Mar 31, 2023
Kernex Microsystems (India) Limited Report on the Audit of the Standalone Financial Statements Qualified
Opinion
We have audited the accompanying standalone financial statements of Kernex Microsystems (India) Limited (âthe Companyâ), which comprise the balance sheet as at 31 March 2023, and the statement of Profit and Loss, including the Statement of Other Comprehensive Income, the statement of cash flows and the statement of changes in equity for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Financial statements give the information required by the Companies Act, 2013, as amended (âthe Actâ) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2023, its loss including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of standalone financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of the Standalone Financial statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the standalone Financial statements under the provisions of the Act, and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on the standalone Financial statements.
We draw attention to Note 44 to the standalone financial statements which describes that the Company has assessed the recoverability and impairment of certain financial assets namely trade receivables including Rs. 414.57 lakhs from Related party, income tax assets and margin money /security deposits secured for customer guarantees under arbitration / negotiation. Such assessments are based on current facts and circumstances and may not necessarily reflect future uncertainties and events and the final recoverable amount may vary for the reasons mentioned there in.
Our opinion is not modified in respect of this matter.
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.
Key Audit Matter |
Auditor''s Response |
1. The Company recognizes revenue from sale of goods/services based on the terms and conditions of purchase orders / contracts received from different customers. For recognising revenue, the control of goods / services are transferred to the customer. As revenue recognition is subject to management''s assessment as to when control is transferred / services performed, we consider this as a key audit matter. |
1. We have evaluated the appropriateness of the assumptions applied for assessing the revenue and tested the evidence to support the revenue recognition. |
Information Other than the Standalone Financial Statements and Auditor''s Report Thereon
The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Annual Report but does not include the Standalone Financial Statements and our auditor''s report thereon.
Our opinion on the standalone financial statements does not cover the other information and we do not and will not express any form of assurance conclusion thereon.
In connection with our audit of the standalone Financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether such other information is materially inconsistent with the standalone Financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone Financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in the equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards(Ind AS) specified under section 133 of the Act read with the companies (Indian Accounting Standards) Rules, 2015, as amended. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of 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 Standalone Financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the Standalone Financial statements, the management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the company''s financial reporting process.
Auditor''s Responsibilities for the Audit of the Standalone Financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone Financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act, 2013, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls system in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
⢠Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2020 (âthe Orderâ), issued by the Central
Government of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in the
Annexure B a statement on the matters specified in paragraphs 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 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 the Statement of 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 standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
e) On the basis of the written representations received from the directors as on 31 March 2023 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2023 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 over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ.
g) In our opinion, the managerial remuneration for the year ended 31 March 2023 has been paid /provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;
h) 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, as amended in our opinion and to the best of our information and according to the explanations given to us:
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 were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company
iv. a) The management has represented that, to the best of its knowledge and belief, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the company to or in any other person or entity, including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediaries shall, whether,directly or indirectly lend or invest in other person or entity identified in any manner whatsoever by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
b) The management has represented that, to the best of its knowledge and belief, no funds have been received by the company from any person or entity, including foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the company shall, whether, directly or indirectly, lend or invest in other person or entity identified in any manner whatsoever by or on behalf of the Funding Parties (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
c) Based on the audit procedures that were considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (a) and (b) contain any material misstatement.
v. No dividend has been declared or paid during the year by the Company.
For PRSV & Co. LLP
Chartered Accountants
Firm''s Registration No. S-200016
Sd/-
Raja Praturi
Partner
Place: Hyderabad Membership No. 020615
Date : 28 May 2023 UDIN: 23020615BGYNNY7297
Mar 31, 2018
INDEPENDENT AUDITORSâ REPORT
To
The Members
Kernex Microsystems (India) Limited
Report on the Standalone Ind AS Financial
Statements
We have audited the accompanying standalone Ind AS financial statements of KERNEX MICROSYSTEMS (INDIA) LIMITED ("the Companyâ), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss, including the Statement of Other Comprehensive Income, the Statement of Cash flows and the Statement of Changes in Equity for the year then ended and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Standalone Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Actâ) with respect to the preparation of these standalone Ind 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 Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India.
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 Ind AS standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorsâ Responsibility
Our responsibility is to express an opinion on these standalone Ind 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 and the Order issued under section 143(11) of the Act.
We conducted our audit of the Ind AS standalone financial statements 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 about whether the standalone financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the Ind AS standalone financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone 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 the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the Ind AS standalone financial statements.
We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
Basis for Qualified Opinion
- Out of the total trade receivables as per note no 9, dues outstanding for more than 6 months as on March 31, 2018 is of Rs. 32.85 crores which are subject to confirmation and reconciliation. These trade receivable are slow moving, as partly received or non-moving.
- An amount of Rs. 15.08 crores receivable from Konkan Railway Corporation Limited (KRCL) is under arbitration. Further, the Company has failed in the conciliation proceedings against KRCL for outstanding dues of Rs 5.18 crores and the Company is in the process of filing Arbitration petition. The company has not made any provision in the books of accounts.
- Other financial assets under non-current assets as per note no 5 amounting to Rs. 6.00 is subject to confirmation from parties.
- No provision has been made for slow/nonmoving stocks lying as on March 31, 2018.
Qualified Opinion
In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of the matters described in the Basis for Qualified Opinion, the aforesaid Ind AS standalone 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, of the state of affairs of the Company as at March 31, 2018, its loss including other comprehensive loss, its cash flows and the changes in equity for the year ended on that date.
Report on Other Legal and Regulatory
Requirements
1. As required by Section 143(3) of the Act, based on our audit 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 of Other Comprehensive Income, Statement of Cash Flow 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 standalone Ind AS financial statements comply with the Indian Accounting Standards prescribed under section 133 of the Act, read with Companies (Indian Accounting Standards) Rules 2015, as amended.
e) On the basis of the written representations received from the directors of the Company as on March 31, 2018 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 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 over financial reporting of the Company with reference to these standalone Ind AS financial statements and the operating effectiveness of such controls, refer to our separate Report in "Annexure A to this reportâ.
g) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements.
ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
2. As required by the Companies (Auditorâs Report) Order, 2016 ("the Orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in "Annexure Bâ a statement on the matters specified in paragraphs 3 and 4 of the Order.
