Mar 31, 2023
INDEPENDENT AUDITORâS REPORT
To the Members of KINGFA SCIENCE & TECHNOLOGY (INDIA) LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the Financial Statements of Kingfa Science &
Technology (India) Limited (âthe Companyâ), which comprise
the Balance Sheet as at March 31,2023, and the Statement of
Profit and Loss (including Other Comprehensive Income),
Statement of Changes in Equity and Statement of Cash Flows
for the year then ended, and notes to the Financial Statements,
including a summary of Significant Accounting Policies and
other explanatory information(hereinafter referred to as âthe
Financial Statementsâ).
In our opinion and to the best of our information and according
to the explanations given to us, the aforesaid Financial
Statements give the information required by the Companies
Act, 2013 (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, and its profit (including Other
Comprehensive Income), changes in equity and its cash flows
for the year ended on that date.
We conducted our audit in accordance with the Standards on
Auditing (SAs) specified under section 143(10) of the Act. Our
responsibilities under those Standards are further described in
the Auditorâs Responsibilities for the Audit of the 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
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.
Emphasis of Matters
We draw your attention to Note 33 to the financial statements
regarding delay in settlement or realisation of certain trade
payable and trade receivable balances, as the case may be,
denominated in foreign currency which are due to/from group
companies. As informed by management, the Company is in
the process of regularising these delays for making necessary
compliances in respect of aforesaid dues and it believes that
impact, if any, is not expected to be material to the financial
statements. Our opinion is not modified in respect of this matter.
Key Audit Matters
Key audit matters are those matters that, in our professional
judgment, 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.
The Companyâs Board of Directors is responsible for the other
information. The other information comprises the Management
Discussion and Analysis; Board of Directorsâ Report along with
its Annexures included in the Annual Report, but does not
include theFinancial Statements and our auditorâs report
thereon.Our opinion on the Financial Statements does not
cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the Financial Statements, our
responsibility is to read the other information and, in doing so,
consider whether the other information is materially
inconsistent with the 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 Financial Statements
The Companyâs Board of Directors is responsible for the
matters stated in section 134(5) of the Act with respect to the
preparation of these Financial Statements that give a true and
fair view of the financial position, financial performance
(including other comprehensive income), changes in equityand
cash flows 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 Actread 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 Financial Statements that
give a true and fair view and are free from material
misstatement, whether due to fraud or error.
In preparing the Financial Statements, the management is
responsible for assessing the Companyâs ability to continue as
a going concern, disclosing, as applicable, matters related to
going concern and using the going concern basis of accounting
unless management 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 Companyâs financial reporting process.
Auditorâs Responsibilities for the Audit of the 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 auditorâs 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 Financial Statements.
As part of an audit in accordance with SAs, we exercise
professional judgment and maintain professional skepticism
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 Act 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 managementâs
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
Companyâs ability to continue as a going concern. If
we conclude that a material uncertainty exists, we
are required to draw attention in our auditorâs 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
auditorâs 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 auditorâs 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 (Auditorâs Report) Order,
2020 (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 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 except
that the back-up of the books of accounts and other
books and papers maintained in electronic mode has
been maintained on servers physically located
outside India.
c) The Balance Sheet, the Statement of Profit and Loss
(including other comprehensive income), the
Statement of Changes in Equity 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 Indian Accounting Standards
specified 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 as on March 31, 2023taken on
record by the Board of Directors, none of the
directors is disqualified as on March 31, 2023from
being appointed as a director in terms of Section 164
(2) of the Act.
f) With reference to the maintenance of accounts and
other matters connected therewith, refer to our
comment in Paragraph 2 (b) above, the backup of
books of accounts and other books and papers
maintained in electronic mode has been maintained
on the servers located outside India.
g) With respect to the adequacy of the internal financial
controls with reference to financial reporting of the
Company and the operating effectiveness of such
controls, refer to our separate Report in âAnnexure
Bâ.
h) As required by section 197 (16) of the Act; in our
opinion and according to information and
explanation provided to us, the remuneration paid by
the company to its directors is in accordance with the
provisions of section 1 97 of the Act and
remuneration paid to directors is not in excess of the
limit laid down under this section.
i) 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, 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 31.5.1 to the
Financial Statements;
(ii) The Company did not have any long-term
contracts including derivative contracts as at
March 31,2023.
(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 to us that, to
the best of its knowledge and belief, other than
as disclosed in the notes to the accounts to the
financial statements, if any, 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(s) or entity(ies), including
foreign entities (âIntermediariesâ), with the
understanding, whether recorded in writing or
otherwise, that the Intermediary shall, whether,
directly or indirectly lend or invest in other
persons or entities 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 to us, that, to
the best of its knowledge and belief, other than
as disclosed in the notes to the accounts to the
Financial Statements, if any, no funds have
been received by the Company from any
person(s) or entity(ies), 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
persons or entities identified in any manner
whatsoever by or on behalf of the Funding
Party (âUltimate Beneficiariesâ) or provide any
guarantee, security or the like on behalf of the
Ultimate Beneficiaries.
(c) Based on the information and explanation
given to us and audit procedures performed as
considered reasonable and appropriate in the
circumstances, nothing has come to our notice
that has caused us to believe that the
representations made by the management and
as mentioned under sub-clause (iv)(a) and
(iv)(b) above contain any material
misstatement.
(v) The Company has not declared or paid dividend
during the year.
