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Auditor Report of Kanchi Karpooram Ltd.

Mar 31, 2018

INDEPENDENT AUDITORS'' REPORT FOR THE YEAR ENDED 31ST MARCH 2018

TO

THE MEMBERS OF

KANCHI KARPOORAM LIMITED

Report on the Ind AS Financial Statements

1. We have audited the accompanying Ind AS financial statements of Kanchi Karpooram Limited, ("the Company"), which comprises the Balance Sheet as at 31st March 2018, the Statement of Profit and Loss(including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Ind AS Financial Statements

2. The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act,2013 ("the Act”) with respect to the preparation of the seInd AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act and the Rules made thereunder.

3. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

4. Our responsibility is to express an opinion on the seInd AS financial statements based on our audit. In conducting our audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit of the Ind AS financial statements in accordance with the Standards on Auditing as specified under Section143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Ind AS financial statements are free from material misstatement.

5. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Ind AS financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used, and there adorableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the Ind AS financial statements.

6. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Ind AS financial statements.

Opinion

7. In our opinion and to the best of our information and according to the explanations given to us, the afore said Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the Ind AS and accounting principles generally accepted in India, of the state of affairs of the Company as at 31stMarch 2018,and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Other Matters

8. The comparative financial information of the Company for the year ended 31stMarch 2017 and the transition date opening balance sheet as at 1stApril 2016 included in these Ind AS financial statements, are based on the previously issued statutory financial statements prepared in accordance with the Companies(Accounting Standards) Rules, 2006 audited by another firm of Chartered Accountants and their reports for the year ended 31stMarch 2017 and31stMarch 2016 dated 29th May 2017 and 30thMay 2016 respectively, expressing an unmodified opinion on those financial statements and have been restated to comply with Ind AS. Adjustments made to the previously issued said statutory financial information or the differences in the accounting principles adopted by the Company on transition to the Ind AS have been audited by us. Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

9. As required by the Companies (Auditor’s Report) Order,2016 ("the Order") and issued by the Central Government of India in terms of sub-section 11 of Section 143 of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the said Order, to the extent applicable.

10. 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 best of our knowledge and belief were necessary for the purposes of our audit;

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

(c) the Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and Statement of Changes in Equity dealt with by this report are in agreement with the books of account;

(d) in our opinion, the aforesaid IndAS financial statements, comply with the Indian Accounting Standards prescribed under Section 133 of the Act and the Rules made thereunder;

(e) on the basis of written representations received from the Directors as on 31stMarch 2018, and taken on record by the Board of Directors, none of the Directors is disqualified as on 31stMarch 2018, from being appointed as a Director in terms of Section 164 (2)of the Act;

(f) with respect to the adequacy of the internal financial controls with reference to financial statements and the operating effectiveness of such controls, refer tour separate report in Annexure B; and

(g) with respect to the other matters to be included in the Auditor’s Report in 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 explanations given to us:

i. the Company has no pending litigations as at 31st March 2018 and accordingly, disclosing the impact of pending litigations on its financial position in its financial statements does not arise.

ii. the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

iii. there was no delay in transferring the required amount to the Investor Education and Protection Fund by the Company during the year.

a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

b) As explained to us, these fixed assets have been physically verified by the Management at regular intervals; as informed to us, no material discrepancies were noticed on such verification.

c) The title deeds of immovable properties are held in the name of the Company.

ii. The Management has conducted physical verification of inventory at reasonable intervals and as per the information made available to us, no material discrepancies were noticed on such verification.

iii. According to the information and explanations given to us and on the basis of our examination of the books of account, the Company has not provided any loans, secured or unsecured to companies, firms, limited liability partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013.

iv. According to the information and explanations provided to us, the Company does not have any loans, investments, guarantees and security which are subject to the provisions of Section 185 and 186 of the Companies Act, 2013. Therefore, provisions of Para 4(iv) of the Companies (Auditor''s Report) Order, 2016 are not applicable to the Company.

v. The Company has not accepted any deposits from public.

vi. On the basis of the records produced to us, we are of the opinion that, prima facie, the cost records prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013 have been maintained. However, we have not carried out any detailed examination of such records.

vii. According to the information and explanations given to us in respect of statutory dues:

a) the Company has generally been regular in depositing with the appropriate authorities the undisputed statutory dues including Provident Fund, Employees’ State Insurance, Income Tax, Service Tax, Sales Tax, Customs Duty, Excise Duty and Cess though there has been a slight delay in a few cases. To the best of our knowledge and according to the information and explanations given to us, there were no arrears of outstanding statutory dues as at 31st March 2018 for a period of more than six months from the date they become payable.

