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Ashima Ltd.

BSE: 514286 Sector: Industrials
NSE: ASHIMASYN ISIN Code: INE440A01010
BSE LIVE 15:49 | 02 Dec 14.80 0.05
(0.34%)
OPEN

14.90

HIGH

15.60

LOW

14.60

NSE LIVE 15:52 | 02 Dec 14.80 -0.05
(-0.34%)
OPEN

14.70

HIGH

15.60

LOW

14.25

OPEN 14.90
PREVIOUS CLOSE 14.75
VOLUME 59123
52-Week high 21.85
52-Week low 9.45
P/E
Mkt Cap.(Rs cr) 190.11
Buy Price 14.80
Buy Qty 736.00
Sell Price 0.00
Sell Qty 0.00
OPEN 14.90
CLOSE 14.75
VOLUME 59123
52-Week high 21.85
52-Week low 9.45
P/E
Mkt Cap.(Rs cr) 190.11
Buy Price 14.80
Buy Qty 736.00
Sell Price 0.00
Sell Qty 0.00

Ashima Ltd. (ASHIMASYN) - Auditors Report

Company auditors report

To

The Members of

Ashima Limited

Report on the Financial Statements

1. We have audited the accompanying financial statements of Ashima Ltd. (‘theCompany') which comprise the Balance Sheet as at 31st March 2016 the Statement of Profitand Loss and the Cash Flow Statement for the year then ended and a summary of significantaccounting policies and other explanatory information.

Management's responsibility for the Financial statements

2. The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparationand presentation of these financial statements that give a true and fair view of thefinancial position financial performance and cash flows of the Company in accordance withthe accounting 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.

Auditor's Responsibility

3. Our responsibility is to express an opinion on these financial statements based onour audit.

4. 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 there under.

5. 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.

6. An audit involves performing procedures to obtain audit evidence about the amountsand the disclosures in the financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances but not for the purpose of expressing anopinion on whether the Company has in place an adequate internal financial controls systemover financial reporting and the operating effectiveness of such controls. An audit alsoincludes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the financial statements.

7. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the financial statements.

Opinion

8. 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 2016 and its loss and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

9. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the Annexure A a statement on the matters specifiedin paragraphs 3 and 4 of Order.

10. 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 31st March2016 and taken on record by the Board of Directors none of the directors is disqualifiedas on 31st March 2016 from being appointed as a director in terms of Section 164(2) ofthe Act;

f. With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in "Annexure B"; and

g. With respect to the other matters to be included in the Auditor's 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 as at March 312016 onits financial position in its financial statements - Refer Note 27 and 28 of the financialstatements.

ii. The company has made provisions as at March 31 2016 as required under theapplicable law or accounting standards for material foreseeable losses if any on longterm contracts including derivative contracts.

iii. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company during the year ended March 312016.

For Dhirubhai Shah & Doshi
Chartered Accountants
FRN No: 102511W
Kaushik D. Shah
Partner
Membership Number: 016502
Place: Ahmedabad
Date: 14/05/2016

ANNEXURE - A TO THE AUDITOR'S REPORT

Referred to in Paragraph 9 of the Independent Auditors' Report of the even date to themembers of Ashima Limited on the financial statements for the year ended 31 March 2016 wereport that:

(i) (a) The company has maintained 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 at reasonable intervals. In our opinion the program of verification isreasonable having regard to the size of the company and the nature of its assets. We havebeen informed that no material discrepancies were noticed on such verification.

(c) According to the information and explanations provided to us and on the basis ofour examination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.

(ii) As explained to us the inventories have been physically verified during the yearby the management except inventories lying with third parties (other than stock lying withAshima Dyecot Pvt. Ltd.) which have been confirmed and stock in transit which have beensubsequently received. In our opinion the frequency of verification is reasonable.Discrepancies noticed on physical verification of inventory as compared to book recordswere not material and the same have been properly dealt with in books of account.

(iii) According to information and explanations provided to us the Company has notgranted any loans secured or unsecured to companies firms or other parties covered in theregister maintained under section 189 of the Companies Act and therefore the provisionsof clauses (iii)(a) (iii)(b) & (iii)(c) of the Order are not applicable to theCompany.

(iv) In our opinion and according to the information and explanations provided to usthe Company has not granted any loan provided any guarantee or made any investment as perSection 185 and 186 of Companies Act 2013 hence this clause is not applicable.

(v) According to the information and explanations provided to us the Company has notaccepted any deposits from the public under section 73 to 76 or any other relevantprovisions of the Companies Act 2013 and rules framed thereunder where applicable. Noorder has been passed by Company Law Board or National Company Law Tribunal or ReserveBank of India or any court or any other tribunal.