ANNEXURE âAâ TO THE INDEPENDENT AUDITORSâ REPORT OF EVEN DATE ON THE STANDALONE IND AS FINANCIAL STATEMENTS
(Referred to in paragraph 1(f) under âReport on Other Legal and Regulatory Requirementsâ section of our report to the Members of Kernex Microsystems (I) Limited of even date)
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Subsection 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of KERNEX MICROSYSTEMS (INDIA) LIMITED ("the Companyâ) as of March 31, 2018 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Board of Directors of the Company 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. 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, 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.
Auditorsâ Responsibility
Our responsibility is to express an opinion on the internal financial controls over financial reporting of the Company 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 Noteâ) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. 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 over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, 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 auditorâs judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained, is sufficient and appropriate to provide a basis for our audit opinion on the Companyâs internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A companyâs internal financial control over financial reporting is a process 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 companyâs internal financial control over financial reporting includes those policies and procedures that (1) Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) 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 (3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, 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 over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 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.
ANNEXURE âBâ TO THE INDEPENDENT AUDITORSâ REPORT
(Referred to in paragraph 2 under âReport on Other Legal and Regulatory Requirementsâ section of our report to the Members of Kernex Microsystems (I) Limited of even date)
I. In respect of the Companyâs fixed assets:
(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) All the fixed assets have not been physically verified by the management during the year but there is regular program of verification which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. According to the information and explanations given to us, no material discrepancies were noticed on such verification.
(c) According to the information and explanations given to us, the title deeds of immovable properties included in property, plant and equipment are held in the name of the Company.
ii. As explained to us, the management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies were observed in the inventories.
iii. According to the information and explanations given to us, the Company has not granted any unsecured loans to companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013, Accordingly, the provisions of clause 3 (iii) (b), (c) and (d) are not applicable to the Company.
iv. In our opinion and according to the information and explanations given to us, the Company has
not advanced loans to director/ to a Company in which the Director is interested to which provisions of section 185 of the Companies Act, 2013 apply. In our opinion and according to the information and explanations given to us, the Company has made investments and given guarantees/provided security which is in compliance with the provisions of Sections 186 of the Companies Act, 2013.
v. The Company has not accepted deposits during the year within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Therefore, the provisions of the clause 3 (v) of the Order are not applicable to the Company.
vi. The maintenance of cost records has not been specified by the Central Government under section 148(1) of the Companies Act, 2013 for the business activities carried out by the Company. Thus, reporting under clause 3(vi) of the order is not applicable to the Company.
vii. (a) According to the books and records as
produced and examined by us and also based on management representations, undisputed statutory dues in respect of Provident fund, Employeesâ State Insurance, Income Tax, Sales Tax, Service Tax, Value Added Tax, Goods and Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues have not been regularly deposited by the Company during the year with appropriate authorities and the outstanding statutory dues outstanding for more than 6 months as at the end of the financial year are as follows.
Nature of Statutory Dues |
Amount (Rs. In Lakhs) |
Service Tax |
69.72 |
CST against ''C'' Forms |
22.07 |
Total |
91.79 |
(b) According to information and explanations given to us, disputed amounts payable in respect of Income Tax, Sales Tax, Provident fund were outstanding as at March 31, 2018 are as follows:
Name of the Statute |
Period to which the amount relates |
Amount ? in Lakhs |
||
The Income Tax Act, 1961 |
Income Tax |
High Court of judicature at Hyderabad for the state of Telangana and state of Andhra Pradesh |
A.Y. 1998-99 |
8.00 |
APGST Act, 1957 |
Sales Tax and Interest |
Sales Tax Appellate Tribunal |
F.Y. 2002-03 |
4.13 |
The Employee Provident Act, 1952 |
Provident Fund |
PF Department |
F.Y 2017-18 |
51.64 |
viii. In our Opinion and according to the information and explanations given by the management, the company has not defaulted in repayment of loans or borrowings to banks or government. There are no dues which are payable to financial institutions. The Company did not have any debenture holders during the year.
ix. According the information and explanations given by the management, the Company has not raised any moneys by way of initial public offer/further public offer/ debt instruments and term loans and hence reporting under clause 3 (ix) of the Order is not applicable to the Company.
x. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no fraud by the Company or no material 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, the Company has paid/provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.
xii. The Company is not a Nidhi Company and hence reporting under clause 3 (xii) of the Order is not applicable to the Company.
xiii. In our opinion and according to the information and explanations given to us by the management, the Company is in compliance with Section 177 and 188 of the Companies Act, 2013 where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the notes to the financial statements as required by the applicable accounting standards.
xiv. According the information and explanations given to us, the Company has not made any preferential allotment or private placement of shares or fully or partly paid convertible debentures during the year under review and hence reporting under clause 3 (xiv) of the Order is not applicable to the Company.
xv. According to the information and explanations given to us, the Company has not entered into any non-cash transactions with its Directors or persons connected to its directors as referred to in section 192 of the Companies Act, 2013 during the year under review and hence provisions of section 192 of the Companies Act, 2013 are not applicable to the Company.
xvi. According to the information and explanations given to us, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
For PRSV & Co. LLP
Chartered Accountants
Firm Registration No: S-200016
Y. Venkateswarlu
Partner
Membership No: 222068
Place: Hyderabad
Date: 27th May, 2018
Mar 31, 2016
INDEPENDENT AUDITOR''S REPORT
To
The Members of
Kernex Microsystems (India) Limited
1. Report on the Financial Statements
We have audited the accompanying financial statements of KERNEX MICROSYSTEMS (INDIA) LIMITED, (âThe Companyâ), which comprise the Balance Sheet as at March 31, 2016, 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.
2. Management''s Responsibility for the Financial Statements
The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and 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 of 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 are free from material misstatement, whether due to fraud or error.
3. 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 about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the 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 in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, 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 on the financial statements.
4. 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, of the state of affairs of the Company as at 31st March, 2016 and its loss and its cash flows for the year ended on that date.
