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Indokem Ltd.

BSE: 504092 Sector: Industrials
NSE: N.A. ISIN Code: INE716F01012
BSE LIVE 15:50 | 15 Dec 27.70 0.40
(1.47%)
OPEN

28.90

HIGH

29.40

LOW

26.00

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 28.90
PREVIOUS CLOSE 27.30
VOLUME 11963
52-Week high 43.90
52-Week low 16.55
P/E
Mkt Cap.(Rs cr) 67
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 28.90
CLOSE 27.30
VOLUME 11963
52-Week high 43.90
52-Week low 16.55
P/E
Mkt Cap.(Rs cr) 67
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Indokem Ltd. (INDOKEM) - Auditors Report

Company auditors report

INDEPENDENT AUDITOR’S REPORT

The Members of

INDOKEM LIMITED

Report on the Financial Statements

I have audited the accompanying financial statements of INDOKEM LIMITED whichcomprises Balance Sheet as at 31st March 2016 the Statement of Profit andLoss Account for the year ended 31st March 2016 Cash Flow Statement for theyear ended 31st March 2016 and a summary of Significant Accounting Policies andother 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 presentation ofthese financial statements that give a true and fair view of the financial position andfinancial performance in accordance with the accounting principles generally accepted inIndia including the Accounting Standards specified under section 133 of the Act readwith Rule 7 of the Companies (Accounts) Rules 2014. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies ;making judgments and estimates that are reasonable and prudent ; and design implementationand maintenance of adequate internal financial controls that were operating effectivelyfor ensuring the accuracy and completeness of 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.

Auditor’s Responsibility

My responsibility is to express an opinion on these financial statements based on myaudit. I 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.

I have conducted the 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 the auditor'sjudgment including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders 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 an opinionon whether the Company has in place adequate internal financial control system overfinancial 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 Directors as well as evaluating theoverall presentation of the financial statements.

I believe that the audit evidence I have obtained is sufficient and appropriate toprovide a basis for my qualified audit opinion.

Basis for Qualified Opinion

The inventories of the Ankelshwar Plant brought to Mumbai amounting to ' 186.25 lakhsat the year end is as valued and certified by the management only (Refer Para No 2 (c) ofNote No 28 of Notes to Accounts)

Qualified Opinion

In my opinion and to the best of the information and according to the explanationsgiven to me except for the effects of the matters described in the Basis for QualifiedOpinion paragraph the financial statements give the information required by the Act inthe manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India:

(a) In the case of the Balance Sheet of the state of affairs of the Company as at 31stMarch 2016.

(b) In the case of the Profit and Loss Account of the loss for the year ended on thatdate.

(c) In the case of the Cash Flow Statement of the cash flows for the year ended onthat date. Disclaimer of Opinion

According to the information and explanation given to me the Company has notestablished its internal financial control over financial reporting on criteria based onor considering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the Institute ofChartered Accountants of India. Because of this reason I am unable to obtain sufficientappropriate audit evidence to provide a basis for my opinion whether the Company hadadequate internal financial controls over financial reporting and whether such internalfinancial controls were operating effectively as at 31st March 2016.

I have considered the disclaimer reported above in determining the nature timing andextent of my audit tests applied in my audit of the financial statements of the Companyand the disclaimer does not affect my opinion on the financial statements of the Company.

Emphasis of Matter

1. As referred in Para No 2(a) of Note No 28 of Notes to Accounts the Company hasrepaid loan outstanding of ' 1410 lakhs in the current financial year and impact ofadditional interest of ' 164.06 lakhs and gain on settlement of principal amount of suchloan ' 68.15 lakhs is accounted in the current year.

2. As referred in Para No 2(b) of Note no 28 of Notes to Accounts there are olddebtors of ' 306.52 lakhs which in the opinion of the management are good for recovery andno provision for doubtful debts is required.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) order 2016 ("The Order")issued by the Central Government in terms of sub section (11) of section 143 of the Actwe give in the Annexure a statement on the matters specified in the paragraphs 3 and 4 ofthe Order.

