Mar 31, 2018
Report on the Financial Statements
We have audited the accompanying financial statements of Arrow Textiles Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss(including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
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 state of affairs (financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (âInd ASâ) specified under Section 133 of the Act. 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 and ensuring their operating effectiveness and 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 disclosures in the financial statements. The procedures selected depend on the auditorsâ 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 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 including Ind AS specified under Section 133 of the Act, of the state of affairs (financial position) of the Company as at March 31, 2018, and its profit (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
Other Matter(s)
The comparative financial information for the year ended March 31, 2017 and the transition date opening balance sheet as at April 1, 2016 prepared in accordance with Ind AS included in these financial statements, are based on the previously issued financial statements for the year ended March 31, 2017 and March 31, 2016 respectively prepared in accordance with Accounting Standards prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 which were audited by the predecessor auditor whose reports dated May 15, 2017 and May 12, 2016 respectively expressed an unmodified opinion on the financial statements for the year ended March 31, 2017 and March 31, 2016, and have been adjusted for the differences in the accounting principles adopted by the Company on transition to Ind AS, which have been audited by us. Our opinion is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements
(1) As required by the Companies (Auditorsâ Report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of Section 143(11) of the Act, we give in âAnnexure Aâ, a statement on the matters specified in paragraphs 3 and 4 of the Order.
(2) Further to our comments in Annexure A, 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 financial statements dealt with by this report are in agreement with the books of account;
d. in our opinion, the aforesaid financial statements comply with the Ind AS specified under Section 133 of the Act;
e. on the basis of written representations received from the directors as on March 31, 2018, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164 (2) of the Act;
f. we have also audited the internal financial controls over financial reporting (IFCoFR) of the Company as on March 31, 2018 in conjunction with our audit of the financial statements of the Company for the year ended on that date and our report dated May 18, 2018 as per âAnnexure Bâ expressed an unmodified opinion;
g. with respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our information and according to the explanations given to us:
(i) the Company, as detailed in Note No. 33 has disclosed the impact of pending litigations on its financial position;
(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 The Independent Auditorâs Report of even date to the members of Arrow Textiles Limited on the financial statements for the year ended March 31, 2018]
Based on the audit procedures performed for the purpose of reporting a true and fair view on the financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, and to the best of our knowledge and belief, we report that:
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) The fixed assets of the Company have been physically verified by the management during the year and no material discrepancies were noticed on such verification. In our opinion, the frequency of verification of the fixed assets is reasonable having regard to the size of the Company and the nature of its assets.
(c) The title deeds of immovable properties (which are included under the head âProperty, Plant and Equipmentâ) are held in the name of the Company.
(ii) In our opinion, the management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies between physical inventory and book records 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 under Section 189 of the Act. Hence, the provisions of Paragraph 3 (iii) of the order are not applicable to the Company.
(iv) In our opinion, the Company has not advanced any loan or given any guarantee or provided any security or made any investment covered under section 185 and 186 of the Act. Hence, the provisions of Paragraph 3(iv) of the order are not applicable.
(v) In our opinion, the Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of Paragraph 3(v) of the order are not applicable.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to rules prescribed by the Central Government for the maintenance of the cost records under Sub-Section (1) of Section 148 of the Act and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.
(vii) (a) The Company is regular in depositing with appropriate authorities, undisputed statutory dues including provident fund, employeesâ state insurance, income tax, sales tax, gst, service tax, duty of customs, duty of excise, value added tax, cess and any other material statutory dues, as applicable to it. Further, no undisputed amounts payable in respect thereof were outstanding, at the year-end for a period of more than six months from the date they became payable.
(b) In our opinion, there are no dues with respect to income tax, sales tax, service tax, value added tax, customs duty, excise duty, which have not been deposited on account of any dispute, except for the dues in relation to income tax as disclosed hereunder:
Name of the Statute |
Nature of Dues |
Amount (Rs. in â000) |
Period to which the Amount Relates |
Forum where dispute is pending |
Income Tax Act, 1961 |
Income Tax |
172.71 |
F.Y 2011-12 |
Rectification application made u/s 154 of the Act and pending before Assessing Officer. |
Income Tax Act, 1961 |
Income Tax |
1040.40 |
F.Y 2014-15 |
Commissioner of Income Tax (Appeals) |
(viii) According to the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowings to banks. The Company did not have any outstanding dues to any financial institutions or debenture holders during the year.
(ix) The Company did not raise moneys by way of initial public offer or further public offer (including debt instruments). In our opinion, no term loans were raised during the year under audit.
(x) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud by the Company or any fraud on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such instance by the management.
(xi) As per the information and explanations given to us, managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
(xii) In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of Paragraph 3(xii) of the Order are not applicable to the Company.
(xiii) As per the information and explanation given to us, all transactions entered into by the Company with the related parties are in compliance with Sections 177 and 188 of Act, where applicable, and the requisite details have been disclosed in the financial statements etc., as required by the applicable Ind AS.
(xiv) As informed, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures.
(xv) According to the information and explanations given to us, the Company has not entered into any non-cash transactions with directors or persons connected with them covered under Section 192 of the Act.
(xvi) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.
