Mar 31, 2018
INDEPENDENT AUDITORS''
To the Members of Tips Industries Limited Report on the Financial Statements
We have audited the accompanying financial statements of Tips Industries Limited (the "Company"), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of these 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 Indian Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncement require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence, about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by 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 qualified audit opinion on the Financial Statements.
Basis for Qualified opinion
Attention is invited to Note 34(15) to the financial statements for the year ended March 31, 2018 regarding non recognition of Deferred tax liability on tinning differences in accounting of inventory. In the absence of adequate information, we are unable to quantify its impact on the profits for the year and on the reserves as at March 31,2018.
Qualified Opinion
In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the state of affairs of the Company as at March 31, 2018, 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'' (hereinafter referred to as the "Order"), issued by the Central Government of India in terms of sub - section 11 of section 143 of the Companies Act, 2014, and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanation given to us, we give in the "Annexure-A" a statement on the matters specified in paragraph 3 and 4 of the Order.
2. As required by Section 143 (3) of the Act, we report that:
a) We have sought and, except for the matters described in the Basis for Qualified Opinion paragraph, obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;
b) Except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph above, 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) Except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, in our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement 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 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) 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 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:
a) The Company has disclosed the impact of pending litigations on its financial position in its financial statements-Refer Note 34(1) to the financial statements;
b) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses as at March 31,2018;
c) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31,2018.
i. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) The fixed assets of the Company have been physically verified by the Management during the year and no material discrepancies have been noticed on such verification. In our opinion, the frequency of verification is reasonable.
(c) The title deeds of immovable properties are held in the name of the Company.
ii. The inventory has been physically verified by the Management during the year. In our opinion the frequency of verification is reasonable. The discrepancies noticed on physical verification of inventory as compared to books records were not material.
iii. In our opinion and according to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Accordingly, clauses 3(iii)(a) to 3(iii)(c) of the Order are not applicable to the Company for the current year.
iv. In our opinion and according to the information and explanations given to us, the Company has not given any loans, investments, guarantees and security and as such the provisions of Section 185 and 186 of the Companies Act, 2013 are not applicable for the current year.
v. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the rules framed there under.
vi. In our opinion and according to the information and explanations given to us, the Central Government of India has not prescribed the maintenance of cost records under sub-section (1) of Section 148 of the Act for any of the products of the Company.
vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues including Provident Fund, Employees'' State Insurance, Income-tax, Sales-tax, Service tax, Value Added tax, Goods and Service tax, cess and other statutory dues as applicable with the appropriate authorities. As explained to us, Duty of Custom and Duty of Excise are not applicable to the Company for the current year.
(b) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company has no undisputed amounts payable in respect of Provident Fund, Employees'' State Insurance, Income-tax, Sales-tax, Service tax, Value Added tax, Goods and Service tax, cess and other statutory dues were in arrears as at March 31, 2018 for a period more than six months from the date they became payable. As explained to us, Duty of Custom and Duty of Excise are not applicable to the Company for the current year.
(c) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of income tax, sales tax, value added tax, service tax which have not been deposited with appropriate authority on account of dispute except as mentioned below:
Nature of Statute |
Nature of Dues |
Amount ('' in Lakhs) |
Period to which the amount relate |
Forum where the dispute is pending |
Maharashtra VAT Act, 2005 |
Sales tax, interest and penalty |
35.66 |
F.Y 2005-06 |
Commissioner of Sales Tax (Appeals) |
63.83 |
F.Y 2006-07 |
|||
148.19 |
F.Y 2007-08 |
|||
151.30 |
F.Y 2008-09 |
|||
173.60 |
F.Y 2009-10 |
|||
304.67 |
F.Y.2012-13 |
|||
186.65 |
F.Y.2013-14 |
|||
Maharashtra VAT Act, 2005 |
Sales tax, interest and penalty |
383.83 |
F.Y 2010-11 |
Maharashtra Sales tax Tribunal |
193.84 |
F.Y.2011-12 |
viii. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution and bank. The Company has not taken any loan or borrowing from Government nor has issued any debentures during the current year.
ix. As per information and explanation given to us, on an overall basis, the term loan has been applied for the purposes for which they were obtained. Further, the Company has not raised any money by way of initial public offer or further public offer (including debt instruments).
x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of such case by the Management.
xi. The Company has paid/provided for managerial remuneration as per limits specified under Section 197 read with Schedule V of the Act.
xii. The Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3 (xii) of the Order are not applicable to the Company.
xiii. As per information and explanation given to us, all transactions with the related parties are in compliance with sections 188 of Companies Act, 2013. The details of such related party transactions have been disclosed in the financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
xiv. The company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.
xv. According to the information and explanation given to us, the company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.
xvi. The company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
We have audited the internal financial controls over financial reporting of Tips Industries Limited ("the Company") as of March 31, 2018 in conjunction with our audit of the 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, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the 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 financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For SSPA & Associates
Chartered Accountants
Firm Registration No.131069W
Parag Ved
Place: Mumbai Partner
Date : May 28, 2018 Membership Number: 102432
Mar 31, 2016
To the Members of Tips industries Limited Report on the Financial Statements
We have audited the accompanying financial statements of Tips Industries Limited (the "Company"), which comprise the Balance Sheet as at March 31, 2016, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.
Managementâs 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 and presentation 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 of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncement require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence, about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by 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 qualified audit opinion on the Financial Statements.
Emphasis of matter
Attention is invited to Note 29 to the financial statements with respect to the excess managerial remuneration paid for the current year for which the company has made an application to the Central Government, the approval of which is pending. Our audit opinion is not qualified in respect of this matter.
Basis for Qualified opinion
Attention is invited to Note 33 to the financial statements for the year ended March 31, 2016 regarding non recognition of Deferred tax liability on timing differences in accounting of inventory. In the absence of adequate information, we are unable to quantify its impact on the profits for the year and on the reserves as at March 31, 2016.
Qualified Opinion
In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the state of affairs of the Company as at March 31, 2016, and its profit and its cash 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'' (hereinafter referred to as the "Order"), issued by the Central Government of India in terms of sub - section 11 of Section 143 of the Companies Act, 2014, and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanation given to us, we give in the "Annexure-A" a statement on the matters specified in paragraph 3 and 4 of the Order.
2. As required by Section 143 (3) of the Act, we report that:
a) We have sought and, except for the matters described in the Basis for Qualified Opinion paragraph, obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;
b) Except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph above, 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) Except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, in our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement 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 March 31, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2016 from being appointed as a director in terms of Section 164 (2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure-B".
g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 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:
a) The Company has disclosed the impact of pending litigations on its financial position in its financial statements-Refer Note 28 to the financial statements;
b) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses as at March 31,2016;
c) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2016.
i. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed assets.
(b) The fixed assets of the Company have been physically verified by the Management during the year and no material discrepancies have been noticed on such verification. In our opinion, the frequency of verification is reasonable.
