Independent Auditors' Report
Anshus Clothing Limited
Report on the Financial Statements:
We have audited the accompanying financial statements of M/s AnshusClothing Limited ("the Company") which comprise the Balance Sheet as atMarch 31 2014 and also the Statement of Profit and Loss and Cash Flow Statement for theyear ended on that annexed thereto and a summary of the significant accounting policiesand other explanatory information.
Managements Responsibility for the Financial Statements:
The Companys Management is responsible for the preparation of these financialstatements that give a true and fair view of the financial position financial performanceand Cash Flow of the Company in accordance with the notified under the Companies Act 1956("the Act") read with the General Circular 15/2013 Dated 13th September 2013 ofthe Ministry of Corporate Affairs in respect of section 133 of the Companies Act 2013.This responsibility includes the design implementation and maintenance of internalcontrol relevant to the preparation and presentation of the financial statements that givea true and fair view and are free from material misstatement whether due to fraud orerror.
Our responsibility is to express an opinion on these financial statements based on ouraudit. We conducted the audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India. Those Standards require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the financial statements are free from material misstatements.
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 control relevant to the Companys preparation and fairpresentation of the financial statements in order to design audit procedures that areappropriate in the circumstances. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made by themanagement as well as 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.
Basis of Qualified Opinion:-
Attention is drawn to:
A) In respect of balances of receivables and payables confirmation and reconciliationis unsecured and doubtful. Impact is uncertain and cannot be commented by us. Forreceivables considered doubtful and no provision has been created in the books ofaccounts.
B) Claims & Discounts payable to the debtors/creditors are subject toconfirmations adjustments and realization are not ascertained.
C) Valuation and verification of inventories is as taken valued and certified by themanagement the impact of any variation on the statement of Profit and Loss and state ofaffairs not being ascertained.
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 subject to the our observations and notes:
(i) In the case of the Balance Sheet of the state of affairs of the Company as atMarch 31 2014; and
(ii) In the case of the Statement of Profit and Loss of the profit of the Company forthe year ended on that date.
(iii) In case of Cash Flow Statement of the Cash Flows of the Company for the yearended on that date
Report on Other Legal and Regulatory Requirements:
1. As required by the Companies (Auditors Report) Order 2003 ("theOrder") issued by the Central Government of India in terms of Section 227(4A) of theAct we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 ofthe Order.
2. As required by Section 227(3) of the Act we report that:
a. Except as stated in under the head " Basis of Qualified Report" We haveobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purpose of our audit;
b. In our opinion proper books of accounts as required by law have been kept by theCompany so far as it appears from our examination of those books.
c. The Balance Sheet and the Statement of Profit and Loss Account and the Cash FlowStatement dealt with by this Report are in agreement with the books of account.
d. In our opinion the Balance Sheet and the Statement of Profit and Loss Account andthe Cash Flow Statement comply with the notified under the Act read with the GeneralCircular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs inrespect of section 133of the Companies Act 2013. e. On the basis of the writtenrepresentations received from the directors as on March 31
2014 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2014 from being appointed as a director in terms of Section 274(1) (g) ofthe Act.
|FOR JSKG & CO. || |
|CHARTERED ACCOUNTANTS || |
|Sachin Kansal || |
|Partner || |
|M. No:-137191 ||Date: 27-08-2014 |
|Firm Reg No:- 138035W ||Place: Ahmedabad |
ANNEXURE TO THE AUDITORS' REPORT
Referred to in Paragraph 1 under the heading of "report on other legal andregulatory requirements" of our report of even date
1. In respect of the Companys fixed assets:
a) The Company has maintained records of fixed assets in the books of accounts.
b) Physical verification of fixed assets not carried out and their realizable valueis not ascertainable. As explained to us all the fixed assets have been physicallyverified by the management during the year in a phased periodical manner which in ouropinion is reasonable having regard to the size of the Company and nature of its fixedassets.
c) In our opinion the Company has not disposed of substantial part of its fixed assetsduring the year and the going concern status of the Company is not affected.
2. In respect of the Companys inventories:
a) Realizable value of inventories not ascertained in view of no physical verificationof inventories and same is accepted as per the management declaration and thereforeshortfall/excess realization will affect the financial results. As explained to usinventories have been physically verified by the management at regular intervals duringthe year.
b) In our opinion and according to the information and explanations given to us theprocedures of physical verification of inventories followed by the management arereasonable and adequate in relation to the size of the Company and the nature of itsbusiness.
c) The Company has maintained proper records of inventories. As explained to us thediscrepancies noticed on physical verification of inventories as compared to the bookrecords were not material and have been properly dealt with in the books of account.
3. In respect of the loans secured or unsecured granted or taken by theCompany to / from companies firms or other parties covered in the register maintainedunder Section 301 of the Companies Act 1956:
(a) As explained the company has taken interest free unsecured loan from one partycovered in the register maintained under Section 301 of the Act. The maximum amountinvolved during the year and the year-end balance of such loans aggregates to Rs. 18.22Lacs & Rs. 18.22 lacs respectively.
