Mar 31, 2022
Finolex Industries LimitedReport on the Audit of the Financial Statements Opinion
We have audited the Financial Statements of Finolex Industries Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2022, and the Statement of Profit and Loss (including Other Comprehensive Income), Statement of Changes in Equity and Statement of Cash Flows for the year then ended, and notes to the Financial Statements, including a summary of Significant Accounting Policies and other explanatory information (hereinafter referred to as âthe Financial Statementsâ).
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Financial Statements give the information required by the Companies Act, 2013 (âthe Actâ) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2022, and its profit (including Other Comprehensive Income), changes in equity and its cash flows for the year ended on that date.
We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditorâs Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the Financial Statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
The Companyâs Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Corporate Governance and Board of Directorâs report, but does not include the Financial Statements and our auditorâs report thereon.
Our opinion on the Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the Financial Statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the Financial Statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information; we are required to report that fact. We have nothing to report in this regard.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Ind AS financial statements of the current period. These matters were addressed in the context of our audit of the Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
We have determined the matter described below to be the key audit matter to be communicated in our report.
The company has at balance sheet date Inventory amounting to ''1,015.47 Crores as disclosed in Note 8 which constitute 19.3% of total assets of the company. The inventory is valued at the lower of cost and net realizable value. Refer to Note 2.7 which describes companyâs accounting policy on valuation of inventory. The Inventory valuation is considered as Key Audit matter since it constitutes significant portion of assets and considering price volatility of raw material and management estimate in respect of realizable value.
Our audit methodology included the following:
⢠Obtained an understanding and assessed internal controls and its effectiveness with respect to process of Inventory recording, verification and valuation
⢠Reviewed the managementâs inventory verification process, observed the physical verification process for sample items, taken cognizance and assessed the trend of past inventory differences.
⢠Performed cut off procedures on test check basis to ensure completeness of Inventory.
⢠Tested on sample basis the accuracy of weighted average cost and Overhead absorption for Raw material, Work in Progress, Finished Goods and Trading material as per the accounting policy adopted by the company
⢠Evaluated the management judgement, estimate and process for identification and valuation of slow moving / non-moving, obsolete and damaged items of inventory.
⢠Performed analysis of Net realizable value (NRV) vs Cost of inventory on test basis to ensure that the Inventory is carried at Cost or NRV whichever is lower as per applicable Ind AS 2.
⢠Ensured presentation and disclosure as per applicable Ind AS and accounting framework
Responsibilities of Management and Those Charged with Governance for the Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these Financial Statements that give a true and fair view of the financial position, financial performance (including other comprehensive income), changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the Financial Statements, the management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors is also responsible for overseeing the Companyâs financial reporting process.
Auditor''s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Financial Statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit.
⢠Identify and assess the risks of material misstatement of the Financial Statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
⢠Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the Financial Statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the Financial Statements, including the disclosures, and whether the Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Financial Statements of the current period and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2020 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure A; a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. As required by Section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Statement of Changes in Equity and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid Financial Statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended.
e) On the basis of the written representations received from the directors as on March 31, 2022 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2022 from being appointed as a director in terms of Section 164 (2) of the Act.
f) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Bâ.
g) As required by section 197 (16) of the Act; in our opinion and according to information and explanation provided to us, the remuneration paid by the company to its directors is in accordance with the provisions of section 197 of the Act and remuneration paid to directors is not in excess of the limit laid down under this section.
h) 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 Ind AS financial statements - Refer Note 38.2 to the financial statements.
(ii) The Company did not have any long-term contracts including derivative contracts as at 31 March 2022
(iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
(iv) (a) The management has represented to
us that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts to the financial statements, if any, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in
other persons or entities identified in any manner whatsoever by or on behalf of the company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(b) the management has represented to us, that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts to the Financial Statements, if any, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(c) Based on the information and explanation given to us and audit procedures performed as considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations made by the management and as mentioned under sub-clause (iv)(a) and (iv)(b) above contain any material misstatement.
(v) (a) The final dividend proposed in the
previous year, declared and paid by the Company during the year is in accordance with Section 123 of the Act, as applicable
(b) The Board of Directors of the Company have proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. The amount of dividend proposed is in accordance with section 123 of the Act, as applicable.
(vi) The requirement to the use of accounting software for maintaining Companyâs books of account which has a feature of recording audit trail (edit log) facility is deferred to financial years commencing on or after April 1, 2023, therefore reporting under Rule 11(g) of Companies (Audit & Auditors) Rules, 2014 is not applicable for financial year ended on March 31, 2022.
For P G BHAGWAT LLP
Chartered Accountants
Firm Registration Number: 101118W/W100682
Nachiket Deo
Partner
Membership Number: 117695
UDIN: 22117695AJFISD8457
Pune
Date: May 18, 2022
Mar 31, 2021
Finolex Industries Limited
Opinion
We have audited the accompanying standalone Ind AS financial statements of Finolex Industries Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2021, and the Statement of Profit and Loss (including Other Comprehensive Income), Statement of Changes in Equity and Statement of Cash Flows for the year then ended, and notes to the Financial Statements, including a summary of Significant Accounting Policies and other explanatory information (hereinafter referred to as "the Standalone Ind AS Financial Statements").
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS Financial Statements give the information required by the Companies Act, 2013 as amended (''the Act'') in the manner so required and give a true and fair view in conformity with accounting principles generally accepted in India, of the standalone state of affairs of the Company as at March 31, 2021, and its standalone profit (including Other Comprehensive Income), standalone changes in equity and its standalone cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of standalone IndAS financial statements in accordance with the Standards on Auditing (SAs) as specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the ''Auditor''s Responsibilities for the Audit of the Standalone Ind AS Financial Statements'' section ofour report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the standalone Ind AS Financial Statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS Financial Statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the standalone Ind AS financial statements for the financial year ended March 31, 2021. These matters were addressed in the context of our audit of the standalone Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our
description of how our audit addressed the matter is provided in that context.
We have determined the matter described below to be the key audit matter to be communicated in our report.
The company has at balance sheet date Inventory amounting to H 918.82 Crores as disclosed in Note 8 which constitute 21.8% of total assets of the company. The inventory is valued at the lower of cost and net realizable value. Refer to Note 2.7 which describes company''s accounting policy on valuation of inventory. The Inventory valuation is considered as Key Audit matter since it constitutes significant portion of assets and considering price volatility of raw material and management estimate in respect of realizable value.
Our audit methodology included the following:
⢠Obtained an understanding and assessed internal controls and its effectiveness with respect to process of Inventory recording, verification and valuation
⢠Reviewed the management''s inventory verification process, observed the physical verification process for sample items, taken cognizance and assessed the trend of past inventory differences.
⢠Performed cut off procedures on test check basis to ensure completeness of Inventory.
⢠Tested on sample basis the accuracy of weighted average cost
and Overhead absorption for Raw material, Work in Progress, Finished Goods and Trading material as per the accounting policy adopted by the company
⢠Evaluated the management judgement, estimate and process for identification and valuation of slow moving / non-moving, obsolete and damaged items of inventory.
⢠Performed analysis of Net realizable value (NRV) vs Cost of inventory on test basis to ensure that the Inventory is carried at Cost or NRV whichever is lower as per applicable Ind AS 2.
⢠Ensured presentation and disclosure as per applicable Ind AS and accounting framework
At the balance sheet date, the value of current and non-current investments amounted to H 1,592.20 crores representing 37.8% of the total assets. The net gain on fair valuation of investments amounted to H 419.14 crores in the total comprehensive income. Investments have been considered as key audit matter since it constitutes significant portion of assets, having diversity in nature and various recognition and subsequent measurement principles. Refer note 2.6 and 2.15 to the Standalone Financial Statements for its accounting policy.
Our audit methodology included the following:
⢠Obtained external confirmations in order to test the assertion of existence, accuracy, valuation and completeness.
⢠Evaluated independently the fair values of listed and quoted noncurrent investments.
⢠Critically analysed the assumptions made by the Management in fair valuation of unquoted non-current investments.
⢠Evaluated the process of the management to identify impairment (if any) for the investments measured at amortised cost.
⢠Assessed the compliance of the recognition and subsequent measurement principles as specified in the accounting policy adopted by the company
⢠Ensured presentation and disclosure as per applicable Ind AS and accounting framework
The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Corporate Governance and Directors'' Report, but does not include the standalone Ind AS Financial Statements and our auditor''s report thereon.
Our opinion on the standalone Ind AS Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone Ind AS Financial Statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent
with the standalone Ind AS Financial Statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information; we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Standalone Ind AS Financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone Ind AS Financial Statements that give a true and fair view of the standalone financial position, standalone financial performance (including other comprehensive Income), standalone changes in equity and standalone cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy
and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone Ind AS Financial Statements, the management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.
Auditorâs Responsibilities for the Audit of the Standalone Ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone Ind AS Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone Ind AS Financial Statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit.
We also:
⢠Identify and assess the risks of material misstatement of the standalone Ind AS Financial Statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to standalone Ind AS financial statements in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
⢠Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the standalone Ind AS Financial Statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the standalone Ind AS Financial Statements, including the disclosures, and whether the standalone Ind AS Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone Ind AS Financial Statements for the financial year ended March 31, 2021 and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
1. As required by the Companies (Auditor''s Report) Order, 2016 ("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; a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. As required by Section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the statement of Changes in Equity and the Statement of Cash Flow dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended.
e) On the basis of the written representations received from the directors as on March 31 , 2021 taken on record by the Board of Directors, none of the director is disqualified as on March 31, 2021 from being appointed as a director in terms of Section 164 (2) of the Act.
f) With respect to the adequacy of the internal financial controls with reference to standalone Ind AS financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B" to this report.
g) As required by section 197 (16) of the Act; in our opinion and according to information and explanation provided to us, the remuneration paid/ provided for by the company to its directors is in accordance with the provisions of section 197 of the Act and remuneration paid
to directors is not in excess of the limit laid down under this section.
h) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our information and according to the explanations given to us:
(i) The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements - Refer Note 37.2 to the financial statements.
(ii) The Company did not have any long-term contracts including derivative contracts as at March 31,2021.
(iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
Chartered Accountants
ICAI Firm Registration Number-
101118W/W100682
Partner
Membership Number: 117695
UDIN: 21117695AAAACQ7244
Pune
Date: 25th June, 2021
Mar 31, 2018
Report on the Standalone Indian Accounting Standards (Ind AS) Financial Statements
We have audited the accompanying Standalone Ind AS Financial Statements of Finolex Industries Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information hereinafter referred to as (âthe Standalone Ind AS Financial Statementsâ).