ANNEXURE B
Independent Auditorâs Report on the Internal Financial Controls under Clause (i) of Sub-Section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
In conjunction with our audit of the financial statements of Arrow Textiles Limited (âthe Companyâ) as of and for the year ended March 31, 2018, we have audited the internal financial controls over financial reporting (IFCoFR) of the company of as of that date.
Managementâs Responsibility for Internal Financial Controls
The Companyâs Board of Directors is responsible for establishing and maintaining internal financial controls based on the 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 (the âGuidance Noteâ) 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 Act.
Auditorsâ Responsibility
Our responsibility is to express an opinion on the Companyâs IFCoFR based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing issued by ICAI and deemed to be prescribed under Section 143(10) of the Act, to the extent applicable to an audit of IFCoFR, 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 IFCoFR and their operating effectiveness. Our audit of IFCoFR included obtaining an understanding of IFCoFR, 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 Ind AS 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 IFCoFR.
Meaning of Internal Financial Controls over Financial Reporting
A Companyâs IFCoFR 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 the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India. A Companyâs IFCoFR 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 Companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of IFCoFR, 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 IFCoFR to future periods are subject to the risk that the IFCoFR 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, 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 ICAI.
For M H S & Associates
Chartered Accountants
ICAI Firm Reg. No.: 141079W
(Mayur H. Shah)
Proprietor
Membership No. 147928
Mumbai: May 18, 2018
Mar 31, 2016
To the Members of Arrow Textiles Limited
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of Arrow Textiles Limited(âthe Companyâ), which comprise the Balance Sheet as at March 31, 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information.
Managementâs Responsibility for the Standalone Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and 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 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 and ensuring their operating effectiveness and the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs Responsibility
Our responsibility is to express an opinion on these standalone financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the standalone financial statements. The procedures selected depend on the auditorsâ judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the standalone 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 31st March, 2016, 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 (Auditorsâ Report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of sub section (11) of Section 143 of the Act, we give in âAnnexure 1â, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
(2) As required by Section 143(3) of the Act, we report that:
a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;
b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
c. The Balance Sheet, the Statement of Profit and Loss, 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 read with Note 1 (a) thereto 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, and 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, we give our separate Report in âAnnexure 2â;
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 standalone financial statements - Refer Note 26(i)on Contingent Liabilities to the standalone financial statements;
(ii) The Company did not have any long-term contracts including derivative contracts. Hence, the question of any material foreseeable losses does not arise;
(iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
[Referred to in paragraph 1 under âReport on Other Legal and Regulatory Requirementsâ in the Independent Auditorâs Report of even date to the members of Arrow Textiles limited on the standalone financial statements 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) During the year, the fixed assets of the Company have been physically verified by the management and as informed, no material discrepancies were noticed on such verification. In our opinion, the frequency of verification is reasonable having regard to the size of the Company and the nature of its assets.
(c) The title deeds of immovable properties recorded as fixed assets in the books of account of the Company are held in the name of the Company.
(ii) The inventory has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable. As informed, no material discrepancies were noticed on physical verification carried out during the year.
(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. Hence, the provisions of Paragraph 3 (iii)(a), 3 (iii)(b) and 3 (iii)(c) of the order are not applicable to the Company.
(iv) Based on information and explanation given to us in respect of loans, investments, guarantees, and securities, the Company has complied with the provisions of Section 185 and 186 of the Act.
(v) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the provisions of Sections 73 to 76 of the Act and the rules framed there under.
(vi) As per information and explanation given to us, the Central Government has prescribed the maintenance of cost records for a product of the Company under sub-section (1) of Section 148 of the Act and the rules framed there under and such accounts are made and maintained.
(vii) (a) The Company is generally regular in depositing with appropriate authorities, undisputed statutory dues including provident fund, employeesâ state insurance, income tax, sales tax, service tax, value added tax, custom duty, cess and any other material statutory dues applicable to it.
According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employeesâ state insurance, income tax, sales tax, service tax, value added tax, customs duty, cess and any other material statutory dues applicable to it, were outstanding, at the year end, for a period of more than six months from the date they became payable.
(b) In our opinion and according to the information and explanations given to us, there are no dues with respect to income tax, sales tax, service tax, value added tax, customs duty, excise duty, which have not been deposited on account of any dispute, except for the dues in relation to income tax and Central Sales Tax as disclosed hereunder:
Name of the Statute |
Nature of Dues |
Amount Rs. in Lacs |
Period to which the amount relates |
Forum where dispute is pending |
Income Tax Act, 1961 |
Income tax |
1.64 |
F.Y-2009-10 |
Appeal pending before Commissioner of Income Tax(Appeals) |
Income Tax Act, 1961 |
Income Tax |
1.72 |
F.Y-2011-12 |
Rectification application made u/s 154 of the Act and pending before Assessing Officer. |
Central Sales Tax |
CST Tax |
7.15 |
F.Y-2002-03 |
Appeal pending before High Court |
(viii) According to the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowings to banks. The Company did not have any outstanding dues to any financial institutions or debenture holders during the year.
(ix) According to the information and explanations given to us, the Company has not raised money by way of public issue offer. Term loans obtained by the Company have been applied for the purposes for which they were raised.