(c) The title deeds of immovable properties are held in the name of the Company.
ii. The inventory has been physically verified by the Management during the year. In our opinion the frequency of verification is reasonable. The discrepancies noticed on physical verification of inventory as compared to books records were not material.
iii. In our opinion and according to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Accordingly, clauses 3(iii)(a) to 3(iii)(c) of the Order are not applicable to the Company for the current year.
iv. In our opinion and according to the information and explanations given to us, the Company has not given any loans, investments, guarantees and security and as such the provisions of Section 185 and 186 of the Companies Act, 2013 are not applicable for the current year.
v. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the rules framed there under.
vi. In our opinion and according to the information and explanations given to us, the Central Government of India has not prescribed the maintenance of cost records under subsection (1) of Section 148 of the Act for any of the products of the Company.
vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues including Provident Fund, Employees'' State Insurance, Income-tax, Sales-tax, Service tax, Value Added tax, cess and other statutory dues as applicable with the appropriate authorities. As explained to us, Duty of Custom and Duty of Excise are not applicable to the Company for the current year.
(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of Sales tax and cess as at March 31, 2016 which have not been deposited on account of disputes are as follow:
Nature of |
Nature of |
Amount |
Period to |
Forum where |
Statute |
Dues |
('' in |
which the |
the dispute is |
Lakhs) |
amount relate |
pending |
||
Maharashtra |
Sales tax, |
35.66 |
F.Y 2005-06 |
Commissioner |
VAT Act, 2005 |
interest and |
63.83 |
F.Y 2006-07 |
of Sales Tax (Appeals) |
penalty |
148.19 151.30 173.60 410.83 193.84 |
F.Y 2007-08 F.Y 2008-09 F.Y 2009-10 F.Y 2010-11 F.Y.2011-12 |
viii. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution and bank. The Company has not taken any loan or borrowing from Government nor has issued any debentures during the current year.
ix. As per information and explanation given to us, on an overall basis, the term loan has been applied for the purposes for which they were obtained. Further, the Company has not raised any money by way of initial public offer or further public offer (including debt instruments).
x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of such case by the Management.
xi. The Company has paid/provided for managerial remuneration based on previous Central Government approval which is in excess of limits specified under Section 197 read with Schedule V of the Act. However, the Company has applied for Central Government approval for the excess remuneration paid/to be paid.
xii. The Company is not a Nidhi Company and the Nidhi Rules,
2014 are not applicable to it, the provisions of Clause 3 (xii) of the Order are not applicable to the Company.
xiii. As per information and explanation given to us, all transactions with the related parties are in compliance with Sections 188 of Companies Act, 2013. The details of such related party transactions have been disclosed in the financial statements as required under Accounting Standard (AS) 18, Related Party Disclosures specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
xiv. The company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.
xv. According to the information and explanation given to us, the company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.
xvi. The company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.
Report on the Internal Financial Controls under Clause (i) of Subsection 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of Tips Industries Limited ("the Company") as of March 31, 2016 in conjunction with our audit of the financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditorsâ Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India.
Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the 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 financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For SSPA & Associates
Chartered Accountants
Firm Registration No.131069W
Parag Ved
Place : Mumbai Partner
Date : May 25, 2016 Membership Number : 102432
Mar 31, 2015
We have audited the accompanying financial statements of Tips
Industries Limited (the "Company"), which comprise the Balance Sheet as
at March 31,2015, the Statement of Profit and Loss and Cash Flow
Statement for the year then ended, and a summary of significant
accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements
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 of the assets of the Company and
for preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit.
We have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
there under.
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. Those Standards and
pronouncement require that we comply with ethical requirements and plan
and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence, about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal financial control relevant
to the Company's preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of
the accounting estimates made by 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 qualified audit opinion on the
Financial Statements.
Emphasis of matter
Attention in invited to Note 29 to the financial statements with respect
to the excess managerial remuneration paid in the earlier years for
which the Company has made an application to the Central Government,
which is pending approval. Our audit opinion is not qualified in respect
of this matter.
Basis for Qualified Opinion
Attention in invited to Note 33 to the financial statements for the
year ended March 31, 2015 regarding non recognition of Deferred tax
liability on timing differences in accounting of inventory. In the
absence of adequate information we are unable to quantify its impact on
the profits for the year and on the reserves as at March 31,2015.
Qualified Opinion
In our opinion and to the best of our information and according to the
explanations given to us, except for the possible effects of the matter
described in the Basis for Qualified Opinion paragraph, the aforesaid
financial statements give the information required by the Act in the
manner so required and give a true and fair view in conformity with the
accounting principles generally accepted in India of the state of
affairs of the Company as at March 31, 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'
(hereinafter referred to as the "Order"), issued by the Central
Government of India in terms of sub - section 11 of section 143 of the
Companies Act, 2013 and on the basis of such checks of the books and
records of the Company as we considered appropriate and according to
the information and explanations given to us, we give in the Annexure a
statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and, except for the matters described in the Basis
for Qualified Opinion paragraph, obtained all the information and
explanations which to the best of our knowledge and belief were
necessary for the purpose of our audit.
(b) Except for the impact of the matter described in the Basis for
Qualified Opinion paragraph above, 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) Except for the impact of the matter described in the Basis for
Qualified Opinion paragraph, in our opinion, the Balance Sheet, the
Statement of Profit and Loss, and the Cash Flow Statement 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 March 31, 2015 taken on record by the Board of
Directors, none of the directors is disqualified as on March 31, 2015
from being appointed as a director in terms of Section 164 (2) of
theAct.
(f) With respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations as at
March 31,2015 on its financial position in its financial statements -
Refer Note 28 to the financial statements.
II. The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable
losses.
ill. 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
The Annexure referred to in our report to the members of Tips
Industries Limited ('The Company') for the year ended March 31, 2015.
We report that:-
1. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The fixed assets of the Company have been physically verified by
the Management during the year and no material discrepancies have been
noticed on such verification. In our opinion, the frequency of
verification is reasonable.
2. (a) The inventory has been physically verified by the Management
during the year. In our opinion, the frequency of 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) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
3. The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under Section 189 of the Act. Accordingly, clauses (iii)(a) and (iii)
(b) of the Order are not applicable to the Company forthe current year.
4. 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, fixed assets and forthe sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanations given to us, we have neither come across nor have been
informed of any continuing failure to correct major weaknesses in the
aforesaid internal control system.
5. The Company has not accepted any deposits within the meaning of
Sections 73 to 76 of the Act and the rules framed there under.
6. The Central Government of India has not prescribed the maintenance
of cost records under sub-section (1) of Section 148 of the Act for any
of the products of the Company.
7. (a) According to the information and explanations given to us and the
records of the Company examined by us, in our opinion, the Company is
generally regular in depositing the undisputed statutory dues including
Provident Fund, Employees' State Insurance, Income- tax, Sales-tax,
Wealth tax, Service tax, Duty of Custom, Excise Duty, Value Added tax,
cess and other statutory dues as applicable with the appropriate
authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, the particulars of dues of
Income tax, Sales tax and cess as at March 31, 2015 which have not been
deposited on account of disputes are as follow:
Nature of Nature of Amount Period to which Forum where the
Statute Dues (Rs. in the amount dispute is
Lacs) relate Pending
Maharashtra Sales 35.66 F.Y 2005-06 Commissioner
VAT tax, 63.83 F.Y 2006-07 of Sales Tax
Act, 2005 interest 148.19 F.Y 2007-08 (Appeals)
and 151.30 F.Y 2008-09
penalty 173.60 F.Y 2009-10
410.83 F.Y 2010-11
(c) According to the information and explanations given to us and the
records of the Company examined by us, there are no amount required to
transferred to investor education and protection fund in accordance
with the relevant provisions of the Companies Act, 1956(1 of 1956) and
rules made there under.