b) According to the information and explanations given to us and on the basis of our examination of the records of the Company, there were no dues of Income Tax or Sales Tax or Customs Duty or Excise Duty or Value Added Tax or Goods and Services Tax, as at 31st March 2018, which have not been deposited on account of any dispute.

viii. On the basis of verification of records and according to the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowing to a financial institution, bank, Government or dues to debenture holders.

ix. In our opinion and according to the information and explanations given to us, the Company has not raised monies by way of initial public offer or further public offer (including debt instruments) during the year. The term loans availed were applied for the purposes for which they were raised.

x. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given to us by the Management, no fraud by the Company and no fraud on the Company by its officers or employees has been noticed or reported during the year.

xi. In our opinion and according to the information and explanations given to us, managerial remuneration paid or provided has been in accordance with the requisite approvals mandated by the provisions of Section 197, read with Schedule V to the Companies Act, 2013.

xii. The Company is not a Nidhi Company and hence compliance with the provisions of the Nidhi Rules is not applicable.

xiii. In our opinion and according to the information and explanations given to us, all transactions with related parties are in compliance with Sections 177 and 188 of the Companies Act, 2013 where applicable and the details have been disclosed in the financial statements, as required by the applicable accounting standards.

xiv. During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures.

xv. In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors or persons connected with him which will come under the purview of Section 192 of the Companies Act, 2013.

xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.

1. We have audited the internal financial controls with reference to the financial statements of Kanchi Karpooram Limited ("the Company") as of 31st March 2018 in conjunction with our audit of the Ind AS financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

2. The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India ("ICAI"). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors'' Responsibility

3. Our responsibility is to express an opinion on the Company’s internal financial controls with reference to the financial statements, based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting ("the Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to financial statements were in place and if such controls were operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to financial statements and their operating effectiveness. Our audit of internal financial controls with reference to financial statements included obtaining an understanding of internal financial controls with reference to financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. 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 error.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls with reference to financial statements.

Meaning of Internal Financial Controls with reference to Financial Statements

6. A company’s internal financial controls with reference to financial statements are designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial controls with reference to financial statements includes those policies and procedures that

a) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

b) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

c) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls with reference to Financial Statements

7. Because of the inherent limitations of internal financial controls with reference to financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to financial statements to future periods are subject to the risk that the internal financial controls with reference to financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

8. In our opinion, the Company has, in all material respects, adequate internal financial controls with reference to financial statements and such internal financial controls were operating effectively as at 31st March 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.

Place : Chennai For P.CHANDRASEKAR, LLP

Date : 16th May 2018 CHARTERED ACCOUNTANTS

(Firm Regn. No.000580S/S200066)

S.SRIRAM

Partner

Membership No. 205496


Mar 31, 2015

Report on Financial Statements

We have audited the accompanying financial statements of KANCHI KARPOORAM LIMITED("The Company") which comprise of the Balance Sheet as at 31stMarch 2015, Statement of Profit &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

The Company's Board of Directorsare responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ('the act') with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the company in accordance with the accounting principles generally accepted in India, including the Accounting Standards Specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) rules 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the company and for preventing and detecting frauds and other irregularities, selection and application of appropriate accounting policies, making judgments and estimates that are reasonable and prudent; and design implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records relevant to the preparation and presentation of the financial statements that give a true and fair view and a re free from material misstatement, whether due to fraud orerror.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the act, and the rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance a bout whether the financial statements are free from materia I 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 auditor's 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 financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate to the circumstances, but not for the purpose of expressing an opinion on whether the company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the company's directors, as well as evaluating the overall presentation of thefinancial statements.

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

Opinion

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

a) In the case of the Bala nee Sheet, of the state of affairs of the Company as at 31st March 2015; and

b) In the case of the Statement of Prof it and Loss, of the Prof it for the year ended on that date.

c) In the case of Cash Flow Statement, of the cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2015, ('The Order") issued by the Central Government oflndia in terms of Subsection (11) of Section 143 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required bysection 143(3) of the Act, we reportthat:

a) We have sought and obtained all the information and 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 it appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from the branches not visited by us.

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

d) In our opinion, the aforesaid financial statements comply with the Accounting Standards Specified under Section 133oftheAct, read with Rule 7 ofthe Companies (Accounts) Rules 2014.

e) On the basis of written representations received from the directors as on 31stMarch 2015 and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 2015 from being appointed as a director in terms of section 164(2) ofthe Act.

f) With respect to the other matters to be included in the Auditors report in accordance with Rule 11 of the Companies (Audits and Auditors) Rules 2014, in our opinion and to the best of our information and according to the explanationsgiventous:-

(I) The Company has disclosed the impact of pending litigations on its financial position in its financial statements.