Managementâs Responsibility for the Standalone Ind AS Financial Statements
The Companyâs Board of Directors are responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these Standalone Ind AS Financial Statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Ind AS 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 Ind AS 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 Ind AS Financial Statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the Standalone Ind AS Financial Statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the Standalone Ind AS Financial Statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the Standalone Ind AS Financial Statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the Standalone Ind AS Financial Statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Ind AS Financial Statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Ind AS Financial Statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs (financial position) of the Company as at March 31, 2018, its profit (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in âAnnexure Aâ, 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 Statement, the Cash Flow Statement and the Statement of Changes in Equity dealt with by this report are in agreement with the books of account.
(d) In our opinion, the aforesaid Standalone Ind AS Financial Statements comply with Indian Accounting Standards (Ind AS) specified under section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended.
(e) On the basis of the written representations received from the directors as on March 31, 2018 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) For our opinion on the internal financial controls with reference to Standalone Ind AS Financial Statements of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Bâ
(g) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed pending litigations and the impact on its financial position -refer note 38.2 to the Standalone Ind AS Financial Statements.
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
Referred to in paragrapRs.1 under the heading, âReport on Other legal and Regulatory Requirementsâ of our report on even date:
(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) The fixed assets are being physically verified by the management at regular intervals based on the programme of verification which in our opinion is reasonable. Part of the major fixed assets has been verified by the management in the current year and discrepancies noticed on such physical verification were not material and the same have been properly dealt with in the books of account.
(c) The title deeds of immovable properties are held in the name of the company.
(ii) Physical verification of inventory has been conducted by the management during the current year. In our opinion, the interval of such verification is reasonable. Discrepancies noticed on physical verification were not material and the same have been properly dealt with in the books of account.
(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 Companies Act, 2013 in the current year. Accordingly, clause (iii) (a), (b) and (c) of the Order are not applicable to the Company.
(iv) According to the information and explanation provided to us, there are no loans, guarantees and security given by the Company, to Directors, covered under the provisions of section 185 of the Companies Act, 2013. According to the information and explanations provided to us, provisions of section 186 of the Companies Act, 2013 have been complied with respect to loans, guarantees, investment and security.
(v) According to information and explanation provided to us, the Company has not accepted deposits, hence the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed there under, are not applicable to it. According to information and explanation provided to us, no order has been passed by Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal.
(vi) We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under sub-section (l) of section 148 of the Companies Act, 2013 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have not however made a detailed examination of records with a view to determine whether they are accurate and complete.
(vii) (a) The Company is generally regular in depositing undisputed statutory dues including provident fund, employeesâ state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, goods and service tax, value added tax, cess and any other statutory dues with the appropriate authorities. According to the information and explanation provided to us, no undisputed amounts payable in respect of statutory dues were in arrears as at March 31, 2018, for a period more than six months from the date they became payable except goods and service tax on customer advances for the month of July 2017 of RS.272.35 lakhs which was paid on May 22, 2018.
(b) According to the information and explanation provided to us, there are no dues of income tax, sales tax, service tax, duty of customs, duty of excise, goods and service tax value added tax or cess which have not been deposited on account of any dispute except those mentioned below:
Name of the |
Nature of |
Amount |
Period to which the |
Forum where dispute |
Statute |
Dues |
(in lakhs) |
amount relates |
is pending |
Customs Act, 1962 |
Customs Duty |
112.41 |
2013-14 |
CESTAT |
Central Excise Act, |
Excise Duty |
4,754.72 |
1996-97, 2000-16 |
CESTAT |
1944 |
||||
Finance Act, 1994 |
Service Tax |
411.70 |
December 2005 to December 2007 |
Deputy Commissioner |
152.84 |
2008-12, 2014-15 |
CESTAT |
||
4.12 |
2013-14 |
Assistant Commissioner Appeals |
||
21.99 |
April 2015 to December 2015 |
Commissioner Appeals |
||
82.56 |
August 2015 to August 2016 |
Commissioner |
(viii) Based on our audit procedures and according to the information and explanation provided to us, the Company has not defaulted in repayment of loans or borrowings to a financial institution, bank or government. The Company did not have debenture holders.
(ix) According to information and explanation provided to us, the Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) in the current year.
The Company does not have any term loans in the current year. Accordingly, clause 3 (ix) of the Order for reporting on application of money raised is not applicable to the Company.
(x) Based upon the audit procedures performed by us and according to the information and explanation provided to us by the management, no fraud by the Company or any fraud on the Company by its officers or employees has been noticed or reported to us during the year.
(xi) According to the information and explanation provided to us, the managerial remuneration has been paid and provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act.
(xii) The Company is not a Nidhi Company and accordingly, clause (xii) of the Order is not applicable to the Company.
(xiii) According to the information and explanation provided to us, all transactions with the related parties are in compliance with sections 177 and 188 of Companies Act, 2013 wherever applicable and the details have been disclosed in the Standalone Ind AS Financial Statements as required by the applicable accounting standards.
(xiv) According to the information and explanation provided to us, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review.
(xv) According to the information and explanation provided to us, the Company has not entered into any non-cash transactions with directors or persons connected with him.
(xvi) According to the information and explanation provided to us, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
For M/s PG.BHAGWAT
Chartered Accountants
Firmâs Registration Number:101118W
Abhijeet Bhagwat
Partner
Membership Number:136835
Place: Pune
Date: May 23, 2018
Mar 31, 2017
TOTHE MEMBERS OF FINOLEX INDUSTRIES LIMITED
Report on the Standalone Ind AS Financial Statements
We have audited the accompanying standalone Ind AS financial statements of Finolex Industries Limited ("the Company"), which comprise the Balance Sheet as at 31st March 2017, 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 the significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Ind AS 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 standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act, read with the Companies (Account) Rules, 2014 and amendments thereof.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone Ind AS 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 of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the state of affairs (financial position) of the Company as at 31st March 2017, and its profit (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 ("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'','' 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 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 Statement, the Cash Flow Statement and Statement of Changes in Equity dealt with by this report are in agreement with the books of account.
(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with the Companies (Account) Rules, 2014 and amendments thereof.
(e) On the basis of the written representations received from the directors as on 31st March 2017 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March 2017 from being appointed as a director in terms of Section 164 (2) of the Act.
(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B''.''
(g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed pending litigations and the impact on its financial position -refer note 41 to the standalone Ind AS financial statements.
ii. The Company did not have any long-term contracts including derivative contracts, having 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.
iv. The company has provided the disclosure regarding Specified Bank Notes (SBN) in Note 48 to the standalone Ind AS financial statements as per notification no. G.S.R. 308(E), dated 30th March 2017 issued by the Ministry of Corporate Affairs and these are in accordance with the books of account maintained by the Company.
Referred to in paragraph 1 under the heading,
"Report on Other legal and Regulatory
Requirements" of our report on even date:
(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) The fixed assets are being physically verified by the management at regular intervals based on the programme of verification which in our opinion is reasonable. Part of the major fixed assets has been verified by the management in the current year and discrepancies noticed on such physical verification were not material and the same have been properly dealt with in the books of account.
(c) The title deeds of immovable properties are held in the name of the company.
(ii) Physical verification of inventory has been conducted by the management during the current year. In our opinion, the interval of such verification is reasonable. Discrepancies noticed on physical verification were not material and the same have been properly dealt with in the books of account.
(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 Companies Act, 2013 in the current year. Accordingly, clause (iii) (a), (b) and (c) are not applicable to the Company.
(iv) According to the information and explanations provided to us, in respect of loans, investments, guarantees, and security; provisions of section 185 and 186 of the Companies Act, 2013 have been complied with.
(v) According to information and explanation provided to us, the Company has not accepted deposits, hence the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed there under, are not applicable to it. According to information and explanation provided to us, no order has been passed by Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal.
(vi) We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under sub-section (I) of section 148 of the Companies Act, 2013 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have not however made a detailed examination of records with a view to determine whether they are accurate and complete.
(vii) (a) The Company is regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax ,cess and any other statutory dues with the appropriate authorities. According to the information and explanation provided to us, no undisputed amounts payable in respect of statutory dues were in arrears as at 31st March, 2017, for a period more than six months from the date they became payable.
(b) According to the information and explanation provided to us, there are no dues of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax or cess which have not been deposited on account of any dispute except those mentioned below:
Name of the Statute |
Nature of Dues |
Amount (in Lakh) |
Period to which the amount relates |
Forum where dispute is pending |
Customs Act, 1962 |
Customs Duty |
26.94 |
2000-01 |
CESTAT |
Customs Act, 1962 |
Customs Duty |
1,170.55 |
2013-14 |
Commissioner (Appeals) |
Central Excise Act, 1944 |
Excise Duty |
181.62 |
1998-99, 2005- 06,2010-11,2012-13, 2013-14 |
CESTAT |
Central Excise Act, 1944 |
Excise Duty |
30.31 |
2008-09, 2012-13 |
Additional Commissioner |
55.23 |
2005-06, 2008-09, 2011-12, 2014-15, 2016-17 |
Assistant Commissioner (Appeals) |
||
1597.17 |
1998-99, 2006-07, 2007-08, 2014-15 |
Commissioner |
||
4.61 |
2012-13 |
Assistant Commissioner |
||
Central Excise Act, 1944 |
Excise Duty |
40.44 |
1996-97, 1999-2000 |
High Court |
Finance Act, 1994 |
Service Tax |
26.76 |
2007-08, 2010-11 |
CESTAT |
Finance Act, 1994 |
Service Tax |
642.72 |
2001-02, 2006- 07,2008-2009, 2010-11 |
Commissioner |
27.79 |
2007-08, 2008-09, 2009-10, 2010-11 |
Deputy Commissioner |
||
Finance Act, 1994 |
Service Tax |
489.12 |
2005-06 |
High Court |
(viii) Based on our audit procedures and according to the information and explanation provided to us, the Company has not defaulted in repayment of dues to a financial institution, bank, government or dues of debenture holders.
(ix) According to information and explanation provided to us, the Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) in the current year. According to the information and explanations given to us, term loans availed by the company were, prima facie applied for the purpose for which the loans were obtained.
(x) Based upon the audit procedures performed by us and according to the information and explanations provided to us by the management, no fraud by the Company or any fraud on the Company by its officers or employees has been noticed or reported to us during the year.
(xi) According to the information and explanation provided to us, the managerial remuneration has been paid and provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act.
(xii)The Company is not a Nidhi Company and accordingly, Clause (xii) of the Order is not applicable to the Company.
(xiii) According to the information and explanation provided to us, all transactions with the related parties are in compliance with sections 177 and 188 of Companies Act, 2013 wherever applicable and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.
(xiv) According to the information and explanation provided to us, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review.
(xv) According to the information and explanation provided to us, the Company has not entered into any non-cash transactions with directors or persons connected with him.
(xvi) According to the information and explanation provided 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 (f) under the heading, "Report on Other legal and Regulatory Requirements" of our report on even date:
Report on the Internal Financial Controls
Under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
We have audited the internal financial controls over financial reporting of Finolex Industries Limited ("the Company") as of 31st March 2017 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.