5. Other Matters
We did not audit the financial statements/ information of Egypt Branch included in the standalone financial statements of the Company whose financial statements/information reflect total assets of Rs.12,65,92,013 as at 31st March, 2016 and total revenues of Rs.3,23,67,138 for the year ended on that date, as considered in the standalone financial statements. The financial statements/information of this foreign branch have been audited by the branch auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of this branch, is based solely on the report of such branch auditors and the returns submitted at the branch.
The outstanding debtors amount of Rs.24.06 crores from Konkan Railway Corporation Limited is subject to confirmation and reconciliation.
Our opinion is not modified in respect of this matter.
6. Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ) 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 the paragraph 3 and 4 of the order.
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 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 appears from our examination of those books.
(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 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;
(e) On the basis of written representations received from the directors as on 31st March,2016 and taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed to act as a director in terms of Section 164(2) of the Act;
(f) With respect to the adequacy of the internal financial controls over financial reporting of the company and the operating effectiveness of such controls, refer to our separate report in the âAnnexure Bâ and
(g) With respect to 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 the explanations given to us:
I. the company has disclosed the impact of pending litigations on its financial position in its financial statements- Refer Note No. 27 to the financial statements;
ii. the company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any on long-term contracts including derivative contracts-Refer Note 27 to the financial statements;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
1. a) The Company has maintained requisite records showing required particulars including quantitative details and situation of its fixed assets.
b) According to the information and explanation given to us by the management, most of the fixed assets of the company have been physically verified by the management during the year and the intervals of such verification had also been reasonable.
c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the company.
2. As explained to us by the management and as observed by us, the inventory of raw material, finished goods stores and spares etc. has been physically verified during the year and specifically at the year-end by the management and no material discrepancies were observed in the inventories.
3. Based on our scrutiny and as per information and explanations provided to us by the management, the company has not granted any loans during the period under review covered in the registers maintained under section 189 of the Companies Act, 2013. Since there are no loans granted sub-clauses b, c and d are not applicable.
4. Based on our scrutiny and as per the information provided by the management, the company does not have any transactions in respect of loans, investments, guarantees and securities granted, to be complied with the provisions of Sections 185 and 186 of the Companies Act, 2013.
Name of the Statute |
Amount (Rs. In lakhs) |
Period to which the amount relates |
Forum where dispute is pending |
Income Tax Act, 1961 |
8.00 |
F.Y. 1997-98 |
A.Y. 1998-99High Court of Judicature at Hyderabad for the state of Telangana and State of Andhra Pradesh |
APGST Act, 1957 |
4.13 |
F.Y. 2002-03 |
Sales Tax Appellate Tribunal |
5. Based on our scrutiny and as per the information provided by the management, the company has not accepted any deposits during the year under review attracting the sections 73 to 76 of the Companies Act, 2013 and rules made there under.
6. According to the information and explanations given, the maintenance of cost records as specified under sub-section (1) of section 148 of the Companies Act, 2013 are not applicable for the year under review.
7. a) According to the books and records as
produced and examined by us in accordance with Generally Accepted Auditing Practices in India and also based on management representations, undisputed statutory dues in respect of provident fund, employee state insurance, income tax, service tax, sales tax, value added tax, excise duty, cess and other material statutory dues have not been regularly deposited by the company during the year with the appropriate authorities and the outstanding statutory dues as at the end of the financial year outstanding for more than 6 months are as follows :
Nature of Statutory Dues |
Amount (Rs. in Lakhs) |
Provident Fund Employees State Insurance Tax Deducted at Source Service Tax Professional Tax Works Contract Tax TOTAL |
42.25 3.22 24.18 190.78 0.49 9.69 270.61 |
b) According to information and explanations given to us, disputed amounts payable in respect of Income Tax and Sales Tax were outstanding as on 31st March, 2016 are as follows:
8. As observed by us and as per the information and explanations given by the management, we are of the opinion that the company has not defaulted in repayment of dues to its financial institution or bank during the year under audit.
9. As observed by us, the company has not availed any Term Loans from Banks during the year. The company has not raised any monies by way of IPO or FPO during the year under review.
10. Based upon the audit procedures performed and information and explanations given by the management, we report that no material fraud on or by the company by its officers or employees has been noticed or reported during the course of our audit.
11. According to the information and explanations given to us and based on our examination of the records of the company, the managerial remuneration paid/provided during the year by the company is as per the provisions of section 197 read with Schedule V of the Companies Act, 2013.
12. In our opinion and according to the information and explanations given to us, the company is not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.
13. According to the information and explanations given to us and based on our examination of the records of the company, transactions with related parties are in compliance with section 177 and 188 of the Act wherever applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.
14. According to the information and explanations given to us and based on our examination of the records of the company, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.
15. As observed by us and as per the information and explanations given by the management, the company has not entered into any non-cash transactions with the directors or persons connected with him, during the period under review.
16. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.
For GMK ASSOCIATES,
Chartered Accountants
Firm Regn No.006945S
G. Satyanarayana Murty
Partner
Membership No: 29919
Place: Hyderabad
Date: 28th May, 2016
Mar 31, 2015
We have audited the accompanying standalone financial statements of
KERNEX MICROSYSTEMS (INDIA) LIMITED ('the Company'), which comprise
the Balance Sheet as at 31 March 2015, the statement of profit and loss
and the Cash Flow Statement for the year then ended, and a summary of
significant accounting policies and other explanatory information.
Management's Responsibility for the Standalone Financial Statements
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 and presentation of these standalone
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 are free from material
misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these standalone
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 about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the 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 in 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 the accounting policies used and the reasonableness
of the accounting estimates made by the Company's Directors, 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 on the standalone
financial statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone 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, of the state of affairs of the Company as
at 31 March 2015 and its Loss and its cash flows for the year ended on
that date
Other Matter
We did not audit the financial statements/information of Egypt branch
included in the standalone financial statements of the Company whose
financial statements/ information reflect total assets of
Rs.14,64,52,805 as at 31st March,2015 and total revenues of Rs.
4,27,34,800 for the year ended on that date, as considered in the
standalone financial statements. The financial statements/information of
these foreign branch have been audited by the branch auditors whose
reports have been furnished to us, and our opinion in so far as it
relates to the amounts and disclosures included in respect of these
branch, is based solely on the report of such branch auditors.
The outstanding Debtors amount of Rs 18.18 Crores from Konkan Railway
Corporation Limited are subject to confirmation and reconciliation.