(vi) The requirement to the use of accounting software
for maintaining Companyâs books of account which
has a feature of recording audit trail (edit log) facility,
as prescribed under rule 3(1) of the Companies
(Accounts) Rules, 2014,is deferred to financial years
commencing on or after April 1, 2023, therefore
reporting under Rule 11(g) of Companies (Audit &
Auditors) Rules,2014 is not applicable for financial
year ended on March 31,2023.
Chartered Accountants
Firm Registration Number:101118W/W100682
Abhijit Shetye
Partner
Membership Number: 151638
UDIN : 23151638BGQGET2277
Pune
May 24,2023
Mar 31, 2018
Report on the Standalone Indian Accounting Standards (Ind AS) Financial Statements
We have audited the accompanying standalone Ind AS financial statements of Kingfa Science & Technology (India) Limited (âthe Companyâ) comprising of the Balance Sheet as at 31st March, 2018, the Statement of Profit and Loss(including Other Comprehensive Income), the Cash Flow Statement for the year then ended and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information(hereinafter referred to as âthe Standalone Ind AS Financial Statementsâ).
Managementâs Responsibility for the Standalone Ind AS Financial Statements
The Companyâs Board of Directors is responsible for the preparation of these standalone Ind AS financial statements in terms of the requirements the matters stated in Section 134(5) of the Companies Act, 2013 (hereinafter referred to as âthe Actâ) that give a true and fair view of the standalone financial position, standalone financial performance, standalone cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India including the Indian Accounting Standards specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act. The Companyâs Board of Directors is also responsible for ensuring accuracy of records including financial information considered necessary for the preparation of standalone Ind AS financial statements.
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; the selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which has been used for the purpose of preparation of the standalone Ind AS financial statements by the Directors of the Company, as aforesaid.
Auditorsâ Responsibility
Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit. While conducting the audit, we have taken into account the provisions of the Act and the Rules made there under including the accounting standards and matters which are required to be included in the audit report.
We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditorsâ judgment, including the assessment of the risks of material misstatement of the standalone Ind AS 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 Ind AS financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Board of Directors, as well as evaluating the overall presentation of the standalone Ind AS 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 Ind AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the standalone state of affairs of the Company as at 31 March, 2018, and their standalone profit (including other comprehensive income), their standalone cash flows and standalone changes in equity for the year ended on that date.
Other Matters
The comparative financial information of the Company for the year ended 31 March 2017 and the transition date opening balance sheet as at 1 April 2016 included in these standalone Ind AS financial statements, are based on the previously issued statutory financial statements for the years ended 31 March 2016 and 31 March 2017 prepared in accordance with the Companies (Accounting Standards) Rules, 2006 (as amended) which were audited by the predecessor auditor, who expressed an unmodified opinion vide reports dated 26th May, 2017 and 30th May, 2016 respectively. The adjustments to those financial statements for the differences in accounting principles adopted by the company on transition to the Ind AS have been audited by us.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2016, issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (hereinafter referred to as the âOrderâ), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the âAnnexure Aâ statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required bySection143(3) of the Act, we report, to the extent applicable, 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 of the aforesaid standalone Ind AS financial statements.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss(including other comprehensive income), the Cash Flow Statement and the statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid standaloneInd AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act read with relevant rules thereunder.
e) On the basis of the written representations received from the directors as on 31st March 2018, taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 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 and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Bâ.
g) With respect to the other matters to be included in the Auditorsâ Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of ourknowledge and belief and according to the information and explanations given to us:
i. The Company has disclosed the impact, if any, of pending litigations as at 31st March 2018 on its financial position in its standalone Ind AS financial statements -Refer Note [32.6.1];
ii. The Company did not have any long-term contracts including derivative contracts having any material foreseeable losses for which provision was required to be made under the applicable law or accounting standard.
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.
ANNEXUREA
Referred to in paragraph 1 of our âReport on Other Legal and Regulatory Requirementsâ on even date
(i) (a) The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.
(b) As informed to us the fixed assets have been physically verified by the management at reasonable intervals considering the size of the company and nature of asset. Further, discrepancies, if any, noticed on such verification have been properly dealt with in the books of account.
(c ) According to records of the company examined by us the title deeds of immovable properties are held in the name of the company.
(ii) The management has conducted physical verification of inventory at reasonable Intervals. In our opinion, the frequency of verification is reasonable. As informed to us, the discrepancies noticed on verification between physical stock and book records were not material.
(iii) As informed to us, the company has not granted secured or unsecured loan to other companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act, 2013. Accordingly, the provisions of clause 3 (iii) (a) (b) and (c) of the Companies (Auditor''s Report) Order, 2016 are not applicable to the company.
(iv) The Company has not entered into any transaction which attracts the provisions of section 185 and 186 of the Companies Act, 2013.Accordingly, the provisions of clause 3 (iv) of the Companies (Auditor''s Report) Order, 2016 are not applicable to the company.
(v) In our opinion and according to information and explanation given to us, the Company has not accepted public deposits, hence the directive issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed there under, are not applicable to it. According to information and explanation given to us, no order has been passed against the company by Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under sub-section (l) of section 148 of the Companies Act, 2013 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have however not made a detailed examination of records with a view to determine whether they are accurate and complete.
(vii) (a) According to information and explanation given to us and the records of the company examined by us, the company is generally regular in depositing with appropriate authorities undisputed statutory dues including income tax, service tax and other material statutory dues applicable to it.