(x) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud by the Company or any fraud on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such instance by the management.
(xi) As per the information and explanations given to us, managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
(xii) In our opinion, the Company is not a Nidhi Company. Therefore, paragraph 3(xii) of the Order is not applicable to the Company.
(xiii) As per the information and explanation given to us, all transactions entered into by the Company with the related parties are in compliance with Sections 177 and 188 of Act, where applicable and the details have been disclosed in the Financial Statements etc., as required by the applicable accounting standards.
(xiv) As informed, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Therefore, paragraph 3(xiv) of the Order is not applicable to the Company.
(xv) According to the information and explanations given to us, the Company has not entered into any non-cash transactions with directors or persons connected with him during the year.
(xvi) Based on the information and explanation given to us, the Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.
[Referred to in paragraph 2 under âReport on Other Legal and Regulatory Requirementsâ in the Independent Auditorâs Report of even date to the members of Arrow Textiles Limited on the standalone financial statements for the year ended March 31, 2016]
Report on the Internal Financial Controls over Financial Reporting 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 Arrow Textiles Limited(âthe Companyâ) as of March 31, 2016 in conjunction with our audit of the standalone 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.
Auditorsâ Responsibility
Our responsibility is to express an opinion on the Companyâs 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 specified under Section 143(10) of the Act to the extent applicable to an audit of internal financial controls, 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 judgment, including the assessment of the risks of material misstatement of the standalone 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 standalone financial statements for external purposes in accordance with generally accepted accounting principles. A companyâs internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of standalone financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companyâs assets that could have a material effect on the standalone 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 ICAI.
For Amit Desai & Co
Chartered Accountants
ICAI Firm Registration No. 130710W
(Amit N Desai)
Partner
Membership No. 032926
Mumbai: 12th May, 2016
Mar 31, 2015
We have audited the accompanying financial statements of Arrow Textiles
Limited ("the Company"), which comprise the Balance Sheet as at March
31, 2015, Statement of Profit and Loss and Cash Flow Statement for the
year then ended and a summary of significant accounting policies and
other explanatory information.
Management's Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation of these financial statements that give 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 includes the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding 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 internal financial control, that were operating
effectively for ensuring the accuracy and completeness of the
accounting records, relevant to the preparation and presentation of
financial statements that give true and fair view and free from
material 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 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 disclosures in the financial statements. The procedures
selected depend on the auditors' judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company's preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances 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 operative effectiveness of such controls. An audit also
includes evaluating the appropriateness of accounting policies used and
the reasonableness of the accounting estimates made by companies'
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 financial statements, give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India:
a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31,2015;
b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 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 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 appears from our examination of those
books;
c) the Balance sheet and Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
d) in our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement comply with the accounting standards referred in
Section 133 of the Companies Act, 2013, read with Rule 7 of the
Companies (Accounts) Rules, 2014.
e) on the basis of written presentations received from the Directors as
on March 31, 2015, and taken on record by the Board of Directors, none
of the Directors is disqualified as on March 31,2015, from being
appointed as a Director in terms of Sub-Section (2) of Section 164 of
the Companies Act, 2013;
f) With respect to the other matters included in the auditor's report
and to the best of our information and according to the explanation
given to us.
i. The Company has disclosed the impact of pending litigations on its
financial statements - Refer Note 26 (j) to the financial statements;
ii. The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable
losses;
iii. There were no amounts which were required to be transferred to the
Investor Education and Protection Fund by the Company.
(Referred to in Paragraph 1 under the heading of "Report on Other Legal
and Regulatory Requirements" of our report even date.)
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and
situation of fixed assets.
(b) As explained to us, the Company has a policy to carry out a
physical verification of fixed assets in a phased manner at a regular
interval which, in our opinion, is reasonable having regard to the size
of the Company and the nature of its assets. We are informed that no
material discrepancies were noticed on such physical verification.
(ii) (a) The management has carried out physical verification of the
inventory at reasonable intervals during the year.
(b) In our opinion, and according to the information and explanations
given to us, the procedures of physical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
(c) The Company maintains proper records of inventory. Discrepancies
noticed on physical verification of inventory as compared to the book
records were not material and these have been properly dealt with in
the books of account.
(iii) The Company has not granted unsecured loans to Companies, firms
or other parties covered in the register maintained under Section 189
of the Act. Hence, the provisions of Paragraph 3(iii) of the Order are
not applicable to the Company.
(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 purchases of inventory and fixed assets and
with regard to the sale of goods. During the course of our audit, we
have not observed any continuing failure to correct major weaknesses in
internal control system of the Company.
(v) The Company has not accepted any deposits from the public in
accordance with the provisions of section 73 to 76 of the Act and the
rules framed there under.
(vi) The maintenance of cost records has been specified by the Central
Government under sub-section (1) of section 148 of the Companies Act
and such accounts are made and maintained.
(vii) (a) According to the information and explanations given to us and
on the basis of examination of our records of the Company, amounts
deducted / accrued in respect of undisputed statutory dues including
provident fund, employees' state insurance, income-tax, sales-tax,
wealth-tax, service tax, duty of customs, duty of excise, value added
tax, cess, professional tax and other material statutory dues have been
generally regularly deposited during the year by the Company with the
appropriate authorities.