Our opinion is not modified in respect of this matter.
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 of India in terms of
sub-section (11) of section 143 of the Act, we give in the Annexure a
statement on the matters specified in the paragraph 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 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 reports on the accounts of the foreign branch office of the
Company audited under the provisions of Egyptian Laws by branch
auditors have been sent to us and have been properly dealt with by us
in preparing this report;
d. 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;
e. in our opinion, the aforesaid standalone financial statements
comply with the Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;
f. on the basis of the written representations received from the
Directors as on 31 March 2015 taken on record by the Board of
Directors, none of the directors is disqualified as on 31 March 2015
from being appointed as a director in terms of Section 164 (2) of the
Act; 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 the explanations given to us:
i. the Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note 26 to the
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 amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.
Annexure to the Independent Auditors' Report
The Annexure referred to in our Independent Auditors' Report to the
members of the Company on the standalone financial statements for the
year ended 31 March 2015, we report that:
(I) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets
(b) As per information and explanations given to us by the management,
physical verification of Fixed Assets has been carried out during the
year and no material discrepancies are noticed.
(II) (a) The Inventory has been physically verified by the management
at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures for physical verification of inventory
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business;
(c) On the basis of our examination of the inventory records, in our
opinion, the company has maintained proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
(III) During the year, the Company has not granted any loans, secured
or unsecured, to the companies, firms or other parties covered in the
register maintained under Section 301 of the Companies Act, 2013.
Hence Clauses (iii) (a) & (b) of the Order are not applicable.
(IV) In our opinion and according to the information and explanations
provided to us there are adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and for sale of goods and
services. During the course of our audit, no major weakness has been
noticed in the internal control.
(V) The Company has not accepted any deposits from the public during
the year under review falls under section 73 to 76 of the Companies Act
2013;
(VI) Books of account to be maintained by the Company, pursuant to the
Rules made by the Central Government of India for the maintenance of
cost records, is not applicable for this company for the year under
review.
(VII)(a) There have been delays in depositing undisputed statutory dues
including Provident Fund, Employees State Insurance, Income Tax and
Service Tax with appropriate authorities during the year. According to
the records, information and explanations provided to us, there are
undisputed amounts payable in respect of Provident Fund Rs 10,52,071/-,
TDS Rs1852602/-, and Corporate Dividend Tax Rs 20,27,757 were
outstanding at the yearend for a period of more than six months from
the date they become payable ;
(b) According to the information and explanations provided to us,
particulars of out-standing dues of Income tax and Sales tax have not
been deposited on account of any dispute are given below:
Name of Statute Nature of the Period to
Dues which the
amount relates
Income Tax Act Income Tax A.Y 1998-99
APGST Sales Tax A.Y 2003-04
Name of Statute Amount Forum where
(Rupees in Lakhs) dispute is
pending
Income Tax Act 8.00 High Court
APGST 4.13 STAT
(VIII) The Company does not have any accumulated losses at the end of
the financial year and has incurred a cash loss of Rs 5,51,64,254
during the year covered by our audit and has not incurred any cash loss
in the immediately preceding financial year.
(IX) Based on our audit procedures and on the information and
explanations given by the management, the Company has not defaulted in
repayment of dues to any financial institution or bank;
(X) On the basis of our examination of the books of accounts and the
information and explanation given to us the Company has not given any
guarantee for loans by others from bank or financial institutions ;
(XI) According to the information and explanations given to us, the
company has not availed any term loans during the year under review.
(XII) Based on the audit procedures performed and information and
explanations given to us by the management, we report that no fraud on
or by the Company has been noticed or reported during the course of our
audit.
For GMK Associates
Chartered Accountants
Firm Regn No. 006945S
(G. Satyanarayana Murty)
Place: Hyderabad Partner
Date: 24th May, 2015 Membership No. 029919
Mar 31, 2014
We have audited the accompanying financial statements of KERNEX
MICROSYSTEMS (INDIA) LIMTED("the Company"), which comprise the Balance
Sheet as at March 31, 2014 and 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 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") read with the General Circular
15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs
in respect of Section 133 of the Companies Act, 2013 and in accordance
with the accounting principles generally accepted in India. 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 statements 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 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 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 March 31, 2014
(b) In the case of Statement of Profit and Loss, of the profit for the
year ended on that date.
(c) In the case of the 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 Order.
2. 2. 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 and Statement of Profit and Loss 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
comply with the Accounting Standards notified under the Act read with
the General Circular 15/2013 dated 13th September, 2013 of the Ministry
of Corporate Affairs in respect of Section 133 of the Companies Act,
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 March 31st, 2014 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 the under the said
section, prescribing the manner in which such cess is to be paid, no
cess is due and payable by the Company.
Annexure to the Auditor''s report of even date to the Members of Kernex
Microsystems (India) Limited
(I) (a) The Company''s fixed assets register showing full particulars
including Quantitative details and the situation of its fixed assets is
to be updated.
(b) As per the explanations given to us by the management, physical
verification of Fixed Assets has been carried out during the year and
no material discrepancies are noticed.
(c) None of the major fixed assets of the Company are disposed off
during the year.
(II) (a) The Inventory has been physically verified by the management
at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures for physical verification of inventory
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business;
(c) On the basis of our examination of the inventory records, in our
opinion, the company has maintained proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
(III) (a) During the year, the Company has not granted any loans,
secured or unsecured, to the companies, firms or other parties covered
in the register maintained under Section 301 of the Companies Act,
1956. Hence Clauses (iii) (b), (c) & (d) of the Order are not
applicable.
(b) The Company has taken short term loans of Rs 485.85 Lakhs from 4
Directors during the year and the maximum and outstanding balance is Rs
485.85 Lakhs from other parties covered in the register maintained
under Section 301 of the Companies Act, 1956. The Terms and conditions
are not prejudicial to the interest of the company.
(IV) In our opinion and according to the information and explanations
provided to us there are adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and for sale of goods and
services. During the course of our audit, no major weakness has been
noticed in the internal control.