Management''s Responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditors'' Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing, to the extent applicable to an audit of internal financial controls, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s 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 Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of standalone financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of 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 company''s 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 31st March 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For M/s RG.BHAGWAT
Chartered Accountants
Firm''s Registration No.: 101118W
Abhijeet Bhagwat Partner
Membership No. 136835
Pune 26th May 2017
Mar 31, 2016
We have audited the accompanying standalone financial statements of
Finolex Industries Limited ("the Company"), which comprise the Balance
Sheet as at 31st March, 2016, the Statement of Profit and Loss, the
Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation 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,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the standalone financial statements that give a true
and fair view and are free from material misstatement, whether due to
fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made there under. We conducted our
audit in accordance with the Standards on Auditing specified under
Section 143(10) of the Act. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the standalone financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the standalone financial statements.
The procedures selected depend on the auditor''s 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 Company''s preparation of the standalone financial
statements that give a true and fair view in order to design audit
procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of the accounting policies used
and the reasonableness of the accounting estimates made by the
Company''s 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 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 and its profit and its cash flows for the year
ended on that date. Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 ("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", 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
comply with the Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the
directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016
from being appointed as a director in terms of Section 164(2) of the
Act.
(f) With respect to the adequacy of the internal financial controls
over financial reporting of the Company and the operating effectiveness
of such controls, refer to our separate Report in "Annexure B".
(g) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its standalone financial statements - refer note
1.2 to the standalone
financial statements.
ii. The Company did not have any long term contracts including
derivative contracts, having 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.
Referred to in paragraph 1 under the heading, "Report on Other legal
and Regulatory Requirements" of our report on even date:
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The fixed assets are being physically verified by the management at
regular intervals based on the programme of verification which in our
opinion is reasonable. Part of the major fixed assets has been verified
by the management in the current year and discrepancies noticed on such
physical verification were not material and the same have been properly
dealt with in the books of account.
(c) The title deeds of immovable properties are held in the name of the
company.
(ii) Physical verification of inventory has been conducted by the
management during the current year. In our opinion, the interval of
such verification is reasonable. Discrepancies noticed on physical
verification were not material and the same have been properly dealt
with in the books of account.
(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 Companies
Act, 2013 in the current year. Accordingly, clause (iii) (a), (b) and
(c) are not applicable to the Company.
(iv) According to the information and explanations provided to us, in
respect of loans, investments, guarantees, and security; provisions of
section 185 and 186 of the Companies Act, 2013 have been complied with.
(v) According to information and explanation provided to us, the
Company has not accepted deposits, hence the directives issued by the
Reserve Bank of India and the provisions of sections 73 to 76 or any
other relevant provisions of the Companies Act and the rules framed
there under, are not applicable to it. According to information and
explanation provided to us, no order has been passed by Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
court or any other tribunal.
(vi) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the rules made by the Central Government for the
maintenance of cost records under sub-section (l) of section 148 of the
Companies Act, 2013 and we are of the opinion that prima facie the
prescribed accounts and records have been made and maintained. We have
not however made a detailed examination of records with a view to
determine whether they are accurate and complete.
(vii) (a) The Company is regular in depositing undisputed statutory
dues including provident fund, employees'' state insurance, income-tax,
sales-tax, service tax, duty of customs, duty of excise, value added
tax ,cess and any other statutory dues with the appropriate
authorities. According to the information and explanation provided to
us, no undisputed amounts payable in respect of statutory dues were in
arrears as at 31st March, 2016, for a period more than six months from
the date they became payable.
(b) According to the information and explanation provided to us, there
are no dues of income tax, sales tax, service tax, duty of customs,
duty of excise, value added tax or cess which have not been deposited
on account of any dispute except those mentioned below:
Name of the Statue Nature of Dues Amount
( in lakhs)
Customs Act, 1962 Customs Duty 26.94
Customs Act, 1962 Customs Duty 1,170.55
Central Excise Act, 1944 Excise Duty 181.62
Central Excise Act, 1944 Excise Duty 20.82
12.42
3,303.05
5.38
45.01
Central Excise Act, 1944 Excise Duty 40.44
Finance Act, 1994 Service Tax 26.76
Finance Act, 1994 Service Tax 642.72
101.40
24.72
Finance Act, 1994 Service Tax 489.12
MVAT VAT 326.55
Name of the Statute Period to which the Forum where dispute
amount relates is pending
Customs Act,1962 2000-01 CESTAT
Customs Act,1962 2013-14 Commissioner (Appeals)
Central Excise 1998-99, 2005-06, CESTAT
Act,1944
2010-11, 2012-13,
2013-14
Central Excise 2012-13 Additional
Act,1944 Commissioner
2005-06, 2008-09, Assistant
2011-12, 2012-13 Commissioner (Appeals)
2007-08, 2011-12 Commissioner
2006-07 Deputy Commissioner
2008-09 Joint Commissioner
Central Excise 1996-97, 1999-2000 High Court
Act,1944
Finance Act,1944 2007-08, 2010-11 CESTAT
Finance Act,1994 2001-02, 2006-07, Commissioner
2008-09, 2010-11
2007-08 Deputy Commissioner
2008-09, 2009-10 Joint Commissioner
Finance Act,1994 2005-06 High Court
MVAT 2005-06 Bombay Tribunal
(viii) Based on our audit procedures and according to the information
and explanation provided to us, the Company has not defaulted in
repayment of dues to a financial institution, bank, government or dues
of debenture holders.
(ix) According to information and explanation provided to us, the
Company has not raised moneys by way of initial public offer or further
public offer (including debt instruments) in the current year.
According to the information and explanations given to us, term loans
availed by the company were, prima facie; applied for the purpose for
which the loans were obtained.
(x) Based upon the audit procedures performed by us and according to
the information and explanations provided to us by the management, no
fraud by the Company or any fraud on the Company by its officers or
employees has been noticed or reported to us during the year.
(xi) According to the information and explanation provided to us, the
managerial remuneration has been paid and provided in accordance with
the requisite approvals mandated by the provisions of section 197 read
with Schedule V to the Companies Act.
(xii) The Company is not a Nidhi Company and accordingly, Clause (xii)
of the Order is not applicable to the Company.
(xiii) According to the information and explanation provided to us, all
transactions with the related parties are in compliance with sections
177 and 188 of Companies Act, 2013 wherever applicable and the details
have been disclosed in the Financial Statements as required by the
applicable accounting standards.
(xiv) According to the information and explanation provided to us, the
Company has not made any preferential allotment or private placement of
shares or fully or partly convertible debentures during the year under
review.
(xv) According to the information and explanation provided to us, the
Company has not entered into any non-cash transactions with directors
or persons connected with him.
(xvi) According to the information and explanation provided to us, the
Company is not required to be registered under section 45-IA of the
Reserve Bank of India Act, 1934.
For M/s P.G.BHAGWAT
Chartered Accountants
Firm''s Registration No.: 101118W
Abhijeet Bhagwat
Partner
Membership No.: 136835
Pune
21st May, 2016
Mar 31, 2016
We have audited the accompanying standalone financial statements of
Finolex Industries Limited ("the Company"), which comprise the Balance
Sheet as at 31st March, 2016, the Statement of Profit and Loss, the
Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation 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,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the standalone financial statements that give a true
and fair view and are free from material misstatement, whether due to
fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made there under. We conducted our
audit in accordance with the Standards on Auditing specified under
Section 143(10) of the Act. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the standalone financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the standalone financial statements.
The procedures selected depend on the auditor''s 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 Company''s preparation of the standalone financial
statements that give a true and fair view in order to design audit
procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of the accounting policies used
and the reasonableness of the accounting estimates made by the
Company''s 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 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 and its profit and its cash flows for the year
ended on that date. Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 ("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", 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
comply with the Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the
directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016
from being appointed as a director in terms of Section 164(2) of the
Act.
(f) With respect to the adequacy of the internal financial controls
over financial reporting of the Company and the operating effectiveness
of such controls, refer to our separate Report in "Annexure B".
(g) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its standalone financial statements - refer note
1.2 to the standalone
financial statements.
ii. The Company did not have any long term contracts including
derivative contracts, having 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.
Referred to in paragraph 1 under the heading, "Report on Other legal
and Regulatory Requirements" of our report on even date:
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The fixed assets are being physically verified by the management at
regular intervals based on the programme of verification which in our
opinion is reasonable. Part of the major fixed assets has been verified
by the management in the current year and discrepancies noticed on such
physical verification were not material and the same have been properly
dealt with in the books of account.
(c) The title deeds of immovable properties are held in the name of the
company.
(ii) Physical verification of inventory has been conducted by the
management during the current year. In our opinion, the interval of
such verification is reasonable. Discrepancies noticed on physical
verification were not material and the same have been properly dealt
with in the books of account.
(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 Companies
Act, 2013 in the current year. Accordingly, clause (iii) (a), (b) and
(c) are not applicable to the Company.
(iv) According to the information and explanations provided to us, in
respect of loans, investments, guarantees, and security; provisions of
section 185 and 186 of the Companies Act, 2013 have been complied with.
(v) According to information and explanation provided to us, the
Company has not accepted deposits, hence the directives issued by the
Reserve Bank of India and the provisions of sections 73 to 76 or any
other relevant provisions of the Companies Act and the rules framed
there under, are not applicable to it. According to information and
explanation provided to us, no order has been passed by Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
court or any other tribunal.
(vi) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the rules made by the Central Government for the
maintenance of cost records under sub-section (l) of section 148 of the
Companies Act, 2013 and we are of the opinion that prima facie the
prescribed accounts and records have been made and maintained. We have
not however made a detailed examination of records with a view to
determine whether they are accurate and complete.
(vii) (a) The Company is regular in depositing undisputed statutory
dues including provident fund, employees'' state insurance, income-tax,
sales-tax, service tax, duty of customs, duty of excise, value added
tax ,cess and any other statutory dues with the appropriate
authorities. According to the information and explanation provided to
us, no undisputed amounts payable in respect of statutory dues were in
arrears as at 31st March, 2016, for a period more than six months from
the date they became payable.