According to the information and explanation given to us, no undisputed amounts payable in respect of statutory dues were in arrears as at 31st March, 2018, for a period more than six months from the date they became payable except the following:
Sr. No. |
Statue |
Amount in Lakhs |
1 |
Professional Tax |
0.12 |
2 |
Employee State Insurance (ESIC) |
0.06 |
3 |
Labour Welfare Act (LWF) |
0.01 |
Total |
0.19 |
(b) According to the information and explanations given to us, the particulars of dues of income tax, sales tax, wealth tax, service tax, custom duty, excise duty and cess as at 31st March, 2018 which has not been deposited on account of disputes are as follows :
Name of the Statue |
Nature of dispute due |
Amount under dispute not deposited (Rs. in lakhs) |
Period to which amount is related |
Forum where the dispute is pending |
Sales Tax |
Transit pass issue |
14.57 |
2005-06 to 2014-15 |
First Appellate Authority |
Income Tax |
Disallowance of Expenses |
37.64 |
2007-08 to 2014-15 |
First Appellate Authority |
Central Excise & Service Tax |
Non payment of Service tax on commission and availment of CENVAT credit |
29.92 |
2005-06 to 2014-15 |
First Appellate Authority |
(viii) In our opinion and according to information and explanations given to us, the Company has not defaulted in repayment of dues to a financial institution or bank as at the balance sheet date and also not issued debentures. Accordingly provisions of the clause 3 (viii) of the Companies (Auditor''s Report) Order, 2016 is not applicable to the company.
(ix) According to the information and explanation given to us, the company has not raised money by way of initial public offer or further public offer (including debt instrument) and not availed term loan during the year. Accordingly, the clause 3(ix) of the Companies (Auditor''s Report) Order, 2016 are not applicable to the company.
(x) During the course of our examination of the books & records of the company carried out in accordance with the generally accepted auditing Practices in India and according to the information and explanation given to us, we have neither come across any instances of fraud on or by the company, noticed or reported during the year, nor have we been informed of such case by Management. Accordingly, the clause 3(x) of the Companies (Auditor''s Report) Order, 2016 are not applicable to the company.
(xi) According to the information and explanation given to us, the company has paid managerial remuneration within the limit prescribed under section 197 of the Companies Act, 2013. Accordingly no requisite approval is required to be sought.
(xii) In our opinion, the company is not a Nidhi company. Accordingly, provisions of the clause 3(xii) of Companies (Auditorâs Report) order, 2016 are not applicable to the company.
(xiii) According to the information and explanation given to us and in our opinion transactions with the related parties are in compliance with section 177 and 188 of the Companies Act, 2013 and requisite details have been disclosed in the Financial statements as required by the applicable accounting standards.
(xiv) According to the information and explanation given to us, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures for raising funds during the year. Accordingly, the provisions of clause 3 (xiv) of the Companies (Auditorâs Report) Order, 2016 are not applicable to the company.
(xv) According to the information and explanation given to us, the company has not entered into a non-cash transaction with any of the directors or persons connected with directors. Accordingly, the provisions of clause 3 (xv) of the Companies (Auditorâs Report) Order, 2016 are not applicable to the company.
(xvi) In our opinion, the company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions in Paragraph 3(xvi) of Companies (Auditorâs Report) order, 2016 are not applicable to the company.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013
We have audited the internal financial controls over financial reporting of Kingfa Science & Technology (India) Limited (âthe Companyâ) as of March 31, 2018 in conjunction with our audit of the standaloneInd AS financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Companyâs Management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act 2013.
Auditorâs Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing deemed to be prescribed under Section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. 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 judgement, 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 company''s 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 company''s 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 company''s 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, the Company has, in all material respects, an adequate internal financial Control 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.
FOR M/S P. G. BHAGWAT
Chartered Accountants
Firm Registration Number: 101118W
Nachiket Deo
Partner
Membership No: 117695
Pune
Date : 28th May, 2018
Mar 31, 2017
Report on the Financial Statements
We have audited the accompanying financial statements of Kingfa Science and Technology India Limited (âthe Companyâ) which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss, Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.
Managementâs Responsibility for the Financial Statements
The Companyâs 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 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, 2013 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.
Auditorâs 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 thereunder.
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 auditorâs 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 Companyâs 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 Companyâs 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.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information 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, 2017, and its profit and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ), as amended and issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the âAnnexure Aâ a statement on the matters specified in paragraphs 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 purpose of our audit;
b. In our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
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 (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 written representations received from the directors as on March 31, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 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 Bâ.
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, 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
ANNEXURE A TO AUDITORSâ REPORT
Annexure to Independent Auditorsâ Report of even date
I) a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
b) These fixed assets have been physically verified by the management at the end of the financial year 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 and on the basis of examination of the records of the Company, the title deeds of immovable properties are held in the name of the company.
ii) (a) As explained to us, inventories held by the Company were physically verified during the year at reasonable intervals by the management.
(b) In our opinion and according to the information and explanations given to us, the discrepancies noticed on physical verification of the inventory as compared to books records has been properly dealt with in the books of account and were not material.
iii) The Company has not granted any loans, secured or unsecured to companies, firms, limited liability partnerships or other parties covered in the Register maintained under section 189 of the Act.
iv) In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 185 and I86 of the Companies Act, 2013 In respect of loans, investments, guarantees, and security.
v) The Company has not accepted any deposits from the public during the year to which the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed there under are applicable.
vi) The maintenance of cost records has not been prescribed by the Central Government under subsection 1 of Section 148 of the Companies Act.
vii) (a) According to the records of the Company, the Company is regular in depositing undisputed statutory dues including provident fund, employeeâs state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax and any other statutory dues applicable to it, with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of the above were in arrears as at March 31, 2017 for a period of more than six months from the date on when they become payable.
