ad, we report that:

(a) We have obtained all the information A explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

(b) In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books

(c) The Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account,

(d) In our opinion, the Balance Sheet; Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956;

(e) On the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) ofsecton274ofthe Companies Act, 1956.

(f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section -441A of the Companies Act, 19SS nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

(Referred to in paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date)

On the basis of such checks of the books and records as we consider appropriate and as per the information and explanations given to us during the course of our audit, we further report that :-

1. In respect of fixed assets:



(C) The company during the year has disposed off old matinees and the some have been replaced by new machineries and the going concern status of the Company is not affected.

2. In respect of its in ventures:

(A) As explained to us, the inventories have been physically verified by toe management at reasonable intervals during the year.

(B) In our opinion and according to the information and explanation given to us the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the Company and nature of its business.

(C) The Company has maintained proper records of inventories As explained to us, no material discrepancies were noticed on physical verification of inventory as compared to the book record

3. In respect of loans, secured or unsecured, granted or taken by the Company to / from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act. 1956:

(A) The Company has not taken unsecured loans from any party covered in the register maintained u/s 301 of the Act. ft has been taken m view of stipulation by financial Institution and repayable subject to their approval The loan so taken is not prima face prejudicial to the interest of the company. The amount borrowed on current account, the rate of interest wherever applicable and other terms and condition are not prime facie prejudicial to the interest of the Company.

(B) As per the explanation and information given to us the Company has not granted any loans, secured or Unsecured to the Companies, firms or other parties listed in tie register maintained Under Section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and also for the sale of goods. During the course of our audit, we have not observed any major weaknesses in internal control system.

5 (a) According to the information and explanations given to us, we are of the opinion that The transactions that need to be entered into toe register maintained under section 301 of the Companies Act 1956 have been so entered.

(b) According to the information and explanations given to us to transactions made in pursuance of entrails or arrangements entered in the register maintained under section 301 of the Companies Act 1956 that are exceeding the value of justify lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market price at the relevant time.

6. The company has not accepted any deposits from public. In our opinion and according to the information and explanation given to us the Provisions of section 58A of the companies Act 1956 and the Rules framed there under, wherever applicable, are being complied with.

7. In our opinion and according to the information and explanation given to us we report that the company is having proper internal audit system, which is commensurate with its size and nature of its business.

8. The central government has prescribed maintenance of cost record under section 209 (1) (d) of the companies Act, 1956 We have broadly reviewed the accounts and records of the company in this connection and are of the opinion, that prima face, the prescribed accounts and have been made maintained. We have not however, made detailed examination of such records.

9 In respect of statutory dues;

A) According to the records of the Company, undisputed statutory dues including Provident Fund Investor Education and protection fun, Employees State Insurance, Income Tax, Wealth Tax, Custom Duty, Sales Tax, Excise Duty, Cess and other statutory dues have been regularly deposited with the appropriate authorities. According to the Information and Explanation given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March 2013 for a period or more than the six months from the date they have become payable.

B) The disputed statutory dues aggregating to Rs 133.84 Lac that have not been deposited an account of matters pending before appropriate authorities are as under:

Nam of the Financial Year to Which Nature of Forum where dispute is Amount Statute the matter pertains the dues pending (Rs in Lac)

Textile Cess Act, 1997-2007 TC Cess Textile Cess Tribunal, 46.26

Central Excise Act, 2002-2003 Exciss Duty Commissioner (Appeals) 5.44

Entry Tax Act, 2008-2013 Entry Tax H'nble High Court, 82.14 Jodhpur (Rajasthan)

10. The company has no accumulated losses and has not incurred each losses during the financial year covered by our audit report in the immediately preceding financial year.

11. According to the information and explanation given to us we are of the opinion of the company has not defaulted in repayment of dues to financial institution, Banker debenture holders

12. According to the information and explanation given to us, we are of the opinion that the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other cess

13. In our opinion, the company is not chit fund or a nidhi mutual benefit fund/ society Therefore, the provisions of clause 4(13) of the Companies (Auditors' Report) Order, 2003 are not applicable to the Company.

14. In our opinion, the company is not dealing or trading in shares, Securities, Debentures, Mutual funds & others investments, accordingly, the provision of clause 4 (xvi) of the companies (Auditor's report) Order, 2003 (as amended) are no applicable to the company.

15. In our opinion and as per information and explanation given to us, we report that the company has not given any guarantee for loans taken by others from bank or financial institution.

16. As per information and explanation given to us, the company has utilized term loans for the purpose for which the loans were obtained.

17. As per information and explanation given to us, and over all examination of balance sheet of the company we are of opinion that funds raised on short term basis were not used for long term investment and vice-versa.

18. During the year, the company has not made any preferential allotment of shares to parties and companies covered in the register maintained as 301 of the Act,

19. The Company has not raised any amount by issue of debentures.

20. The Company has not raised any amount by way of public issue during the year.

21. In our opinion and as par information and explanation given to us, no fraud on or by the company has been noticed or reported during the year, which causes the financial statements to be materially misstated.

FOR 0. P. DAD & COMPANY

CHARTERED ACCOUNTANTS

[O.P.DAD]

PARTNER

M.N0.35373

PLACE : SHILWARA

DATED : 30th MAY, 2013

 
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