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Auditor Report of Kothari Products Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of KOTHARI PRODUCTS LIMITED ("the Company") which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit & 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 Financial Statements

The Company's management is responsible for the preparation of these statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with Accounting Standards referred to in Section 133 of the Companies Act, 2013 (the Act") read with Rule 7 of the Companies (Accounts) Rule, 2014. 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 misstatements, 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 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 misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. An audit also includes evaluating the appropriateness of the 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 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:

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

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

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

Report on Other legal and Regulatory Requirements

1. As required by the Companies (Auditors' Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Companies Act, 2013, we give in the Annexure 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 obtained all 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 accounts as required by law have been kept by the Company, so far as appears from our examination of those books.

(c) The Balance sheet, the Statement of Profit & Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of accounts.

(d) in our opinion, Balance Sheet, Statement of Profit & Loss and Cash Flow Statement comply with the Accounting Standards referred to in Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rule, 2014.

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

ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT

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

(i) In respect of its fixed assets:

(a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) According to the information and explanations given to us, these fixed assets have been physically verified by the management at reasonable intervals during the year and no material discrepancies were noticed on such verification.

(c) The disposal of fixed assets has been done in the normal course of business and it has not affected the going concern.

(ii) In respect of Inventories:

(a) The inventories have been physically verified during the year by the management, except for stocks lying with third parties, which have, however, been confirmed by them. In our opinion, the frequency of verification is reasonable.

(b) The procedures of physical verification of stocks followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and the discrepancies noticed on physical verification, which were not material, have been properly dealt with in the books of account.

(iii) In respect of Loans & Advances:

(a) The Company has given unsecured loans to its six subsidiary companies, two associate Companies and one enterprise over which Key Managerial Personnel are able to exercise significant influence. Total year end balances of unsecured loans given to subsidiary companies, associate companies and enterprise over which Key Managerial Personnel are able to exercise significant influence were Rs.22899 lacs.

(b) In our opinion and according to the information and explanations given to us, the rate of interest (other than interest free loans to its four wholly owned subsidiary Companies) and other terms & conditions of the loan given by the Company, are not prima facie prejudicial to the interest of the Company.

(c) The principal amounts are repayable on demand and there is no repayment schedule. The amount of interest is also payable on demand.

(d) There is no overdue amount of principal or interest.

(e) The Company has taken unsecured loans from one of its directors and year ended outstanding has been Rs.183 lacs except this the company has taken no loans or advances from companies, firms or other parties covered in the register maintained under section 189 of the Act.

(f) The rate of interest and other terms and conditions are not prejudicial to the interest of the company.

(g) The principal and interest are payable on demand and there is no repayment schedule.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of stocks and fixed assets, for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

(v) The Company has not accepted any deposits from the public. Therefore, reporting under clause 3(v) of the Companies (Auditors' Report) Order, 2015 is not applicable to the Company.

(vi) The maintenance of cost records as prescribed by the Central Government under sub-section (1) of section 148 of the Act are not applicable to the Company.

(vii) In respect of statutory dues:

(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 / Value Added Tax, Wealth Tax, Service tax, Custom Duty, Cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, there are no undisputed amounts payable in respect of Income-tax, Wealth-tax, Service-tax, Sales-tax / Value Added Tax, Custom duty and Cess as at 31st March, 2015 which were outstanding for a period of more than six months from the date they became payable.

(b) According to the information & explanations given to us, there is no disputed amount payable in respect of Income-tax, Wealth-tax, Service-tax, Sales-tax / Value Added Tax, Custom duty and Cess as at 31st March, 2015.

(viii) Company does not have any accumulated losses and it has not incurred cash losses during the financial year and immediately preceding financial year.

(ix) As per information and explanations given by the management, in our opinion the Company has not defaulted in repayment of loan taken from financial institutions or banks.

(x) The Company has given guarantees for loans taken from banks and financial institutions by its subsidiary companies, associate companies and other company. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the Company.

(xi) The Company has not taken any term loan during the year.