8. There are no accumulated losses as at the end of the financial year
and it has not incurred any cash losses in the financial year ended on
that date and has incurred cash losses in the immediately preceding
financial year.
9. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
10. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions during the year.
11. According to information and explanation given to us, term loans
obtained were applied for the purpose for which the loan were obtained.
12. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of such case by the Management.
For SSPA & Associates
Firm Registration No. 131069W
Chartered Accountants
Sd /-
Parag Ved
Place: Mumbai Partner
Date: May 8, 2015 Membership No. 102432
Mar 31, 2014
1. We have audited the accompanying financial statements of Tips
Industries Limited("the Company"), which comprise the Balance Sheet as
at March 31, 2014, and the Statement of Profit and Loss and Cash Flow
for the year then ended, and a summary of significant accounting
policies and other explanatory information.
Management''s Responsibility for the Financial Statements
2. The Company''s Management is responsible for the preparation of
these financial statements that give a true and fair view of the
financial position, financial performance and cash flows of the Company
in accordance with the Accounting Standards notified under the
Companies Act, 1956 ("the Act") read with the General Circular 15/2013
dated September 13, 2013 of the Ministry of Corporate Affairs in
respect of Section 133 of the Companies Act 2013. This responsibility
includes the design, implementation and maintenance of internal control
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor''s Responsibility
3. 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.
4. An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity''s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the
reasonableness of the accounting estimates made by management, as well
as evaluating the overall presentation of the financial statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion
6. In our opinion and to the best of our information and according to
the explanations given to us, the financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2014;
(b) in the case of the Statement of Profit and Loss, of the loss for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
7. As required by the Companies (Auditor''s Report) Order, 2003, as
amended by the Companies (Auditor''s Report) (Amendment) Order, 2004,
issued by the Central Government of India in terms of sub-section (4A)
of section 227 of the Act (the "Order"), and on the basis of such
checks of the books and records of the Company as we considered
appropriate and according to the information and explanations given to
us, we give in the Annexure a statement on the matters specified in
paragraphs 4 and 5 of the Order.
8. 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, the Statement of Profit and Loss and Cash Flow
dealt with by this Report are in agreement with the books of account;
d. In our opinion, the Balance Sheet, the Statement of Profit and Loss
and Cash Flow dealt with by this report, comply with the Accounting
Standards notified under the Companies Act, 1956 read with the General
Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate
Affairs in respect of section 133 of the Companies Act, 2013;
e. on the basis of written representations received from the directors
as on March 31, 2014, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2014, 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
Referred to in paragraph (7) of our report of even date on the accounts
of Tips Industries Limited for the year ended 31st March 2014
(i) FIxED ASSETS
(a) The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
(b) The Company has carried out physical verification of fixed assets
in accordance with the verification programme. According to
information and explanation given to us and in our opinion,
discrepancies noticed on such verification were not material and have
been appropriately dealt with in the books of accounts of the Company.
(c) During the year, the Company has not disposed off substantial part
of fixed assets.
(ii) INVENTORY
(a) As explained to us, inventories were physically verified during the
year by the Management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were generally reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories. Having regard to the size of the operations of the
Company, the discrepancies noticed on verification between physical
stocks and book records were not material and have been properly dealt
with in the books of account.
(iii) LOANS AND ADVANCES GRANTED /TAKEN FROM
CERTAIN ENTITIES:
(a) 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 Act. Accordingly, paragraphs 4(iii)(b), (c)
and (d) of the order are not applicable.
(b) According to the information and explanations given to us, during
the year ended March 31, 2014 the Company has taken unsecured loan from
four parties covered in the register maintained under section 301 of
the act, aggregating to Rs 390 lacs. The maximum amount of loan
outstanding during the year was Rs. 650 lacs and balance outstanding at
the end of the year is Rs. 254 lacs.
(c) According to the information and explanations given to us, in our
opinion, the rate of interest and other terms and conditions of
unsecured loans taken from parties listed in the register maintained
under section 301 of the Companies Act, 1956 were not prejudicial to
the interest of the Company. The repayment of principal and interest is
regular.
(iv) INTERNAL CONTROL SYSTEM
In our opinion and according to the information and explanations given
to us, there are adequate internal control systems commensurate with
the size of the Company and the nature of its business with regard to
purchases of inventory, fixed asset and with regard to the sale of
goods and services. During the course of our audit, and according to
the information and explanations given to us, we have neither come
across nor have been informed of any continuing failure to correct
major weaknesses in the internal control system.
(v) CONTRACTS OR ARRANGEMENT REFERRED TO IN THIS SECTION 301 OF THE
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 that need to be entered in the register maintained under
section 301 of the Companies act, 1956 have been so entered.
(b) In our opinion and according to the information and explanation
given to us, in respect of transactions which have been made in
pursuance of contracts or arrangement entered in the register
maintained under Section 301 and exceeding the value of Rs.5,00,000 in
respect of any party during the period, we are not in the position to
compare the prices with the prevailing market prices or prices charged
to other parties as there have been no other such purchases or sales of
exact type of goods, materials or sales of services and hence we have
relied on managements representation as to reasonableness of such
prices.
(vi) ACCEPTANCE OF DEPOSITS:
The Company had accepted deposits from the public and in our opinion
and according to the information and explanations given to us, the
directives issued by the Reserve Bank of India and the provisions of
section 58A and 58AA and the relevant provisions of the Companies Act,
1956 and rules framed thereunder, where applicable, have been complied
with. We are informed that no order has been passed by the Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
court or any other tribunal.
(vii) INTERNAL AUDIT SYSTEM:
In our opinion, Company has adequate internal audit system commensurate
with the size and the nature of its business.
(viii) COST RECORDS:
The Central Government has not prescribed maintenance of cost records
under section 209(1)(d) of the Companies Act, 1956 for any of the
products of the Company.
(ix) STATUTORY DUES:
(a) According to the records of the Company and information and
explanations given to us, Company is generally regular in depositing
with appropriate authorities undisputed statutory dues including
Provident Fund, Employees State Insurance, Income tax, Sales tax,
Wealth tax, Service tax, Customs duty, Excise duty, Cess and other
material statutory dues applicable to it.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of Income Tax, Sales Tax, Wealth
Tax, Service Tax, Customs duty, Excise duty and Cess are in arrears, as
on 31st March 2014 for a period of more than six months from the date
they became payable.
(c) According to the information and explanations given to us, the
particulars of dues of Income Tax, Service tax, and Cess as at 31st
March 2014 which have not been deposited on account of disputes are as
follows:
Name of Nature of Amount Period to Forum
the statute dues (Rs. In which the where the
lacs) amount dispute is
relates Pending
25.73 FY 2005-06 Commis-
Maharash- Sales tax, 66.33 FY 2006-07 sioner of
tra Vat Act, interest and FY 2008-09 Sales Tax
2005 penalty 181.09 FY 2009-10 (Appeals)
Foreign
Exchange Honourable
Manage- Penalty 90.00 FY 2002-03 Supreme
ment Act, Court
1999
(x) ACCUMULATED LOSSES:
The Company has no accumulated losses as at 31st March 2014. It has
incurred cash losses in the financial year ended on that date and has
not incurred cash losses in the immediately preceding financial year.
