To the Members of Ceenlk Exports (India) Limited.
Report on the Financial Statements
1. We have audited the accompanying Financial Statements of CEENIK EXPORTS(INDIA) UMITED. ("the Company") which comprise the Balance Sheet as at31" March 2017 the Statement of Profit and Loss and Cash Flow Statement for the yearthen ended and a summary of significant accounting policies and other explanatoryInformation.
Management's Responsibility for the Financial Statements
2. The management and Board of Directors of the Company are responsible tor the mattersstated In Section 134(5) of the Companies Act 2013 (the act1) with respect tothe preparation and presentation of these financial statements that give a true and fairview of the financial position financial performance and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theAccounting Standard specified under Section 133 of the Act read with rule 7 of theCompanies (Accounts) Rules 2014. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design; implementation andmaintenance of adequate internal financial controls that are operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.
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 the 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 procedure to obtain audit evidence about the amountsand 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 control systemover financial reporting and the operating effectiveness of such controls. An audit alsoIncludes evaluating the appropriateness of accounting policies used and the reasonablenessof the accounting estimates made by the Company's management and Board of Directors aswell as evaluating 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.
8. In ouropinion 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 2G17 its Loss and its Cash Flows forthe 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 the Section 143of the Act we give in t he An nexure - A a statement on the matters specified inparagraphs 3 and 4 of the Order.
10. As required by Section 143(3) of the Act we further 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 purpose of our audit;
b. in our opinion proper books of account as required by law have been kept by th8Company so far as appears from our examinations of those books;
c. the Balance Sheet Statement of Profit and Loss and Cash Flow statement dealt withby this Report are In agreement with the books of accounts;
d. In our opinion the aforesaid financial statements comply with the applicableAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014;
e. on the basis of written representations received from the directors as on March312017 and taken on record by the Board of Directors none of the directors isdisqualified as on March 31 2017 from being appointed as a director in terms of Section164(2) of the 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*;end
g. in ouropinion and to the best of our information and according to the explanationsgiven to us we report as under with respect to other matters to be Included In theAuditor's Report In accordance with Rule 11 of the Companies (Audltand Auditors) Rules2014:
I. The Company has disclosed the impact of pending litigation on its financial positionin the financial statement.
II. The Company did not have any long-term contracts including derivative contracts; assuch the questions of com mentlng on any material foreseeable losses thereon does notarise
III. There has not been an occasion In case of the Company during the year under reportto transfer any sums to the Investor Education and Protection Fund. The question of delayin transferring such sumsdoes notarise.
IB. The Company has provided requisite disclosures In Its financial statements as toholding as well as dealings in Specified Bank Notes during the period 8th November 2016to 30th December 2016 and these are in accordance with the books of accounts maintainedby the Company.
For Udayavar Dhanesh Kumar & Associates
Chartered Accountants Firm Registration No: 119401W
Dhanesh Kumar Udayavar
Place: Mumbai Proprietor
Membership No. 102031
Annexure -A referred to In paragraph 9 of Our Report of even date to the members ofCEENIK EXPORTS
(INDIA) Limited on the accounts of the company for the year ended 31st March 2017.
On the basic of such checks as we considered appropriate and according to theinformation and explanations given to us during the course of our audit we report that
i.(a) The Company has maintained proper records showing full particulars includingquantitative details and situations of fixed assets;
(b) As explained to us fixed assets have been physically verified by the managementduring the year 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 assets. As informedto us no material discrepancies were notices on such verification.
(c) According to the Information and explanations given to us and on the basis of ourexamination of the records of the company the title deeds of immovable properties areheld in the name of the Company.
ii.(a) As explained to us the Inventory has been physically verified by the managementduring the year. According to the information and explanations given to us we are of theopinion the frequency of verification Is reasonable.
(b) In our opinion and according to the information and explanations given to us theprocedures of physical verification of the inventories followed by the company arereasonable and adequate having regard to size of the company and nature of business.
c) The Company has maintained records of inventories. As explained to us andexplanation g iven to us no material discrepancies are noticed on verification betweenthe physical stocks and the book records. However the company needs to improve methods ofmai ntai n records of inventories of raw materials sent for processing stitching washingand other processes.