(b) According to the information and explanation provided to us, there
are no dues of income tax, sales tax, service tax, duty of customs,
duty of excise, value added tax or cess which have not been deposited
on account of any dispute except those mentioned below:
Name of the Statue Nature of Dues Amount
( in lakhs)
Customs Act, 1962 Customs Duty 26.94
Customs Act, 1962 Customs Duty 1,170.55
Central Excise Act, 1944 Excise Duty 181.62
Central Excise Act, 1944 Excise Duty 20.82
12.42
3,303.05
5.38
45.01
Central Excise Act, 1944 Excise Duty 40.44
Finance Act, 1994 Service Tax 26.76
Finance Act, 1994 Service Tax 642.72
101.40
24.72
Finance Act, 1994 Service Tax 489.12
MVAT VAT 326.55
Name of the Statute Period to which the Forum where dispute
amount relates is pending
Customs Act,1962 2000-01 CESTAT
Customs Act,1962 2013-14 Commissioner (Appeals)
Central Excise 1998-99, 2005-06, CESTAT
Act,1944
2010-11, 2012-13,
2013-14
Central Excise 2012-13 Additional
Act,1944 Commissioner
2005-06, 2008-09, Assistant
2011-12, 2012-13 Commissioner (Appeals)
2007-08, 2011-12 Commissioner
2006-07 Deputy Commissioner
2008-09 Joint Commissioner
Central Excise 1996-97, 1999-2000 High Court
Act,1944
Finance Act,1944 2007-08, 2010-11 CESTAT
Finance Act,1994 2001-02, 2006-07, Commissioner
2008-09, 2010-11
2007-08 Deputy Commissioner
2008-09, 2009-10 Joint Commissioner
Finance Act,1994 2005-06 High Court
MVAT 2005-06 Bombay Tribunal
(viii) Based on our audit procedures and according to the information
and explanation provided to us, the Company has not defaulted in
repayment of dues to a financial institution, bank, government or dues
of debenture holders.
(ix) According to information and explanation provided to us, the
Company has not raised moneys by way of initial public offer or further
public offer (including debt instruments) in the current year.
According to the information and explanations given to us, term loans
availed by the company were, prima facie; applied for the purpose for
which the loans were obtained.
(x) Based upon the audit procedures performed by us and according to
the information and explanations provided to us by the management, no
fraud by the Company or any fraud on the Company by its officers or
employees has been noticed or reported to us during the year.
(xi) According to the information and explanation provided to us, the
managerial remuneration has been paid and provided in accordance with
the requisite approvals mandated by the provisions of section 197 read
with Schedule V to the Companies Act.
(xii) The Company is not a Nidhi Company and accordingly, Clause (xii)
of the Order is not applicable to the Company.
(xiii) According to the information and explanation provided to us, all
transactions with the related parties are in compliance with sections
177 and 188 of Companies Act, 2013 wherever applicable and the details
have been disclosed in the Financial Statements as required by the
applicable accounting standards.
(xiv) According to the information and explanation provided to us, the
Company has not made any preferential allotment or private placement of
shares or fully or partly convertible debentures during the year under
review.
(xv) According to the information and explanation provided to us, the
Company has not entered into any non-cash transactions with directors
or persons connected with him.
(xvi) According to the information and explanation provided to us, the
Company is not required to be registered under section 45-IA of the
Reserve Bank of India Act, 1934.
For M/s P.G.BHAGWAT
Chartered Accountants
Firm''s Registration No.: 101118W
Abhijeet Bhagwat
Partner
Membership No.: 136835
Pune
21st May, 2016
Mar 31, 2016
We have audited the accompanying standalone financial statements of
Finolex Industries Limited ("the Company"), which comprise the Balance
Sheet as at 31st March, 2016, the Statement of Profit and Loss, the
Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation 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,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the standalone financial statements that give a true
and fair view and are free from material misstatement, whether due to
fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made there under. We conducted our
audit in accordance with the Standards on Auditing specified under
Section 143(10) of the Act. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the standalone financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the standalone financial statements.
The procedures selected depend on the auditor''s 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 Company''s preparation of the standalone financial
statements that give a true and fair view in order to design audit
procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of the accounting policies used
and the reasonableness of the accounting estimates made by the
Company''s 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 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 and its profit and its cash flows for the year
ended on that date. Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 ("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", 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
comply with the Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the
directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016
from being appointed as a director in terms of Section 164(2) of the
Act.
(f) With respect to the adequacy of the internal financial controls
over financial reporting of the Company and the operating effectiveness
of such controls, refer to our separate Report in "Annexure B".
(g) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its standalone financial statements - refer note
1.2 to the standalone
financial statements.
ii. The Company did not have any long term contracts including
derivative contracts, having 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.
Referred to in paragraph 1 under the heading, "Report on Other legal
and Regulatory Requirements" of our report on even date:
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The fixed assets are being physically verified by the management at
regular intervals based on the programme of verification which in our
opinion is reasonable. Part of the major fixed assets has been verified
by the management in the current year and discrepancies noticed on such
physical verification were not material and the same have been properly
dealt with in the books of account.
(c) The title deeds of immovable properties are held in the name of the
company.
(ii) Physical verification of inventory has been conducted by the
management during the current year. In our opinion, the interval of
such verification is reasonable. Discrepancies noticed on physical
verification were not material and the same have been properly dealt
with in the books of account.
(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 Companies
Act, 2013 in the current year. Accordingly, clause (iii) (a), (b) and
(c) are not applicable to the Company.
(iv) According to the information and explanations provided to us, in
respect of loans, investments, guarantees, and security; provisions of
section 185 and 186 of the Companies Act, 2013 have been complied with.
(v) According to information and explanation provided to us, the
Company has not accepted deposits, hence the directives issued by the
Reserve Bank of India and the provisions of sections 73 to 76 or any
other relevant provisions of the Companies Act and the rules framed
there under, are not applicable to it. According to information and
explanation provided to us, no order has been passed by Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
court or any other tribunal.
(vi) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the rules made by the Central Government for the
maintenance of cost records under sub-section (l) of section 148 of the
Companies Act, 2013 and we are of the opinion that prima facie the
prescribed accounts and records have been made and maintained. We have
not however made a detailed examination of records with a view to
determine whether they are accurate and complete.
(vii) (a) The Company is regular in depositing undisputed statutory
dues including provident fund, employees'' state insurance, income-tax,
sales-tax, service tax, duty of customs, duty of excise, value added
tax ,cess and any other statutory dues with the appropriate
authorities. According to the information and explanation provided to
us, no undisputed amounts payable in respect of statutory dues were in
arrears as at 31st March, 2016, for a period more than six months from
the date they became payable.
(b) According to the information and explanation provided to us, there
are no dues of income tax, sales tax, service tax, duty of customs,
duty of excise, value added tax or cess which have not been deposited
on account of any dispute except those mentioned below:
Name of the Statue Nature of Dues Amount
( in lakhs)
Customs Act, 1962 Customs Duty 26.94
Customs Act, 1962 Customs Duty 1,170.55
Central Excise Act, 1944 Excise Duty 181.62
Central Excise Act, 1944 Excise Duty 20.82
12.42
3,303.05
5.38
45.01
Central Excise Act, 1944 Excise Duty 40.44
Finance Act, 1994 Service Tax 26.76
Finance Act, 1994 Service Tax 642.72
101.40
24.72
Finance Act, 1994 Service Tax 489.12
MVAT VAT 326.55
Name of the Statute Period to which the Forum where dispute
amount relates is pending
Customs Act,1962 2000-01 CESTAT
Customs Act,1962 2013-14 Commissioner (Appeals)
Central Excise 1998-99, 2005-06, CESTAT
Act,1944
2010-11, 2012-13,
2013-14
Central Excise 2012-13 Additional
Act,1944 Commissioner
2005-06, 2008-09, Assistant
2011-12, 2012-13 Commissioner (Appeals)
2007-08, 2011-12 Commissioner
2006-07 Deputy Commissioner
2008-09 Joint Commissioner
Central Excise 1996-97, 1999-2000 High Court
Act,1944
Finance Act,1944 2007-08, 2010-11 CESTAT
Finance Act,1994 2001-02, 2006-07, Commissioner
2008-09, 2010-11
2007-08 Deputy Commissioner
2008-09, 2009-10 Joint Commissioner
Finance Act,1994 2005-06 High Court
MVAT 2005-06 Bombay Tribunal
(viii) Based on our audit procedures and according to the information
and explanation provided to us, the Company has not defaulted in
repayment of dues to a financial institution, bank, government or dues
of debenture holders.
(ix) According to information and explanation provided to us, the
Company has not raised moneys by way of initial public offer or further
public offer (including debt instruments) in the current year.
According to the information and explanations given to us, term loans
availed by the company were, prima facie; applied for the purpose for
which the loans were obtained.
(x) Based upon the audit procedures performed by us and according to
the information and explanations provided to us by the management, no
fraud by the Company or any fraud on the Company by its officers or
employees has been noticed or reported to us during the year.
(xi) According to the information and explanation provided to us, the
managerial remuneration has been paid and provided in accordance with
the requisite approvals mandated by the provisions of section 197 read
with Schedule V to the Companies Act.
(xii) The Company is not a Nidhi Company and accordingly, Clause (xii)
of the Order is not applicable to the Company.
(xiii) According to the information and explanation provided to us, all
transactions with the related parties are in compliance with sections
177 and 188 of Companies Act, 2013 wherever applicable and the details
have been disclosed in the Financial Statements as required by the
applicable accounting standards.
(xiv) According to the information and explanation provided to us, the
Company has not made any preferential allotment or private placement of
shares or fully or partly convertible debentures during the year under
review.
(xv) According to the information and explanation provided to us, the
Company has not entered into any non-cash transactions with directors
or persons connected with him.
(xvi) According to the information and explanation provided to us, the
Company is not required to be registered under section 45-IA of the
Reserve Bank of India Act, 1934.
For M/s P.G.BHAGWAT
Chartered Accountants
Firm''s Registration No.: 101118W
Abhijeet Bhagwat
Partner
Membership No.: 136835
Pune
21st May, 2016
Mar 31, 2016
We have audited the accompanying standalone financial statements of
Finolex Industries Limited ("the Company"), which comprise the Balance
Sheet as at 31st March, 2016, the Statement of Profit and Loss, the
Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation 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,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the standalone financial statements that give a true
and fair view and are free from material misstatement, whether due to
fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made there under. We conducted our
audit in accordance with the Standards on Auditing specified under
Section 143(10) of the Act. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the standalone financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the standalone financial statements.
The procedures selected depend on the auditor''s 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 Company''s preparation of the standalone financial
statements that give a true and fair view in order to design audit
procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of the accounting policies used
and the reasonableness of the accounting estimates made by the
Company''s 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 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 and its profit and its cash flows for the year
ended on that date. Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 ("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", 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
comply with the Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the
directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016
from being appointed as a director in terms of Section 164(2) of the
Act.
(f) With respect to the adequacy of the internal financial controls
over financial reporting of the Company and the operating effectiveness
of such controls, refer to our separate Report in "Annexure B".
(g) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its standalone financial statements - refer note
1.2 to the standalone
financial statements.
ii. The Company did not have any long term contracts including
derivative contracts, having 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.
Referred to in paragraph 1 under the heading, "Report on Other legal
and Regulatory Requirements" of our report on even date:
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The fixed assets are being physically verified by the management at
regular intervals based on the programme of verification which in our
opinion is reasonable. Part of the major fixed assets has been verified
by the management in the current year and discrepancies noticed on such
physical verification were not material and the same have been properly
dealt with in the books of account.