(b) According to the information and explanations given to us no
undisputed dues in respect of provident fund, employees' state
insurance, income-tax, sales-tax, wealth-tax, service tax, duty of
customs, duty of excise, value added tax, cess, professional tax and
other material statutory dueswhich were outstanding, at the year end
for a period of more than six months from the date they became payable.
(c) According to the information and explanations given to us, the dues
outstanding with respect to income tax, sales tax, wealth tax, service
tax, duty of customs, duty of excise, value added tax, cess or any
other material statutory dues applicable to it, on account of any
dispute, are as follows:
Name of the Nature of Rs. in Lacs Period to which the
Statute Dues amount relates
Income Tax Tax 1.64 F.Y 2009-10
Income Tax Tax 1.72 F.Y. 2011-12
Central Sales CST Tax 7.15 F.Y. 2002-03
Tax
Name of the Forum where dispute is pending
Statute
Income Tax Appeal pending before
Commissioner of Taxes (Appeal)
Income Tax Rectification application made u/s
154 of the Act and pending before
Assessing Officer
Central Sales
Tax Appeal pending before High Court
(d) According to the information and explanations given to us, there is
no amount which is required to be transferred to investor education and
protection fund in accordance with the relevant provisions of the
Companies Act, 1956 (1 of 1956) and Rules made thereunder. Therefore,
the provisions of Paragraph 3 (vii)
(d) of the Order are not applicable to the Company.
(viii) The Company does not have any accumulated losses which exceeds
50% of its net worth at the end of the financial year. Further, the
Company has not incurred cash losses during the financial year covered
by our audit as well as in the immediately preceding financial year.
(ix) The Company has not defaulted in repayment of dues to its bankers.
The Company did not have any outstanding dues to any financial
institutions or debenture holders during the year.
(x) In our opinion and according to the information and explanation
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions. Therefore, the provisions
of Paragraph 3(x) of the Order are not applicable to the Company.
(xi) In our opinion and on overall examination, we report that the term
loans were raised during the year and are applied for the purpose for
which the loans were obtained.
(xii) During the course of our examination of the books and records of
the company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the company, noticed or reported during the year, nor
have we been informed of any such case by the management.
For Amit Desai & Co
Chartered Accountants
Firm's Registration No.130710W
(Amit Desai)
Partner
Mumbai: 12th May, 2015 Membership No. 032926
Mar 31, 2014
We have audited the accompanying financial statements of Arrow Textiles
Limited ("the Company"), which comprise the Balance Sheet as at March
31, 2014, and the Statement of Profit and Loss and Cash Flow Statement
for the year then ended and a summary of significant accounting
policies and other explanatory information.
Managements responsibility for the financial statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards referred to in sub-section (3C) of Section 211
of the Companies Act, 1956 ("the Act") read with the General Circular
15/2013 dated September 13, 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 misstatement, 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
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 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 accounting policies used and the reasonableness of the accounting
estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2014;
(b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors'' Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
Sub-Section (4A) of Section 227 of the Act, we give in the Annexure, a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by Section 227(3) of the Companies Act, 1956, we report
that:
a) we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
(b) in our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books;
(c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
(d) in our opinion, the Balance Sheet, Statement of Profit and Loss,
and Cash Flow Statement comply with the Accounting Standards referred
to in sub Section (3C) of Section 211 of the Companies Act, 1956 read
with the General Circular 15/2013 dated September 13, 2013 of the
Ministry of Corporate Affairs in respect of Section 133 of the
Companies Act, 2013;
(e) on the basis of written representations received from the directors
as on March 31, 2014, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2013, from being
appointed as a director in terms of clause (g) of sub-Section (1) of
Section 274 of the Companies Act, 1956.
ANNEXURE TO AUDITORS'' REPORT
Referred to in paragraph 1 under ''Report on Other Legal and Regulatory
Requirements'' in the Independent Auditors'' Report of even date to the
members of ARROW TEXTILES LIMITED on the financial statements for the
year ended 31st March, 2014.
(i) (a) Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
(b) As explained to us, the Company has a policy to carry out a
physical verification of fixed assets in a phased manner at regular
intervals which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. We are informed that
no material discrepancies were noticed on such verification.
(c) In our opinion and according to the information and explanations
given to us, the Company has not disposed off a substantial part of
fixed assets during the year.
(ii) (a) The inventory (excluding stocks with third parties) has been
physically verified by the management during the year. In respect of
inventory lying with third parties, these have been substantially
confirmed by them. In our opinion, the frequency of verification is
reasonable.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
(c) Company is maintaining proper records of inventory and no material
discrepancies were noticed on physical verification carried out at the
end of the year
(iii) In our opinion and according to the information and explanations
given to us, the Company has not granted/taken loan to / from parties
covered in the register maintained under Section 301 of the Companies
Act, 1956. Accordingly, paragraphs 4(iii) (a), (b), (c), (d), (e), (f)
& (g) of the Companies (Auditor''s Report) Order, 2003 are not
applicable.
