To The Members of M M Rubber Company Limited Report on the Financial Statements
We have audited the accompanying financial statements of M M Rubber Company Limited(The Company) Bangalore which comprise the Balance Sheet as at 31st March 2015 and theStatement of Profit & Loss Account and the Cash Flow Statement for the year then endedand a summary of significant accounting policies and the other explanatory information.
Managements Responsibility for the Financial Statements
The Companys Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 (the Act) with respect to the preparation of thesefinancial statements that give a true and fair view of the financial position financialperformance and cash flows of the Company in accordance with the Accounting principlesgenerally accepted in India including the Accounting Standards specified under section 133of the Act read with Rule 7 of the Companies(Accounts) Rules 2014. This responsibilityalso includes maintenance of adequate accounting records in accordance with the provisionsof the Act for safeguarding the assets of the Company and for preventing and detectingfrauds and other irregularities: selection and application of appropriate accountingpolicies: making judgments and estimates that are reasonable and prudent: and designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatements whether due to fraudor error.
Our responsibility is to express an opinion on these financial statements based on ouraudit.
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 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 misstatement.
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 wh -ther due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to thecompanys preparation of the financial statements that give a true and fair view inorder to design audit procedures that are appropriate in the circumstances but not forthe purpose of expressing an opinion on whether the company has in place an adequateInternal financial controls systems over financial reporting and the operatingeffectiveness of such controls. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made by theCompanys Directors as well as evaluating the overall presentation of the financialstatements. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the said financial statements give the information required by the act in themanner so required subject to the non-ascertainment of impact on the accounts of thecompany in respect of matters dealt with in the Note No.22.7(Revised Accounting StandardNo. 15 on Employees Retirement Benefits has been Complied with except that the Companyneither has ascertaihed nor provided for actuarial value of its gratuity liability andLeave Encashment as on 31.3.2015and subject to Note No 22.6(Accounting Standard A S 28 onImpairment of assets) and subject to Note no 22.1 (Balances are subject to confirmations)and subject to deviation from Accounting Standard AS 2 regarding valuation of finishedgoods inventory for the reasons stated in Note No.22.5 of the notes to the accounts andread together with other notes thereon give a true and fair view in conformity with theaccounting principles generally accepted in India of the State of affairs of the Companyas at 31st March 2015 and the statement of Profit & Loss Account and its Cash FlowStatement for the year ended on that date.
Report on other Legal and Regulatory Requirements
As required by the Companies (Auditors Report) Order 2015 ("theOrder") issued by the Central Government of India in terms of Section 143(11) of theAct based on the comments in the Auditors Report of the Company and on theauditors reports issued in accordance with the Order we give in the annexure astatement on the matters specified in paragraphs 3 and 4 of the Order to the extentapplicable.
As required by Section 143(3) of the Act we report to the extent applicable that:
1. 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.
2. 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.
3. The Balance Sheet Statement of Profit & Loss and Cash Flow statement dealt withby this report are in agreement with the relevant books of account maintained for thepurpose of preparation of the financial statements.
4. In our opinion the aforesaid financial statements comply with the AccountingStandards specified under section 133 of Act read with Rule 7 of the Companies (Accounts)Rules 2014:
5. On the basis of the written representations received from the directors as on 31stMarch 2015 and taken on record by the Board of Directors we report that none of thedirectors is disqualified as on 31st March 2015 from being appointed as a director interms of Section 164(2) of the Companies Act2013
6. With respect to the other matters to be included in the Auditors 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:
a) The Company has disclosed the impact of pending litigations on its financialposition in its financial statements as of March 312015.
b) The Company did not have any long term contracts including derivative contracts forwhich there were any material foreseeable losses.
c) There has been no delay transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company.
| ||For S R Mandre & Co |
| ||Chartered Accountants |
| ||FRN No 001962S |
| ||B S Dinesh |
|Place : Bangalore ||Partner |
|Date : 29.05.2015 ||Mem No 29624 |
(Referred to in Paragraph 1 of our Report on Other Legal and Regulatory Requirementssection of our report of even date)
(i) In respect of the fixed assets of the Company
a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets; .