(V) Based on the audit procedures applied by us and according to the
information and explanations provided by the management, we are of the
opinion that there have been no transactions that need to be entered
into the register maintained under Section 301;
(VI) The Company has not accepted any deposits from the public during
the year under review falls under section 58A and 58AA of the Companies
Act 1956;
(VII) The Company has an in-house internal audit department, which, in
our opinion the scope is commensurate with the size and nature of the
business of the company;
(VIII) We have broadly reviewed the books of account maintained by the
Company in respect of the 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 Section 209 of the Act and are of
the opinion that prima facie, the prescribed accounts and records have
been made and 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) There have been delays in depositing undisputed statutory dues
including Provident Fund, Employees State Insurance, Income Tax and
Service Tax with appropriate authorities during the year. According to
the records, information and explanations provided to us, there are
undisputed amounts payable in respect of Provident Fund Rs 28,35,064/-
Employees State Insurance Rs. 5,78,862, TDS Rs 52,57,692/-,and
Corporate Dividend Tax Rs 20,27,757/-were outstanding at the yearend
for a period of more than six months from the date they become payable
;
(b) According to the information and explanations provided to us,
particulars of out standing dues of Income tax and Sales tax have not
been deposited on account of any dispute are given below:
Name of Statute Nature of the Period to which Amount(Rupees in
Dues the amounts relates Lakhs)
Income Tax Act Income Tax A.Y 1998-99 8.00
APGST Sales Tax A.Y 2003-04 4.13
Name of Statute Forum dispute is pending
Income Tax Act High Court
APGST STAT
(X) The Company does not have any accumulated losses at the end of the
financial year and has not incurred any cash loss during the year
covered by our audit and also in the immediately preceding financial
year.
(XI) Based on our audit procedures and on the information and
explanations given by the management, the Company has not defaulted in
repayment of dues to any financial institution or bank;
(XII) Based on our examination and according to the information and
explanations given to us , the Company has not granted loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities ;
(XIII) In our opinion, the Company is not a Chit Fund / Nidhi / Mutual
Benefit Fund/ Society and Clause 4 (xiii) of the Order are not
applicable to this company.
(XIV) In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of Clause 4(xiv) of the Order not applicable to the Company.
(XV) On the basis of our examination of the books of accounts and the
information and explanation given to us the Company has not given any
guarantee for loans by others from bank or financial institutions ;
(XVI) According to the information and explanations given to us, the
company has not availed any term loans during the year under review.
(XVII) On the basis of our examinations of the books of accounts and
the information and explanation given to us, in our opinion, the funds
raised on short-term basis have not been used for long-term investment.
(XVIII) During the year, the Company has not made any preferential
allotment of shares to parties and companies covered in the Register
maintained under Section 301 of the Act ;
(XIX) The Company has not made any issue of debentures during the year;
(XX) During the year covered by our audit report the Company has not
raised any money by way of Public Issue.
(XXI) Based on the audit procedures performed and information and
explanations given to us by the management, we report that no fraud on
or by the Company has been noticed or reported during the course of our
audit.
For GMK Associates
Chartered Accountants
Firm Regn No. 006945S
(G. Satyanarayana Murty)
Partner
Membership No. 029919
Place: Hyderabad
Date: 24.05.2014
Mar 31, 2013
Report on the Financial Statements
We have audited the accompanying financial statements of KERNEX
MICROSYSTEMS (INDIA) LIMTED(Â''the Company''''), which comprise the
Balance Sheet as at March 31, 2013 and 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 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 (Â''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 statements 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 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 CompanyÂs 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 March 31, 2013
b. In the case of Statement of Profit and Loss, of the profit for the
year ended on that date.
c. In the case of the 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
subÂsection (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 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 and Statement of Profit and Loss 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
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 March 31st, 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.
Annexure to the Auditor''s report of even date to the Members of Kernex
Microsystems (India) Limited
(I) (a) The Company is in the process of updating the records showing
full particulars including Quantitative details and the situation of
its fixed assets.
(b) As per the explanations given to us by the management, physical
verification of Fixed Assets has been carried out during the year and
no material discrepancies are noticed.
(c) None of the major fixed assets of the Company are disposed off
during the year.
(II) (a) The Inventory has been physically verified by the management
at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures for physical verification of inventory
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business;
(c) On the basis of our examination of the inventory records, in our
opinion, the company has maintained proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
(III) (a) During the year, the Company has not granted any loans,
secured or unsecured, to the companies, firms or other parties covered
in the register maintained under Section 301 of the Companies Act,1956.
Hence Clauses (iii) (b), (c) & (d) of the Order are not applicable.
(b) The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Companies Act, 1956. Hence Clauses (iii) (f) &
(g) of the Order are not applicable.
(IV) In our opinion and according to the information and explanations
provided to us there are adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and for sale of goods and
services. During the course of our audit, no major weakness has been
noticed in the internal control.
(V) Based on the audit procedures applied by us and according to the
information and explanations provided by the management, we are of the
opinion that there have been no transactions that need to be entered
into the register maintained under Section 301;
(VI) The Company has not accepted any deposits from the public during
the year under review falls under section 58A and 58AA of the Companies
Act 1956;
(VII) The Company has an in-house internal audit department, which, in
our opinion the scope is commensurate with the size and nature of the
business of the company;
(VIII) We have broadly reviewed the books of account maintained by the
Company in respect of the 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 Section 209 of the Act and are of
the opinion that prima facie, the prescribed accounts and records have
been made and 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) There have been delays in depositing undisputed statutory dues
including Provident Fund, Employees State Insurance, Income Tax and
Service Tax with appropriate authorities during the year. According to
the records, information and explanations provided to us, there are
undisputed amounts payable in respect of Provident Fund Rs. 3,56,951/-,
Employees State Insurance Rs. 6,64,147, TDS Rs 22,54,681/-,and
Corporate Dividend Tax Rs. 20,27,757/- outstanding at the year end for
a period of more than six months from the date they become payable ;
(X) The Company does not have any accumulated losses at the end of the
financial year and has not incurred any cash loss during the year
covered by our audit and also in the immediately preceding financial
year.
(XI) Based on our audit procedures and on the information and
explanations given by the management, the Company has not defaulted in
repayment of dues to any financial institution or bank;
(XII) Based on our examination and according to the information and
explanations given to us , the Company has not granted loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities ;
(XIII) In our opinion, the Company is not a Chit Fund / Nidhi / Mutual
Benefit Fund/ Society and Clause 4 (xiii) of the Order are not
applicable to this company.