(c) The title deeds of immovable properties are held in the name of the
company.
(ii) Physical verification of inventory has been conducted by the
management during the current year. In our opinion, the interval of
such verification is reasonable. Discrepancies noticed on physical
verification were not material and the same have been properly dealt
with in the books of account.
(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 Companies
Act, 2013 in the current year. Accordingly, clause (iii) (a), (b) and
(c) are not applicable to the Company.
(iv) According to the information and explanations provided to us, in
respect of loans, investments, guarantees, and security; provisions of
section 185 and 186 of the Companies Act, 2013 have been complied with.
(v) According to information and explanation provided to us, the
Company has not accepted deposits, hence the directives issued by the
Reserve Bank of India and the provisions of sections 73 to 76 or any
other relevant provisions of the Companies Act and the rules framed
there under, are not applicable to it. According to information and
explanation provided to us, no order has been passed by Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
court or any other tribunal.
(vi) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the rules made by the Central Government for the
maintenance of cost records under sub-section (l) of section 148 of the
Companies Act, 2013 and we are of the opinion that prima facie the
prescribed accounts and records have been made and maintained. We have
not however made a detailed examination of records with a view to
determine whether they are accurate and complete.
(vii) (a) The Company is regular in depositing undisputed statutory
dues including provident fund, employees'' state insurance, income-tax,
sales-tax, service tax, duty of customs, duty of excise, value added
tax ,cess and any other statutory dues with the appropriate
authorities. According to the information and explanation provided to
us, no undisputed amounts payable in respect of statutory dues were in
arrears as at 31st March, 2016, for a period more than six months from
the date they became payable.
(b) According to the information and explanation provided to us, there
are no dues of income tax, sales tax, service tax, duty of customs,
duty of excise, value added tax or cess which have not been deposited
on account of any dispute except those mentioned below:
Name of the Statue Nature of Dues Amount
( in lakhs)
Customs Act, 1962 Customs Duty 26.94
Customs Act, 1962 Customs Duty 1,170.55
Central Excise Act, 1944 Excise Duty 181.62
Central Excise Act, 1944 Excise Duty 20.82
12.42
3,303.05
5.38
45.01
Central Excise Act, 1944 Excise Duty 40.44
Finance Act, 1994 Service Tax 26.76
Finance Act, 1994 Service Tax 642.72
101.40
24.72
Finance Act, 1994 Service Tax 489.12
MVAT VAT 326.55
Name of the Statute Period to which the Forum where dispute
amount relates is pending
Customs Act,1962 2000-01 CESTAT
Customs Act,1962 2013-14 Commissioner (Appeals)
Central Excise 1998-99, 2005-06, CESTAT
Act,1944
2010-11, 2012-13,
2013-14
Central Excise 2012-13 Additional
Act,1944 Commissioner
2005-06, 2008-09, Assistant
2011-12, 2012-13 Commissioner (Appeals)
2007-08, 2011-12 Commissioner
2006-07 Deputy Commissioner
2008-09 Joint Commissioner
Central Excise 1996-97, 1999-2000 High Court
Act,1944
Finance Act,1944 2007-08, 2010-11 CESTAT
Finance Act,1994 2001-02, 2006-07, Commissioner
2008-09, 2010-11
2007-08 Deputy Commissioner
2008-09, 2009-10 Joint Commissioner
Finance Act,1994 2005-06 High Court
MVAT 2005-06 Bombay Tribunal
(viii) Based on our audit procedures and according to the information
and explanation provided to us, the Company has not defaulted in
repayment of dues to a financial institution, bank, government or dues
of debenture holders.
(ix) According to information and explanation provided to us, the
Company has not raised moneys by way of initial public offer or further
public offer (including debt instruments) in the current year.
According to the information and explanations given to us, term loans
availed by the company were, prima facie; applied for the purpose for
which the loans were obtained.
(x) Based upon the audit procedures performed by us and according to
the information and explanations provided to us by the management, no
fraud by the Company or any fraud on the Company by its officers or
employees has been noticed or reported to us during the year.
(xi) According to the information and explanation provided to us, the
managerial remuneration has been paid and provided in accordance with
the requisite approvals mandated by the provisions of section 197 read
with Schedule V to the Companies Act.
(xii) The Company is not a Nidhi Company and accordingly, Clause (xii)
of the Order is not applicable to the Company.
(xiii) According to the information and explanation provided to us, all
transactions with the related parties are in compliance with sections
177 and 188 of Companies Act, 2013 wherever applicable and the details
have been disclosed in the Financial Statements as required by the
applicable accounting standards.
(xiv) According to the information and explanation provided to us, the
Company has not made any preferential allotment or private placement of
shares or fully or partly convertible debentures during the year under
review.
(xv) According to the information and explanation provided to us, the
Company has not entered into any non-cash transactions with directors
or persons connected with him.
(xvi) According to the information and explanation provided to us, the
Company is not required to be registered under section 45-IA of the
Reserve Bank of India Act, 1934.
For M/s P.G.BHAGWAT
Chartered Accountants
Firm''s Registration No.: 101118W
Abhijeet Bhagwat
Partner
Membership No.: 136835
Pune
21st May, 2016
Mar 31, 2016
We have audited the accompanying standalone financial statements of
Finolex Industries Limited ("the Company"), which comprise the Balance
Sheet as at 31st March, 2016, the Statement of Profit and Loss, the
Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation 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,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the standalone financial statements that give a true
and fair view and are free from material misstatement, whether due to
fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made there under. We conducted our
audit in accordance with the Standards on Auditing specified under
Section 143(10) of the Act. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the standalone financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the standalone financial statements.
The procedures selected depend on the auditor''s 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 Company''s preparation of the standalone financial
statements that give a true and fair view in order to design audit
procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of the accounting policies used
and the reasonableness of the accounting estimates made by the
Company''s 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 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 and its profit and its cash flows for the year
ended on that date. Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 ("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", 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
comply with the Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the
directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016
from being appointed as a director in terms of Section 164(2) of the
Act.
(f) With respect to the adequacy of the internal financial controls
over financial reporting of the Company and the operating effectiveness
of such controls, refer to our separate Report in "Annexure B".
(g) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its standalone financial statements - refer note
1.2 to the standalone
financial statements.
ii. The Company did not have any long term contracts including
derivative contracts, having 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.
Referred to in paragraph 1 under the heading, "Report on Other legal
and Regulatory Requirements" of our report on even date:
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The fixed assets are being physically verified by the management at
regular intervals based on the programme of verification which in our
opinion is reasonable. Part of the major fixed assets has been verified
by the management in the current year and discrepancies noticed on such
physical verification were not material and the same have been properly
dealt with in the books of account.
(c) The title deeds of immovable properties are held in the name of the
company.
(ii) Physical verification of inventory has been conducted by the
management during the current year. In our opinion, the interval of
such verification is reasonable. Discrepancies noticed on physical
verification were not material and the same have been properly dealt
with in the books of account.
(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 Companies
Act, 2013 in the current year. Accordingly, clause (iii) (a), (b) and
(c) are not applicable to the Company.
(iv) According to the information and explanations provided to us, in
respect of loans, investments, guarantees, and security; provisions of
section 185 and 186 of the Companies Act, 2013 have been complied with.
(v) According to information and explanation provided to us, the
Company has not accepted deposits, hence the directives issued by the
Reserve Bank of India and the provisions of sections 73 to 76 or any
other relevant provisions of the Companies Act and the rules framed
there under, are not applicable to it. According to information and
explanation provided to us, no order has been passed by Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
court or any other tribunal.
(vi) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the rules made by the Central Government for the
maintenance of cost records under sub-section (l) of section 148 of the
Companies Act, 2013 and we are of the opinion that prima facie the
prescribed accounts and records have been made and maintained. We have
not however made a detailed examination of records with a view to
determine whether they are accurate and complete.
(vii) (a) The Company is regular in depositing undisputed statutory
dues including provident fund, employees'' state insurance, income-tax,
sales-tax, service tax, duty of customs, duty of excise, value added
tax ,cess and any other statutory dues with the appropriate
authorities. According to the information and explanation provided to
us, no undisputed amounts payable in respect of statutory dues were in
arrears as at 31st March, 2016, for a period more than six months from
the date they became payable.
(b) According to the information and explanation provided to us, there
are no dues of income tax, sales tax, service tax, duty of customs,
duty of excise, value added tax or cess which have not been deposited
on account of any dispute except those mentioned below:
Name of the Statue Nature of Dues Amount
( in lakhs)
Customs Act, 1962 Customs Duty 26.94
Customs Act, 1962 Customs Duty 1,170.55
Central Excise Act, 1944 Excise Duty 181.62
Central Excise Act, 1944 Excise Duty 20.82
12.42
3,303.05
5.38
45.01
Central Excise Act, 1944 Excise Duty 40.44
Finance Act, 1994 Service Tax 26.76
Finance Act, 1994 Service Tax 642.72
101.40
24.72
Finance Act, 1994 Service Tax 489.12
MVAT VAT 326.55
Name of the Statute Period to which the Forum where dispute
amount relates is pending
Customs Act,1962 2000-01 CESTAT
Customs Act,1962 2013-14 Commissioner (Appeals)
Central Excise 1998-99, 2005-06, CESTAT
Act,1944
2010-11, 2012-13,
2013-14
Central Excise 2012-13 Additional
Act,1944 Commissioner
2005-06, 2008-09, Assistant
2011-12, 2012-13 Commissioner (Appeals)
2007-08, 2011-12 Commissioner
2006-07 Deputy Commissioner
2008-09 Joint Commissioner
Central Excise 1996-97, 1999-2000 High Court
Act,1944
Finance Act,1944 2007-08, 2010-11 CESTAT
Finance Act,1994 2001-02, 2006-07, Commissioner
2008-09, 2010-11
2007-08 Deputy Commissioner
2008-09, 2009-10 Joint Commissioner
Finance Act,1994 2005-06 High Court
MVAT 2005-06 Bombay Tribunal
(viii) Based on our audit procedures and according to the information
and explanation provided to us, the Company has not defaulted in
repayment of dues to a financial institution, bank, government or dues
of debenture holders.
(ix) According to information and explanation provided to us, the
Company has not raised moneys by way of initial public offer or further
public offer (including debt instruments) in the current year.
According to the information and explanations given to us, term loans
availed by the company were, prima facie; applied for the purpose for
which the loans were obtained.
(x) Based upon the audit procedures performed by us and according to
the information and explanations provided to us by the management, no
fraud by the Company or any fraud on the Company by its officers or
employees has been noticed or reported to us during the year.
(xi) According to the information and explanation provided to us, the
managerial remuneration has been paid and provided in accordance with
the requisite approvals mandated by the provisions of section 197 read
with Schedule V to the Companies Act.