(b)The Fixed assets were physically verified by the management during the year inaccordance with a regular programme of verification which in our opinion provides forphysical verification of all the fixed assets at reasonable intervals. Accordingly to theinformation and explanations given to us no material discrepancies were noticed on suchverification however such records do not show updated value both in respect of GrossBlock and Net Block.
(ii) In respect of the Inventories of the Company:
(a) As explained to us the inventories were physically verified during the year by themanagement at reasonable intervals.
(b) In our opinion and according to the information and explanations given to us theprocedures of physical verification of inventories followed by the management werereasonable and adequate in relation to the size of the company and nature of its business;
c) In our opinion and the according to the information and explanations given to usthe Company has maintained proper records of inventories and no material discrepancieswere noticed on physical verification..
iii) The Company has not granted any loans secured or unsecured to companies firmsor other parties covered in the register maintained under Section 189 of the CompaniesAct2013.
iv) In our opinion and in according to the information and explanations given to ushaving regard to the explanations that some of the items purchased are of special natureand suitable alternative sources are not readily available for obtaining comparablequotations there is an adequate Internal Control procedure commensurate with the size ofthe Company and the nature of its business with regard to the purchase of inventories andthe sale of goods and services. During the course of our audit we have not observed anymajor weakness in the internal control system. However areas pertaining to purchase ofgoods and inventory needs to be strengthened.
v) According to information and explanations given to us the Company has not acceptedany deposit during the year and does not have any unclaimed deposit. Therefore theprovisions of the clause 3(v) of the Order are not applicable to the company.
vi) The provisions of clause 3(vi) of the Order are not applicable to the Company.
vii) According to the information and explanations given to us in respect of statutoryDues.:
a) The Company has been regular in depositing undisputed statutory dues includingProvident Fund Investor Education & Protection Fund Employees State InsuranceIncome-tax Act Vat Wealth Tax Customs Duty Excise Duty Service tax Cess and otherstatutory dues with the appropriate authorities except in some cases there has been delaysin remittance of ESI as ascertained and provided for in the books of account of thecompany.
b) there are no undisputed amounts payable in respect of Provident Fund InvestorEducation & Protection Fund Employees State Insurance Income-tax Act Vat WealthTax Customs Duty Excise Duty Service tax Cess and other statutory dues were in arrearsas at 31st March 2015 for a period of more than six months from the date they becamepayable.
c) The details of due of excise duty of sales Tax which have not been deposited as on31st March 2015 on account of disputes are given below:
|Name of the Statue ||Nature of Dues ||Amount Rs in lakhs ||Period to Which it relates ||Forum where Pending |
|Central Excise Laws ||Excise Duty 1/3/1981 to 31/3/1985 Order dated 5/07/2011 ||96.30 ||1980/85 ||CE Tribunal Chennai CE Trbinual Chennai |
|Sales Tax Laws ||Kerala Sales Tax Surcharge And Interest ||14.03 9.03 ||1997/1999 1996/1997 ||Kerala High Court Dy Comm of Sales Tax Kerala |
d) During the year there were no amounts due for transferring to the Investor Educationand Protection Fund in accordance with the relevant provisions of the Companies Act 1956(1 of 1956) and Rules made thereunder.
viii) The Company has accumulated losses at the end of the financial year which is morethan 50% of its net worth. The Company has not incurred cash losses during the currentfinancial year covered by our audit and had incurred cash losses during the immediatelypreceding financial year.
ix) In our opinion and according to information and explanations given to us thecompany has not defaulted in repayment of dues to any financial institution or bank duringthe year. The Company has not issued any debentures.
x) According to the information and explanations given to us company has not given anyguarantee for loans taken by others from banks and financial institutions.
xi) As per the information and explanations to given to us the company did not availany term loan during the year.
xii) On the basis of our examination and according to the information and explanationsgiven to us no fraud by the company and no material fraud on the company has beennoticed or reported during the year.
| ||For S.R.MANDRE & CO. |
|. ||Chartered Accountants |
| ||Firm Reg No. 001962S |
| ||(B.S.DINESH) |
|Place: Bangalore ||Partner |
|Date: 29.05.2015 ||Membership No. 29624 |