(xi) DUES TO FINANCIAL INSTITUTIONS, BANKS AND DEBENTURE HOLDERS:
According to the information and explanations given to us and based on
the documents and records produced before us, Company has not defaulted
in repayment of dues to any Financial Institutions and Banks.
(xii) SECURITY FOR LOANS & ADVANCES GRANTED:
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) SPECIAL STATUTE:
The provisions of any special statute applicable to chit fund/nidhi/
mutual benefit fund/society are not applicable to the Company.
(xiv) DEALINGS/TRADING IN SHARES, SECURITIES, DEBENTURES AND OTHER
INVESTMENTS:
In our opinion, the Company does not deal or trade in shares,
securities, debentures and other investments.
(xv) GUARANTEES GIVEN:
According to information and explanations given to us, the Company has
not given any guarantee for loans taken by others from banks or
financial institutions.
(xvi) TERM LOANS:
According to information and explanation given to us, term loans
obtained were applied for the purpose for which the loans were
obtained.
(xvii) UTILISATION OF FUNDS:
According to the information and explanations given to us, on an
overall examination of the Balance Sheet and the Cash Flow of the
Company, we report that the Company has not utilized funds raised on
short-term basis for long-term investment.
(xviii) PREFERENTIAL ALLOTMENT OF SHARES:
During the year, the Company has not made any preferential allotment of
shares to parties and companies covered in the register maintained
under section 301 of the Companies Act, 1956.
(xix) SECURITY FOR DEBENTURES ISSUED:
Company has not issued any debentures during the year.
(xx) PUBLIC ISSUE OF EQUITY SHARES:
During the year Company has not raised any money by way of public
issue.
(xxi) FRAUDS NOTICED:
During the course of our examination of the books and records of the
Company, carried out in accordance with the generally accepted auditing
practices in India, and according to the information and explanations
given to us, we have neither come across any instance of fraud on or by
the Company, noticed or reported during the year, nor have we been
informed of such case by the management.
For B. K. Khare & Co.
Chartered Accountants
Firm''s Registration Number 105102W
Sd/-
Devdatta Mainkar
Partner
Membership No. 109795
Mumbai, May 9, 2014
Mar 31, 2013
Report on the Financial Statements
1. We have audited the accompanying fnancial statements of Tips
Industries Limited ("the Company"), which comprise the Balance Sheet as
at March 31, 2013, and the Statement of Proft and Loss and Cash Flow
Statement for the year then ended, and a summary of signifcant
accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
2. The Company''s Management is responsible for the preparation of
these fnancial statements that give a true and fair view of the
fnancial position, fnancial performance and cash fows 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
fnancial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error.
Auditor''s Responsibility
3. Our responsibility is to express an opinion on these fnancial
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 fnancial statements are free
from material misstatement.
4. An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the fnancial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the fnancial
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 fnancial 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 fnancial statements.
5. We believe that the audit evidence we have obtained is suffcient
and appropriate to provide a basis for our audit opinion.
Opinion
6. In our opinion and to the best of our information and according to
the explanations given to us, the fnancial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2013;
(b) in the case of the Statement of Proft and Loss, of the proft for
the year ended on that date; and;
(c) in the case of the Cash Flow Statement, of the cash fows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
7. As required by ''the Companies (Auditor''s Report) Order, 2003, as
amended by the Companies (Auditor''s Report) (Amendment) Order, 2004'',
issued by the Central Government of India in terms of sub-section (4A)
of section 227 of the Act (hereinafter referred to as the "Order"), and
on the basis of such checks of the books and records of the Company as
we considered appropriate and according to the information and
explanations given to us, we give in the Annexure a statement on the
matters specifed in paragraphs 4 and 5 of the Order.
8. As required by section 227(3) of the Act, we report that:
a. we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
b. in our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books;
c. the Balance Sheet, Statement of Proft and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
d. in our opinion, the Balance Sheet, Statement of Proft and Loss, and
Cash Flow Statement comply with the Accounting Standards referred to in
subsection (3C) of section 211 of the Companies Act, 1956;
e. on the basis of written representations received from the directors
as on March 31, 2013, and taken on record by the Board of Directors,
none of the directors is disqualifed as on March 31, 2013, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956;
f. Since the Central Government has not issued any notification as to
the rate at which the cess is to be paid under section 441A of the
Companies Act, 1956 nor has it issued any Rules under the said section,
prescribing the manner in which such cess is to be paid, no cess is due
and payable by the Company.
Referred to in paragraph (7) of our report of even date on the accounts
of Tips Industries Limited for the year ended 31st March 2013
(i) FIXED ASSETS
(a) The Company has maintained proper records showing full particulars
including quantitative details and situation of fxed assets.
(b) The Company has carried out physical verifcation of fxed assets in
accordance with the verifcation programme. According to information
and explanation given to us and in our opinion, discrepancies noticed
on such verifcation were not material and have been appropriately dealt
with in the books of accounts of the Company.
(c) During the year, the Company has not disposed off substantial part
of fxed assets.
(ii) INVENTORY
(a) As explained to us, inventories were physically verifed during the
year by the Management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verifcation of inventories
followed by the management were generally reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories. Having regard to the size of the operations of the
Company, the discrepancies noticed on verifcation between physical
stocks and book records were not material and have been properly dealt
with in the books of account.
(iii) LOANS AND ADVANCES GRANTED /TAKEN FROM CERTAIN ENTITIES:
(a) The Company has not granted any loans, secured or unsecured to
companies, frms or other parties covered in the register maintained
under section 301 of the Act. Accordingly, paragraphs 4(iii)(b), (c)
and (d) of the order are not applicable.
(e) According to the information and explanations given to us, during
the year ended March 31, 2013 Company has taken unsecured loan from one
party covered in the register maintained under section 301 of the act,
aggregating to Rs 300 lacs. The maximum amount of loan outstanding
during the year was Rs. 310 lacs and balance outstanding at the end of
the year is Rs. 260 lacs.
(f) According to the information and explanations given to us, in our
opinion, the rate of interest and other terms and conditions of
unsecured loans taken from parties listed in the register maintained
under section 301 of the Companies Act, 1956 were not prejudicial to
the interest of the Company. The repayment of principal and interest is
regular.
(iv) INTERNAL CONTROL SYSTEM
In our opinion and according to the information and explanations given
to us, there are adequate internal control systems commensurate with
the size of the Company and the nature of its business with regard to
purchases of inventory, fxed asset and with regard to the sale of goods
and services. During the course of our audit, and according to the
information and explanations given to us, we have neither come across
nor have been informed of any continuing failure to correct major
weaknesses in the internal control system.
(v) CONTRACTS OR ARRANGEMENT REFERRED TO IN THIS SECTION 301 OF THE
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 that need to
be entered in the register maintained under section 301 of the
Companies act, 1956 have been so entered.
