To the Members of
Amal Ltd Report on the Financial Statements
We have audited the accompanying financial Statements of Amal Ltd (Company) whichcomprise the Balance Sheet as at March 31 2015 the Statement of Profit and Loss theCash flow Statement for the year then ended and a summary of significant accountingpolicies and other explanatory information.
Managements responsibility for the Financial Statements
The Companys Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 (Act) with respect to the preparation of the financialStatements that give a true and fair view of the financial position financial performanceand cash flows of the Company in accordance with the accounting principles generallyaccepted in India including the Accounting Standards specified under Section 133 of theAct read with Rule 7 of the Companies (Accounts) Rules 2014. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal financial controls and ensuring theiroperating effectiveness and the accuracy and completeness of the accounting recordsrelevant to the preparation and presentation of the financial Statements that give a trueand fair view and are free from material misstatement whether due to fraud or error.
Our responsibility is to express an opinion on the financial Statements based on ouraudit. 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 anddisclosures 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 accounting policies used and thereasonableness of the accounting estimates made by the Companys Directors as wellas evaluating the overall presentation of the financial Statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the financial Statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial Statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31stMarch 2015 its loss and its cash flows for the year ended on that date.
Emphasis of matter
We draw attention to Note 31 to the financial Statements of the Company wherein theBoard of Directors of the Company has approved the proposed merger of the Company withAtul Ltd and is in the process of submitting the Modified Draft Rehabilitation Scheme(MDRS) (Merger Scheme) to the Board for Industrial and financial Reconstruction (BIfR)through IDBI Bank Ltd (Operating Agency) for obtaining their approval. Under the proposedscheme the entire undertaking of Amal Ltd together with all assets and liabilities willbe transferred to Atul Ltd. In view of above books of account have been prepared on agoing concern basis.
Our opinion is not modified in respect of this matter.
Report on other legal and regulatory requirements
1. As required by the Companies (Auditors Report) Order 2015 (the Order) issuedby the Central Government of India in terms of subsection (11) of Section 143 of the Actwe give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of theOrder to the extent applicable.
2. As required by Section 143(3) of the Act we report that:
a) We have sought and obtained all the information and explanations which to the 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 financial Statements comply with the AccountingStandards specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014;
e) On the basis of written representations received from the Directors as on March 312015 and taken on record by the Board of Directors none of the Directors is disqualifiedas 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 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 to us:
i) The Company has disclosed the impact of pending litigations on its financialposition in the financial Statements Refer Note 22 on Contingent Liabilities;
ii) The Company did not have any long-term contracts including derivative contracts;hence the question of any material foreseeable losses does not arise;
iii) There were no amounts which were required to be transferred to the InvestorEducation and Protection fund by the Company.
for Haribhakti & Co. LLP
firm Registration number 103523W
| ||Bhavik L. Shah |
|Mumbai ||Partner |
|April 24 2015 ||Membership Number 122071 |
Annexure to Independent Auditors Report
Referred to in paragraph 1 under Report on Other Legal and RegulatoryRequirements in the Independent Auditors Report of even date to the members ofAmal Ltd on the financial Statements for the year ended 31-03-2015
i) a) The Company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets.
b) During the year certain fixed assets have been physically verified by themanagement and there is a regular programme of verification which in our opinion isreasonable having regard to the size of the Company and the nature of its assets. Asinformed no material discrepancies were noticed on such verification.
ii) a) The inventory has been physically verified by the management during the year. Inour opinion the frequency of verification is reasonable.
b) The procedures of physical verification of inventory followed by the management arereasonable and adequate in relation to the size of the Company and the nature of itsbusiness.
c) The Company is maintaining proper records of inventory. As informed no materialdiscrepancies were noticed on physical verification carried out during the year.
iii) As informed the Company has not granted any loans secured or unsecured tocompanies firms or other parties covered in the register maintained under Section 189 ofthe Act. Accordingly the provisions stated in paragraph 3 (iii)(a) and 3 (iii)(b) of theOrder are not applicable.
iv) In our opinion and according to the information and explanations given to us thereexists 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. During the course of our audit we have not observed any continuingfailure to correct any major weaknesses in aforesaid internal control system of theCompany.
v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public within the provisions of Sections 73to 76 of the Act and the rules framed there under.
vi) We have broadly reviewed the books of account maintained by the Company in respectof products where the maintenance of cost records has been specified by the CentralGovernment under sub-section (1) of Section 148 of the Act and the rules framed thereunder and we are of the opinion that prima facie the prescribed accounts and records havebeen made and maintained. We have not however made a detailed examination of recordswith a view to determine whether they are accurate or complete.
vii) a) The Company is generally regular in depositing with appropriate authoritiesundisputed statutory dues including provident fund employees state insuranceincome tax sales tax wealth tax service tax value added tax customs duty exciseduty cess and any other material statutory dues applicable to it.
b) According to the information and explanation given to us the dues outstanding withrespect to income tax sales tax wealth tax service tax value added tax customs dutyexcise duty or cess as applicable to it on account of any dispute are as follows:
|Name of the statute ||Nature of dues ||Amount Rs. in 000 ||Period to which the amount relates ||Forum where dispute is pending |
|The Gujarat Sales Tax Act 1969 ||Sales Tax (including interest and penalty) ||5247 ||2001-02 to 2003- 04 ||Joint Commissioner Surat |
|CST Act 1956 ||Sales Tax (including interest and penalty) ||381* ||2003-04 ||Gujarat VAT Tribunal Ahmedabad |
*Out of the above Rs. 50000/- has been paid under protest by the Company towardsdues.
c) According to the information and explanations given to us there were no amountswhich were required to be transferred to the Investor Education and Protection fund by theCompany.
viii) The accumulated losses of the Company are more than fifty percent of its networth. further the Company has incurred cash losses during the financial year covered byour audit but not in the immediately preceding financial year.
ix) According to the information and explanations given to us the Company has notdefaulted in repayment of dues to financial institution bank or debenture holder.
x) According to the information and explanations given to us the Company has not givenany guarantee for loans taken by others from banks or financial institutions.
xi) The Company has not obtained any term loans.
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 fraud on or by the Company noticed or reported during the year nor have webeen informed of any such instance by the management.
| ||for Haribhakti & Co. LLP |
| ||firm Registration number 103523W |
| ||Chartered Accountants |
| ||Bhavik L Shah |
|Mumbai ||Partner |
|April 24 2015 ||Membership Number 122071 |