(XIV) In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of Clause 4(xiv) of the Order not applicable to the Company.
(XV) On the basis of our examination of the books of accounts and the
information and explanation given to us the Company has not given any
guarantee for loans by others from bank or financial institutions ;
(XVI) According to the information and explanations given to us, the
company has not availed any term loans during the year under review.
(XVII) On the basis of our examinations of the books of accounts and
the information and explanation given to us, in our opinion, the funds
raised on short-term basis have not been used for long-term investment.
(XVIII) During the year, the Company has not made any preferential
allotment of shares to parties and companies covered in the Register
maintained under Section 301 of the Act ;
(XIX) The Company has not made any issue of debentures during the year;
(XX) During the year covered by our audit report the Company has not
raised any money by way of Public Issue.
(XXI) Based on the audit procedures performed and information and
explanations given to us by the management, we report that no fraud on
or by the Company has been noticed or reported during the course of our
audit.
For GMK ASSOCIATES.,
Chartered Accountants
(Firm Regn No.006945S)
G.Satyanarayana Murty
Partner
Membership No.:29919
Place: Hyderabad
Date: 25th May, 2013
Mar 31, 2012
We have audited the attached Balance Sheet of Kernex Microsystems
(India ) Limited, as at 31st March, 2012 and also the Statement of
Profit and Loss and Cash Flow Statement for the year ended on that date
annexed thereto. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion
on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in India. Those Standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An Audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An Audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
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 Companies Act, 1956, we enclose
in the Annexure a statement on the matters specified in paragraphs 4
and 5 of the said Order.
Further to our comments in the Annexure referred to above, we report
that:
(i) 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;
(ii) 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;
(iii) The Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
accounts.
(iv) In our opinion , the Balance Sheet, Statement of Profit and Loss
and Cash Flow Statement dealt with by this report comply with the
accounting
standards referred to in sub-section (3C) of Section 211 of the
Companies Act,1956 ;
(v) On the basis of written representations received from the directors
as on 31st March, 2012 and taken on record by the Board of Directors,
we report that none of the directors is disqualified as on 31st March,
2012 from being appointed as a director in terms of Clause (g) of
sub-section (1) of Section 274 of the Companies Act,1956;
(vi) In our opinion and to the best of our information and according to
the explanations given to us , they said accounts give the information
required by the Companies Act,1956, 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 Balance Sheet, of the state of affairs of the
Company as at 31st March, 2012;
(b) In the case of Statement of Profit and Loss, of the Profit for the
year ended on that date.
(c) In the case of Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Annexure to the Auditor's report of even date to the Members of
Kernex Microsystems (India) Limited
(I) (a) The Company is in the process of updating
the records showing full particulars including Quantitative details and
the situation of its fixed assets.
(b) As per the explanations given to us by the management, physical
verification of Fixed Assets has been carried out during the year and
no material discrepancies are noticed.
(c) None of the major fixed assets of the Company are disposed off
during the year.
(II) (a) The Inventory has been physically verified by the management
at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures for physical verification of inventory
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business;
(c) On the basis of our examination of the inventory records, in our
opinion, the company has maintained proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
(III) (a) During the year, the Company has not
granted any loans, secured or unsecured, to the companies, firms or
other parties covered in the register maintained under Section 301 of
the Companies Act,1956. Hence Clauses (iii) (b), (c) & (d) of the
Order are not applicable.
(b) The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Companies Act, 1956. Hence Clauses (iii) (f) &
(g) of the Order are not applicable.
(IV) In our opinion and according to the information and explanations
provided to us there are adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and for sale of goods and
services. During the course of our audit, no major weakness has been
noticed in the internal control.
(V) Based on the audit procedures applied by us and according to the
information and explanations provided by the management, we are of the
opinion that there have been no transactions that need to be entered
into the register maintained under Section 301;
(VI) The Company has not accepted any deposits from the public during
the year under review falls under section 58A and 58AA of the Companies
Act 1956;
(VII) The Company has an in-house internal audit department, which, in
our opinion the scope is commensurate with the size and nature of the
business of the company;
(VIII) We have broadly reviewed the books of account maintained by the
Company in respect of the 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 Section 209 of the Act and are of
the opinion that prima facie, the prescribed accounts and records have
been made and 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) There have been delays in depositing
undisputed statutory dues including Provident Fund, Employees State
Insurance, Income Tax and Service Tax with appropriate authorities
during the year. According to the records, information and explanations
provided to us, there are undisputed amounts payable in respect of TDS
Rs 7,20,600/-, Excise Duty Rs 5,31,388/- and Corporate Dividend Tax Rs
20,76,036/-were outstanding at the yearend for a period of more than
six months from the date they become payable ;
(b) According to the information and explanations provided to us,
particulars of outstanding dues of Income tax and Sales tax have not
been deposited on account of any dispute are given below:
Name of statute Nature of the Period to
which the Amount (Rupees Forum where
Dues amounts
relates in Lakhs) dispute is
pending
Income Tax Act Income Tax A.Y
1998-99 8.00 High Court
APGST Sales Tax A.Y
2003-04 4.13 STAT
(X) The Company has no accumulated losses at the end of the financial
year ended 31.03.2012 and it has not incurred cash loss during the year
covered by our audit and also in the immediately preceding financial
year.
(XI) Based on our audit procedures and on the information and
explanations given by the management, the Company has not defaulted in
repayment of dues to any financial institution or bank;
(XII) Based on our examination and according to the information and
explanations given to us , the Company has not granted loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities ;
(XIII) In our opinion, the Company is not a Chit Fund / Nidhi / Mutual
Benefit Fund/ Society and Clause 4 (xiii) of the Order are not
applicable to this company.
(XIV) In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of Clause 4(xiv) of the Order not applicable to the Company.
(XV) On the basis of our examination of the books of accounts and the
information and explanation given to us the Company has not given any
guarantee for loans by others from bank or financial institutions ;
(XVI) According to the information and explanations given to us, the
company has not availed any term loans during the year under review.
(XVII) On the basis of our examinations of the books of accounts and
the information and explanation given to us, in our opinion, the funds
raised on short-term basis have not been used for long-term investment.