(the extent of arrears of outstanding statutory dues as at the last day of the financial year for a period of more than 6 months from the date they became payable to be indicated)
(b) there are no dues of income tax or sales tax or wealth tax or service tax or duty of customs or duty of excise or value added tax which have not been deposited on account of any dispute except the following pending in appeals :
(i) Income tax of Rs.37.82 lakhs before the first appellate authority
(ii) Customs duty of Rs.26.78 lakhs before the first appellate authority
(iii) Sales tax of Rs.12.94 lakhs before the first appellate authority and
(iv) Central Excise and Service tax before the first appellate authority Rs.23.70 lakhs.
viii) On the basis of records produced and in our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of the dues to bank. The Company has not availed borrowing facilities from financial institution, Government or dues to debenture holders.
ix) The company has not raised moneys by way of initial public offer or further public offer including debt instruments and term Loans. However, the Company made rights issue during the year under audit. In our opinion and on the basis of the audit procedures performed and the information and explanations given by the management, the moneys raised by the Company through its rights offer were applied for the purposes for which those were raised.
x) On the basis of the audit procedures carried out by us and information and explanations given by the management, we state that no material fraud on or by the Company has been noticed or reported during the course of our audit.
xi) On the basis of the audit procedures performed and the information and explanations given by the management, the managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act;
xii) In our opinion, the Company is not a Nidhi Company and therefore the provisions of clause 4 (xii) of the Order are not applicable to the Company.
xiii) In our opinion, all transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.
xiv) Based upon the audit procedures performed and the information and explanations given by the management, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under audit.
xv) In our opinion, on the basis of the audit procedures performed and the information and explanations given by the management, the company has not entered into any non-cash transactions with directors or persons connected with him.
xvi) In our opinion, the company is not required to be registered under section 45 iA of the Reserve Bank of India Act, 1934.
for and on behalf of
P. Srinivasan & Co.,
Chartered Accountants
FRN:004054S
Place : Chennai
Date : 26.05.2017 P. Srinivasan
Partner
M. No.: 02090
Mar 31, 2016
Independent Auditorâs Report To the Members of Kingfa Science & Technology (India) Limited (Formerly Hydro S &S Industries Limited)
Report on the Financial Statements
We have audited the accompanying financial statements of KINGFA SCIENCE & TECHNOLOGY (INDIA) LIMITED (FORMERLY HYDRO S&S INDUSTRIES LIMITED (âthe Companyâ) which comprise the Balance Sheet as at March 31, 2016, the Statement of Profit and Loss, Cash Flow Statement for the year, then ended, and a summary of significant accounting policies and other explanatory information.
Managementâs Responsibility for the Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actââ) with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, 2013 read with Rule7ofthe 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.
Auditorâs 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 auditorâs 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 Companyâs 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 Companyâs 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 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, 2016, and its Profit and its Cash Flow for the year ended on that date.
Report on Other Legal and Regulatory Requirements
a) we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;
b) in our opinion proper books of account as required by taw 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 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 March 31,2016 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2016 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 Bâ.
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, in our opinion and to the best of our information and according to the explanations given to us:
âANNEXURE Aâ TO THE INDEPENDENT AUDITORSâ REPORT
Referred to in paragraph 8 under the heading âReport on Other Legal & Regulatory Requirement'' of our report of even date to the financial statements of the Company for the year ended March 31, 2016.
i) a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
b) These fixed assets have been physically verified by the management at the end of the financial year 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 and on the basis of examination of the records of the Company, the title deeds of immovable properties are held in the name of the company.
ii) a) As explained to us, inventories held by the Company were physically verified during the year at reasonable intervals by the management.
b) In our opinion and according to the information and explanations given to us, the discrepancies noticed on physical verification of the inventory as compared to books records has been properly dealt with in the books of account and were not material.
iii) In our opinion and according to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms, limited liability partnerships or other parties covered in the Register maintained under section 189 of the Act.
iv) In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 185 and 186 of the Companies Act, 2013 In respect of loans, investments, guarantees, and security.
v) The Company has not accepted any deposits from the public during the year to which the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed there under are applicable.
vi) According to the records produced and the information and explanations given to us, the cost records prescribed by the Central Government under subÂsection 1 of section 148 of the Companies Act are being prima facie maintained by the Company. We have broadly reviewed the cost records maintained by the company.
vii) (a) According to the records of the Company, the Company is regular in depositing undisputed statutory dues including provident fund, employeeâs state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax and any other statutory dues applicable to it, with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of the above which are outstanding as at March 31,2016 for a period of more than six months from the date they become payable.
(b) On the basis of audit procedures and on the information and explanations given to us, there are no dues of income tax or sales tax or wealth tax or service tax or duty of customs or duty of excise or value added tax which have not been deposited on account of any dispute except the following pending in appeals: .
(i) Income tax of Rs.37.82 lakhs before the first appellate authority
. (ii) Customs duty of Rs.26.78 lakhs before the first appellate authority
(iii)Sales tax of Rs.56,87 before the first appellate authority and
(iv) Central Excise and Service tax before the first appellate authority Rs.19.85 lakhs.
(vii) On the basis of records produced and in our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of the dues to bank. The Company has not availed borrowing facilities from financial institution, Government or issued any debentures.