(xii) The Company is not a Nidhi Company and accordingly, Clause (xii)
of the Order is not applicable to the Company.
(xiii) According to the information and explanation provided to us, all
transactions with the related parties are in compliance with sections
177 and 188 of Companies Act, 2013 wherever applicable and the details
have been disclosed in the Financial Statements as required by the
applicable accounting standards.
(xiv) According to the information and explanation provided to us, the
Company has not made any preferential allotment or private placement of
shares or fully or partly convertible debentures during the year under
review.
(xv) According to the information and explanation provided to us, the
Company has not entered into any non-cash transactions with directors
or persons connected with him.
(xvi) According to the information and explanation provided to us, the
Company is not required to be registered under section 45-IA of the
Reserve Bank of India Act, 1934.
For M/s P.G.BHAGWAT
Chartered Accountants
Firm''s Registration No.: 101118W
Abhijeet Bhagwat
Partner
Membership No.: 136835
Pune
21st May, 2016
Mar 31, 2015
We have audited the accompanying financial statements of FINOLEX
INDUSTRIES LIMITED("the Company"), which comprise the Balance Sheet as
at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow
Statement for the year then ended, and a summary of the significant
accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements
The Company's 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 a true and
fair view of the financial position, financial performance and cash
flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view
and are free from material misstatement,whether due to fraud or error.
Auditors' Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made thereunder. We conducted our
audit in accordance with the Standards on Auditing specified under
section 143(10) of the Act. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal financial control relevant
to the Company's preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on whether the Company has in place an adequate internal
financial controls system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the Company's Directors, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the financial
statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India, of the state of affairs of the Company as
at 31st March, 2015, and its profit and its cash flows for the year
ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (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 Companies Act, 2015, we give in
the Annexure 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 financial statements comply with the
Accounting Standards specified under section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014.
(e) There are no observations and comments on financial transactions or
other matters which have an adverse effect on the functioning of the
Company.
(f) On the basis of the written representations received from the
directors as on 31st March, 2015 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2015
from being appointed as a director in terms of section 164 (2) of the
Act.
(g) There are no qualifications, reservations or adverse remarks
relating to maintenance of accounts and other matters connected
therewith.
(h) With respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note 1.2 to the
financial statements;
ii. The Company did not have any long-term contracts including
derivative contracts, having any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.
Annexure to the auditors' report
Re: Finolex Industries Limited
Referred to in paragraph 1 under the heading, "Report on Other legal
and Regulatory Requirements" of our report on even date:
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The fixed assets have been physically verified by the management
during the current year based on the regular programme of verification
which in our opinion is reasonable having regard to the size of the
company and the nature of its assets. According to the information and
explanations given to us, discrepancies noticed on physical
verification were not material and have been properly dealt with in the
books of account.
(ii) (a) Physical verification of inventory has been conducted by the
management during the current year. In our opinion, the interval of
such verification is reasonable.
(b) In our opinion the procedures of physical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory.
Discrepancies noticed on physical verification were not material and
the same have been properly dealt with in the books of account.
(iii) According to the information and explanations given to us, 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 Companies Act in the current year. Accordingly, the
provisions of clause 3 (iii) (a) and (b) are not applicable to the
Company.
(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 inventory and fixed assets and for the sale of goods and
services. During the course of our audit we have not observed any major
weaknesses or continuing failure to correct major weaknesses in
internal control system.
(v) According to the information and explanations given to us, the
Company has not accepted deposits, hence the directives issued by the
Reserve Bank of India and the provisions of sections 73 to 76 or any
other relevant provisions of the Companies Act and the rules framed
there under, are not applicable to it. According to information and
explanations given to us no order has been passed by Company Law Board
or National Company Law Tribunal or Reserve Bank of India or any court
or any other tribunal.
(vi) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the rules made bythe Central Government for the maintenance
of cost records Government under sub-section (l) of section 148 of the
Companies Act, 2013 and we are of the opinion that prima facie the
prescribed accounts and records have been made and maintained. We have
not however made a detailed examination of records with a view to
determine whether they are accurate and complete.
(vii) (a) The Company is regular in depositing 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 and any other statutory dues with the appropriate
authorities.
According to the information and explanations given to us, no
undisputed amounts payable in respect of statutory dues were in arrears
as at 31st March, 2015, for a period more than six months from the date
they became payable.
(b) According to the information and explanations given to us, dues of
income tax, sales tax, wealth tax, service tax, duty of customs, duty
of excise, value added tax or cess which have not been deposited on
account of any dispute are mentioned below:
Name of the Nature of Dues Amount(in lakhs)
Statute
Customs Act, Customs Duty 26.94
1962
Customs Act, Customs Duty 168.90
1962 (Appeals)
Central Excise Excise Duty 28.98
Act, 1944 2012-13
Central Excise Excise Duty 20.82
Act, 1944
12.42
3,454.59
5.38
45.01
Central Excise Excise Duty 40.44
Act, 1944
Finance Act, Service Tax 26.76
1994
Finance Act, Service Tax 642.72
1994
101.40
24.72
Finance Act, Service Tax 489.12
1994
MVAT VAT 270.49
Central Sales Tax CST 7,239.07
Name of the Period to which Forum where
Statute the amount relates dispute is pending
Customs Act, 2000-01 CESTAT
1962
Customs Act, 2013-14 Commissioner
1962 (Appeals)
Central Excise 2005-06,2010-11, CESTAT
Act, 1944 2012-13
Central Excise 2012-13 Additional Commissioner
Act, 1944
2005-06, 2008-09, Assistant
2011-12,2012-13 Commissioner (Appeals)
1998-99, 2007-08, Commissioner
2011-12
2006-07 Deputy Commissioner
2008-09 Joint Commissioner
Central Excise 1996-97, 1999-2000 High Court
Act, 1944
Finance Act, 2007-08, 2010-11 CESTAT
1994
Finance Act, 2001-02, 2006-07, Commissioner
1994 2008-2009, 2010-11
2007-08 Deputy Commissioner
2008-09, 2009-10 Joint Commissioner
Finance Act, 2005-06 High Court
1994
MVAT 2005-06 Bombay Tribunal
Central Sales Tax 2005 to 2008 Bombay Tribunal
(c) According to the information and explanations given to us, there
are no amounts 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.
(viii) The Company has no accumulated losses at the end of 31 st March,
2015. The Company has not incurred cash losses in the current financial
year and in the immediately preceding financial year.
(ix) Based on our audit procedures and according to the information and
explanations given to us, we are of the opinion that the company has
not defaulted in repayment of dues to financial institution or bank and
debenture holders.
(x) 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.
(xi) According to the information and explanations given to us, term
loans availed by the company were, prima facie; applied for the purpose
for which the loans were obtained.
(xii) Based upon the audit procedures performed by us and according to
the information and explanations given to us, no fraud on or by the
Company has been noticed or reported during the year.
For M/s P G Bhagwat
Chartered Accountants
Firm's Registration No.: 101118W
Abhijeet Bhagwat
Pune Partner
28th May, 2015 Membership No.:136835
Mar 31, 2013
Report on the fnancial statements
We have audited the accompanying financial statements of Finolex
Industries Limited, which comprise the Balance sheet as at March 31,
2013, the profit and loss statement 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 fnancial 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'' judgement, 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 31st, 2013;
(b) in the case of the Profit and Loss statement, 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.
Emphasis of matter
We draw attention to note 1.4 (d) to the financial statements which
describes the uncertainty related to the outcome of the amounts claimed
by the banks in respect of derivative transactions which are under
dispute and not acknowledged as debt by the Company. Our opinion is not
qualified in respect of this matter.
Report on other legal and regulatory requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 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, Profit and Loss statement 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 and Loss statement 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 31st, 2013, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31st , 2013, from
being appointed as a director in terms of clause (g) of sub-section (1)
of section 274 of the Companies Act, 1956.
Annexure to the auditors'' report
Re: Finolex Industries Limited
Referred to in paragraph 1 under the heading, "Report on other legal
and regulatory requirements" of our report on even date:
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The fixed assets have been physically verified by the management
during the current year based on the regular programme of verification
which in our opinion is reasonable having regard to the size of the
Company and the nature of its assets. According to the information and
explanations given to us, discrepancies noticed on physical
verification were not material and have been properly dealt with in the
books of account.
(c) The Company has not disposed off substantial part of its fixed
assets during the current year.
(ii) (a) As explained to us, physical verification of inventory has
been conducted by the management during the year. In our opinion, the
interval of such verification is reasonable.
(b) In our opinion, the procedures of physical verification of
inventory followed by the management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory.
Discrepancies noticed on physical verification were not material and
have been properly dealt with in the books of account.
(iii) (a) According to the information and explanations given to us,
the Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under section 301 of the Companies Act, 1956. Accordingly, the
provisions of clause 4 (iii) (b), (c) and (d) of the Order are not
applicable to the Company.
(e) According to the information and explanations given to us, 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. Accordingly, the provisions of clause 4
(iii) (f) and (g) of the Order are not applicable to the Company.
(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 inventory and fixed assets and for the sale of goods and
services. During the course of our audit we have not observed any major
weaknesses or continuing failure to correct major weaknesses in
internal control system.
(v) (a) According to the information and explanations given to us, the
par ticulars of contracts or arrangements referred to in section 301 of
the Companies Act, 1956 have been entered in the register required to
be maintained under that section.
(b) In our opinion and according to the information and explanations
given to us by the management, the transactions made in pursuance of
such contracts or arrangements have been made at prices which are
reasonable having regard to the prevailing market prices at the
relevant time.
(vi) In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposits from the public,
hence the provisions of sections 58A, 58AA or any other relevant
provisions of the Act and the rules framed thereunder and the
directives issued by the Reserve Bank of India are not applicable to
the Company.
(vii) In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
(viii) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the rules made by the Central Government for the
maintenance of cost records under section 209 (1) (d) of the Companies
Act, 1956 and we are of the opinion that prima facie the prescribed
accounts and records have been made and maintained. We have not however
made a detailed examination of records with a view to determine whether
they are accurate and complete.
(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, Wealth tax, Service
tax, Custom duty, Excise duty, cess and other material statutory dues
applicable to it with the appropriate authorities.
According to the information and explanations given to us, no
undisputed amounts payable in respect of statutory dues were in
arrears, as at 31st March, 2013, for a period of more than six months
from the date they became payable.