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

For MEHROTRA & MEHROTRA, Firm Registration No.000226C CHARTERED ACCOUNTANTS, (Vivek Kumar)

Place: Kanpur PARTNER

Date : 27th May, 2015 Membership No. 408227




Mar 31, 2014

We have audited the accompanying financial statements of KOTHARI PRODUCTS LIMITED ("the Company") which comprise the Balance Sheet as at 31st March, 2014, the Statement of Profit & 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 Financial Statements

The Company''s management is responsible for the preparation of these statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956 (the Act") read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013. 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 misstatements, 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 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 misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of the 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 suffcient and appropriate to provide a basis for our audit opinion.

Opinion

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

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2014;

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

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

Report on Other legal and Regulatory Requirements

1. As required by the Companies (Auditors'' Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we 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 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 accounts as required by law have been kept by the Company, so far as appears from our examination of those books.

(c) The Balance sheet, the Statement of Profit & Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of accounts.

PRODUCTS LIMITED

(d) in our opinion, Balance Sheet, Statement of Profit & Loss and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Act read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013.

(e) On the basis of the written representations received from the directors as on 31st March, 2014 and taken on records by the Board of Directors, none of the directors is disqualifed as on 31st March, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act.

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT (Referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date) (i) In respect of its fixed assets:

(a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) According to the information and explanations given to us, these fixed assets have been physically verifed by the management at reasonable intervals during the year and no material discrepancies were noticed on such verifcation.

(c) The disposal of fixed assets has been done in the normal course of business and it has not affected the going concern. (ii) In respect of Inventories:

(a) The inventories have been physically verifed during the year by the management, except for stocks lying with third parties, which have , however, been confirmed by them. In our opinion, the frequency of verifcation is reasonable.

(b) The procedures of physical verifcation of stocks followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and the discrepancies noticed on physical verifcation, which were not material, have been properly dealt with in the books of account.

(iii) In respect of Loans & Advances:

(a) The Company has given unsecured loans to its six subsidiary companies and four associate Companies and total year end balances were 13635 lacs.

(b) In our opinion and according to the information and explanations given to us, the rate of interest (other than interest free loans to its four wholly owned subsidiary Companies) and other terms & conditions of the loan given by the Company, are not prima facie prejudicial to the interest of the Company.

(c) The principal amounts are repayable on demand and there is no repayment schedule. The amount of interest is also payable on demand.

(d) There is no overdue amount of principal or interest.

(e) The Company has taken unsecured loans from one of its directors and year ended outstanding has been Rs. 24 lacs except this the company has taken no loans or advances from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(f) The rate of interest and other terms and conditions are not prejudicial to the interest of the company.

(g) The principal and interest are payable on demand and there is no repayment schedule.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of stocks and fixed assets, for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

(v) (a) To the best of our knowledge and according to the information and explanations given to us, the contracts or arrangements that need to be entered into a register in pursuance of section 301 of the Companies Act, 1956 have been so entered;

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts / arrangements entered in the Register maintained under section 301 of the Act and exceeding the value of Rs. 5 lacs in respect of each party during the year have been made at prices which appear reasonable, having regard to the prevailing market prices at the relevant time;

(vi) The Company has not accepted any deposits from the public. Therefore, reporting under clause 4(vi) of the Companies (Auditors'' Report) Order, 2003 is not applicable to the Company.

(vii) The Company has integrated Internal Control cum audit system which involves reasonable internal audit which is considered by us to be commensurate with size and nature of its business.

(viii) The maintenance of cost records as prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Companies Act, 1956 are not applicable to the Company.

KUTT1AHI

PRODUCTS LIMITED

(ix) In respect of statutory dues:

(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 / Value Added Tax, Wealth Tax, Service tax, Custom Duty, Cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, there are no undisputed amounts payable in respect of Income-tax, Wealth-tax, Service-tax, Sales-tax / Value Added Tax, Custom duty and Cess as at 31st March, 2014 which were outstanding for a period of more than six months from the date they became payable.

(b) According to the information & explanations given to us, there is no disputed amount payable in respect of Income-tax, Wealth-tax, Service-tax, Sales-tax / Value Added Tax, Custom duty and Cess as at 31st March, 2014.

(x) The Company does not have any accumulated losses and it has not incurred cash losses during the financial year and immediately preceding financial year.

(xi) As per information and explanations given by the management, in our opinion the Company has not defaulted in repayment of loan taken from financial institutions or banks.