(ix) The company has not raised moneys by way of initial public offer or further public offer including debt instruments and term Loans. However, the Company made rights issue during the year under audit. In our opinion and on the basis of the audit procedures performed and the information and explanations given by the management, the moneys raised by the Company through its rights offer were applied for the purposes for which they were raised.
x) On the basis of the audit procedures carried out by us and information and explanations given by the management, we state 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.
xi) On the basis of the audit procedures performed and the information and explanations given by the management, the managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act;
xii) In our opinion, the Company is not a Nidhi Company and therefore the provisions of clause 4 (xii) of the Order are not applicable to the Company.
xiii) In our opinion and according to the information and explanations given by the management, all transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.
xiv) Based upon the audit procedures performed ana me information and explanations given by the management, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under audit.
xv) In our opinion, on the basis of the audit procedures performed and the information and explanations given by the management, the company has not entered into any non-cash transactions with directors or persons connected with him.
xvi) In our opinion, the company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934.
âAnnexure Bâ to the Independent Auditorâs Report of even date on the Financial Statements of Kingfa Science & Technology (India) Limited (Formerly Hydro S&S Industries Limited) Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of Kingfa Science & Technology (India) Limited ; (Formerly Hydro S &S Industries Limited) (âthe Companyâ) as of March 31, 2016 in conjunction with our audit of the financial : statements of the Company for the year ended on that date,
Managementâs Responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient ; conduct of its business, including adherence to company s policies, the safeguarding of its assets, the prevention and : detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable
financial information, as required under the Companies Act, 2013.
Auditorsâ Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls 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 company''s 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 authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls 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, 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, 2016, 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.
For and on behalf of
P.Srinivasan & Co.,
Chartered Accountants
FRM:004054S
Place: Chennai
DATE : 30.05.2016
Mar 31, 2015
We have audited the accompanying standalone financial statements of
Hydro S&S Industries 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.
AUDITORS' 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 thereunder.
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 losses and its cash flows for the year ended
on that date.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the Companies (Auditor's Report) Order, 2015 ("the
Order") issued by the Central Government 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 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 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 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
(f) 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 25 of the
financial statements.
ii. the Company did not have long-term contracts including derivative
contracts for which there were any material foreseeable losses; and
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 INDEPENDENT AUDITORS' REPORT OF EVEN DATE
i) a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
b) These fixed assets have been physically verified by the management
at the end of the financial year 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.
ii) (a) As explained to us, inventories held by the Company were
physically verified during the year at reasonable intervals by the
management.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verification.
iii) The company has not granted any loans, secured or unsecured to
companies, firms or other parties covered in the register maintained
u/s 189 of the Act.
iv) a) In our opinion and according to the information and explanations
given to us, there exists and adequate internal control systems
commensurate with the size of the Company and nature of its business
with regard to the purchase of inventories and fixed assets and for the
sale of goods and services.
b) In our opinion and according to the information and explanations
given to us, there is no continuing failure to correct major weaknesses
in internal control system of the Company.
v) The Company has not accepted any deposits from the public during the
year to which the directives issued by the Reserve Bank of India and
the provisions of sections 73 to 76 or any other relevant provisions of
the Companies Act and the rules framed there under are applicable.
vi) The maintenance of cost records has not been prescribed by the
Central Government under sub-section 1 of Section 148 of the Companies
Act.
vii) According to the records of the Company,
(a) The Company is regular in depositing undisputed statutory dues
including provident fund, employee's state insurance, income tax, sales
tax, wealth tax, service tax, duty of customs, duty of excise, value
added tax, cess and any other statutory dues applicable to it, with the
appropriate authorities during the year.
(b) there are no dues of income tax or sales tax or wealth tax or
service tax or duty of customs or duty of excise or value added tax or
cess which have not been deposited on account of any dispute except the
following pending in appeals:
(i) Income tax of Rs. 19.47 lakhs before the first appellate authority
(ii) Customs duty of Rs. 26.78 lakhs before the first appellate
authority
(iii) Sales tax of Rs. 56.87 before the first appellate authority and
(iv) Central Excise and Service tax before the first appellate
authority Rs. 14.07 lakhs.
(c) The Company is required to transfer amounts of Rs. 2,61,261 to
investor education and protection fund under the relevant provisions of
the Companies Act, 2013 and the same has been transferred to the said
fund within time.
viii) The Company has accumulated losses at the end of the financial
year i.e. 31.03.2015 which is more than fifty percent of its net worth.
The Company has incurred cash losses in this financial year ended
31.03.2015 and also in the immediately preceding financial year ended
31.03.2014.
ix) On the basis of records produced, the Company has not defaulted in
repayment of the dues to bank. The Company has not availed borrowing
facilities from financial institutions and debenture holders.
x) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions during the year.
xi) As per records produced and information and explanations given, the
term loans have been applied for the purpose for which these term loans
were obtained.
xii) On the basis of the audit procedures carried out by us and
information and explanations given by the management, we state that no
material fraud on or by the Company has been noticed or reported during
the course of our audit.
For P. SRINIVASAN & Co.,
Chartered Accountants
(Firm Registration No. : 004054S)
Place : Chennai CA. P. SRINIVASAN
Date :28th May 2015 Partner
Membership No. : 02090
Mar 31, 2013
Report on the Financial Statements
We have audited the accompanying financial statements of M/s. Hydro S&S
Industries Limited ("the CompanyÂ)'' which comprise the Balance Sheet as
at 31st March'' 2013'' the Statement of Profit and Loss and the Cash Flow
Statement for the year then ended'' and a summary of the significant
accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
The Company''s 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 section 211(3C)
of the Companies Act'' 1956 ("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 mis-statement''
whether due to fraud or error.
Auditors'' 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 the
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material mis-statement.