(b) In our opinion and according to the information and explanation
given to us, in respect of transactions which have been made in
pursuance of contracts or arrangement entered in the register
maintained under Section 301 and exceeding the value of Rs.5,00,000 in
respect of any party during the period, we are not in the position to
compare the prices with the prevailing market prices or prices charged
to other parties as there have been no other such purchases or sales of
exact type of goods, materials or sales of services and hence we have
relied on managements representation as to reasonableness of such
prices.
(vi) ACCEPTANCE OF DEPOSITS:
The Company had accepted deposits from the public and in our opinion
and according to the information and explanations given to us, the
directives issued by the Reserve Bank of India and the provisions of
section 58A and 58AA and the relevant provisions of the Companies Act,
1956 and rules framed thereunder, where applicable, have been complied
with. We are informed that no order has been passed by the Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
court or any other tribunal.
(vii) INTERNAL AUDIT SYSTEM:
In our opinion, Company has adequate internal audit system commensurate
with the size and the nature of its business.
(viii) COST RECORDS:
The Central Government has not prescribed maintenance of cost records
under section 209(1)(d) of the Companies Act, 1956 for any of the
products of the Company.
(ix) STATUTORY DUES:
(a) According to the records of the Company and information and
explanations given to us, Company is generally regular in depositing
with appropriate authorities undisputed statutory dues including
Provident Fund,
Employees State Insurance, Income tax, Sales tax, Wealth tax, Service
tax, Customs duty, Excise duty, Cess and other material statutory dues
applicable to it.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of Income Tax, Sales Tax, Wealth
Tax, Service Tax, Customs duty, Excise duty and Cess are in arrears, as
on 31st March 2013 for a period of more than six months from the date
they became payable.
(c) According to the information and explanations given to us, there
are no dues of Income Tax, Wealth Tax, Service Tax, Sales Tax, Custom
duty, Excise duty and Cess which have not been deposited on account of
dispute.
(x) ACCUMULATED LOSSES:
Company has no accumulated losses as at 31st March 2013 and it has not
incurred cash losses in the fnancial year ended on that date or in the
immediately preceding fnancial year.
(xi) DUES TO FINANCIAL INSTITUTIONS, BANKS AND DEBENTURE HOLDERS:
According to the information and explanations given to us and based on
the documents and records produced before us, Company has not defaulted
in repayment of dues to any Financial Institutions and Banks.
(xii) SECURITY FOR LOANS & ADVANCES GRANTED:
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) SPECIAL STATUTE:
The provisions of any special statute applicable to chit fund/
nidhi/mutual beneft fund/society are not applicable to the Company.
(xiv) DEALINGS/TRADING IN SHARES, SECURITIES, DEBENTURES AND OTHER
INVESTMENTS:
In our opinion, the Company does not deal or trade in shares,
securities, debentures and other investments.
(xv) GUARANTEES GIVEN:
According to information and explanations given to us, the Company has
not given any guarantee for loans taken by others from banks or
fnancial institutions.
(xvi) TERM LOANS:
According to information and explanation given to us, term loans
obtained were applied for the purpose for which the loans were
obtained.
(xvii) UTILISATION OF FUNDS:
According to the information and explanations given to us, on an
overall examination of the Balance Sheet and the Cash Flow of the
Company, we report that the Company has not utilized funds raised on
short-term basis for long-term investment.
(xviii) PREFERENTIAL ALLOTMENT OF SHARES:
During the year, the Company has not made any preferential allotment of
shares to parties and companies covered in the register maintained
under section 301 of the Companies Act, 1956.
(xix) SECURITY FOR DEBENTURES ISSUED:
Company has not issued any debentures during the year.
(xx) PUBLIC ISSUE OF EQUITY SHARES:
During the year Company has not raised any money by way of public
issue.
(xxi) FRAUDS NOTICED:
During the course of our examination of the books and records of the
Company, carried out in accordance with the generally accepted auditing
practices in India, and according to the information and explanations
given to us, we have neither come across any instance of fraud on or by
the Company, noticed or reported during the year, nor have we been
informed of such case by the management.
For B. K. Khare & Co.
Chartered Accountants
Firm Registration No. 105102W
Devdatta Mainkar
Place: Mumbai Partner
Date: 23rd May 2013 Membership No. 109795
Mar 31, 2012
1. We have audited the attached Balance Sheet of TIPS INDUSTRIES
LIMITED as at 31st March 2012 and the Statement of Profit & Loss and
the Cash Flow Statement of the Company 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 the financial statements based on our audit.
2. 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 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. As required by the Companies (Auditors' Report) Order, 2003, issued
by the Central Government of India in terms of sub- section (4A) of
Section 227 of Companies Act, 1956, we give in the Annexure a statement
on the matters specified in paragraph
4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to in paragraph
(3) 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 purpose of our
audit.
(b) In our opinion, proper books of accounts as required by the law
have been kept by the Company so far as it appears from our examination
of these books.
(c) The Balance Sheet, Statement of Profit and Loss and the Cash Flow
dealt with by this Reports are in agreement with the books of account.
(d) In our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement comply with the Accounting Standards referred to in
sub-section (3C) of Section 211 of the Companies Act, 1956.
(e) On the basis of written representations received from the Directors
as on 31st March 2012 and taken on record by the Board of Directors, we
report that, none of the directors is disqualified as on 31st March,
2012 from being appointed as a Director in terms of clause (g) of Sub
Section (1) of Section 274 of the Companies Act, 1956.
(f) In our opinion and to the best of our information and according to
the explanations given to us, they said accounts read with the notes
thereon give the information required by the Companies Act, 1956, in
the manner so required and, give a true and fair view in conformity
with the accounting principles generally accepted in India:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March 2012,
(ii) in the case of Statement of Profit and Loss, of the profit 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.
Referred to in paragraph (3) of our report of even date on the accounts
of Tips Industries Limited for the year ended 31st March 2012
(i) FIXED ASSETS
(a) The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
(b) The Company has carried out physical verification of fixed assets
in accordance with the verification programme. According to information
and explanation given to us and in our opinion, discrepancies noticed
on such verification were not material and have been appropriately
dealt with in the books of accounts of the company.
(c) In our opinion, the disposal of fixed assets during the year does
not affect the going concern assumption.
(ii) INVENTORY
(a) As explained to us, inventories were physically verified during the
year by the Management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were generally reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories.
(iii) LOANS AND ADVANCES GRANTED /TAKEN FROM CERTAIN ENTITIES:
(a) 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 Act. Accordingly, paragraphs 4(iii)(b), (c)
and (d) of the order are not applicable.
(b) According to the information and explanations given to us, during
the year ended March 31, 2012 the Company has taken unsecured loan from
five parties covered in the register maintained under section 301 of
the act, aggregating to Rs 195 lacs. The maximum amount of loan
outstanding during the year was 535 lacs and balance outstanding at the
end of the year is Rs. 260 lacs.
(c) According to the information and explanations given to us, in our
opinion, the rate of interest and other terms and conditions of
unsecured loans taken from parties listed in the register maintained
under section 301 of the Companies Act, 1956 were not prejudicial to
the interest of the Company. The repayment of principal and interest is
regular.
(iv) INTERNAL CONTROL SYSTEM
In our opinion and according to the information and explanations given
to us, there are adequate internal control systems to commensurate with
the size of the Company and the nature of its business with regard to
purchases of inventory, fixed asset and with regard to the sale of
goods and services. During the course of our audit, and according to
the information and explanations given to us, we have neither come
across nor have been informed of any continuing failure to correct
major weaknesses in the internal control system.