(XVIII) During the year, the Company has not made any preferential
allotment of shares to parties and companies covered in the Register
maintained under Section 301 of the Act ;
(XIX) The Company has not made any issue of debentures during the year;
(XX) During the year covered by our audit report the Company has not
raised any money by way of Public Issue.
(XXI) Based on the audit procedures performed and information and
explanations given to us by the management, we report that no fraud on
or by the Company has been noticed or reported during the course of our
audit.
For GMK ASSOCIATES.,
Chartered Accountants
(Firm Regn No.006945S)
G. Satyanarayana Murty
Partner
Place: Hyderabad Membership No.:29919
Date: 28th May,2012
Mar 31, 2011
We have audited the attached Balance Sheet of Kernex Microsystems
(India) Limited, as at 31st March, 2011 and also the Profit and Loss
Account and Cash Flow Statement for the year ended on that date annexed
thereto. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in India. Those Standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An Audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An Audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
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 Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
Further to our comments in the Annexure referred to above, we report
that:
(i) 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;
(ii) 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;
(iii) The Balance Sheet, Profit and Loss Account and Cash Flow
Statement dealt with by this report are in agreement with the books of
accounts;
(iv) In our opinion, the Balance Sheet, Profit and Loss Account and
Cash Flow Statement dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of Section 211 of
the Companies Act,1956 ;
(v) On the basis of written representations received from the directors
as on 31st March, 2011 and taken on record by the Board of Directors,
we report that none of the directors is disqualified as on 31st March,
2011 from being appointed as a director in terms of Clause (g) of
sub-section (1) of Section 274 of the Companies Act,1956;
(vi) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies Act,1956, 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 Balance Sheet, of the state of affairs of the
Company as at 31st March, 2011;
(b) In the case of Profit and Loss Account, of the Profit for the year
ended on that date; and
(c) In the case of Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Annexure to the Auditor's report of even date to the Members of Kernex
Microsystems (India) Limited
(I) (a) The Company is in the process of updating the records showing
full particulars including Quantitative details and the situation of
its fixed assets.
(b) As per the explanations given to us by the management, physical
verification of Fixed Assets has not been carried out during the year.
(c) None of the major fixed assets of the Company are disposed off
during the year.
(II) (a) The Inventory has been physically verified by the management
at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures for physical verification of inventory
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business;
(c) On the basis of our examination of the inventory records, in our
opinion, the company has maintained proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
(III) (a) During the year, the Company has not granted any loans,
secured or unsecured, to the companies, firms or other parties covered
in the register maintained under Section 301 of the Companies Act,1956.
Hence Clauses (iii) (b), (c) & (d) of the Order are not applicable.
(b) The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Companies Act, 1956. Hence Clauses (iii) (f)
& (g) of the Order are not applicable.
(IV) In our opinion and according to the information and explanations
provided to us there are adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and for sale of goods and
services. During the course of our audit, no major weakness has been
noticed in the internal control.
(V) Based on the audit procedures applied by us and according to the
information and explanations provided by the management, we are of the
opinion that there have been no transactions that need to be entered
into the register maintained under Section 301;
(VI) The Company has not accepted any deposits from the public during
the year under review falls under section 58A and 58AA of the Companies
Act 1956;
(VII) The Company has an in-house internal audit department, which, in
our opinion the scope is commensurate with the size and nature of the
business of the company;
(VIII) We have broadly reviewed the books of account maintained by the
Company in respect of the 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 Section 209 of the Act and are of
the opinion that prima facie, the prescribed accounts and records have
been made and 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) There have been minor delays in depositing undisputed
statutory dues including Provident Fund, Employees State Insurance,
Income Tax and Service Tax with appropriate authorities during the
year. According to the records, information and explanations provided
to us, there are no undisputed amounts payable in respect of Provident
Fund, Investor Education and Protection Fund, Employee's State
Insurance, Income-Tax, Sales-Tax, Wealth-Tax, Service Tax, Customs
Duty, Excise Duty, Cess and other statutory dues which were outstanding
at the year end for a period of more than six months from the date they
became payable ;
(b) According to the information and explanations provided to us,
particulars of out standing dues of Income tax and Sales tax have not
been deposited on account of any dispute are given below:
Name of Statute Nature of the Period to Amount Forum where
Dues which the (Rupees
in Lakhs) dispute is
amount
relates pending
Income Tax Act Income Tax A.Y 1998-99 8.00 High Court
APGST Sales Tax A.Y 2003-04 4.13 STAT
(X) The Company has no accumulated losses at the end of the financial
year ended 31.03.2011 and it has not incurred cash loss during the year
covered by our audit. However the company has incurred a cash loss of
Rs.9,17,54,483/- in the immediately preceding financial year ;
(XI) Based on our audit procedures and on the information and
explanations given by the management, the Company has not defaulted in
repayment of dues to any financial institution or bank;
(XII) Based on our examination and according to the information and
explanations given to us, the Company has not granted loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities ;
(XIII) In our opinion, the Company is not a Chit Fund / Nidhi / Mutual
Benefit Fund/ Society and Clause 4 (xiii) of the Order are not
applicable to this company.
(XIV) In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of Clause 4(xiv) of the Order not applicable to the Company.
(XV) On the basis of our examination of the books of accounts and the
information and explanation given to us the Company has not given any
guarantee for loans by others from bank or financial institutions ;
(XVI) According to the information and explanations given to us, the
company has not availed any term loans during the year under review.
(XVII) On the basis of our examinations of the books of accounts and
the information and explanation given to us, in our opinion, the funds
raised on short-term basis have not been used for long-term investment.
(XVIII)During the year, the Company has not made any preferential
allotment of shares to parties and companies covered in the Register
maintained under Section 301 of the Act ;
(XIX) The Company has not made any issue of debentures during the year;
(XX) During the year covered by our audit report the Company has not
raised any money by way of Public Issue.
(XXI) Based on the audit procedures performed and information and
explanations given to us by the management, we report that no fraud on
or by the Company has been noticed or reported during the course of our
audit.