(xii) The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) The Company is not a Chit Fund or a Nidhi / Mutual benefit Fund / Society. Therefore, the reporting under Clause 4(xiii) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly the reporting under clause 4(xiv) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

(xv) The Company has given guarantees for loans taken from banks and financial institutions by one of its subsidiary companies and two of its associate companies. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the Company.

(xvi) The Company has not taken any term loan during the year.

(xvii) As per information and explanations given to us, funds raised for short term basis have not been used for long term investment.

(xviii) The Company has not made any preferential allotment of shares during the year.

(xix) The Company has not issued any debentures during the year.

(xx) The Company has not raised any money by public issue during the year.

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

For MEHROTRA & MEHROTRA, Firm Registration No.000226C CHARTERED ACCOUNTANTS,

(Ishan Goel) Place: Kanpur PARTNER Date : 22nd May, 2014 Membership No. 424241


Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of KOTHARI PRODUCTS LIMITED ("the Company") which comprise the Balance Sheet as at 31st March, 2013, the Statement of Profit & 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 Financial Statements

The Company''s management is responsible for the preparation of these statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with 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 ar e free from material misstatements, 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 accorda nce with 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 misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors'' judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures tha t are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of the 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 aforesaid financial statem ents 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 Statement of Profit & Loss, of the Profit of the Company for the year ended on that date; and

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

Report on Other legal and Regulatory Requirements

1. As required by the Companies (Auditors'' Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we 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 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 accounts as required by law have been kept by the Company, so far as appears from our examination of those books.

(c) The Balance sheet, the Statement of Profit & Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of accounts.

(d) in our opinion, Balance Sheet, Statement of Profit & Loss and Cash Flow Statement report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Act.

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

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT

(i) In respect of its fixed assets:

(a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of its fixed assets.

(b) According to the information and explanations given to us, these fixed assets have been physically verified by the management at reasonable intervals during the year and no material discrepancies were noticed on such verification.

(c) The disposal of fixed assets has been done in the normal course of business and it has not affected the going concern.

(ii) In respect of Inventories:

(a) The inventories have been physically verified during the year by the management, except for stocks lying with third parties, which have , however, been confirmed by them. In our opinion, the frequency of verification is reasonable.

(b) The procedures of physical verification of stocks followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and the discrepancies noticed on physical verification, which were not material, have been properly dealt with in the books of account.

(iii) In respect of Loans & Advances:

(a) The Company has given unsecured loans to its seven subsidiary companies and two associate Companies and total year end balances were 23754 lacs.

(b) In our opinion and according to the information and explanations given to us, the rate of interest (other than interest free loans to its four wholly owned subsidiary Companies) and other terms & conditions of the loan given by the Company, are not prima facie prejudicial to the interest of the Company.

(c) The principal amounts are repayable on demand and there is no repayment schedule. The amount of interest is also payable on demand

(d) There is no overdue amount of principal or interest.

(e) The Company has taken unsecured loans from one of its directors and year ended outstanding has been Rs.748 lacs except this the company has taken no loans or advances from companies, fiEms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(f) The rate of interest and other terms and conditions are not prejudicial to the interest of the company.

(g) The principal and interest are payable on demand and there is no repayment schedule.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of stocks and fixed assets, for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

(v) (a) To the best of our knowledge and according to the information and explanations given to us, the contracts or arrangements that need to be entered into a register in pursuance of section 301 of the Companies Act, 1956 have been so entered;

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts / arrangements entered in the Register maintained under section 301 of the Act and exceeding the value of Rs. 5 lacs in respect of each party during the year have been made at prices which appear reasonable, having regard to the prevailing market prices at the relevant time;

(vi) The Company has not accepted any deposits from the public. Therefore, reporting under clause 4(vi) of the Companies (Auditors'' Report) Order, 2003 is not applicable to the Company.

(vii) The Company has integrated Internal Control cum audit system which involves reasonable internal audit which is considered by us to be commensurate with size and nature of its business.

(viii) The maintenance of cost records as prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Companies Act, 1956 are not applicable to the Company.