(b) According to the information and explanations given to us, dues of
income tax, sales tax, wealth tax, service tax, custom duty, excise
duty and cess which have not been deposited on account of any dispute
are mentioned below:
Name of the
statute Nature of Amount
dues (Rs. in lakhs)
Customs Act, 1962 Customs duty 4.21
Customs Act, 1962 Customs duty 250.21
Central Excise Act, 1944 Excise duty 24.28
Central Excise Act, 1944 Excise duty 39.93
4.62
2,688.82
43.32
0.05
Central Excise Act, 1944 Excise duty 36.23
Finance Act, 1994 Service tax 26.76
Finance Act, 1994 Service Tax 742.72
29.15
Finance Act, 1994 Service Tax 489.12
NAME Period to
which the
amount Forum where dispute is
relates pending
Customs Act, 1962 1996-97 High Court
Customs Act, 1962 2000-01, 2004-05 CESTAT
Customs Act, 1962 2005-06, 2010-11 CESTAT
Customs Act, 1962 2008-09, 2011-12
& 2012-13 Additional Commissioner
Customs Act, 1962 2012-13 Additional Commissioner
(Appeals)
Customs Act, 1962 1998-99, 2006
to 2008, 2011-12 Commissioner
Customs Act, 1962 2005-06,
2008-09, 2011-12 Deputy Commissioner
2012-13 Superintendent
1996-97, 1999-2000 High Court
2007-08, 2010-11 CESTAT
Finance Act, 1994 2001-02, 2006
to 2009, 2010-11 Commissioner
Finance Act, 1994 2007 to 2011 Deputy Commissioner
Finance Act, 1994 2005-06 High Court
(x) The Company has no accumulated losses at the end of 31st March,
2013. The Company has not incurred cash losses in the current financial
year and in the immediately preceding financial year.
(xi) Based on our audit procedures and according to the information and
explanations given to us by the management, we are of the opinion that
the Company has not defaulted in repayment of dues to financial
institutions or banks and debenture holders.
(xii) According to the information and explanations given to us the
Company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
(xiii) In our opinion, the Company is not a chit fund, nidhi, mutual
benefit fund or society and thus the provisions of clause 4 (xiii) (a),
(b), (c) and (d) of the Order are not applicable to the Company.
(xiv) (a) Based on the records examined by us and according to the
information and explanations given to us, we are of the opinion that
the Company is maintaining proper records of the transactions and
contracts of dealing in shares and securities and timely entries have
been made therein.
(b) According to the information and explanations given to us, the
shares and securities have been held by the Company in its own name.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
(xvi) According to the information and explanations given to us by the
management, term loans availed by the Company were, prima facie applied
for the purpose for which the loans were obtained.
(xvii) According to the information and explanations given to us and on
an examination of the financial statements of the Company, on an
overall basis, the funds raised on short-term basis have, prima facie,
not been used for long-term investment.
(xviii) The Company has not made any preferential allotment of shares
to parties and companies covered in the Register maintained under
section 301 of the Companies Act, 1956.
(xix) According to the information and explanations given to us,
security or charge has been created in respect of the debentures
issued.
(xx) According to the information and explanations given to us, the
Company has not raised money by any public issue during the current
year.
(xxi) Based upon the audit procedures performed by us and according to
the information and explanations given to us, no fraud on or by the
Company has been noticed or reported during the year.
For M/S P. G. BHAGWAT
Chartered Accountants
Firm''s registration
number: 101118W
Abhijeet Bhagwat Pune
Partner
4th May, 2013 Membership number: 136835
Mar 31, 2012
1. We have audited the attached Balance Sheet of Finolex Industries
Limited as at 31st March 2012, Statement of profit and Loss Account and
the Cash Flow Statement for the year ended on that date annexed
thereto. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these financial statements based on our audit.
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 of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. No provision for mark to market losses on the derivative contracts
entered into by the company has been made in the financial statements
for the year ended 31st March, 2012. The management has not made an
assessment of the mark to market losses on the aforesaid derivative
contracts, accordingly we are unable to report the impact thereof on
the statement of profit and loss for the year ended 31st March 2012 and
reserves and surplus as at 31st March, 2012.
4. We report as follows:
4(i). As required by the Companies (Auditor's Report) Order, 2003,
issued by the Central Government of India, in terms of Section 227(4A)
of the Companies Act, 1956, we enclose in the Annexure a statement on
the matters specified in the paragraphs 4 and 5 of the said Order.
4(ii). Further to our comments in the Annexure referred to in paragraph
1 above:
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 the books
c) The Balance Sheet, the Statement profit and Loss Account and the
Cash Flow Statement dealt with by this report are in agreement with the
books of account;
d) Except for non-provision for mark to market losses on the derivative
contracts as contemplated by Accounting Standard à 1 "Disclosure of
Accounting Policies", issued by the Institute of Chartered Accountants
of India, in our opinion, the Balance Sheet, the Statement of profit
and Loss Account and the Cash Flow Statement dealt with by this report
comply with the Accounting Standards referred to in sub-section (3C) of
Section 211 of the Companies Act, 1956;
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 is disqualified as on
31st March, 2012 from being appointed as Director in terms of clause
(g) of sub section (1) of Section 274 of the Companies Act, 1956 on the
said date;
f) Subject to Paragraph 3 above, in our opinion, and to the best of our
information and according to the explanations given to us, the said
accounts, read together with the Company's Accounting Policies and the
Notes thereto give the information required by the Companies Act, 1956
in the manner so required and give a true and fair view in conformity
with the accounting principles generally accepted in India:
i) in the case of the Balance Sheet, of the state of affairs of the
Company as on 31st March, 2012,
ii) in the case of the Statement of profit and Loss Account, of the
profit of the Company for the year ended on that date; and
iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Annexure to the Auditors' Report Referred to in paragraph 1 of our
Report of even date:
i. (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
(b) Assets have been physically verified by the management during the
year based on the regular program of verification, which in our opinion
is reasonable having regards to the size of the company and the nature
of its assets. As explained, the discrepancies noticed were not
material and the same have been properly dealt with in the books of
account.
(c) In our opinion and according to the information and explanation
given to us, during the year, the company has not disposed of any
substantial / major part of fixed assets.
ii. (a) As explained to us, the inventory has been physically verified
during the year by the management. 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 for the physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanation
given to us and on the basis of our examination of the records of the
inventory, the Company is maintaining proper records of inventory.
Discrepancies noticed on verification between the physical stocks and
the book records were not material and have been appropriately dealt
with in the books of account.
iii. (a) As informed, the Company has not granted any loans, secured or
unsecured to companies, firms or other parties covered in the register
maintained under Section 301 of the Companies Act, 1956. Accordingly,
provisions of the clause 4 (iii) (b), (c) and (d) of the Companies
(Auditor's Report) Order, 2003 are not applicable and hence not
commented upon.
(b) According to the information and explanations given to us and on
the basis of our examination of the records, the Company has not taken
during the year any loan secured or unsecured from the parties listed
in the register maintained under Section 301 of the Companies Act,
1956. The maximum amount involved during the year is Rs.1602 Lacs, and
the year end balance of the loan is Nil.
(c) According to the information and explanations given to us, in our
opinion, the rate of interest and other terms and conditions of above
loan granted to the company, are not prima facie, prejudicial to the
interest of the company.
(d) According to the information and explanations given to us, the
company is regular in repayment of principal and payment of interest.
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 with regard
to purchase of inventories and fixed assets and with regard to the sale
of goods and services. In our opinion and according to the information
and explanations given to us, there is no continuing failure to correct
major weakness in internal control system.
v. In respect of transactions entered in the register maintained in
pursuance of Section 301 of Companies Act, 1956;
(a) Based on audit procedures applied by us, to the best of our
knowledge and belief and according to the information and explanations
given to us, we are of the opinion that the particulars of contracts or
arrangements have been entered in the register required to be
maintained under Section 301.
(b) According to the information and explanations given to us certain
transactions of purchase of goods and services exceeding the value of
Rs. 5 lakhs during the year have been made at prices which are
reasonable having regard to the prevailing market prices at the
relevant time. However, in respect of certain transactions of purchase
of goods and services and in respect of rent paid exceeding the value
of Rs. 5 lakhs during the year because of unique and specialised nature
of items involved and in absence of any comparable prices, we are
unable to comment whether the transaction were made at prevailing
market prices at the relevant time.
vi. In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposits from the public.
Hence, the provisions of Section 58A and 58AA and any other relevant
provisions of the Companies Act, 1956 and rules framed there under are
not applicable.
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 books of accounts maintained by the
company relating to the manufacture of Chemicals and generation of
Power, pursuant to the rules made by the Central Government for the
maintenance of cost records under Section 209(1) (d) of the Companies
Act, 1956 and are of the opinion that prima facie the prescribed
accounts and records have been maintained. We have not, however, made a
detailed examination of the records with a view of determining whether
they are accurate and complete.
ix. (a) According to the information and explanations given to us and
on the basis of our examination of the records of the Company, the
Company has generally been regular in depositing undisputed statutory
dues including Provident Fund, Investor Education and Protection Fund,
Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service
Tax, Customs Duty, Excise Duty, cess and other material statutory dues
with the appropriate authorities.
(b) According to the information and explanations given to us, no
undisputed amounts payable 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 undisputed statutory dues 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 and information and
explanations given to us, dues of Income Tax, Sales tax, Wealth Tax,
Service Tax, Customs Duty and Excise Duty and cess, which have not been
deposited on account of disputes and forum where dispute is pending are
as under;
Name of statute Nature of dues Amount (Rs.
lakhs)
Customs Act.1962 Custom Demand 9.92
Customs Act.1962 Custom Demand 266.42
Central Excise Excise Demand & 1812.34
Act,1994 & Service Tax Demand
Finance Act 1994.
Central Excise Excise Demand & 532.27
Act,1994 & Service Tax Demand
Finance Act 1994.
Central Excise Excise Demand & 75.22
Act,1994 & Service Tax Demand
Finance Act 1994.
Name of Statue Period to which the Forum where pending
amount relates
Customs Act.1962 For the years 1995-96 Commissioner, Add.
and 2011-2012 Commissioner, Deputy
Commissioner & Asst.
Commissioner.
Customs Act.1962 Various years 1996- CESTAT
97 to 2005-2006
Central Excise
Act,1994 &
Finance Act 1994. Various years 1998- Commissioner, Add.
99 to 2011-2012 Commissioner, Deputy
Commissioner & Asst.
Commissioner.
Central Excise
Act,1994 &
Finance Act 1994. 2005-2006 High Court
Central Excise
Act,1994 &
Finance Act 1994. For the years 1998-99 CESTAT
and 2010-2011
x. The Company does not have accumulated losses at the end of the
financial year and the company has not incurred any cash losses in the
current and the immediately preceding financial year.
xi. Based on our audit procedures and on the basis of information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in the payment of dues to its bankers,
financial institutions and debenture holders.
xii. According to the information and explanations given to us and
based on the documents and records produced to us, the Company has not
granted any loans and advances on the basis of security by way of
pledge of shares, debentures and other securities.
xiii. In our opinion, the Company is not a chit fund or a nidhi /
mutual Benefit fund / society. Therefore, the provisions of clause
4(xiii) of the Companies (Auditor's Report) Order, 2003 (as amended)
are not applicable to the Company.
xiv. (a) Based on the records examined by us and according to the
information and explanations given to us, we are of the opinion that
the company is maintaining proper records of the transactions and
contracts of dealing in shares and securities and timely entries have
been made in therein.