(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 purchase of fixed assets, inventories and with
regard to the sale of goods. During the course of our audit, we have
not observed any continuing failure to correct major weaknesses in
internal control system of the Company.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the particulars of contracts or arrangements
referred to in Section 301 of the Companies Act, 1956 that need to be
entered into the register maintained under Section 301 have been so
entered.
(b) In our opinion and according to the information and explanations
given to us, there are no such transactions made in pursuance of
contracts or arrangements which exceeds the value of Rupees Five Lakhs
in value.
(vi) In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposits from the public
within the meaning of Sections 58A and 58AA and directions issued by
the Reserve Bank of India or any other relevant provisions of the Act
and the rules framed there under.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) We have broadly reviewed the cost records maintained by the
Company pursuant to the Companies (Cost Accounting Records) Rules, 2011
prescribed by the Central Government of India under clause (d) of
Sub-Section (1) of Section 209 of the Act and are of the opinion that
prima facie the prescribed cost records have been maintained. We have
however, not made detailed examination of the costs records with a view
to determine whether they are accurate or complete.
(ix) (a) The Company is generally regular in depositing with
appropriate authorities 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 duty, cess and other material statutory dues applicable to
it.
(b) According to the information and explanations given to us, no
undisputed dues in respect of provident fund, investor education and
protection fund, employees'' state insurance, income-tax, wealth-tax,
service tax, sales- tax, customs duty, excise duty, cess and other
statutory dues which were outstanding, at the year end for a period of
more than six months from the date they became payable.
(c) According to the records of the Company, there are no dues
outstanding as at the year end, 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.
(x) The Company does not have any accumulated losses at the year end.
Further, the Company has not incurred cash losses during the financial
year covered by our audit and in the immediately preceding financial
year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to a
financial institution or bank. There are no debentures issued by the
Company.
(xii) In our opinion and according to the information and explanations
given to us, no loans and advances have been granted by the Company on
the basis of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi /
mutual benefit fund / society. Therefore, the provisions of clause
4(xiii) of the Order are not applicable to the Company.
(xiv) In respect of dealing/trading in shares, securities, debentures
and other investments, in our opinion and according to the information
and explanations given to us, generally the Company did not deal or
trade in it. However, on short term basis, surplus funds were invested
in mutual funds for which proper records for the transactions and
contracts have been maintained and timely entries have been made
therein. These have been held by the Company, in its own name.
(xv) In our opinion and according to the information and explanations
given to us, the Company has not given any guarantees for loans taken
by others from banks or financial institutions.
(xvi) In our opinion and on overall examination, we report that the
term loans have been applied for the purpose for which the loans were
raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short-term basis have been used for long-term
investment.
(xviii) According to the information and explanations given to us, the
Company has not made any preferential allotment of equity shares to the
parties and companies covered in the Register maintained under Section
301 of the Companies Act, 1956.
(xix) The Company has not issued debentures during the year.
(xx) During the year the Company has not raised any money by way of
public issue.
(xxi) During the course of our examination of the books and records of
the company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of any such case by the management.
For amit desai & co
Chartered Accountants
Firm''s Registration No.130710W
(Amit Desai)
Partner
Mumbai: 28th May, 2014 Membership No. 032926
Mar 31, 2013
Reports on the financial statements
We have audited the accompanying financial statements of Arrow Textiles
Limited ("the Company"), which comprise the Balance Sheet as at March
31, 2013, and the Statement of Profit and Loss and Cash Flow Statement
for the year then ended and a summary of significant accounting
policies and other explanatory information.
managements responsibility for the financial statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards referred to in sub-section (3C) of section 211
of the Companies Act, 1956 ("the Act"). This responsibility includes
the design, implementation and maintenance of internal control relevant
to the preparation and presentation of the financial statements that
give a true and fair view and are free from material misstatement,
whether due to fraud or error.
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
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 that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of accounting policies used and
the reasonableness of the accounting estimates made by management, as
well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2013;
(b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
report on other legal and regulatory requirements
1. As required by the Companies (Auditors'' Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure, a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
(a) we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
(b) in our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books ;
(c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account ;
(d) in our opinion, the Balance Sheet, Statement of Profit and Loss,
and Cash Flow Statement comply with the Accounting Standards referred
to in subsection (3C) of section 211 of the Companies Act, 1956;
(e) on the basis of written representations received from the directors
as on March 31, 2013, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2013, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
anneXure To audiTors'' reporT
referred to in the auditors'' report of even date to the members of
arroW TeXTiles limiTed
on the fnancial statements for the year ended 31st march, 2013.
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) As explained to us, the Company has a policy to carry out a
physical verification of fixed assets in a phased manner at regular
intervals which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. We are informed that
no material discrepancies were noticed on such verification.
(c) In our opinion and according to the information and explanations
given to us, the Company has not disposed off a substantial part of
fixed assets during the year and the going concern status of the
Company is not affected.
(ii) (a) The management has carried out physical verification of the
inventory at reasonable intervals during the year.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
(c) The Company maintains proper records of inventory. Discrepancies
noticed on physical verification of inventory as compared to the book
records were not material and these have been properly dealt with in
the books of account.