(ii) The company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses,

(iii) There has been no delay in transferring a mounts, required to be transferred to thelnvestor Education and Protection fund by the Company.

Annexure referred to in Paragraph lunderthe heading "Report on other legal and regulatory requirements "of our Report of even date to the members of KANCHI KARPOORAM LIMITED on the accounts of the company for the year ended 31st March, 2015 :

On the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of our audit, we report that:

I. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets;

(b) As explained to us, these fixed assets have been physically verified by the management at regular intervals; as informed to us no material discrepancies were noticed on such verification;

II. (a) As explained to us, inventories were physically verified during the year by the management at reasonable intervals.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and nature of its business.

(c) In our opinion and according to the information and explanations given to us, the company has maintained proper records of inventories and no material discrepancies noticed on physical verification.

III. The company has not granted Secured or unsecured loans to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act 2013.

IV. In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, for the Purchase of Inventories andfixed assets and for the sale of goods and services. Duringthe course of audit we have not observed any continuing failure to correct major weaknesses in internal controls.

V. The Company has not accepted any deposits from the public covered under Section 73 to 76 of the Companies Act, 2013

VI We have broadly reviewed the books of accounts maintained by the company in respect of products the maintenance of cost records has been prescribed under sub-section (1) of Section 148 of the Companies Act, 2013 and are of the opinion that prima facie, the prescribed accounts and records have been maintained. We have not, however made a detailed examination of the records with a view to determine whether they are accurate or complete.

VI. (a) According to the information and explanations given to us and based on the records of the company examined by us, the company is regular in depositing the undisputed statutory dues, including Provident Fund, Investor education and protection fund Income-tax, Service act and other material statutory dues, as applicable, with the appropriate authorities in India. No undisputed amounts payable in respect of outstanding statutory dues were in arrears as at 31st March 2015 for a period of more than six months from the date they become payable.

(b) According to the information and explanations given to us and based on the records of the company examined by us, there are no dues of sales tax, income tax, customs duty, wealth tax, excise duty and cess, which have not been deposited on account of any dispute, as at 31st March 2015.

(c) According to the information and explanation made available to us there are no amount required to be transferred to Investor Education and protection fund.

VII. The company has no accumulated losses as at 31st March 2015. The company has not incurred cash losses in the financial year under report and in the immediately preceding financial year.

VIII. The company has not defaulted in repayment of dues to Banks/Financial institutions/Debenture holders.

IX. The company has not given guarantees for loans taken by others from banks or financial institutions.

X. The term loans have been applied for the purpose for which they were obtained.

XI. To the best of our knowledge belief and according to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the year

For M/s R.SUBRAMANIAN AND COMPANY

(Chartered Accountants)

(Registration No.FRN004137S)

K.Jayasankar

Partner

M.No.014156


Mar 31, 2014

We have audited the accompanying financial statements of KANCHI KARPOORAM LIMITED which comprise of the Balance Sheet as at 31st March 2014, Statement of Profit & 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 give a true and fair 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, 1956 (“the Act”). The 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 statements are free of 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 auditor’s 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 thecircumstances.An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of thefinancial 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, thefinancial statements give the information required by the Act in the manner so 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 31st March 2014

b) in the case of the Statement of Profit and Loss, of the Profit for the year ended on that date; and

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2003 ("the 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 said Order.

2. As required by section 227(3) of theAct, we report that:

(a) we have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of ouraudit;

(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 sub-section (3C) of section 211 of the Companies Act, 1956. Read with the general Circular 15/2013 dated 13th September 2013 of the or corporate offciers in respect of section 133 of the CompaniesAct, 2013.

(e) On the basis of written representations received from the directors as on 31st March 2014 and taken on record by the Board of Directors, none of the directors is disqualified as on 31s1 March 2014 from being appointed as a director in terms of clause (g) of sub-section (1)ofsection274ofthe CompaniesAct, 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 441Aof the CompaniesAct, 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.

KANCHI KARPOORAM LIMITED

ANNEXURE REFERRED TO IN PARAGARAPH 1 OF OUR REPORT OF EVEN DATE

1. The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

2. Some of the fixed assets were physically verified during the year by the Management in accordance with a program of verification, which in our opinion provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanations give to us, no material discrepancies were noticed on such verification.