(b) Based on our audit procedures and to the best of our knowledge and
belief and according to the information and explanations given to us,
the shares and securities have been held by the company in its own
name.
xv. According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks and financial institutions.
xvi. Based on the information and explanation given to us by the
management term loans availed by the company were, prima facie, applied
by the company during the year for the purpose for which loans were
obtained.
xvii. According to the Cash Flow Statement and records examined by us
and according to the information and explanations given to us, on
overall basis, funds raised on short-term basis have, prima facie, not
been used during the year for long term investment.
xviii. The Company has not made preferential allotment of shares to
parties covered in the register maintained under Section 301 of the
Companies Act, 1956 during the year.
xix. According to the information and explanations given to us,
security or charge has been created in respect of debentures issued.
xx. The Company has not raised any money by public issues during the
year.
xxi. Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the course of our audit.
For B. K. Khare & Co.
Chartered Accountants
Firm registration number: 105102W
Membership No.: 047296
Prasad Paranjape
Place: Pune Partner
Date : April 28, 2012 Membership No.: 047296
Mar 31, 2010
We have audited the attached Balance Sheet of Finolex Industries
Limited as at 31st March 2010, and also the Profit and Loss Account and
the Cash Flow Statement for the year ended on that date annexed
thereto. These financial statements are the responsibility of the
Companys management. Our responsibility is to express an opinion on
these financial statements based on our audit.
We conducted our audit in accordance with the auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance whether the financial
statements are free of material mis-statement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
1. As required by the Companies (Auditors Report) Order, 2003 issued
by the Government of India, in terms of sub-section (4A) of Section 227
of the Companies Act, 1956, we enclose in the Annexure a statement on
the matters specified in the paragraphs 4 and 5 of the said Order.
2. Further to our comments in the Annexure referred to in paragraph 1
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 the books
and proper returns adequate for the purpose of our audit have been
received from the branches not visited by us;
c) The Balance Sheet, Profit and 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 and Loss Account and Cash
Flow Statement dealt with by this report comply with the Accounting
Standards referred to in sub-section (3C) of Section 211 of the
Companies Act, 1956;
e) On the basis of the written representations received from the
Directors as on 31st March, 2010 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 Director in terms of clause
(g) of sub-section (1) of Section 274 of the Companies Act, 1956 on the
said date;
f) In our opinion, and to the best of our information and according to
the explanations given to us, the said accounts, read together with the
Companys accounting policies and the Notes thereto, give the
information required by the Companies Act, 1956 in the manner so
required and give a true and fair view in conformity with the
accounting principles generally accepted in India:
i) in the case of the Balance Sheet, of the state of affairs of the
Company as on 31st March, 2010;
ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
iii) in the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
Referred to in paragraph 1 of our Report of even date:
i. (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
(b) Assets have been physically verified by the management during the
year based on the regular programme of verification, which in our
opinion is reasonable having regard to the size of the Company and the
nature of its assets. As explained, the discrepancies noticed were not
material and the same have been properly dealt with in the books of
account.
(c) In our opinion and according to the information and explanations
given to us, during the year, the Company has not disposed of any
substantial/major part of fixed assets.
ii. (a) As explained to us, the inventory has been physically verified
during the year by the management. 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 for the physical verification of
inventories followed by the management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us and on the basis of our examination of the records of the
inventory, the Company is maintaining proper records of inventory.
Discrepancies noticed on verification between the physical stocks and
the book records were not material and have been appropriately dealt
with in the books of account.
iii. 1. (a) The Company had granted an unsecured loan of Rs. 45 lakhs
to Finolex Plasson Industries Limited, an associate company, listed in
the register maintained under Section 301 of the Companies Act, 1956
which has been repaid during the year.
(b) According to the information and explanations given to us, in our
opinion, the rate of interest and other terms and conditions of the
above loan granted by the Company, were not prima facie, prejudicial to
the interest of the Company.
(c) According to the information and explanations given to us, the
company to whom loans and advances in the nature of loan were given had
been repaying the principal amount as stipulated and was also regular
in payment of interest.
(d) There is no overdue amount of loan granted to the company listed in
the register maintained under Section 301 of the Companies Act, 1956.
2. (a) According to the information and explanations given to us and on
the basis of our examination of the records, the Company has accepted
Inter-Corporate Deposits from the following parties listed in the
register maintained under Section 301 of the Companies Act, 1956 -
Name of the Company Relationship Maximum Outstanding
amount as at March
Rs. lakhs 31,2010
Rs. lakhs
AkashTatva Investments Pvt. Ltd. CommonDirector 277.00 207.00
Coated Fabrics Pvt. Ltd. Common Director 638.00 537.00
Corrugated Box Industries
(I) Pvt. Ltd. Common Director 125.00 125.00
Finolib Chemicals Pvt. Ltd. Common Director 70.00 70.00
Orbit Electricals Pvt. Ltd. Common Director 177.00 50.00
(b) According to the information and explanations given to us, in our
opinion, the rate of interest and other terms and conditions of above
loans granted to the Company, are not prima facie, prejudicial to the
interest of the Company.
(c) According to the information and explanations given to us, the
Company is regular in repayment of principal and payment of interest.
(d) There is no overdue amount of Inter-Corporate Deposits accepted
from the parties listed in the register maintained under Section 301 of
the Companies Act, 1956.
iv. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventories and fixed assets and with regard to the sale
of goods and services. In our opinion and according to the information
and explanations given to us, there is no continuing failure to correct
major weakness in internal control system. v. In respect of
transactions entered in the register maintained in pursuance of Section
301 of Companies Act, 1956;
a) Based on audit procedures applied by us, to the best of our
knowledge and belief and according to the information and explanations
given to us, we are of the opinion that the particulars of contracts or
arrangements have been entered in the register required to be
maintained under Section 301.
b) According to the information and explanations given to us and
excluding certain transactions of purchase of goods and materials of
special nature for which alternate quotations are not available, in our
opinion, the transactions have been made at prices which are, prima
facie, reasonable having regard to the prevailing market prices at the
relevant time.
vi. In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposits from the public.
Hence, the provisions of Section 58A and 58AA and any other relevant
provisions of the Companies Act, 1956 and rules framed there under are
not applicable.
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 books of accounts maintained by the Company
relating to the manufacture of PVC Resin, pursuant to the rules made by
the Central Government for the maintenance of cost records under
Section 209(1 )(d) of the Companies Act, 1956 and are of the opinion
that prima facie the prescribed accounts and records have been
maintained. We have not, however, made a detailed examination of the
records with a view of determining whether they are accurate and
complete. ix. a) According to the information and explanations given
to us and on the basis of our examination of the records of the
Company, the Company has generally been regular in depositing
undisputed statutory dues including Provident Fund, Investor Education
and Protection Fund, Employees State Insurance Contribution, Income
Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty,
cess and other material statutory dues with the appropriate
authorities. b) According to the records of the Company and
information and explanations given to us, dues of Income Tax, Sales
tax, Wealth Tax, Service Tax, Customs Duty and Excise Duty and cess,
which have not been deposited on account of disputes and forum where
dispute is pending are as under:
Name of statute Nature of dues Amount Period to Forum where
(in Rs.which the pending
lakhs) amount
relates
Finance Act, 1994
(Service Tax) Service Tax Demand 167.45 2001-02 Commissioner
Finance Act, 1994
(Service Tax) Service Tax Demand 489.12 2005-06 High Court
Finance Act, 1994
(Service Tax) Service Tax Demand 67.22 2006-07 Commissioner
Finance Act, 1994
(Service Tax) Service Tax Demand 5.01 2007-08 CESTAT
Finance Act, 1994
(Service Tax) Service Tax Demand 0.79 2008-09 CESTAT
Finance Act, 1994
(Service Tax) Service Tax Demand 286.98 2008-09 Commissioner
Finance Act, 1994
(Service Tax) Service Tax Demand 18.54 2008-09 Deputy
Commissioner
Finance Act, 1994
(Service Tax) Service Tax Demand 6.18 2009-10 Deputy
Commissioner
Customs Customs Demand 26.94 2000-01 CESTAT
Customs Customs Demand 14.03 2001-02 CESTAT
Central Excise Excise Demand 32.54 1996-97 High Court
Central Excise Excise Demand 2.07 1999-00 High Court
Central Excise Excise Demand 18.17 2002-03 CESTAT
Central Excise Excise Demand 13.11 2005-06 Commissioner
(A)
Central Excise Excise Demand 0.96 2005-06 CESTAT
Central Excise Excise Demand 2.71 2005-06 High Court
Central Excise Excise Demand 0.46 2006-07 Commissioner
Central Excise Excise Demand 981.99 2007-08 Commissioner
Central Excise Excise Demand 9.49 2008-09 Additional
Commissioner
Central Excise Excise Demand 0.54 2009-10 Deputy
Commissioner
x. The Company does not have accumulated losses at the end of the
financial year and the Company has not incurred any cash losses in the
current and the immediately preceding financial year.
xi. Based on our audit procedures and on the basis of information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in the payment of dues to its bankers,
financial institutions and debenture holders.
xii. According to the information and explanations given to us, the
Company has not granted any loans and advances on the basis of security
by way of pledge of shares, debentures and other securities.
xiii.The provisions of any Special Statute applicable to chit fund or
nidhi / mutual benefit fund / societies are not applicable to the
Company.
xiv. a) Based on the records examined by us and according to the
information and explanations given to us, we are of the opinion that
the Company is maintaining proper records of the transactions and
contracts of dealing in shares and securities and timely entries have
been made in these records.
b) Based on our audit procedures and to the best of our knowledge and
belief and according to the information and explanations given to us,
the shares and securities have been held by the Company in its own
name.
xv. According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks and financial institutions.
xvi.To the best of our knowledge and belief and according to
explanations given to us, term loans availed by the Company were, prima
facie, applied by the Company during the year for the purpose for which
loans were obtained.
xvii.On the basis of overall examination of the financial statements
including Cash Flow Statement and other financial information
furnished, we are of the opinion that the funds raised on short term
basis have not been used for long term investments, except to the
extent of approximately Rs. 10,860.01 lakhs for acquisition /
construction of fixed assets.
xviii.The Company has not made preferential allotment of shares to
parties covered in the register maintained under Section 301 of the
Companies Act, 1956 during the year.
xix.According to the information and explanations given to us, security
or charge has been created in respect of debentures issued.
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 course of our audit.
For B.K. Khare & Co.
Chartered Accountants
Place : Pune U. B. Joshi
Dated : 24th April, 2010 Partner
Membership No. 044097
Firm Reg. No. 105102W