(ix) In respect of statutory dues:

(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 / Value Added Tax, Wealth Tax, Service tax, Custom Duty, Cess and any other statutory dues with the appropriate authorities. According to the information and explanations given to us, there are no undisputed amounts payable in respect of Income-tax, Wealth-tax, Service-tax, Sales-tax / Value Added Tax, Custom duty and Cess as at 31st March, 2013 which were outstanding for a period of more than six months from the date they became payable.

(b) According to the information & explanations given to us, there is no disputed amount payable in respect of Income-tax, Wealth-tax, Service-tax, Sales-tax / Value Added Tax, Custom duty and Cess as at 31st March, 2013.

(x) The Company does not have any accumulated losses and it has not incurred cash losses during the financial year during the year and immediately preceding financial year.

(xi) As per information and explanations given by the management, in our opinion the Company has not defaulted in repayment of loan taken from financial institution or banks.

(xii) The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) The Company is not a Chit Fund or a Nidhi / Mutual BenefiE Fund / Society. Therefore, the reporting under Clause 4(xiii) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly the reporting under clause 4(xiv) of the Companies (Auditors'' Report) Order, 2003 are not applicable to the Company.

(xv) The Company has given guarantees for loans taken from banks and financial institutions by one of its subsidiary companies and two of its associate companies. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the Company.

(xvi) The Company has not taken any term loan during the year.

(xvii) As per information and explanations given to us, funds raised for short term basis have not been used for long term investment.

(xviii) The Company has not made any preferential allotment of shares during the year.

(xix) The Company has not issued any debentures during the year.

(xx) The Company has not raised any money by public issue during the year.

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

For MEHROTRA & MEHROTRA,

Firm Registration No.000226C

CHARTERED ACCOUNTANTS,

(A. N. Rastogi)

Place: Kanpur PARTNER

23rd May, 2013 Membership No. 070168


Mar 31, 2012

1. We have audited the attached Balance Sheet of Kothari Products Limited as at 31st March, 2012, Statement of Profit & Loss for the year ended on that date and the Cash Flow Statement for the year ended on that date annexed hereto, which are in agreement with the books of accounts. 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.

2. 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 from material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors' Report) Order, 2003 issued by the Central Government of India in terms of sub- section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we considered appropriate and the information and explanations given to us during the course of our audit, we report that, in our opinion:-

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

(b) According to the information and explanations given to us, these fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification.

(c) The disposal of fixed assets has been done in the normal course of business and it has not affected the going concern.

(ii) (a) The inventories have been physically verified during the year by the management, except for stocks lying with third parties, which have , however, been confirmed by them. In our opinion, the frequency of verification is reasonable.

(b) The procedures of physical verification of stocks followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and the discrepancies noticed on physical verification, which were not material, have been properly dealt with in the books of account.

(iii) (a) The Company has given unsecured loans to its seven subsidiary companies and two associate Companies and total year end balances were 15534 lacs.

(b) In our opinion and according to the information and explanations given to us, the rate of interest (other than interest free loans to its five wholly owned subsidiary Companies) and other terms & conditions of the loan given by the Company, are not prima facie prejudicial to the interest of the Company.

(c) The principal amounts are repayable on demand and there is no repayment schedule. The amount of interest is also payable on demand

(d) There are no overdue amount of principal or interest.

(e) The Company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 and therefore reporting under clause (f) and (g) is not required.

(iv) There is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of stocks and fixed assets, for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

(v) (a) To the best of our knowledge and according to the information and explanations given to us, the contracts or arrangements that need to be entered into a register in pursuance of section 301 of the Companies Act, 1956 have been so entered;

(b) Each of these transactions has 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. Therefore, reporting under clause 4(vi) of the Companies (Auditors' Report) Order, 2003 is not applicable to the Company.

(vii) The Company has integrated Internal Control cum audit system which involves reasonable internal audit which is considered by us to be commensurate with size and nature of its business.

(viii) The maintenance of cost records as prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Companies Act, 1956 are not applicable to the Company.

(ix) (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 / Value Added Tax, Wealth Tax, Service tax, Custom Duty, Cess and any other statutory dues with the appropriate authorities.

(b) According to the information and explanations given to us, there are no undisputed amounts payable in respect of Income-tax, Wealth-tax, Service-tax, Sales-tax / Value Added Tax, Custom duty and Cess as at 31st March, 2012 which were outstanding for a period of more than six months from the date they became payable.

