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Chennai Ferrous Industries Ltd.

BSE: 539011 Sector: Metals & Mining
NSE: N.A. ISIN Code: INE777O01016
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OPEN 5.28
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VOLUME 50
52-Week high 7.00
52-Week low 3.35
P/E
Mkt Cap.(Rs cr) 2
Buy Price 0.00
Buy Qty 0.00
Sell Price 5.28
Sell Qty 520.00
OPEN 5.28
CLOSE 5.28
VOLUME 50
52-Week high 7.00
52-Week low 3.35
P/E
Mkt Cap.(Rs cr) 2
Buy Price 0.00
Buy Qty 0.00
Sell Price 5.28
Sell Qty 520.00

Chennai Ferrous Industries Ltd. (CHENNAIFERROUS) - Auditors Report

Company auditors report

To

The Members of

CHENNAI FERROUS INDUSTRIES LIMITED

Report on the Financial Statements

We have audited the accompanying financial statements of Chennai Ferrous IndustriesLimited which comprise the Balance Sheet as at March 312016 the Statement of Profit andLoss and 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

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 judgements 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.

Auditors' Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit. We have taken into accounts 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 misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts andthe 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 the auditor considers internal financial controlrelevant to the Company's preparation of the financial statements that give a true andfair view in order to design audit procedures that are appropriate in the circumstancesbut not for the purpose of expressing an opinion on whether the Company has in place anadequate internal financial controls system over financial reporting and the operatingeffectiveness of such controls. An audit also includes evaluating the appropriateness ofthe accounting policies used and the reasonableness of the accounting estimates made bythe Company's Directors as well as evaluating the overall presentation of the financialstatements.

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

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

The Company is yet to comply with the requirements of section 203 of Companies Actregarding appointment of a Company Secretary.

1. 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 Act we give in the "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the Order 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 purpose of our audit;

b) In our opinion proper books of account as required by law have been kept by theCompany so far as 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 the written representations received from the directors as on March312016 taken on record by the Board of Directors none of the directors is disqualifiedas on March 312016 from being appointed as a director in terms of Section 164(2)(g) 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 in accordance with the generally accepted accounting practicedisclosure the impact of pending Litigations on its financial position in its financialstatements;

ii. the Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses under the applicable law or accountingstandards.

iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.

Date : May 28 2016 For S.K GULECHA & ASSOCIATES
Place : Chennai Chartered Accountants
Firm Registration No. 013340S
SANDEEP KUMAR GULECHA
PROPRIETOR
(Membership Number : 226263)

Annexure A to Independent Auditors' Report

The Annexure referred to in our independent Auditors' Report to the members of theCompany on the financial statements of Chennai Ferrous Industries Limited for the yearended 31 March 2016 we report that:

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of Fixed Assets.

(b) As explained to us all the Fixed Assets have been physically verified by themanagement at reasonable intervals during the year. According to the information andexplanations given to us no material discrepancies were noticed on such verification. Inour opinion this periodicity of physical verification is reasonable having regard to thesize of the Company and the nature of its assets.

(c) The Company has not disposed of substantial part of the Fixed Assets during theyear which could affect the going concern status of the Company.

(ii) (a) Inventories have been physically verified during the year by the management atthe close of the year.

(b) In our opinion and according to the information and explanation give to us theprocedures of physical verification of inventory followed by the management are reasonableand adequate in relation to the size of the Company and nature of its business.

(c) The Company is maintaining proper records of inventory and the discrepanciesnoticed on physical verification between the physical stock and book records which werenot material having regard to the size of the company and nature of its business have beenproperly dealt with in the books of account.

(iii) As per the information and explanation given to us and as per the recordsproduced to us the company has not granted any loans secured or unsecured to companiesfirms or other parties covered in the register maintained under section 189 of theCompanies Act 2013 (‘the Act') and accordingly the provisions of clause (iii) ofparagraph 3 of the Order are not applicable to the company.

(iv) In our opinion and according to the information and explanations given to us thecompany has complied with the provisions of section 185 and I86 of the Companies Act 2013In respect of loans investments guarantees and security.

(v) The Company has not accepted any deposit from the public.

(vi) We have broadly reviewed the books of account maintained by the company in respectproducts where pursuant to the rule made by the Central Government of India themaintenance of cost records and we are of the opinion that prima facie the prescribedaccount and records have been made and maintained. We have not however made a detailedexamination of records with a view to determine whether they are accurate or complete.

(vii) (a) The Company is regular in depositing undisputed statutory dues includingProvident Fund Employees State Insurance Income Tax Sales Tax Wealth Tax Service TaxCustoms Duty Excise Duty Value Added Tax Cess and other statutory dues with theappropriate authorities wherever applicable and no dues are pending for a period of morethan six months from the date they become payable.

(b) According to the information and explanations given to us there are no material ndues of sales tax income tax customs duty wealth tax service tax excise duty vatcess and other material statutory dues as applicable which have not been deposited withthe appropriate authorities on account of any dispute.

(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 inaccordance with the relevant provisions of the Companies Act 1956 (1 of 1956) and rulesmade there under..

(viii) The Company did not have any outstanding dues to financial institutions banksor debenture holders during the year.

(ix) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not raised moneys by way of initial public offeror further public offer including debt instruments and term Loans. Accordingly theprovisions of clause 3 (ix) of the Order are not applicable to the Company and hence notcommented upon.

(x) Based upon the audit procedures performed and the information and explanationsgiven by the management we report that no fraud by the Company or on the company by itsofficers or employees has been noticed or reported during the year.

(xi) Based upon the audit procedures performed and the information and explanationsgiven by the management the managerial remuneration has been paid or provided inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Companies Act;

(xii) .In our opinion the Company is not a Nidhi Company. Therefore the provisions ofclause 4 (xii) of the Order are not applicable to the Company.

(xiii) In our opinion all transactions with the related parties are in compliance withsection 177 and 188 of Companies Act 2013 and the details have been disclosed in theFinancial Statements as required by the applicable accounting standards.

(xiv) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year underreview. Accordingly the provisions of clause 3 (xiv) of the Order are not applicable tothe Company and hence not commented upon.

(xv) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not entered into any non-cash transactions withdirectors or persons connected with him. Accordingly the provisions of clause 3 (xv) ofthe Order are not applicable to the Company and hence not commented upon.

(xvi) I n our opinion the company is not required to be registered under section 45 IAof the Reserve Bank of India Act 1934 and accordingly the provisions of clause 3 (xvi)of the Order are not applicable to the Company and hence not commented upon.

Date : May 28 2016 For S.K GULECHA & ASSOCIATES
Place : Chennai Chartered Accountants
Firm Registration No. 013340S
SANDEEP KUMAR GULECHA
PROPRIETOR
(Membership Number:226263)

"Annexure B" to the Independent Auditor's Report of even date on theStandalone financial statements of Chennai Ferrous Industries Limited

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

We have audited the internal financial controls over financial reporting of ChennaiFerrous Industries Limited ("the Company") as of March 31 2016 in conjunctionwith our audit of the standalone financial statements of the Company for the year ended onthat 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 Institute of Chartered Accountants of India. These responsibilities include thedesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

Auditors' Responsibility

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.

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 judgement 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 over financial reporting is a process designedto provide 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 includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized 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

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

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 March 31 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.

Date : May 28 2016 For S.K GULECHA & ASSOCIATES
Place : Chennai Chartered Accountants
Firm Registration No. 013340S
SANDEEP KUMAR GULECHA
PROPRIETOR
(Membership Number:226263