(v) CONTRACTS OR ARRANGEMENT REFERRED TO IN THIS SECTION 301 OF THE
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 that need to be entered in the register maintained under
section 301 of the Companies act, 1956 have been so entered.
(b) In our opinion and according to the information and explanation
given to us, in respect of transactions which have been made in
pursuance of contracts or arrangement entered in the register
maintained under Section 301 and exceeding the value of Rs.5,00,000 in
respect of any party during the period, we are not in the position to
compare the prices with the prevailing market prices or prices charged
to other parties as there have been no other such purchases or sales of
exact type of goods, materials or sales of services and hence we have
relied on managements representation as to reasonableness of such
prices.
(vi) ACCEPTANCE OF DEPOSITS:
The Company had accepted deposits from the public and in our opinion
and according to the information and explanations given to us, the
directives issued by the Reserve Bank of India and the provisions of
section 58A and 58AA and the relevant provisions of the Companies Act,
1956 and rules framed there under, where applicable, have been complied
with. We are informed that no order has been passed by the Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
court or any other tribunal.
(vii) INTERNAL AUDIT SYSTEM:
In our opinion, the company has adequate internal audit system
commensurate with the size and the nature of its business.
(viii) COST RECORDS:
The Central Government has not prescribed maintenance of cost records
under section 209(1)(d) of the Companies Act, 1956 for any of the
products of the Company.
(ix) STATUTORY DUES:
(a) According to the records of the Company and information and
explanations given to us, the Company is generally regular in
depositing with appropriate authorities undisputed statutory dues
including Provident Fund, Employees State Insurance, Income tax, Sales
tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other
material statutory dues applicable to it.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of Income Tax, Sales Tax, Wealth
Tax, Service Tax, Customs duty, Excise duty and Cess are in arrears, as
on 31st March 2012 for a period of more than six months from the date
they became payable.
(c) According to the information and explanations given to us, there
are no dues of Income Tax, Wealth Tax, Service Tax, Sales Tax, Custom
duty, Excise duty and Cess which have not been deposited on account of
dispute.
(x) ACCUMULATED LOSSES:
The Company has no accumulated losses as at 31st march 2012 and it has
not incurred cash losses in the financial year ended on that date or in
the immediately preceding financial year.
(xi) DUES TO FINANCIAL INSTITUTIONS, BANKS AND DEBENTURE HOLDERS:
According to the information and explanations given to us and based on
the documents and records produced to us, the Company has not defaulted
in the repayment of dues to any Financial Institutions and Banks.
(xii) SECURITY FOR LOANS & ADVANCES GRANTED:
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) SPECIAL STATUTE:
In our opinion and according to the information and explanation given
to us, the nature of activities of the company does not attract any
special statute applicable to chit fund and nidhi/ mutual benefit
fund/societies.
(xiv) DEALINGS/TRADING IN SHSRES, SECURITIES, DEBENTURES AND OTHER
INVESTMENTS:
The Company does not deal or trade in shares, securities, debentures
and other investments.
(xv) GUARANTEES GIVEN:
The Company has given guarantee for loans taken by Managing Directors
from banks aggregating to Rs. 28.55 lacs as on balance sheet date.
According to information and explanations given to us, the terms and
conditions of guarantees given are not prima-facie prejudicial to the
interest of the company.
(xvi) TERM LOANS:
According to information and explanation given to us, term loans
obtained were applied for the purpose for which the loans were
obtained.
(xvii) UTILISATION OF FUNDS:
According to the information and explanations given to us, on an
overall examination of the Balance Sheet and the Cash Flow of the
Company, we report that the company has not utilized funds raised on
short-term basis for long-term investment.
(xviii) PREFERENTIAL ALLOTMENT OF SHARES:
During the year, the Company has not made any preferential allotment of
shares to parties and companies covered in the register maintained
under section 301 of the Companies Act, 1956.
(xix) SECURITY FOR DEBENTURES ISSUED:
The Company has not issued any debentures during the year.
(xx) PUBLIC ISSUE OF EQUITY SHARES:
During the year the Company has not raised any money by way of public
issue.
(xxi) FRAUDS NOTICED:
During the course of our examination of the books and records of the
Company, carried out in accordance with the generally accepted auditing
practices in India, and according to the information and explanations
given to us, we have neither come across any instance of fraud on or by
the Company, noticed or reported during the year, nor have we been
informed of such case by the management.
For B. K. Khare and Co.
Chartered Accountants
Firm Registration No. 105102W
Sunil Bhandari
Place : Mumbai Partner
Dated : May 18, 2012 Membership No. 37388
Mar 31, 2011
1. We have audited the attached Balance Sheet of Tips Industries
Limited as at 31st March 2011 and the Profit and Loss Account and the
Cash Flow Statement of the Company 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 the 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. As required by the Companies (Auditor's Report) Order, 2003, issued
by the Central Government in terms of Section 227(4A) of the Companies
Act, 1956, we give in the Annexure a statement on the matters specified
in paragraphs 4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to in paragraph
(3) 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 purpose of our
audit.
b) In our opinion, proper books of account as required by law have been
kept by the Company so far as it appears from our examination of the
books.
c) The Balance Sheet and the Profit and Loss Account dealt with by this
report are in agreement with the books of account.
d) In our opinion, the Balance Sheet, the Profit and Loss Account and
the Cash Flow Statement 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, 2011, and taken on record by the Board of
Directors, we report that, none of the Directors is disqualified as on
31st March, 2011 from being appointed as a Director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act, 1956.
f) Without qualifying our opinion, we draw attention to note no B-3 of
schedule 21 regarding change in accounting policy in respect of
amortisation of cost of production / acquisition of feature films
wherein we have relied on the Management judgement in respect of
adoption of new accounting policy and assumptions made necessitating
change in the accounting policy of amortization of cost of production /
acquisition of feature films. Due to the change in the said policy,
Cost of feature film charged for the year ended 31st March 2011 is
lower by Rs. 1,79,043 thousand. Further consequent to this change
excess cost amortised in the year ended 31st March 2010 in the amount
of Rs. 75,116 thousand has been written back and has been credited to
the profit and loss account. As a result, Profit / (Loss) after tax for
the year ended is stated higher / (lower) by Rs. 2,54,159 thousand.
g) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read with the notes
thereon give the information required by the Companies Act, 1956, in
the manner so required and, give a true and fair view in conformity
with the accounting principles generally accepted in India:
i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2011,
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.
ANNEXURE TO THE AUDITORS REPORT
Referred to in Paragraph (3) of our report of even date on the accounts
of Tips Industries Limited for the year ended 31st March 2011.
(i) FIXED ASSETS
a) The company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
b) The Company has carried out physical verification of fixed assets in
accordance with the verification programme. According to information
and explanations given to us and in our opinion, discrepancies noticed
on such verification were not material and have been appropriately
dealt with in the books of accounts of the Company.
c) In our opinion, the disposal of fixed assets during the year does
not affect the going concern assumption.
(ii) INVENTORY
a) As explained to us, inventories were physically verified during the
year by the management at reasonable intervals.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were generally reasonable and adequate in
relation to the size of the company and the nature of its business
except that such procedures need to be strengthened/improved for
verification of title-wise stock of finished goods (including returned
goods).
c) In our opinion and according to the information and explanations
given to us, the company has maintained proper records of its
inventories except records of title wise inventory of finished stock.