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 mis-statement of the financial
statements'' whether due to fraud or error. In making those risk
assessments'' the auditor considers the 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 the Management'' as well as evaluating the overall
presentation of the financial statements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us'' the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(a) in the case of the Balance Sheet'' of the state of affairs of the
Company as at 31st March'' 2013;
(b) in the case of the Statement of Profit and Loss'' of the loss of the
Company for the year ended on that date'' and
(c) in the case of the Cash Flow Statement'' of the cash flows of the
Company 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 Section
227(4A) 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 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'' 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 Balance Sheet'' Statement of Profit and Loss''
and the Cash Flow Statement comply with the Accounting Standards
referred to in Section 211 (3C) of the Act.
(e) On the basis of the written representations received from the
directors as on 31st March'' 2013 taken on record by the Board of
Directors'' none of the directors is disqualified as on 31st March'' 2013
from being appointed as a director in terms of Section 274 (1) (g) of
the Act.
ANNEXURE REFERRED TO IN PARAGRAPH 1 OF THE REPORT OF EVEN DATE:
i) a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
b) These fixed assets have been physically verified by the management
at the end of the financial year'' 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) In our opinion'' the fixed assets disposed off during the year'' do
not constitute a substantial part of the fixed assets of the company
and such disposal has not affected the going concern status of the
company.
ii) a) As explained to us'' the inventories held by the Company were
physically verified during the year by the management at reasonable
intervals.
b) In our opinion and according to the information and explanations
given to us'' the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
c) In our opinion and according to the information and explanations
given to us'' the company is maintaining proper records of its
inventories and no material discrepancies were noticed on physical
verification.
iii) a) The Company has not granted any loans'' secured or unsecured to
companies'' firms or other parties covered in the register maintained
u/s 301 of the Act.
b) The company has not taken any loans'' secured or unsecured from
companies'' firms or other parties covered in the register maintained
u/s 301 of the Act.
iv) In our opinion and according to the information and explanations
given to us'' there exists an adequate internal control system
commensurate with the size of the Company and the nature of its
business with regard to the purchase of inventory and fixed assets and
for the sale of goods and services. Further on the basis of our
examination of the books and records of the Company'' there is no
continuing failure to correct major weaknesses in the aforesaid
internal control system of the company.
v) a) The entries relating to particulars of contracts or arrangements
referred to in section 301 of the Act have been made in the register
required to be maintained under that section; and
b) In our opinion and to the best of our knowledge and belief'' wherever
applicable the transactions made in pursuance of such contracts or
arrangements have been made at prices which are reasonable having
regard to the prevailing market prices at the relevant time.
vi) The Company has not accepted any deposits from the public during
the year to which the directives issued by the Reserve Bank of India
and the provisions of sections 58 A and 58 AA or any other relevant
provisions of the Act and the rules framed thereunder are applicable.
vii) In our opinion'' the company has an internal audit system
commensurate with its size and nature of its business.
viii) According to the records produced and information given to us''
the cost records prescribed by the Central Government under Sec.
209(1)(d) of the Companies Act'' 1956 (1 of 1956) are being maintained
by the Company. No examination of such records has been carried out by
us.
ix) According to the records of the Company''
a) the Company is regular in depositing undisputed statutory dues
including provident fund'' investor education and protection fund''
employee''s state insurance'' income tax'' sales tax'' wealth tax'' service
tax'' customs duty'' excise duties and cess and any other statutory dues
applicable to it'' with the appropriate authorities during the year.
b) there are no dues of income tax'' sales tax'' wealth tax'' service tax''
customs duty'' excise duty and cess which have not been deposited on
account of any dispute except the following pending in appeals:
(i) Income tax of Rs. 61.54 lakhs before the First Appellate Authority
(ii) Customs duty of Rs. 26.78 lakhs pending before the First Appellate
Authority
(iii) Sales tax of Rs. 12.75 lakhs pending before the First Appellate
Authority and
(iv) Central Excise and Service tax pending before the appellate
authorities as under:
a. First Appellate Authority Rs. 12.54 lakhs and
b. Second Appellate Authority Rs. 2.42 lakhs
x) The Company did not have accumulated losses at the end of the
financial year i.e. 31.03.2013. The Company has incurred cash loss of Rs.
428.48 lakhs in this financial year ended 31.03.2013. The Company did
not incur cash loss in the preceding financial year ended 31.03.2012.
xi) On the basis of records produced'' the Company has not defaulted in
repayment of the dues to any financial institution or bank during the
financial year.
xii) As per the records maintained'' no loans or advances have been
granted by the Company on the basis of security by way of pledge of
shares'' debentures and other securities.
xiii) The provisions of Special statute applicable to chit'' nidhi''
mutual fund / societies are not applicable to the Company.
xiv) On the basis of records maintained and in our opinion'' the Company
does not deal or trade in shares'' securities'' debentures and other
investments.
xv) According to the information and explanations given to us'' the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
xvi) As per the information and explanations given to us'' term loans
have been applied for the purpose for which these term loans were
obtained.
xvii) In our opinion'' based on the information and explanations given
to us and on an overall examination of the books and records of the
company'' the funds raised on short term basis prima facie have not been
used for long term investments. No long term funds have been used to
finance short-term assets.
xviii)The company has not made any preferential allotment of shares
during the financial year to any party.
xix) The company has not issued any debentures during the financial
year.
xx) The company has not raised any money by public issues during the
financial year.
xxi) On the basis of the audit procedures carried out and information
and explanations given by the management'' we state that no fraud on or
by the Company has been noticed or reported during the course of our
audit.