(c) According to the information & explanations given to us, there is no disputed amount payable in respect of Income- tax, Wealth-tax, Service-tax, Sales-tax / Value Added Tax, Custom duty and Cess as at 31st March, 2012.

(x) The Company does not have any accumulated losses and it has not incurred cash losses during the financial year and immediately preceding financial year.

(xi) As per information and explanations given by the management, in our opinion the Company has not defaulted in repayment of loan taken from financial institution or banks.

(xii) The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) The Company is not a Chit Fund or a Nidhi / Mutual Benefit Fund / Society. Therefore, the reporting under Clause 4(xiii) of the Companies (Auditors' Report) Order, 2003 are not applicable to the Company.

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly the reporting under clause 4(xiv) of the Companies (Auditors' Report) Order, 2003 are not applicable to the Company.

(xv) The Company has given guarantees for loans taken by one of its subsidiary Companies and one of its associate Companies from banks and financial institutions. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the Company.

(xvi) The Company has not taken any term loan during the year.

(xvii)As per information and explanations given to us, funds raised for short term basis have not been used for long term investment.

(xviii) The Company has not made any preferential allotment of shares during the year.

(xix) The Company has not issued any debentures during the year.

(xx) The Company has not raised any money by public issue during the year.

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

4. Further to above, we report that:-

(i) we have obtained all information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit.

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

(iii) in our opinion, Balance Sheet, the Statements of Profit & Loss and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

(iv) based on the written representations received from the directors as on 31st March, 2012 and taken on records by the Board of Directors, we report that none of the directors is disqualified from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

(v) in our opinion and to the best of our information and explanations given to us, the said accounts read with Significant Accounting Policies and Notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view :-

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2012.

(b) in the case of Statement of Profit & Loss, of the Profit of the Company for the year ended on that date. and

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

For MEHROTRA & MEHROTRA

Firm Regn No. 000226C

CHARTERED ACCOUNTANTS

PLACE : Kanpur (ANURAG TANDON)

DATE : 29th May, 2012 PARTNER

Membership No. 078862


Mar 31, 2011

1. We have audited the attached Balance Sheet of Kothari Products Limited as at 31st March, 2011, Profit & Loss Account for the year ended on that date and the Cash Flow Statement for the year ended on that date annexed hereto, which are in agreement with the books of accounts. 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.

2. 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 from material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors' Report) Order, 2003 issued by the Central Government of India in terms of subsection (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we considered appropriate and the information and explanations given to us during the course of our audit, we report that, in our opinion:-(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) According to the information and explanations given to us, these fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification.

(c) The disposal of fixed assets has been done in the normal course of business and it has not affected the going concern.

(ii) (a) The inventories have been physically verified during the year by the management, except for stocks lying with third parties, which have , however, been confirmed by them. In our opinion, the frequency of verification is reasonable.

(b) The procedures of physical verification of stocks followed by the management is reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and the discrepancies noticed on physical verification, which were not material, have been properly dealt with in the books of account.

(iii) (a) The Company has given loans to its six subsidiary companies and two associate Companies. In respect of these loans the maximum amount outstanding during the year were Rs.20431 Lacs and year end balances were 15470 Lacs.

(b) In our opinion and according to the information and explanations given to us, the rate of interest (other than interest free loans to its five wholly owned subsidiary Companies) and other terms & conditions of the loan given by the company, are not prima facie prejudicial to the interest of the Company.

(c) The principal amounts are repayable on demand and there is no repayment schedule. The interest is payable on demand.

(d) In respect of the said loans, the same are repayable on demand and therefore the question of overdue amounts does not arise. In respect of interest, wherever applicable, there are no overdue amounts.

(e) The Company has taken interest free unsecured loan from one of its directors amounting to Rs.1890 Lacs. Except this the Company has not taken any loans, secured or unsecured from Companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(f) The rate of interest and other terms and conditions of the loan taken are prima facie not prejudicial to the interest of the Company.

(g) There is no stipulation as to the repayment of the loan. There has been no overdue interest.