(iii) (a) In our opinion and according to the information and
explanations given to us, the Company has not granted/ taken loan to /
from parties covered in the register maintained under section 301 of
the Companies Act, 1956. Accordingly, paragraphs 4(iii) (a), (b), (c),
(d), (e), (f) & (g) of the Companies (Auditor''s Report) Order, 2003 are
not applicable.
(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 purchase of fixed assets, inventories and with
regard to the sale of goods. During the course of our audit, we have
not observed any continuing failure to correct major weaknesses in
internal control system of the Company.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the particulars of contracts or arrangements
referred to in section 301 of the Companies Act, 1956 that need to be
entered into the register maintained under section 301 have been so
entered.
(b) In our opinion and according to the information and explanations
given to us, there are no such transactions made in pursuance of
contracts or arrangements which exceeds the value of Rupees Five Lakhs
(vi) The Company has not accepted any deposits from the public within
the meaning of Sections 58A and 58AA and directions issued by the
Reserve Bank of India 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 the size and nature of its business.
(viii) The Central Government of India has prescribed the maintenance
of cost records under clause (d) of sub- section (1) of section 209 of
the Act. We have been informed that the Company has made and maintained
such accounts and records.
(ix) (a) The Company is regular in depositing with appropriate
authorities 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
duty, cess and other material statutory dues applicable to it.
(b) According to the information and explanations given to us, no
undisputed dues in respect of provident fund, investor education and
protection fund, employees'' state insurance, income-tax, wealth-tax,
service tax, sales- tax, customs duty, excise duty, cess and other
statutory dues which were outstanding, at the year end for a period of
more than six months from the date they became payable.
(c) According to the records of the Company, there are no dues
outstanding as at the year end, 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.
(x) The Company does not have any accumulated losses at the year end.
Further, the Company has not incurred cash losses during the financial
year covered by our audit and in the immediately preceding financial
year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to a
financial institution or bank. There are no debentures issued by the
Company.
(xii) In our opinion and according to the information and explanations
given to us, no loans and advances have been granted by the Company on
the basis of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi /
mutual benefit fund / society. Therefore, the provisions of clause
4(xiii) of the Order are not applicable to the Company.
(xiv) In respect of dealing/trading in shares, securities, debentures
and other investments, in our opinion and according to the information
and explanations given to us, generally the Company did not deal or
trade in it. However, on short term basis, surplus funds were invested
in mutual funds for which proper records for the transaction and
contracts have been maintained and timely entries have been made
therein. The shares, securities and other investments have been held by
the Company, in its own name.
(xv) In our opinion and according to the information and explanations
given to us, the Company has not given any guarantees for loans taken
by others from banks or financial institutions.
(xvi) In our opinion and on overall examination, we report that the
term loans have been applied for the purpose for which the loans were
raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short-term basis have been used for long-term
investment.
(xviii) According to the information and explanations given to us, the
Company has not made any preferential allotment of equity shares to the
parties and companies covered in the Register maintained under section
301 of the Companies Act, 1956.
(xix) The Company has not issued debentures during the year.
(xx) During the year the Company has not raised any money by way of
public issue.
(xxi) During the course of our examination of the books and records of
the company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of any such case by the management.
For Amit Desai & Co
Chartered Accountants
Firm''s Registration No.130710W
(Amit Desai)
Proprietor
Mumbai: 7th May, 2013 Membership No. 32926
Mar 31, 2012
We have audited the attached Balance Sheet of Arrow Textiles Limited as
at 31st March, 2012, the Profit & Loss Account and the Cash Flow
Statement for the year ended on that date annexed thereto, which we
have signed under reference to this report.
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 misstatements. 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.
I. As required by the Companies (Auditors' Report) Order, 2003 as
amended by Companies (Auditors' Report) (Amendment) Order, 2004
issued by the Central Government of India in terms of Section 227 (4A)
of the Companies Act, 1956, and on the basis of such checks of the
books and records as we considered appropriate and according to the
information and explanations given to us, we annex hereto a statement
on the matters specified in paragraphs 4 and 5 of the said Order.
II. Further to our comments in the Annexure referred to in paragraph I
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 & Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
d) In our opinion, the Balance Sheet, 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 Act;
e) On the basis of the written representations received from the
Directors as on 31st March, 2012 and taken on record by the Board of
Directors, we report that none of the Directors are disqualified as on
31st March, 2012 from being appointed as a Director in terms of clause
(g) of sub section (1) of section 274 of the Companies Act, 1956; and
f) In our opinion and to the best of information and according to the
explanations given to us, the said financial statements, give the
information required by the Act, in the manner so required, read
together with the notes thereon, give a true and fair view in
conformity with the accounting principles generally accepted in India:
i) in case of the Balance Sheet, of the state of affairs of the Company
as at 31st March, 2012;
ii) in case of the Profit & Loss Account, of the loss of the Company
for the period ended on that date; and
iii) In the case of Cash Flow Statement, of the cash flows for the
period ended on that date.
ANNEXURE TO AUDITORS' REPORT TO THE MEMBERS OF ARROW TEXTILES LIMITED
(REFERRED TO IN PARAGRAPH I OUR REPORT OF EVEN DATE)
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) As explained to us, the Company has a policy to carry out a
physical verification of fixed assets in a phased manner at regular
intervals which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. We are informed that
no material discrepancies were noticed on such verification.