3. Fixed assets disposed off during the year do not affect the concept of going concern.

4. Inventories were physically verfied during the year by the management at reasonable intervals.

In our opinion and according to the information and explanations given to us, the procedure of physical verification of inventories followed by the management was reasonable and adequate in relation to the size of the Company and the nature of its business.

In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

5. The company has not granted any loan secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the companiesAct 1956.

6. In our opinion and according to the information and explanations given to us, the company has not availed loansfrom parties listed in the registermaintained under section 301 of the CompaniesAct, 1956.

7. 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 and fixed assets and for the sale of goods and services and there was no continuing failure to correct any major weakness.

8. In our opinion and according to the explanations given to us, transactions made in pursuance of contracts or arrangements requiring entry in the registers maintained under section 301 of the CompaniesAct, 1956 have been entered.

The transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

9. The company has no fixed deposits requiring compliance of provisions of Section 58 and 58 AA or any other relevant provisions of the act and the rules framed there under.

10. In our opinion and according to the information and explanation given to us the company has an internal Audit system commensurate with the size and nature of its business.

11. We have broadly reviewed the books and records maintained by the company relating to the materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for Maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956. We are at the opinion that prima facie the prescribed accounts and records have been made and maintained for the period under audit.

We have however not made a detailed examination of the said records with a view to determine whether they are accurate orcomplete.

12. According to the information and explanations given to us, the Company has been generally regualrally regular in deposting undisputed statutory dues, Including Provident Fund, Employee''s State Insurance, Incometax, Sales-tax, Service Tax, Custom Duty, Excise Duty, cess and any other statutory dues with the appropriate authorities during the year. However, occasional delays have been observed in remitting the stautory dues. The company has no dues towards Investor Education and Protection Fund and Wealth Tax.

According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, service tax, were in arrears as at 31.03.2014 for a period more than six months from the date they became payable.

According to the information and explanations given to us, there are no dues of Sales tax, income Tax, Customs Duty, Wealth Tax, Excise Duty and cess which have not been deposited on account of any dispute.

According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, service tax, were in arrears as at 31.03.2014 for a period more than six months from the date they became payable.

According to the information and explanations given to us, there are mo dues of Sales tax, income Tax, Customs Duty, Wealth Tax, Excise Duty and cess which have not been deposited on account of any dispute.

13. The Company has no accumulated losses at the end of the year. The Company has not incurred any cash loss during the financial yearand the immdeiately preceding financial year.

14. The Company has not defaulted in the payment of dues to financial institutions, banks or debenture holders during the year.

15. The Company has not granted any loan or advance on the basis of security by way of pledge of shares, and othersecurities.

16. In our Opinion and according to the information and explanations given to us the Company is not a Chit Fund, mutual Benefit fund orSociety.

17. The Company is not dealing in trading of shares, securities, debentures and other investments and therefore the provisions of clause 4 (xiv) of the Companies (Auditor''s Report) order, 2003 are not applicable this Company.

18. In our opinion and according to the information and explanations given to us the Company has not given any guarantee for any loans taken by others from banks and financial institutions during the financial year.

19. To the best on our knowledge and belief and according to the information and explanations given to us, new term loan availed by the Company during the year have been applied for the purposes for which loans were obtained.

20. According to the cash flow statement and other records examined by us and the information and explanation join to us, to funds on shortterm basis have been used for long term investments.

21. The Company has not allotted shares during the financial year to companies covered in the register maintained under section 301 ofthe Companies Act, 1956.

22. According to the information and explanations given to us and the records examined by us, no debentures have been issued during the year.

23. To the best of our knowledge and belief and according to the information and explanations given to us or by the Company no fraud on or by the company was noticed or reported during the financial year.

24. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the financial year.

For R. Subramanian and Company Chartered Accountants FRN 004137 S

Sd/- Place : Chennai M. RAJASEKAR (Partner) Date : 30.05.2014 M. No. 228637


Mar 31, 2013

Report on Financial Statements

We have audited the accompanying financial statements of KANCHI KARPOORAM LIMITED which comprise of the Balance Sheet as at 31st March 2013, Statement of Profit & 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 give a true and fair 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, 1956 ("the Act"). The responsibility includes the design, implementation and maintenance off 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 statements are free of 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 auditor''s 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 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 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 financial statements give the information required by the Act in the manner so 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 31st March 2013

b) in the case of the Statement of Profit and Loss, of the Profit for the year ended on that date; and

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

Report on Other Legal and Regulatory Requirements

1 As required by section 227(3) of the Act, we report that:

(a) we have obtained all the information and 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 sub-section (3C) of section 211 of the Companies Act, 1956.