III .The company has not granted any loans secured or unsecured to/from companiesfirms or other parties covered in the register maintained under Section 189 of the Act.
iv. In our opinion and according to the information and explanations given to us thecompany has complied with the provisions of section 185 and 186 of the Act with respectto loans and Investments made.
v. The Company has not accepted any deposits from the public covered under Section 73to 76 of the Companies Act 2013.
vi. As informed to us the Central Government has not prescribed maintenance of costrecords undersub- section (1) of Section 148 of the Act.
vii.(a) According to the Information and explanations given to us and on the basis ofour examination of the records of the company the company is regular in depositing withappropriate authorities the und isputed statutory dues including Provident Fund InvestorEducation Protection Fund Employees'State Insurance
Income-tax Sales-tax Service Tax Custom Duty Cess and other material statutorydues as applicable with the appropriate authorities in India; except Sales Tax/VAT whichis due since April 2016 to March 2017 According to the Information and explanation givento us no undisputed amounts payable In respect of Provident Fund Income Tax Value AddedTax Sales Tax Service Tax Cess and other material Statutory dues were in arrears as at31st March 2017 fora period of more than six months from the date they became payable.
(b) Details of dues of Income Tax which have not been deposited as on 31 st March 2017on accountof disputes are given below.
|Sr. No. ||Name of Statute ||Nature of the Dues ||Amount (Rs In Lacs) ||Period to which It relate* ||Forum where dispute Is pending |
|1. ||Income Tax Act 1961 ||Income Tax ||2.12 ||Financial Year 2011-12 ||Commissioner of Income Tex (Appeals) |
|2. ||Income Tax Act 1961 ||Income Tax ||4.52 ||Financial Year 2012-13 ||Commissioner of Income Tax (Appeals) |
|3. ||Income Tbx Act 1961 ||Income Tax ||4.96 ||Financial Year 2013-14 ||Commissioner of Income Tax (Appeals) |
|4. ||Income Tax Act 1904 ||Service Tax ||3.43 ||Financial Year 2007-08 till 2010-11 ||Commissioner of Appeals Mumbai |
viii. Baaed on ouraudlt procedures and on the Information and explanations given to uswe are of the opinion that the company has not defaulted in repayment of dues to afinancial institutions and or bank.
ix. The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt Instruments) Further the company has raised new term loansduring the year. The term loans granted to the company have been applied for the purposefor which they have been raised.
x. According to information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or re portedduring the course of our audit.
xi. According to information and explanations given to us and based on our examinationof the records of the Company the Company has paid/provlded for managerial remunerationIn accordance with the provisions of section 197 read with Schedule V to the Act.
xii. In our opinion and according to the information and explanations given to us theCompany is not a nidhi company. According ly paragraph 3(xll) of the order is notapplicable.
xiii. According to the information and explanations given 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 d Is closed In the financial statements as required by theapplicable accounting standards.
xiv. According to information and explanations given to us and based on our examlnationof the records of the Company the Company has not made any preferential allotment orprivate pi a cement of shares or fully or parity convertible debentures during the year.
xv. According to Information and explanations given to us and based on our examinationof the records of the Company the Company has not entered into non-cash transactions withdirectors or persons connected with him. Accordingly paragraph 3(xv) of the Order's notapplicable.
xvi. The Company is not required to be registered under section 45-IAof the Reserve Bank of I nd ia Act 1934.
| ||For Udayavar Dhanesh Kumar A Associates |
| ||Chartered Accountants |
| ||Firm Registration No: 119401W |
| ||Dhanesh Kumar Udayavar |
|Place: Mumbai ||Proprietor |
|Date: 30.05.2017 ||Membership No. 102031 |
Annexure - B to the Auditors' Report
Report on the Internal Financial Controls under Clause (I) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")
We have audited the Internal financial controls over financial reporting of CEENIKEXPORTS (INDIA) Limited ("the Company") as of 31 March 2017 in conjunction withour 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 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 flCAP). These responsibilitiesinclude the design implementation and maintenance of adequate Internal financial controlsthat were operating effectively for ensuring the orderly and officiant conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired underthe Companies Act 2013.
Our responsibility Is to express an opinion on the Company's Internal financialcontrols overfinanclal 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 deemed to beprescribed under section 143(10) of the Compan les Act 2013 to the extent applicable toan audit of Internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and rf suchcontrols operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe 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.
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
A company's Internal financial control overfinandal reporting Is a process designed toprovide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting Indudes those policies and procedures that
(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only Inaccordance with authorizations of managementand directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
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 overfinandalreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions orthatthe degree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over finandal reporting and such Internal financial controlsover financial reporting were operating effectively as at 31 March 2017 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. Further In our opinion the Company should adopt computerizedtechnology for effective and proper internal controls.
| ||For Udayavar Dhanesh Kumar & Associates |
| ||Chartered Accountants |
| ||Firm Registration No: 119401W |
| ||Dhanesh Kumar Udayavar |
|Place: Mumbai ||Proprietor |
|Date: 30.05.2017 ||Membership No. 102031 |