(c) In our opinion, the Company has not disposed off a substantial part
of fixed assets during the period and the going concern status of the
Company is not affected.
(ii) (a) The management carried out physical verification of the
inventory at reasonable intervals during the year.
(b) In our opinion, and according to the information and explanations
given to us, the procedures of physical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
(c) The Company maintains proper records of inventory. Discrepancies
noticed on physical verification of inventory as compared to the book
records were not material and these have been properly dealt with in
the books of account.
(iii) In our opinion and according to the information and explanations
given to us, the Company has not granted/ taken loans to / from parties
covered in the register maintained under Section 301 of the Companies
Act, 1956. Accordingly, paragraphs 4(iii) (a),(b),(c),(d),(e),(f) &
(g) of the Companies (Auditor's Report) Order, 2003 are not
applicable
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and nature of its business
with regard to purchases of inventory, fixed assets and 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) According to the information and explanations given to us, the
particulars of contracts or arrangement referred to in Section 301 of
the Act, have been entered in the register maintained under that
Section.
(b) In our opinion and according to the information and explanations
given to us, there are no such transactions made in pursuance of such
contracts or arrangements and which exceeds the value of Rs. Five Lacs.
(vi) The Company has not accepted any deposits from the public to which
the directives issued by the Reserve Bank of India and the provisions
of section 58A and 58AA 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 the size and nature of its business.
(viii) The Central Government has prescribed u/s 209(1) (d) read with
Companies (Cost Accounting Records), Rules 2011, maintenance of cost
records for the Company. We have been informed that the Company is in
process of making and maintaining such accounts and records and
informed us that the same will be ready before the due date under the
relevant regulations.
(ix) (a) According to the information and explanations given to us, the
Company is generally 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, Custom Duty, Excise Duty, Cess and any other statutory
dues as applicable to it during the period with the appropriate
authorities and there were no such outstanding dues as at 31st March,
2012 for a period exceeding six months from the date they became
payable.
(b) According to the information and explanations given to us there
were no dues of Sales Tax, Income Tax, Custom Duty, Wealth Tax, Service
Tax, Excise Duty and Cess which have not been deposited on account of
any dispute.
(x) The Company does not have accumulated losses at the end of the
financial year and has not incurred cash losses in the financial year
and in the immediate preceding financial year.
(xi) On the basis of our examination of records and according to the
information and explanations given to us, the Company has not defaulted
in repayment of dues to any Bank.
(xii) In our opinion and according to the information and explanations
given to us, no loans and advances have been granted by the Company on
the basis of security by way of pledge of shares, debentures and other
securities.
(xiii) Clause (xiii) relating to applicability of provisions for
special statute applicable to Chit Fund, or relating to Nidhi, Mutual
Benefit Funds/Societies, is not applicable to the Company.
(xiv) In our opinion, the Company is not a dealer or trader, 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
banks or financial institutions.
(xvi) In our opinion and on overall examination, we report that the
term loans have been applied for the purpose for which the loans were
raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that the Company has not, prima facie, used short term funds for long
term purposes or vice versa.
(xviii) In our opinion and according to the information and
explanations given to us, the Company has not made any preferential
allotment of shares to parties covered in the Register maintained under
Section 301 of the Companies Act, 1956.
(xix) The Company has not issued debentures during the year.
(xx) The Company has raised funds by right issue of equity shares. The
detail of end use of funds is disclosed by the management in the notes
to Financial Statement and the same is verified by us.
(xxi) To the best of our knowledge and according to the information and
explanations given to us, there have been no cases of fraud on or by
the Company noticed or reported during the year.
For Amit Desai & Co
Chartered Accountants
Firm's Registration No.130710W
(Amit Desai)
Proprietor
Membership No. 032926
Mumbai: 25th May, 2012
Mar 31, 2010
We have audited the attached Balance Sheet of Arrow Textile Limited as
at 31st March, 2010, the Profit & Loss Account and the Cash Flow
Statement for the year ended on that date annexed thereto.
These financial statements are the responsibility of the CompanyÃs
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 misstatements. 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.
I. As required by the Companies (Auditors Report) Order, 2003 and
amended by Companies (Auditorsà Report) (Amendment) Order, 2004 issued
by the Central Government of India in terms of Section 227 (4A) of the
Companies Act, 1956,and onthe basisofsuch checks of the books and
records as we considered appropriate and according to the information
and explanations given to us, we annex hereto a statement on the
matters specified inparagraphs 4 and5 of the said Order.
II. Further to our comments in the Annexure referred to in paragraph
Iabove:
a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose ofour
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 these books.
c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books ofaccount.
d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to insub section (3C)of Section 211of the Act.
e) On the basis of the written representations received from the
Directors and taken on record by the Board of Directors, we report that
none of the Directors are disqualified as on 31st March, 2010 from
being appointed as a Director in terms of clause (g) of sub section (1)
of section 274 of the Companies Act, 1956.
f) In our opinion and to the best of information and according to the
explanations given to us, the said accounts, give the information
required by the Act, in the manner so required, read together with the
notes thereon, give a true and fair view in conformity with the
accounting principles generally accepted inIndia:
i) in case of the Balance Sheet, of the state of affairs of the
Companyasat31st March,2010.
ii) in case of the Profit & Loss Account, of the loss of the Company
for theyear ended onthatdate, and
iii) In the case of Cash Flow Statement,of the cash flows for the year
ended onthat date.