For P. SRINIVASAN & Co.
Chartered Accountants
Place : Chennai CA. P. SRINIVASAN
Date : 21st May'' 2013 Partner
Membership No. : 2090
FRN. 004054S
Mar 31, 2012
We have audited the attached Balance sheet of M/s. Hydro S&S Industries
Limited as at 31 st March 2012, the Statement of profit and loss and
also the 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 the management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
1) As required by the Companies (Auditor's Report) Order, 2003 issued
by the Central Government in terms of Section 224(4A) 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 to the extent
applicable to the company.
2) Further to our comments in the Annexure referred to in the paragraph
above, 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 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, 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 Balance sheet, Statement of profit and loss and
the 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, as they apply to the company.
e) On the basis of written representations received from the directors
as at 31 st 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 section 274 (1)(g)
of the Companies Act, 1956.
f) 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 :
i. in the case of the Balance sheet, of the state of affairs of the
company as at 31 st March, 2012;
ii. in the case of the Statement of profit and loss, of the profit of
the company for the financial year ended on that date; and
iii. in the case of the Cash flow statement, of the cash flows for the
financial year ended on that date.
ANNEXURE REFERRED TO IN PARAGRAPH 1 OF THE REPORT OF EVEN DATE:
i) a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
b) These fixed assets have been physically verified by the management
at the end of the financial year, 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) In our opinion, the fixed assets disposed off during the year, do
not constitute a substantial part of the fixed assets of the company
and such disposal has not affected the going concern status of the
company.
ii) a) As explained to us, the inventories held by the Company were
physically verified during the year by the management
at reasonable intervals.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
c) In our opinion and according to the information and explanations
given to us, the company is maintaining proper records of its
inventories and no material discrepancies were noticed on physical
verification.
iii) a) The Company has not granted any loans, secured or unsecured to
companies, firms or other parties covered in the register maintained
u/s 301 of the Act.
b) The company has not taken any loans, secured or unsecured from
companies, firms or other parties covered in the register maintained
u/s 301 of the Act.
iv) In our opinion and according to the information and explanations
given to us, there exists an adequate internal control system
commensurate with the size of the Company and the nature of its
business with regard to the purchase of inventory and fixed assets and
for the sale of goods and services. Further on the basis of our
examination of the books and records of the Company, there is no
continuing failure to correct major weaknesses in the aforesaid
internal control system of the company.
v) a) The entries relating to particulars of contracts or arrangements
referred to in section 301 of the Act have been made in the register
required to be maintained under that section; and
b) In our opinion and to the best of our knowledge and belief, wherever
applicable the transactions made in pursuance of such contracts or
arrangements have been made at prices which are reasonable having
regard to the prevailing market prices at the relevant time.
vi) The Company has not accepted any deposits from the public during
the year to which the directives issued by the Reserve Bank of India
and the provisions of sections 58 A and 58 AA or any other relevant
provisions of the Act and the rules framed there under are applicable.
vii) In our opinion, the company has an internal audit system
commensurate with its size and nature of its business.
viii) As explained to us, the Central Government has not prescribed the
maintenance of cost records under clause (d) of sub-section (1) of
Section 209 of the Companies Act, 1956.
ix) According to the records of the Company,
(a) the Company is regular in depositing undisputed statutory dues
including provident fund, investor education and protection fund,
employee's state insurance, income tax, sales tax, wealth tax,
service tax, customs duty, excise duties and cess and any other
statutory dues applicable to it, with the appropriate authorities
during the year.
b) there are no dues of income tax, sales tax, wealth tax, service tax,
customs duty, excise duty and cess which have not been deposited on
account of any dispute except the following pending in appeals:
(i) Income tax of Rs. 16.94 lakhs before the First Appellate Authority
(ii) Customs duty of Rs. 26.78 lakhs pending before the First Appellate
Authority and
(iii) Service tax pending before the appellate authorities as under:
a. First Appellate Authority Rs. 10.16 lakhs and
b. Second Appellate Authority Rs. 2.42 lakhs
x) The Company did not have accumulated losses at the end of the
financial year i.e. 31.03.2012. The Company did not incur cash loss in
this financial year and in the preceding financial year ended
31.03.2011.
xi) On the basis of records produced, the Company has not defaulted in
repayment of the dues to any financial institution or bank during the
financial year.
xii) As per the records maintained, no loans or advances have been
granted by the Company on the basis of security by way of pledge of
shares, debentures and other securities.
xiii) The provisions of Special statute applicable to chit, nidhi,
mutual fund / societies are not applicable to the Company.
xiv) On the basis of records maintained and in our opinion, the Company
does not deal or trade in shares, securities, debentures and other
investments.
xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
xvi) As per the information and explanations given to us, term loans
have been applied for the purpose for which these term loans were
obtained.
xvii) In our opinion, based on the information and explanations given
to us and on an overall examination of the books and records of the
company, the funds raised on short term basis prima facie have not been
used for long term investments. No long term funds have been used to
finance short-term assets.
xviii)The company has not made any preferential allotment of shares
during the financial year to any party.
xix) The company has not issued any debentures during the financial
year.
xx) The company has not raised any money by public issues during the
financial year.
xxi) On the basis of the audit procedures carried out and information
and explanations given by the management, we state that no fraud on or
by the Company has been noticed or reported during the course of our
audit.
For M/s. P. SRINIVASAN & Co.