(iii) LOANS AND ADVANCES GRANTED / TAKEN FROM CERTAIN ENTITIES:
a) 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 Act. Accordingly, paragraphs 4(iii) (b), (c)
and (d) of the Order are not applicable.
b) Company has taken unsecured loan from four parties covered in the
register maintained under section 301 of the Act, aggregating to Rs. 65
lacs. The maximum amount of loan outstanding during the year was Rs.
700 lacs. The rate of interest and other terms and conditions are not
prejudicial to the interest of the Company. The repayment of principle
and interest is regular.
(iv) INTERNAL CONTROL SYSTEM
In our opinion and according to the information and explanations given
to us, there is an internal control system for the purchase of
inventory and fixed assets and for the sale of goods and services.
(v) CONTRACTS OR ARRANGEMENT REFERRED TO IN THIS SECTION 301 OF THE
COMPANIES ACT,1956 :
a) According to the information and explanations given to us, we are of
the opinion that the particulars of contracts or arrangements that need
to be entered in the register maintained under section 301 of the
Companies Act, 1956 have been so entered.
b) In our opinion and according to the information and explanations
given to us, in respect of transactions which have been made in
pursuance of contracts or arrangement entered in the register
maintained under Section 301 and exceeding the value of Rs. 5,00,000 in
respect of any party during the period, we are not in the position to
compare the prices with the prevailing market prices or prices charged
to other parties as there have been no other such purchases or sales of
exact type of goods, materials or sales of services and hence we have
relied on managements representation as to reasonableness of such
prices.
(vi) ACCEPTANCE OF DEPOSITS:
In our opinion and according to information and explanations given to
us, the directives issued by the Reserve Bank of India and the
provisions of sections 58A, 58AA and other relevant provisions of the
Companies Act, 1956 and the rules framed there under, where applicable,
have been complied with. We are informed that no order has been passed
by the Company Law Board or National Company Law Tribunal or Reserve
Bank of India or any court or any other tribunal.
(vii) INTERNAL AUDIT SYSTEM:
In our opinion, the Company has adequate Internal Audit system
commensurate with the size and nature of its business.
(viii) COST RECORDS:
The Central Government has not prescribed maintenance of cost records
under section 209(1)(d) of the Companies Act, 1956 for any of the
products of the Company.
(ix) STATUTORY DUES:
According to the information and explanations given to us, in respect
of statutory and other dues:
a) According to the records of the Company, the company has been
generally regular in depositing undisputed statutory dues including
Provident Fund, Investor Education and Protection Fund, Employees'
State Insurance Fund, Income tax, Sales tax, Wealth tax, Service tax,
Custom duty, Excise duty, cess and any other statutory dues, with
appropriate authorities during the year.
b) According to the information and explanations given to us, no
undisputed amounts payable in respect of Income tax, Sales Tax, Wealth
Tax, Service Tax, Customs duty, Excise duty and Cess were outstanding,
at the year end for a period of more than six months from the date they
became payable.
c) According to the information and explanations given to us, there are
no dues of Income Tax, Sales tax, Service tax, Customs duty, Excise
duty and Cess, which have not been deposited on account of any dispute.
(x) ACCUMULATED LOSSES:-
The Company has no accumulated losses as at 31st March 2011 and it has
not incurred cash losses in the financial year ended on that date or in
the immediately preceding financial year.
(xi) DUES TO FINANCIAL INSTITUTIONS, BANKS AND DEBENTURE HOLDERS:
According to the information and explanations given to us and based on
the documents and records produced to us, the Company has not defaulted
in repayment of dues to any financial institutions or banks or
debenture holders as at the balance sheet date.
(xii) SECURITY FOR LOANS & ADVANCES GRANTED:
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) SPECIAL STATUTE:
In our opinion and according to the information and explanations given
to us, the nature of activities of the Company does not attract any
special statute applicable to chit fund and nidhi/ mutual benefit fund/
societies.
(xiv) DEALINGS/TRADING IN SHARES, SECURITIES , DEBENTURES AND OTHER
INVESTMENTS:
The Company does not deal or trade in shares, securities, debentures
and other investments.
(xv) GUARANTEES GIVEN:
The Company has given guarantee for loan taken by Managing Director
from banks aggregating to Rs. 54.98 lacs as on balance sheet date.
According to information and explanations given to us, the terms and
conditions of guarantees given are not prima facie prejudicial to the
interest of the Company.
(xvi) TERM LOANS:
According to information and explanations given to us, term loans
obtained were applied for the purpose for which the loans were
obtained.
(xvii)UTILISATION OF FUNDS:
According to the information and explanations given to us, on an
overall examination of the Balance Sheet and Cash Flows of the Company,
we report that the Company has not utilized funds raised on short-term
basis for long-term investment.
(xviii)PREFERENTIAL ALLOTMENT OF SHARES:
During the year, the Company has not made any preferential allotment of
shares to parties and companies covered in the register maintained
under section 301 of the Companies Act, 1956.
(xix) SECURITY FOR DEBENTURES ISSUED:
The Company has not issued any debentures during the year and
accordingly, paragraph 4(xix) of the order is not applicable.
(xx) PUBLIC ISSUE OF EQUITY SHARES:
The Company has not raised any money through a public issue during the
year.
(xxi) FRAUDS NOTICED:
During the course of our examination of the books and records of the
Company, carried out in accordance with generally accepted auditing
practices in India, and according to the information and explanations
given to us, we have neither come across any instances of fraud on or
by the Company, noticed or reported during the year, nor have we been
informed of such case by management.
For and on behalf of
B. K. Khare and Co.
Chartered Accountants
Firm Registration No. 105102W
Sunil Bhandari
Place: Mumbai Partner
Date: May 11, 2011 Membership No. 37388
Mar 31, 2010
1. We have audited the attached Balance Sheet of Tips Industries
Limited as at 31st March 2010 and the Profit and Loss Account and the
Cash Flow Statement of the Company 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.
2. 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 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. As required by the Companies (Auditors Report) Order, 2003, issued
by the Central Government in terms of Section 227(4A) of the Companies
Act, 1956, we give in the Annexure a statement on the matters specified
in paragraphs 4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to in paragraph
(3) 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 purpose of our
audit.
b) In our opinion, proper books of account as required by law have been
kept by the Company so far as it appears from our examination of the
books.
c) The Balance Sheet and the Profit and Loss Account dealt with by this
report are in agreement with the books of account.
d) In our opinion, the Balance Sheet, the Profit and Loss Account and
the Cash Flow Statement comply with the Accounting Standards referred
to in sub-section (3C) of section 211 of the Companies Act, 1956,
subject to valuation of finished goods inventory, which is not in
accordance with Accounting Standard 2 - Valuation of Inventories, as
stated in paragraph 4(f) below.
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 is disqualified as on
31st March, 2010 from being appointed as a Director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act, 1956.
f) As stated in Note no. B- 7 of Schedule 21, the entire cost of
copyrights and in-house music production costs are considered for the
purpose of valuation of inventories in the absence of records of
title-wise stock [apportioned cost Rs. 76.08 lacs (Previous year Rs.