2. As required by Section 143(3) of the Act we report that :

a. I have obtained all the information and explanations which to the best of myknowledge and belief were necessary for the purpose of audit .

b. In my opinion proper books of accounts as required by law have been kept by theCompany so far as appears from my examination of those books .

c. The Balance Sheet Statement of Profit and Loss and other notes thereon dealt withby this report are in agreement with the books of accounts.

d. In my opinion the Balance Sheet and Statement of Profit and Loss comply with theaccounting standards referred to in the Section 133 of the Companies Act 2013 and readwith Rule No 7 of the Companies Accounting Rules 2014.

e. On the basis of representations received from the directors as on March 31 2016 andtaken on record by the Board of Directors none of the directors is disqualified as onMarch 312016 from being appointed as a director in terms of Section 164(2) of the Act.

f. There are no other matters to be included in the Auditor's Report in accordance withRule 11 of the Companies (Audit and Auditors) Rules2014.

For Sheth Doctor and Associates
Chartered Accountants
Firm Regn. No. 124822W
Paresh S. Doctor
Place: Mumbai Proprietor
Date: 12th May 2016 Membership No. 36056

ANNEXURE TO THE AUDITOR’S REPORT

(REFERRED TO IN THE REPORT OF EVEN DATE OF THE AUDITOR TO THE MEMBERS OF INDOKEMLIMITED ON THE ACCOUNTS FOR THE YEAR ENDED 31st March 2016)

1. a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

b) As explained to me major portion of the fixed assets have been physically verifiedby the management at the year end which in our opinion is reasonable having regard to thesize of the Company and nature of its assets. No material discrepancies were noticed onsuch physical verification.

c) According to the information and explanations given to me and on the basis ofexamination of the records of the Company the title deeds of immoveable properties areheld in the name of the Company other than those disclosed in the table below:

Asset Class No of cases Gross Block ( Rs. In lakhs) Net Block ( Rs. In lakhs) Remarks
Building at Essel House Delhi Branch 1 28.40 16.80 Pending completion of the relevant formalities pursuant to the scheme of amalgamation the title remains to be vested in the Company. Such assets continue in the name of erstwhile amalgamated Company.

2. a) Inventories have been physically verified during the year by the management atreasonable

intervals. In my opinion the frequency of verification is reasonable.

b) The discrepancies noticed on verification between physical stocks and book recordsare not material and have been adequately dealt with in books of the Company.

3. According to the information and explanations given to me the Company has notgranted any loans secured or unsecured to companies firms limited liabilitypartnerships or other parties covered in the Register maintained under Section 189 of theCompanies Act 2013 ('the Act") except for unsecured loan to a Company amounting to' 271.63 lakhs for which no terms and conditions and repayments schedule is stipulated.

4. In my opinion and according to the information and explanations given to me theCompany has not granted any loans or made any investments or provided any guarantee orsecurity to the parties covered under Section 185 of the Act

5. In my opinion and according to the information and explanations given to me theCompany has not accepted any deposits from the public within the meaning of provisions ofsections 73 to 76 and the rules framed thereunder. Accordingly paragraph 3(v) of theOrder is not applicable to the Company.

6. As the turnover of the products to which the cost records as per provisions of theSection 148 of the Companies Act 2013 are applicable is below threshold limit theCompany is of opinion that provisions of maintenance of cost records as per the saidsection are not applicable to the Company.

7. a) According to the information and explanations given to me and on the basis ofexamination

of the records of the Company the amounts deducted / accrued in the books of accountin respect of undisputed statutory dues including provident fund investor education andprotection fund employee's state insurance income tax sales tax service tax valueadded tax custom duty excise duty cess and other statutory dues as applicable havebeen generally regularly deposited during the year by the Company with the appropriateauthorities except for delay in

few cases. According to the information and explanations given to me there were noundisputed amounts payable in respect of above dues at the year end for the period of morethan six months from the date they become payable. There are dues of ' 100.83 lakhstowards property tax land revenue tax provident fund damages professional tax etc.outstanding for more than six months which in the opinion of the management is of disputednature and provided only as prudent norms of accounting.

b) On the basis of my examination of the documents and records there are disputedstatutory dues which remain to be deposited with the appropriate authorities at year end.