Chartered Accountants
Place : Chennai CA. P. SRINIVASAN
Date : 4th June, 2012 Partner
Membership No. : 2090
FRN. 004054S
Mar 31, 2010
We have audited the attached Balance sheet of M/s. Hydro S&S Industries
Limited as at 31st March 2010, the Profit and Loss account and also the
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 mis-statement. 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 the management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
1) As required by the Companies (Auditors Report) Order, 2003 issued
by the Central Government in terms of Section 224(4A) 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 to the extent
applicable to the company.
2) Further to our comments in the Annexure referred to in the paragraph
above, 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 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, Profit and loss account and the Cash flow
statement dealt with by this report are in agreement with the books of
account.
d) In our opinion, the Balance sheet, Profit and loss account and the
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, as they apply to the company.
e) On the basis of written representations received from the directors
as at 31st March, 2010 and taken on record by the Board of Directors,
we report that none of the directors is disqualified as on 31st March
2010 from being appointed as a director in terms of section 274 (1)(g)
of the Companies Act, 1956.
f) 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 :
i. in the case of the Balance Sheet, of the state of affairs of the
company as at 31st March, 2010;
ii in the case of the Profit and Loss account, of the loss of the
company for the financial year ended on that date; and
iii in the case of the Cash Flow Statement, of the cash flows for
the financial year ended on that date.
ANNEXURE REFERRED TO IN PARAGRAPH 1 OF THE REPORT OF EVEN DATE
i) a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
b) These fixed assets have been physically verified by the management
at the end of the financial year, 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) In our opinion, the fixed assets disposed off during the year, do
not constitute a substantial part of the fixed assets of the company
and such disposal has not affected the going concern status of the
company.
ii) a) As explained to us, the inventories held by the Company were
physically verified during the year by the management at reasonable
intervals.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
c) In our opinion and according to the information and explanations
given to us, the company is maintaining proper records of its
inventories and no material discrepancies were noticed on physical
verification.
iii) a) The Company has not granted any loans, secured or unsecured to
Companies, firms or other parties covered in the register maintained
u/s 301 of the Act.
b) The company has not taken any loans, secured or unsecured from
Companies, firms or other parties covered in the register maintained
u/s 301 of the Act.
iv) In our opinion and according to the information and explanations
given to us, there exists an adequate internal control system
commensurate with the size of the Company and the nature of its
business with regard to the purchase of inventory and fixed assets and
for the sale of goods and services. Further on the basis of our
examination of the books and records of the Company, there is no
continuing failure to correct major weaknesses in the aforesaid
internal control system of the company.
v) a) The entries relating to particulars of contracts or arrangements
referred to in section 301 of the Act have been made in the register
required to be maintained under that section; and
b) In our opinion and to the best of our knowledge and belief, wherever
applicable the transactions made in pursuance of such contracts or
arrangements have been made at prices which are reasonable having
regard to the prevailing market prices at the relevant time.
vi) The Company has not accepted any deposits from the public during
the year to which the directives issued by the Reserve Bank of India
and the provisions of sections 58 A and 58 AA or any other relevant
provisions of the Act and the rules framed thereunder are applicable.
vii) In our opinion, the company has an internal audit system
commensurate with its size and nature of its business.
viii) As explained to us, the Central Government has not prescribed the
maintenance of cost records under clause (d) of sub- section (1) of
Section 209 of the Companies Act, 1956.
ix) According to the records of the Company,
a) the Company is regular in depositing undisputed statutory dues
including provident fund, investor education and protection fund,
employees state insurance, income tax, sales tax, wealth tax, service
tax, customs duty, excise duties and cess and any other statutory dues
applicable to it, with the appropriate authorities during the year.
b) there are no dues of income tax, sales tax, wealth tax, service tax,
customs duty, excise duties and cess which have not been deposited on
account of any dispute except the following:
(i) Income tax of Rs.6.05 lakhs disputed in appeal preferred by the
Company, pending before the first income tax appellate authority. (ii)
Excise duty of Rs.1.80 lakhs, customs duty of Rs.26.78 lakhs and
service tax of Rs.4.53 lakhs disputed in appeals preferred by the
Company, pending before the first appellate authority.
x) The Company did not have accumulated losses at the end of the
financial year i.e. 31.03.2010. The Company did not incur cash loss in
this financial year and had incurred cash loss of Rs. 53.40 lakhs in
the preceding financial year ended 31.03.09.
xi) On the basis of records produced, the Company has not defaulted in
repayment of the dues to any financial institution or bank during the
financial year.
xii) As per the records maintained, no loans or advances have been
granted by the Company on the basis of security by way of pledge of
shares, debentures and other securities.
xiii) The provisions of Special statute applicable to chit, nidhi,
mutual fund / societies are not applicable to the Company.
xiv) On the basis of records maintained and in our opinion, the Company
does not deal or trade in shares, securities, debentures and other
investments.
xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
xvi) As per the information and explanations given to us, term loans
have been applied for the purpose for which these term loans were
obtained.
xvii) In our opinion, based on the information and explanations given
to us and on an overall examination of the books and records of the
company, the funds raised on short term basis prima facie have not been
used for long term investments.
xviii) The company has not made any preferential allotment of shares
during the financial year to any party.
xix) The company has not issued any debentures during the financial
year.
xx) The company has not raised any money by public issues during the
financial year.
xxi) On the basis of the audit procedures carried out and information
and explanations given by the management, we state that no fraud on or
by the Company has been noticed or reported during the course of our
audit.
For M/s. P. SRINIVASAN & Co.
Chartered Accountants
Place : Chennai CA. P. SRINIVASAN
Date : 28th July, 2010 Partner
Membership No. : 2090
FRN. 004054S