For GMK ASSOCIATES.,
Chartered Accountants
(Registration No.006945S)
G Satyanarayana Murty
Place: Hyderabad Partner
Date : 13th August, 2011. Membership No.:29919
Mar 31, 2010
We have audited the attached Balance Sheet of Kernex Microsystems
(India ) Limited, as at March,31, 2010 and also the Profit and Loss
Account and Cash Flow Statement for the year ended on that date annexed
thereto. These financial statements are the responsibility of the
Companys management. Our responsibility is to express an opinion on
these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in India. Those Standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An Audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An Audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
As required by the Companies (Auditors Report) Order,2003,( the Order
) issued by the Central Government of India in terms of sub-section
(4A) of section 227 of the Companies Act,1956, we enclose in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of
the said Order.
Further to our comments in the Annexure referred to above, we report
that:
(i) 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;
(ii) 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;
(iii) The Balance Sheet, Profit and Loss Account and Cash Flow
Statement dealt with by this report are in agreement with the books of
accounts;
(iv) In our opinion , the Balance Sheet, Profit and Loss Account and
Cash Flow Statement dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of Section 211 of
the Companies Act,1956;
(v) On the basis of written representations received from the directors
as on March 31,2010 and taken on record by the Board of Directors , we
report that none of the directors is disqualified as on March 31 , 2010
from being appointed as a director in terms of Clause (g) of
sub-section (1) of Section 274 of the Companies Act,1956;
(vi) In our opinion and to the best of our information and according to
the explanations given to us , the said accounts give the information
required by the Companies Act,1956, 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 Balance Sheet, of the state of affairs of the
Company as at 31st March, 2010;
(b) In the case of Profit and Loss Account, of the Profit for the year
ended on that date; and
(c) In the case of Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Annexure to the Auditors report of even date to the Members of Kernx
Microsystems (India) Limited
(I) (a) The Company is in the process of updating
the records showing full particulars including Quantitative details and
the situation of its fixed assets.
(b) The fixed Assets are physically verified by the management
according to a phased programme designed to cover all the items over a
period of three years, which in our opinion, is reasonable having
regard to the size of the company and nature of its assets. Pursuant to
the programme, a portion of the fixed assets has been physically
verified by the management during the year and no material
discrepancies between the book records and the physical inventory have
been noticed.
(c) None of the major fixed assets of the Company are disposed off
during the year.
(II) (a) The Inventory has been physically verified by
the management at reasonable intervals;
(b) In our opinion and according to the information and explanations
given to us, the procedures for physical verification of inventory
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business;
(c) On the basis of our examination of the inventory records, in our
opinion, the company has maintained proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
(III) (a) During the year, the Company has not granted any loans,
secured or unsecured, to the companies, firms or other parties covered
in the register maintained under Section 301 of the Companies Act,1956.
Hence Clauses (iii) (b), (c) & (d) of the Order are not applicable.
(b) The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Companies Act, 1956. Hence Clauses (iii) (f)
& (g) of the Order are not applicable.
(IV) In our opinion and according to the information and explanations
provided to us there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and for sale of goods and
services. During the course of our audit, no major weakness has been
noticed in the internal control.
(V) Based on the audit procedures applied by us and according to the
information and explanations provided by the management, we are of the
opinion that the transactions that need to be entered into the register
maintained under Section 301 have been entered and the transactions are
made at prices which are reasonable with regard to the prevailing
market prices at the relevant time;
(VI) The Company has not accepted any deposits from the public during
the year under review which falls under section 58A and 58AA of the
Companies Act 1956;
(VII) The Company has an internal audit conducted by external auditors
, which, in our opinion is commensurate with the size and nature of the
business of the company;
(VIII) We have broadly reviewed the books of account maintained by the
Company in respect of the 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 Section 209 of the Act and are of
the opinion that prima facie, the prescribed accounts and records have
been made and 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 records, information and explanations
provided to us, the Company is generally regular in depositing with
appropriate authorities undisputed amount of Provident Fund, Investor
Education and Protection Fund, Employees State Insurance, Income-Tax,
Sales-Tax, Wealth-Tax, Service Tax, Customs Duty, Excise Duty, Cess and
other statutory dues applicable to it and no undisputed amounts payable
were outstanding as at 31st March,2010 for a period of more than six
months from the date they became payable ;
(b) According to the information and explanations provided to us,
particulars of out standing dues of Income tax have not been deposited
on account of any dispute are given below:
Name of Statute Nature of the Period to Amount Forum where
Dues which the (Rupees in Lakhs) dispute is
amount
relates pending
Income Tax Act Income Tax A.Y 1998-99 8.00 High Court
(X) The Company has no accumulated losses at the end of the financial
year and has incurred a cash loss of Rs. 9.18 Crores during the
financial year covered by our audit, and no cash losses incurred in the
immediately preceding financial year ;
(XI) Based on our audit procedures and on the information and
explanations given by the management, the Company has not defaulted in
repayment of dues to any financial institution or bank;
(XII) Based on our examination and according to the information and
explanations given to us , the Company has not granted loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities ;
(XIII) In our opinion, the Company is not a Chit Fund / Nidhi / Mutual
Benefit Fund/ Society and Clause 4 (xiii) of the Order are not
applicable to this company.
(XIV) In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of Clause 4(xiv) of the Order not applicable to the Company.
(XV) On the basis of our examination of the books of accounts and the
information and explanation given to us the Company has not given any
guarantee for loans taken by others from bank or financial institutions
;
(XVI) According to the information and explanations given to us, the
company has not availed any term loans during the year under review.
(XVII) On the basis of our examinations of the books of accounts and
the information and explanation given to us, in our opinion, the funds
raised on short-term basis have not been used for long-term investment.
(XVIII) During the year, the Company has not made any preferential
allotment of shares to parties and companies covered in the Register
maintained under Section 301 of the Act ;
(XIX) The Company has not made any issue of debentures during the year;
(XX) During the year covered by our audit report the Company has not
raised any money by way of Public Issue.
(XXI) Based on the audit procedures performed and information and
explanations given to us by the management, we report that no fraud on
or by the Company has been noticed or reported during the course of our
audit.
For GMK ASSOCIATES.,
Chartered Accountants
(Registration No.006945S)
G Satyanarayana Murty
Place: Hyderabad Partner
Date : 29th May, 2010 Membership No.:29919