70.11 lacs)], the impact of which on the profit and on the finished
goods inventory is not ascertained by the company.
g) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read with the notes
thereon give the information required by the Companies Act, 1956, in
the manner so required and, give a true and fair view in conformity
with the accounting principles generally accepted in India:
i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31s1 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.
ANNEXURE TO THE RUDITORS REPORT Referred to in Paragraph (3) of our
report of even date on the accounts of Tips Industries Limited for the
year ended 31st March 2010.
(i) FIXED ASSETS:
a) The company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
b) The Company has carried out physical verification of fixed assets in
accordance with the verification programme. According to information
and explanations given to us and in our opinion, discrepancies noticed
on such verification were not material and have been appropriately
dealt with in the books of accounts of the Company.
c) In our opinion, the disposal of fixed assets during the year does
not affect the going concern assumption.
(ii) INVENTORY:
a) As explained to us, inventories were physically verified during the
year by the management at reasonable intervals.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were generally reasonable and adequate in
relation to the size of the company and the nature of its business
except that such procedures need to be strengthened/improved for
verification of title-wise stock of finished goods (including returned
goods).
c) In our opinion and according to the information and explanations
given to us, the company has maintained proper records of its
inventories except records of title wise inventory of finished stock.
(iii) LOANS AND ADVANCES GRANTED / TAKEN FROM CERTAIN ENTITIES:
a) 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 Act. Accordingly, paragraphs 4(iii) (b), (c)
and (d) of the Order are not applicable.
b) Company has taken unsecured loan from four parties covered in the
register maintained under section 301 of the Act, aggregating to Rs. 80
lacs. The maximum amount of loan outstanding during the year was Rs.
685 lacs and the balance outstanding at the end of the year is Rs. 650
Lacs. The rate of interest and other terms and conditions are not
prejudicial to the interest of the Company. The repayment of principle
and interest is regular.
(iv) INTERNAL CONTROL SYSTEM:
In our opinion and according to the information and explanations given
to us, there are adequate internal control systems commensurate with
the size of the Company and the nature of its business with regard to
purchases of inventory, fixed asset and with regard to the sale of
goods and services. During the course of our audit, and according to
the information and explanations given to us, we have neither come
across nor have been informed of any continuing failure to correct
major weaknesses in the internal control system.
(v) CONTRACTS OR ARRANGEMENT REFERRED TO IN THIS SECTION 301 OF THE
COMPANIES ACT, 1956:
a) According to the information and explanations given to us, we are of
the opinion that the particulars of contracts or arrangements that need
to be entered in the register maintained under section 301 of the
Companies Act, 1956 have been so entered.
b) In our opinion and according to the information and explanations
given to us, in respect of transactions which have been made in
pursuance of contracts or arrangement entered in the register
maintained under Section 301 and exceeding the value of Rs. 5,00,000 in
respect of any party during the period, we are not in the position to
compare the prices with the prevailing market prices or prices charged
to other parties as there have been no other such purchases or sales of
exact type of goods, materials or sales of services and hence we have
relied on managements representation as to reasonableness of such
prices.
(vi) ACCEPTANCE OF DEPOSITS:
In our opinion and according to information and explanations given to
us, the directives issued by the Reserve Bank of India and the
provisions of sections 58A, 58AA and other relevant provisions of the
Companies Act, 1956 and the rules framed there under, where applicable,
have been complied with. We are informed that no order has been passed
by the Company Law Board or National Company Law Tribunal or Reserve
Bank of India or any court or any other tribunal.
(vii) INTERNAL AUDIT SYSTEM:
In our opinion, the Company has adequate Internal Audit system
commensurate with the size and nature of its business.
(viii) COST RECORDS:
The Central Government has not prescribed maintenance of cost records
under section 209(1 )(d) of the Companies Act, 1956 for any of the
products of the Company.
(ix) STATUTORY DUES:
According to the information and explanations given to us, in respect
of statutory and other dues:
a) According to the records of the Company, the company has been
generally regular in depositing undisputed statutory dues including
Provident Fund, Investor Education and Protection Fund, Employees
State Insurance Fund, Income tax, Sales tax, Wealth tax, Service tax,
Custom duty, Excise duty, cess and any other statutory dues, with
appropriate authorities during the year.
b) According to the information and explanations given to us, no
undisputed amounts payable in respect of Income tax, Sales Tax, Wealth
Tax, Service Tax, Customs duty, Excise duty and Cess were outstanding,
at the year end for a period of more than six months from the date they
became payable.
c) According to the information and explanations given to us, there are
no dues of Income Tax, Sales tax, Service tax, Customs duty, Excise
duty and Cess, which have not been deposited on account of any dispute.
(x) ACCUMULATED LOSSES:
The Company does not have accumulated losses as at 31st March 2010. The
company has not incurred cash losses in the financial year ended on
that date and in the immediately preceding financial year.
(xi) DUES TO FINANCIAL INSTITUTIONS, BANKS AND DEBENTURE HOLDERS:
According to the information and explanations given to us and based on
the documents and records produced to us, the Company has not defaulted
in repayment of dues to any financial institutions or banks or
debenture holders as at the balance sheet date.
(xii) SECURITY FOR LOANS & ADVANCES GRANTED:
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) SPECIAL STATUTE:
In our opinion and according to the information and explanations given
to us, the nature of activities of the Company does not attract any
special statute applicable to chit fund and nidhi/ mutual benefit fund/
societies.
(xiv) DEALINGS/TRADING IN SHARES, SECURITIES, DEBENTURES AND OTHER
INVESTMENTS:
The Company does not deal or trade in shares, securities, debentures
and other investments.
(xv) GUARANTEES GIVEN:
The Company has given guarantee for loan taken by Managing Director
from banks aggregating to Rs. 79.37 lacs as on balance sheet date.
According to information and explanations given to us, the terms and
conditions of guarantees given are not prima facie prejudicial to the
interest of the Company.
(xvi) TERM LOANS:
According to information and explanations given to us, term loans
obtained were applied for the purpose for which the loans were
obtained.
(xvii) UTILISATION OF FUNDS:
According to the information and explanations given to us, on an
overall examination of the Balance Sheet and Cash Flows of the Company,
we report that the Company has not utilized funds raised on short-term
basis for long-term investment.
(xviii) PREFERENTIAL ALLOTMENT OF SHARES:
During the year, the Company has not made any preferential allotment of
shares to parties and companies covered in the register maintained
under section 301 of the Companies Act, 1956.
(xix) SECURITY FOR DEBENTURES ISSUED:
The Company has not issued any debentures during the year and
accordingly, paragraph 4(xix) of the order is not applicable.
(xx) PUBLIC ISSUE OF EQUITY SHARES:
The Company has not raised any money through a public issue during the
year.
(xxi) FRAUDS NOTICED:
During the course of our examination of the books and records of the
Company, carried out in accordance with generally accepted auditing
practices in India, and according to the information and explanations
given to us, we have neither come across any instances of fraud on or
by the Company, noticed or reported during the year, nor have we been
informed of such case by management.
For and on behalf of
B. K. Khare and Co.
Chartered Accountants
Firm Registration No .105120W
Sunil Bhandari
Partner
Membership No. 37388
Place: Mumbai
Date: May 26, 2010
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