ANNEXURE TO AUDITORS REPORT TO THE MEMBERS OF ARROW TEXTILE LIMITED
(REFERRED TO IN PARAGRAPH I OUR REPORT OF EVEN DATE)
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) As explained to us, the Company has a policy to carry out a
physical verification of fixed assets in a phased manner at regular
intervals which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. We are informed that
no material discrepancies were noticed onsuch verification.
(c) In our opinion, the Company has not disposed off a substantial part
of fixed assets during the period and the going concern status of the
Company is not affected.
(ii) (a) The management carried out physical verification of the
inventory at reasonable intervals during the year.
(b) In our opinion, and according to the information and explanations
given to us, the procedures ofphysical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
(c) The Company maintains proper records of inventory. Discrepancies
noticed on physical verification of inventory as compared to the book
records were not material and these have been properly dealt within the
books ofaccount.
(iii) In respect of loans, secured or unsecured, granted or taken by
the Company to/from companies, firms or other parties covered in the
Register maintained under Section 301 of the Companies Act,1956, we
report that :
(a) The company has not granted loanto party covered in the register
maintained under Section 301 of the Companies Act,1956. Accordingly,
paragraphs 4(iii) (b),(c) of the Companies (AuditorÃs Report) Order,
2003 are not applicable.
(b) According to information and explanations given to us, the Company
has taken unsecured loans from two parties covered in the register
maintained under section 301 of the Act. In respect of the said loans,
the maximum amount involved during the year was Rs. 221.82and the year
end balance was Rs.Nil
(c) According to the information and explanations given to us, in our
opinion, the rate of interest and other terms and conditions of the
above loans taken are not prima-facie prejudicial to the interest of
the Company.
(d) Since there is no stipulation as to the time period for repayment
of the principal amount and interest of unsecured loans, we are unable
to comment on the regularity of repaymentof the same.
(iv) In our opinion and according to the information and
explanations given to us, there are adequate internal control
procedures commensurate with the size of the Company and nature of its
business with regard to purchases of inventory, fixed assets and 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) According to the information and explanations given to us, the
particulars of contracts or arrangement referred to in section 301 of
the Act, have been entered in the register maintained under that
Section.
(b) In our opinion and according to the information and explanations
given to us, there are no such transactions made in pursuance of such
contracts or arrangements and which exceeds the value of Rs. Five Lacs.
(vi) The Company has not accepted any deposits from the public to which
the directives issued by the Reserve Bank of India and the provisions
of section 58A and 58AA 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 the size and nature of its business.
(viii) As informed to us, the Central Government has not prescribed
maintenance of cost records under section 209(1) (d) of the Act.
(ix) (a) According to the information and explanations given to us, the
Company is generally regular in depositing undisputed statutory dues
including Provident Fund, Investor Education and Protection Fund,
Employeesà State Insurance, Income Tax, Sales Tax, Wealth Tax, Service
Tax, Custom Duty, Excise Duty, Cess and any other statutory dues as
applicable to it during the period with the appropriate authorities and
there were no such outstanding dues as at 31st March, 2010 for a period
exceeding six months from the date they becamepayable.
(b) According to the information and explanations giventousthere
werenoduesofSales Tax,Income Tax, Custom Duty, Wealth Tax, Service Tax,
Excise Duty and Cess which have not been deposited on accountof any
dispute.
(x) Since the Company is registered for a period of less than five
years, the reporting requirement of having any accumulated losses which
exceed 50% of its net worth at the end of the financial year and having
incurred cash losses during the year and immediately preceding financial
period is not applicable.
(xi) On the basis of our examination of records and according to the
information and explanations given to us, the Company has not defaulted
in repayment of dues to any Bank or any Financial Institution.
(xii) In our opinion and according to the information and explanations
given to us, no loans and advances have been granted by the company on
the basis of security by way of pledge of shares, debentures and other
securities.
(xiii) Clause (xiii) relating to applicability of provisions for
special statute applicable to Chit Fund, or relating to Nidhi, Mutual
Benefit Funds/Societies, is not applicable to the Company.
(xiv) In our opinion, the Company is not a dealer or trader, 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
banks or financial institutions.
(xvi) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that the Company has not, prima facie, used short term funds for long
term purposesor vice versa.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that the Company has not, prima facie, used short term funds for long
term purposesor vice versa.
(xviii) In our opinion and according to the information and
explanations given to us, the Company has not made any preferential
allotment of shares to parties covered in the Register maintained under
Section 301oftheCompanies Act, 1956.
(xix) The Company has not issued debentures during the period.
(xx) The Company has not raised any monies by way of public issue
during the period.
(xxi) To the best of our knowledge and according to the information and
explanations given to us, there have been no cases of fraud on or by
the Company noticed orreported during the period.
For Amit Desai & Co
Chartered Accountants
Firms Registration No.130710W
(Amit Desai)
Proprietor
Mumbai: 10th May, 2010 M No. 032926