(iv) There is an adequate internal control system commensurate with the size of the company and the nature of its business, for the purchase of stocks and fixed assets, for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

(v) (a) To the best of our knowledge and according to the information and explanations given to us, the contracts or arrangements that need to be entered into a register in pursuance of section 301 of the Companies Act, 1956 have been so entered;

(b) Each of these transactions has 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. Therefore, reporting under clause 4(vi) of the Companies (Auditors' Report) Order, 2003 is not applicable to the Company.

(vii) The Company has integrated Internal Control cum audit system which involves reasonable internal audit which is considered by us to be commensurate with size and nature of its business.

(viii) The Company has not done any manufacturing activity during the year. Therefore, the maintenance of cost records as prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Companies Act, 1956 are not applicable to the Company.

(ix) (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 / Value Added Tax, Wealth Tax, Service tax, Custom Duty, Cess and any other statutory dues with the appropriate authorities.

(b) According to the information and explanations given to us, there are no undisputed amounts payable in respect of Income-tax, Wealth-tax, Service-tax, Sales-tax / Value Added Tax, Custom duty and Cess as at 31st March, 2011 which were outstanding for a period of more than six months from the date they became payable.

(c) According to the information & explanations given to us, there is no disputed amount payable in respect of Income-tax, Wealth-tax, Service-tax, Sales-tax / Value Added Tax, Custom duty and Cess as at 31st March, 2011

(x) The Company does not have any accumulated losses and it has not incurred cash losses during the financial year and immediately preceding financial year.

(xi) As per information and explanations given by the management, in our opinion the Company has not defaulted in repayment of loan taken from financial institution or banks.

(xii) The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) The Company is not a Chit Fund or a Nidhi / Mutual Benefit Fund / Society. Therefore, the reporting under Clause 4(xiii) of the Companies (Auditors' Report) Order, 2003 are not applicable to the Company.

(xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly the reporting under clause 4(xiv) of the Companies (Auditors' Report) Order, 2003 are not applicable to the company.

(xv) The Company has given guarantees for loans taken by other body corporate from banks and financial institutions or other wise. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the Company.

(xvi) The Company has not taken any term loans during the year.

(xvii)As per information and explanations given to us, funds raised for short term basis have not been used for long term investment.

(xviii) The Company has not made any preferential allotment of shares during the year.

(xix) The Company has not issued any debentures during the year.

(xx) The Company has not raised any money by public issues during the year.

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

4. Further to above, we report that:-i. we have obtained all information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit.

ii. in our opinion, proper books of accounts have been kept by the Company as required by the law, so far as appears from our examination of those books.

iii. in our opinion, Balance Sheet; the Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

iv. based on the written representations received from the directors as on 31st March, 2011 and taken on records by the Board of Directors, we report that none of the directors is disqualified from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

v. in our opinion and to the best of our information and explanations given to us, the said accounts read with Significant Accounting Policies and Notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view :-(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2011.

(b) in the case of Profit & Loss Account, of the Profit of the Company for the year ended on that date. and

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

For MEHROTRA & MEHROTRA

CHARTERED ACCOUNTANTS

PLACE :KANPUR (ANURAG TANDON)

DATE :30th May, 2011 PARTNER

Membership No. 078862








Mar 31, 2010

1. We have audited the attached Balance Sheet of Kothari Products Limited as at 31st March, 2010, Profit & Loss Account for the year ended on that date and the Cash Flow Statement for the year ended on that date annexed hereto, which are in agreement with the books of accounts. 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.

2. 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 from material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we considered appropriate and the information and explanations given to us during the course of our audit, we report that, in our opinion:- (i) (a) The company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) According to the information and explanations given to us, these fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such verification.

(c) The disposal of fixed assets has been done in the normal course of business and it has not affected the going concern.

(ii) (a) The stock of finished goods, semi-finished goods, raw material, stores & perfumes and traded items have been physically verified by the management at the end of the year. In our opinion, the frequency of verification is reasonable.

(b) The procedures of physical verification of stocks followed by the management is reasonable and adequate in relation to the size of the company and the nature of its business.

(c) The company is maintaining proper records of inventory and the discrepancies noticed on physical verification, which were not material, have been properly dealt with in the books of account.

(iii) (a) The Company has given loans to its five wholly owned subsidiary companies. In respect of these loans the maximum amount outstanding during the year ware Rs.6997.45 lac and year end balances were 5118.95 lac.

