The Members Of
20 Microns Limited
Report on the Standalone Financial Statements We have audited the accompanyingstandalone financial statements of 20 MICRONS LIMITED ("the Company")which comprise the Balance Sheet as at 31st March 2015 the Statement of Profit and Lossthe Cash Flow Statement for the year then ended on that date and a summary of thesignificant accounting policies and other explanatory information.
Managements Responsibility for the Standalone Financial Statements
The Companys Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
Our responsibility is to express an opinion on these standalone financial statementsbased on our audit.
We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditors judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal financial control relevant to the Companyspreparation of the financial statements that give a true and fair view in order to designaudit procedures that are appropriate in the circumstances but not for the purpose ofexpressing an opinion on whether the Company has in place an adequate internal financialcontrols system over financial reporting and the operating effectiveness of such controls.An audit also includes evaluating the appropriateness of the accounting policies used andthe reasonableness of the accounting estimates made by the Companys Directors aswell as evaluating the overall presentation of the financial statements. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the standalone financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at 31st March 2015 and its profit and its cash flows for the year ended on that date.
Emphasis of Matter
We draw attention to:
a) Note 4(e) to the financial statements regarding restructuring/re-schedulement ofloans by lenders.
b) Note 42 to the financial statements regarding action taken by the company forrepayment of deposits accepted prior to commencement of the Act and its classification into Current and Non-Current Category for the reasons stated in the said note.
Our Opinion is not modified in respect of above matters.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order 2015 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the Annexure a statement on the matters specified inparagraphs 3 and 4 of the Order.
2. As required by Section 143 (3) of the Act we report that:
(a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.
(b) In our opinion proper books of account as required by law have been kept by theCompany 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 Statementdealt with by this Report are in agreement with the books of account.
(d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.
(e) On the basis of the written representations received from the directors as on 31stMarch 2015 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2015 from being appointed as a director in terms of Section164 (2) of the Act.
(f) With respect to the other matters to be included in the Auditors Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given tous :
(i) The Company has disclosed the impact of pending litigations on its financialposition in its financial statements Refer Note 28 to the financial statements;
(ii) The Company did not have any long-term contracts including derivative contractsfor which there were any material foreseeable losses;
(iii) There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
For Manubhai & Shah
Firm Registration No. 106041W
(G. R. Parmar)
Place : Ahmedabad
Date : May 27 2015
ANNEXURE TO INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 1 under "Report on Other Legal and RegulatoryRequirements" section of our report on Standalone Financial Statement of 20 MicronsLimited of even date) (i)
(a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) As explained to us the fixed assets have been physically verified by themanagement as per phased programme of verification designed to cover all the fixed assetson rotation basis which in our opinion is reasonable having regard to the size of theCompany and nature of its assets. As informed to us no material discrepancies werenoticed on such physical verification as compared to the records maintained by theCompany.
(ii) (a) As explained to us inventories have been physically verified by themanagement at regular intervals during the year. In our opinion the frequency ofverification is reasonable.
(b) In our opinion the procedures of physical verification of inventory followed bythe Management are reasonable and adequate in relation to the size of the Company and thenature of its business.
(c) On the basis of our examination of the inventory records in our opinion theCompany is maintaining proper records of inventory. The discrepancies noticed onverification between physical stocks and book records were not material.
(iii) The Company has not granted any loans secured or unsecured to companies firmsor other parties covered in the register maintained under Section 189 of the Act.Therefore the provisions of Clause
3 (iii) [(a) and (b)] of the said Order are not applicable to the Company.
(iv) In our opinion and according to the information and explanations given to usthere is an adequate internal control system commensurate with the size of the Company andthe nature of its business for the purchase of inventory and fixed assets and for the saleof goods and services. Further on the basis of our examination of the books and recordsof the Company and according to the information and explanations given to us we haveneither come across nor have been informed of any continuing failure to correct majorweaknesses in the aforesaid internal control system.