Nature of Dues Amount ( Rs. in lakhs) Period to which amount relates Forum where the dispute is pending
Income Tax 2.09 2006-07 Income Tax Appellet Tribunal
32.76 2009-10 Commissioner Of Income Tax (Appeals)
430.30 2011-12 Commissioner Of Income Tax (Appeals)
36.25 2013-14 Commissioner Of Income Tax (Appeals)
Income Tax 30.13 2001-02 Commissioner Of Income Tax (Appeals)
28.06 2002-03 Commissioner Of Income Tax (Appeals)
32.51 2003-04 Commissioner Of Income Tax (Appeals)
30.60 2004-05 Commissioner Of Income Tax (Appeals)
42.17 2005-06 Commissioner Of Income Tax (Appeals)
41.68 2006-07 Commissioner Of Income Tax (Appeals)
11.92 2007-08 Commissioner Of Income Tax (Appeals)
22.18 2008-09 Commissioner Of Income Tax (Appeals)
28.73 2009-10 Commissioner Of Income Tax (Appeals)
8.59 2010-11 Commissioner Of Income Tax (Appeals)
Sales Tax 9.92 1990-91 Sales Tax Tribunal
11.53 1995-96 Assistant Commissioner (Appeals)
7.50 2002-03 Sales Tax Tribunal
1.54 2004-05 Assistant Commissioner (Appeals)
Service Tax 2.78 2004-05 Service Tax and Excise Tribunal

8. According to the information and explanations given to me and on the basis ofexamination of the records the Company has not defaulted during the year in repayment ofloans and borrowings from banks except for the sum of ' 1410 lakhs due to a bank which wasin default in the earlier years and settled during the year and the Company has fullyrepaid the same(Refer Para No 2(a) of Note no. 28 to the Notes to Accounts).The Companydoes not have any loans or borrowings from financial institutions or government or dues todebenture holders during the year except for vehicle loan from a bank where no default inrepayment is found.

9. According to the information and explanations given to me and on the basis ofexamination of the records the Company has not raised any monies by way of initial publicoffers (including debt instruments) and has not obtained any term loans during the year.Accordingly paragraph 3(ix) of the Order is not applicable to the Company.

10. During the course of my examination of the books and records of the Companycarried out in the

accordance with the generally accepted audit practices in India and according to theinformation and explanations given to me I have neither come across any instance ofmaterial fraud by the Company or on the Company by its officers or employees noticed orreported during the year nor I have been informed of any such case by the management.

11. In my opinion and according to the information and explanations given to me themanagerial remuneration has been paid or provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with schedule V of the Act.

12. In my opinion and according to the information and explanations given to me theCompany is not a Nidhi Company and the Nidhi Rules 2014 are not applicable to it.Accordingly paragraph 3(xii) of the Order is not applicable to the Company.

13. In my opinion and according to the information and explanations given to me theCompany has entered into transactions with related parties in compliance with theprovisions of Sections 177 and 188 of the Act where applicable and the details of suchrelated party transactions have been disclosed in the financial statements as required byAccounting Standard (AS)18 Related Party Disclosures specified under Section 133 of theAct read with Rule 7 of the Companies (Accounts) Rules 2014.

14. According to the information and explanations given to me and based on theexamination 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. Accordingly paragraph 3(xiv) of the Order is not applicable to the Company.

15. According to the information and explanations given to me and based on theexamination of the records of the Company the Company has not entered into non cashtransactions with directors or persons connected with them. Accordingly paragraph 3(xv) ofthe Order is not applicable to the Company.

16. In my opinion and according to the explanations given to me the Company is notrequired to be registered under section 45-IA of the Reserve Bank of India Act 1934.Accordingly paragraph 3(xvi) of the Order is not applicable to the Company.

For Sheth Doctor and Associates
Chartered Accountants
Firm Regn. No. 124822W
Paresh S. Doctor
Place: Mumbai Proprietor
Date: 12th May 2016 Membership No. 36056