(e) On the basis of written representations received from the directors as on 31st March 2013 and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 2013 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the 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, 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.

2. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order”) issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the annexure a statement on the matters specified in the paragraphs 4 and 5 of the said Order.

ANNEXURE REFERRED TO IN OUR REPORT OF EVEN DATE

i (a) The Company is maintaining proper records which is being updated showing full particulars, including quantitative details and situation of Fixed assets.

(b) The Fixed Assets have been physically verfied by the management in a phased manner which in our opinion is reasonable commensurate to the size of the Company and nature of its assets. No material discrepancies between the books and the physical verification of Fixed Assets was noticed.

(c) Substantial part of the Fixed assets have not been sold during the year under review affecting Going concern.

ii. (a). The stock of Finished goods, Work in progress, raw materials and stores have been Physically verified during the year by the management. In our opinion the frequency of verification is reasonable.

(b) The procedure of Physical verification of Inventory followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company has maintained proper records of Inventory. The discrepancies noticed on verification between the Physical stocks and the book records were not material and have been properly dealt with in the books of accounts.

iii. (a) The Company has not availed loans from Parties listed in the register maintained under section 301 of the Companies Act, 1956.

(b) The Company has not granted any loans to Companies, firms or other parties listed in the Register maintained under Section 301 of the companies Act 1956.

iv. 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 in regard to purchase of Inventory, fixed assets and with regard to the Sale of goods. During the course of audit, we have not observed any continuing failure to correct major weakness in Internal Controls.

v. (a) According to the information and explanations given to us, and based on our verification, we are of the opinion that the transactions that were required to be entered in the register maintained under section 301 of the Companies Act, 1956 have been duly recorded.

(b) In our opinion and according to the information and explanations given to us the transactions made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act 1956 in respect of any Party during the year have been made at rates or values which are reasonable having regard to the relevant market rates or values at the relevant time.

vi. The Company has not accepted any fixed deposits from the public during the year requiring compliance of provisions of Section 58 A and 58 AA or any other relevant provisions of the Companies Act 1956.

vii. The Company has an Internal audit system Commensurate with the size of the Company and the nature of its business.

viii. We have broadly reviewed the books of accounts maintained by the Company in respect of products where, pursuant to the rules made by the Central Government of India, the maintenance of cost records has been prescribed under Clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 and are of the opinion that prima facie, the prescribed accounts and records have been maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

ix. (a) According to the information and explanations given to us, the Company has been regular in depositing undisputed statutory dues including Employees Provident Fund Employees'' State Insurance, Investor Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax Customs Duty Excise Duty, Cess and any other statutory dues with the appropriate authorities during the year. However occasional delays have been observed in remitting the statutory dues

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax .service tax etc were in arrears as at 31.03.2013 for a period of more than six months from the date they became payable.

(c) According to the information and explanations made available to us, there are no dues of Sales tax, Income tax, Customs duty, Wealth tax , Excise duty and cess which have not been deposited on account of any dispute.

x. The Company has no accumulated losses as at the end of the year, and has not incurred cash loses during the year and also in the immediately preceding financial year.

xi. As per the information and explanation made available to us, the Company has not defaulted in repayment of dues to any Financial Institutions, Banks or Debenture holders.

xii. The Company has not granted any loan or advance on the basis of Security by way of pledge of shares, Debentures and other securities.

xiii. The Company is not a Chit fund or nidhi /mutual benefit fund /society and therefore the provisions of clause 4 (xiii) of the Companies (Auditors Report order) 2003 are not applicable to this Company.

xiv. The Company is not dealing in or trading in shares, securities, debentures and other investments and therefore the Provisions of clause 4 (xiv) of the Companies (Auditor''s Report) order, 2003 are not applicable to this Company.

xv. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from Bank or Financial Institutions during the financial year.

xvi. To the best of our knowledge and belief and according to the information and Explanations given to us, Term Loans have been applied for the purpose for which they were raised.

xvii. According to the Cash flow statement and other records examined by us and based on the information and explanations given to us, on an overall basis, no funds raised on Short term basis have been used for Long term Investments.

xviii. During the year Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the companies act 1956.

xix. No debentures have been issued by the Company during the year.

xx. The Company has not raised any money by way of Public issue during the year.

xxi. To the best of our knowledge and according to information and explanations given to us, no fraud on or by the Company was noticed or reported during the financial year that causes the financial statements to be materially misstated.

For R. Subramanian and Company

Chartered Accountants FRN 004137 S Sd/-

A.S. RAMANATHAN Place : Chennai Partner Date : 30.05.2013 M. No. 11072.

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