(v) In respect of deposits accepted prior to commencement of the act i.e. 01.04.2014as per Section 74(1) of the Act the Company is required to make repayment of depositaccepted prior to 31.03.2014 within a period of one year from 01.04.2014 or the date onwhich deposit becomes due for payment whichever is earlier. The Company has repaid thedeposits which have matured during the year 2014-15. However in respect of depositsmaturing after 31.03.2015 the Company has made an application dated March 29 2015 underSection 74 (2) of the Companies Act 2013 before the Company Law Board Western RegionBench Mumbai to allow the Company to re-pay the deposits up to and inclusive of the timeas agreed with the fixed deposit holders. In respect of deposits accepted aftercommencement of the Act i.e. 01.04.2014 from members the Company has complied withprovisions of Section 73 of Companies Act 2013. According to the information andexplanations given to us no order has been passed by the Company Law Board or theNational Company Law Tribunal or the Reserve Bank of India or any Court or any otherTribunal.
(vi) We have broadly reviewed the books of account maintained by the Company in respectof mineral products where pursuant to the rules made by the Central Government of Indiathe maintenance of cost records has been prescribed under subsection (1) of Section 148 ofthe Act and are of the opinion that prima facie the prescribed accounts and recordshave been made and maintained. We have not however made a detailed examination of therecords with a view to determine whether they are accurate or complete.
(vii) (a) According to the information and explanations given to us and the records ofthe Company examined by us in our opinion the Company is regular in depositing theundisputed statutory dues including provident fund employees state insuranceincome tax sales tax wealth tax service tax duty of customs duty of excise valueadded tax cess and other material statutory dues as applicable with appropriateauthorities except Income Tax Deducted at source Sales Tax Service Tax Provident Fundand ESIC where there was some delay on few occasions at some of the offices of thecompany.
According to the information and explanations given to us and the records of theCompany examined by us in our opinion no undisputed amounts payable as applicable werein arrears as at March 31 2015 for a period of more than six months from the date theybecame payable.
(b) According to the information and explanations given to us and the records of theCompany examined by us the details of disputed statutory dues that have not beendeposited on account of dispute are as under.
|Name of Statute ||Nature of dues ||Amount (In Lacs Rs) ||Period to which the amount relates ||Forum where dispute is pending |
|1. Central Excise Act 1944 ||Excise Duty ||749.67 ||Financial Year 07.02.2000 to 31.07.2003 ||Supreme Court |
|2. Central Excise Act 1944 ||Excise Duty ||2.00 ||Financial Year 1999-2000 ||Customs Excise and Service Tax Appellate Tribunal |
|3. Central Excise Act 1944 ||Custom Duty ||1.50 ||Financial Year 2006-2007 ||Customs Excise and Service Tax Appellate Tribunal |
|4. Income Tax Act 1961 ||Income tax ||5.96 ||Assessment Year 2009-2010 ||Commissioner of Income Tax |
|5. Income Tax Act 1961 ||Income tax ||32.76 ||Assessment Year 2011-2012 ||Commissioner of Income Tax |
|6. Central Sales Tax 1956 ||Central Sales Tax ||9.43 ||Financial Year 2008-2009 ||Commissioner of Commercial Taxes Appeals |
(c) The Company is not required to transfer any amount to Investor Education andProtection Fund in accordance with the provisions of the Companies Act 1956 and rulesmade thereunder.
(viii) The Company has no accumulated losses as at the end of the year ended March 312015 and it has not incurred any cash losses in the year ended on that date or in theimmediately preceding year ended on March 31 2014.
(ix) In our opinion and according to the information and explanations given to usduring the year there have been defaults in repayment of instalments and Interest on TermLoans from the Banks. However in this regards Company had made an application forre-schedulement which was approved by the banks by way of Restructuring Package asmentioned in Note no. 4(e) to the Financial Statements. As per the terms of restructuringpackage the repayment of dues will commence from April 2016. Hence at the year-end therewas no default in terms of restructuring package.
(x) According to the information and explanations given to us the Company has givenguarantee of Rs1225 Lacs for loans taken by Subsidiary Company. The terms of suchguarantee are not prejudicial to the interest of the Company.
(xi) The Term Loans were applied for the purpose for which the loans were obtained.
(xii) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud on or by the Company noticed or reported during the periodnor have we been informed of any such case by the Management.
For Manubhai & Shah
Firm Registration No. 106041W
(G. R. Parmar)
Place : Ahmedabad
Date : May 27 2015