(vi) According to the information and explanations provided to us the Company hasmaintained proper cost records as prescribed by Central Government under sub-section (1)of section 148 of the Companies Act 2013. We have broadly reviewed the accounts andrecord of the Company in this connection and are of the opinion that prima facie theprescribed accounts and records have been maintained. However we have not made a detailedexamination of the same.

(vii) (a) According to the information and explanations provided to us the company isgenerally regular in depositing with appropriate authorities undisputed statutory duesincluding provident fund employee's state insurance income tax sales tax wealth taxduty of custom service tax duty of excise value added tax cess and other materialstatutory dues applicable to it. According to the information and explanations given tous no undisputed amounts payable in respect of provident fund employee's stateinsurance income tax sales tax wealth tax duty of custom service tax duty of excisevalue added tax cess and other material statutory dues applicable to it were in arrears asat 31st March 2016 for a period of more than six months from the date they becamepayable.

(b) According to the information and explanations provided to us the details ofdisputed statutory dues which are disputed are as follows:

Nature of Statute Nature of Dues Amount (Rs. in Lacs) Period to which the amount relates Forum where dispute is pending
1 Foreign Trade (Dev.& Regu. Act) 1992 Custom Duty and Interest 63.78 1997 Gujarat High Court
2 The Income Tax Act 1961 Income tax 41.04 A.Y 1994-95 Gujarat High Court
3 The Income Tax Act 1961 Income tax 676.66 A.Y 1996-97 Assessment Officer (matter remanded by ITAT)
4 The Income Tax Act 1961 Income tax 0.87 A.Y 2001-02 Assessment Officer
5 Gujarat Sales Tax Act 1969 Sales Tax 1906.01 F.Y 1999-2000 and 2000-2001 Joint Commissioner (Appeals) of Commercial Tax
6 Gujarat Value Added Tax Act 2003 VAT 30.45 F.Y 2007-08 VAT Tribunal
7 Gujarat Value Added Tax Act 2003 VAT 7.38 F.Y 2008-09 VAT Tribunal
8 Gujarat Value Added Tax Act 2003 VAT 1.34 F.Y 2011-12 Commissioner (Appeals) of Commercial Tax
9 Employees' State Insurance Act 1948 ESI Contribution 81.20 Part of FY 199495 to FY 1996-97 ESI Court

(viii) As per scheme of arrangement u/s 391 of the Companies Act 1956 examined by usand information and explanations provided in Note No.44 of notes to financial statementsthe Company has not defaulted in repayment of dues to financial institutions banks ordebenture holders during the year.

An amount of Rs. 750 lacs in suspense account remains unsettled. Refer Note 40 of notesto financial statements.

(ix) According to information and explanation provided to us the Company has made aRights Issue of equity shares for Rs.8008.51 Lacs for part-financing debt settlement underScheme of Arrangement. The process of allotment refund and credit of allotment money tothe company has been completed after the end of reporting period as the same was delayeddue to court cases. Of the total issued amount the company has already applied Rs.6217.73lacs towards payment to secured creditors against the amounts due for debt settlementunder Scheme of Arrangement.

(x) According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.

(xi) According to the information and explanations provided to us and based on ourexamination of the records of the Company the Company has paid managerial remuneration toits Chairman and Managing Director as permissible as per provisions of the Section 197read with the Schedule V of the Companies Act 2013.

(xii) In our opinion and according to the information and explanations provided to usthe Company is not a nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable.

(xiii) According to the information and explanations provided to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards and Companies Act 2013.

(xiv) According to the information and explanations provided to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. As provided in the Scheme of Arrangement the Company has issued 150 lac equityshares at par to one secured lender by converting debt of Rs. 1500 lacs after the date ofBalance Sheet.

(xv) According to the information and explanations provided to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

(xvi) According to the information and explanations provided to us the Company is notrequired to be registered under section 45-IA of the Reserve Bank of India Act 1934.

For Dhirubhai Shah & Doshi
Chartered Accountants
FRN No: 102511W
Kaushik D. Shah
Partner
Membership Number: 016502
Place: Ahmedabad
Date: 14/05/2016

ANNEXURE - B TO THE AUDITOR'S REPORT

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

1. We have audited the internal financial controls over financial reporting of AshimaLimited ("the Company") as of 31st March 2016 in conjunction with our audit ofthe financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

2. The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India (‘ICAI'). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.

Auditors' Responsibility

3. Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

5. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

6. A company's internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

7. Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

8. In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31 March 2016 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For Dhirubhai Shah & Doshi
Chartered Accountants
Firm's Registration Number: 102511W
Kaushik D. shah
Place: Ahmedabad Partner
Date: 14/05/2016 Membership Number: 016502

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