(b) In our opinion and according to the information and explanations given to us, the rate of interest and other terms & conditions of the loan given by the company , are not prima facie prejudicial to the interest of the company.

(c) The principal amounts are repayable on demand and there is no repayment schedule. The interest is payable on demand.

(d) In respect of the said loans. The same are repayable on demand and therefore the question of overdue amounts does not arise. In respect of interest, wherever applicable, there are no overdue amounts.

(e) The Company has not taken any loans, secured or unsecured from companies, firm or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(f) Not Applicable to the Company.

(g) Not Applicable to the Company.

(iv) There is an adequate internal control system commensurate with the size of the company and the nature of its business, for the purchase of stocks and fixed assets, for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system.

(v) (a) To the best of our knowledge and according to the information and explanations given to us, the contracts or arrangements that need to be entered into a register in pursuance of section 301 of the Companies Act, 1956 have been so entered;

(b) Each of these transactions has 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. Therefore, reporting under clause 4(vi) of the Companies (Auditors Report) Order, 2003 is not applicable to the company.

(vii) The company has integrated Internal Control cum audit system which involves reasonable internal audit which is considered by us to be commensurate with size and nature of its business.

(viii) The maintenance of cost records has not been prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Companies Act, 1956 for the products manufactured by the Company.

(ix) (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 / Value Added Tax, Wealth Tax, Service tax, Custom Duty, Excise Duty, Cess and any other statutory dues with the appropriate authorities.

(b) According to the information and explanations given to us, there are no undisputed amounts payable in respect of Income-tax, Wealth-tax, Service-tax, Sales-tax / Value Added Tax, Custom duty, Excise Duty and Cess as at 31st March, 2010 which were outstanding for a period of more than six months from the date they became payable.

(c) According to the information & explanations given to us, details of dues of Income-tax which have not been deposited on account of any dispute are given below :

STATUTE FINANCIAL YEAR TO WHICH FORUM WHERE MATTER AMT. IN

THE MATTER PERTAINS IS PENDING

Rs. 000

Income Tax 1989-90, 1990-91, 1991-92, 1992-93, 1993-94, 1994-95, High Court 103117

1996-97, 2000-01, 2004-05 Block Period ended 18.11.1999

(x) The Company does not have any accumulated losses and it has not incurred cash losses during the financial year during the year and immediately preceding financial year.

(xi) The Company does not have any dues payable to a financial institution or bank.

(xii) The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) The Company is not a Chit Fund or a Nidhi / Mutual Benefit Fund / Society. Therefore, the reporting under Clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

(xiv) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly the reporting under clause 4(xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the company.

(xv) The company has given guarantees for loans taken by other from banks and financial institutions or otherwise. According to the information and explanations given to us, we are of the opinion that the terms and conditions thereof are not prima facie prejudicial to the interest of the company

(xvi) The Company has not taken any term loans during the year.

(xvii) As per information and explanations given to us, neither short-term funds nor long-term funds have been raised during the year.

(xviii) The Company has not made any preferential allotment of shares during the year.

(xix) The Company has not issued any debentures during the year.

(xx) The Company has not raised any money by public issues during the year.

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

4. Further to above, we report that :- i. we have obtained all information and explanations which to the best of our knowledge and belief were necessary for the purpose of our

audit. ii. in our opinion, proper books of accounts have been kept by the Company as required by the law, so far as appears from our examination

of those books. iii. in our opinion, Balance Sheet; the Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the

Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956. iv. based on the written representations received from the directors as on 31st March, 2010 and taken on records by the Board of Directors,

we report that none of the directors is disqualified from being appointed as a director in terms of clause (g) of sub-section (1) of Section

274 of the Companies Act, 1956. v. in our opinion and to the best of our information and explanations given to us, the said accounts read with Significant Accounting

Policies and Notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and

fair view :- (a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2010.

(b) in the case of Profit & Loss Account, of the Profit of the Company for the year ended on that date. and

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

For MEHROTRA & MEHROTRA CHARTERED ACCOUNTANTS

PLACE :KANPUR (ANURAG TANDON)

DATE :29th May, 2010 PARTNER

Membership No. 078862

 
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