(b) The company has also given the interest free loan to one party covered in theregister maintained under section 301 of the Act. The maximum amount involved during theyear and the year-end balance of such loans aggregates to Rs. 69.33 Lacs & Rs. 8.82lacs respectively.
(c) The Company has given interest free loans in the nature of loan to one partycovered in the register maintained under section 301 of the Act.
(d) In our opinion the rate of interest and other terms and conditions on which loanshave been granted to companies firms or other parties listed in the registers maintainedunder Section 301 are not prima facie prejudicial to the interest of the company.
4. In our opinion and according to the information and explanations given to us thereare generally adequate internal control systems commensurate with the size of the Companyand the nature of its business for the purchase of inventory fixed assets and also forthe sale of goods and services during the course of our audit. In our opinion andaccording to the information and explanations given to us there is no continuing failureto correct major weakness in internal control system.
5. In respect of the contracts or arrangements referred to in Section 301 of theCompanies Act 1956:
a) In our opinion and according to the information and explanations given to us thetransactions made in pursuance of contracts or arrangements that needed to be enteredinto in the register maintained under Section 301 of the Companies Act 1956 have been soentered.
b) In our opinion and according to the information and explanations given to us thetransactions made in pursuance of contracts or arrangements entered in the registermaintained u/s. 301 of the Companies Act 1956 in respect of any party during the yearhave been made at prices which are reasonable having regard to prevailing market prices atthe relevant time.
6. According to information and explanations given to us the Company has not invitedor accepted any public deposit hence the provisions of section 58A 58AA and any otherrelevant provision of the Companies Act 1956 and the rules framed there-under are notapplicable to the Company and no order under the aforesaid section have been passed by theCompany Law Board or National Company Law Tribunal or Reserve Bank of India or any courtor any tribunal on the Company.
7. The Company does not have formal internal audit system but there are adequate checksand controls at all levels. The management has informed us that the steps are being takento introduce internal audit system commensurate with the size and nature of its business.
8. According to the information and explanations provided by the Company the CentralGovernment has not prescribed maintenance of cost records under clause (d) of sub-section(1) of Section 209 of the Act. Accordingly clause 4(viii) of the Order is not applicableto the Company.
9. In respect of statutory dues:
a) According to the records of the Company the company is not regular in depositingamount payable on account of undisputed statutory dues including provident fund salestax wealth tax service tax TDS payable and other material statutory dues withappropriate authorities wherever applicable to it subject to the details herein below.
b) According to information and explanations given to us the company has not depositedamount of undisputed statutory dues related to VAT amounting Rs. 9.32 lacs which is morethan six months.
c) We have not examined outstanding of other statutory dues. The Company does not haveaccumulated losses at the end of the financial year.
10. The company has not incurred any cash losses during the financial year 2013-14according to accounts but the same be read with notes related to Profit and Loss Accountcovered by the audit and in the immediately preceding financial year as per auditedaccounts.
11. Based on our audit procedures and according to the information and explanationgiven to us we are of the opinion that the Company has defaulted in the repayment of loanand interest on loan to the financial institutions and banks. The company does not haveprovisions of interest payable to bank/NBFC amounting to Rs. 80.92 lacs in view ofdefault.
12. According to information and explanations given to us and based on the documentsand records produced before us the Company has not granted loans and advances on thebasis of security by way of pledge of shares debentures and other securities. Thereforethe provisions of clause 4(xii) of the Order are not applicable to the Company.
13. In our opinion the Company is not a chit fund or a nidhi /mutual benefitfund/society. Therefore the provisions of clause (xiii) of paragraph 4 of the Companies(Auditors Report) Order 2003 are not applicable to the Company.
14. In our opinion the Company is not dealing in or trading in shares securitiesDebentures and other investments. Accordingly the provisions of Clause (xiv) of paragraph4 of the Companies (Auditors Report) Order 2003 are not applicable to the Company.However as and when the Company deals in shares and securities proper entries are madein records maintained for the purpose.
15. According to the information and explanations given to us the Company has notgiven any guarantee for loans taken by others from banks or financial institutions.
16. In our opinion and according to the information and explanation given to us theCompany had not raised any term loan and therefore the provisions of Clause (xvi) of thePara 4 of the Companies Auditors Report) Order 2003 are not applicable to theCompany.
17. According to the information and explanations given to us and on an overallexamination of the Balance Sheet of the Company prima facie we report that no fundsraised on short term basis have been used for long term investment or vice versa.
18. During the year the Company has not made any preferential allotment of shares toparties and companies covered in the Register maintained under Section 301 of theCompanies Act 1956.
19. The Company has not issued any debentures and therefore the question of creatingsecurity & charge in respect thereof does not arise.
20. The Company has not raised money by public issues during the year.
21. In our opinion and according to the information and explanations given to us nofraud on or by the Company has been noticed or reported during the year
|FOR JSKG & CO. || |
|CHARTERED ACCOUNTANTS || |
|Sachin Kansal || |
|Partner || |
|M. No:-137191 ||Date: 27.08.2014 |
|Firm Reg No: - 138035W ||Place: Ahmedabad |