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Rainbow Denim Ltd.

BSE: 532441 Sector: Industrials
NSE: N.A. ISIN Code: INE820D01025
BSE LIVE 13:18 | 19 Sep 6.44 0.30
(4.89%)
OPEN

5.85

HIGH

6.44

LOW

5.85

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 5.85
PREVIOUS CLOSE 6.14
VOLUME 780
52-Week high 14.99
52-Week low 5.70
P/E
Mkt Cap.(Rs cr) 9
Buy Price 6.44
Buy Qty 315.00
Sell Price 0.00
Sell Qty 0.00
OPEN 5.85
CLOSE 6.14
VOLUME 780
52-Week high 14.99
52-Week low 5.70
P/E
Mkt Cap.(Rs cr) 9
Buy Price 6.44
Buy Qty 315.00
Sell Price 0.00
Sell Qty 0.00

Rainbow Denim Ltd. (RAINBOWDENIM) - Auditors Report

Company auditors report

To

The Members of

Rainbow Denim Limited

Report on the Financial Statements

We have audited the accompanying financial statements ofRainbow Denim Limited("the company") which comprise the Balance Sheet as at 31st March 2016 theStatement of Profit & Loss the Cash Flow Statement for the year then ended and asummary of significant accounting policies and other explanatory information

Management’s Responsibility for the Financial Statements

The Management is responsible for the matters in Section 134(5) of the Companies Act2013 ("the Act") with respect to the preparation of these financial statementsthat give a true and fair view of the financial position financial performance and cashflows of the Company in accordance with the accounting accepted in India including theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014. This responsibility also includes the maintenance ofadequate accounting records in accordance with the provision of the Act for safeguardingof the assets of the Company and for preventing and detecting the frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of internal financial control that were operating effectively for ensuringrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit.

We have taken into account the provision of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovision 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 misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on theauditor’s judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal financial control relevant to the Company’spreparation of the financial statements that give true and fair view in order to designaudit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of accounting policies used and the reasonableness of theaccounting estimates made by Company’s Directors as well as evaluating the overallpresentation of the financial statements.

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

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

(a) in the case of the Balance Sheet of the state of affairs of the Company as atMarch 31 2016;

(b) in the case of the Statement of Profit & Loss of the loss for the year endedon that date; and

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

Emphasis of matter

We draw attention to Note 33 of the accompanying financial statements in respect ofCompany’s ability to continue as a going concern. Our opinion is not qualified inrespect of this matter.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor’s Report) Order 2016 issued by the CentralGovernment of India in terms of section 143 (11) of the Companies Act 2013 we give inthe "Annexure A"- a statement on the matters specified in the paragraph 3& 4 of said order.

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 Statement of Profit & Loss and the Cash Flow Statement dealtwith by this Report are in agreement with the books of account. comply with the AccountingStandards specified

d. in our opinion the aforesaid standalone financial under section 133 of the Actread with Rule 7 of the Companies (Accounts) Rules 2014.

e. On the basis of written representations received from the directors as on 31stMarch 2016 taken on record by the Board of Directors we report that none of thedirectors is disqualified as on 31st March 2016 from being appointed as a director interms of Section 164 (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"

g. To our best of information and according to the explanations given to us:

i) The Company did not have any long term contracts including derivatives contract forwhich there were any material foreseeable losses.

ii) The Company did not have any pending litigations which would have impact itsfinancial position in its financial statements.

iii) There were no amounts which were required to be transferred to Investor Education& Protection Fund by the Company.

For Dayal and Lohia
Chartered Accountants
Firm Regn. No. 102200W
Rinkit K. Uchat
(Partner)
Memb. No: 165557
Place: Mumbai
Date: 30th May 2016

"ANNEXURE A" TO THE INDEPENDENT AUDITORS REPORT

The annexure referred to our Report of even date to the members of Rainbow DenimLimited on the financial statements for the year ended 31st March 2016. We reportthat:

1. In respect of its Fixed assets:

a) The Company has maintained proper records showing full particulars includingquantitative details and situations of fixed assets on the basis of available information;

b) Management has certified that they have carried out physical verification of fixedassets and no material discrepancy was noticed on such verification.

c) The title deeds of immovable properties are held in the name of company.

2. According to the information and explanations given to us the inventories have beenphysically verified at reasonable intervals by the management during the year and nomaterial discrepancies have been noticed.

3. According to the information and explanations given to us the company has notgranted any loans secured or unsecured to any companies firms or other parties coveredin the register maintained under section 189 of the Companies Act 2013. Accordingly subclause (a) (b) and (c) are not applicable.

4. The Provisions of Section 185 and 186 are not applicable as company has not givenany loan guarantees Investment & security. Accordingly paragraph 3(iv) of the Orderis not applicable.

5. According to the information and explanation given to us the company has notaccepted any deposits as per the provisions of Section 73 to 76 or any other relevantprovisions of the Companies Act 2013 and the rules framed there under.

6. We have broadly reviewed the books of accounts maintained by the Company pursuant tothe rules made by the Central Government for the maintenance of cost records under section148 (1) of the Companies Act 2013 in respect of the Company’s Products to which thesaid rules are made applicable and are of the opinion that prima facie the prescribedaccounts have been made and maintained. We have however not made a detailed examinationof the records with a view to determine whether they are accurate.

7. a) According to the records of the Company there were no undisputed amounts payablein respect of Provident Fund Employee’s State Insurance Income Tax Sales TaxService Tax Custom Duty Excise Duty Value added tax Cess and any other statutory dueswith appropriate authorities outstanding as on 31st March 2016 for a period of more thansix months from the date they became payable.

b) According to the records of the Company and information and explanations given to usthere are no dues of sales tax income tax wealth tax service tax custom duty exciseduty value added tax cess on account of any disputes.

8. On the basis of our examination of the books and according to the information andexplanation given to us we are of the opinion that the company have restructured allprevious defaulted loans including interest and L.C. devolvement with securitizationcompanies and there are no defaults in repayment as per the agreed rescheduled paymentterms with the securitization companies on respective due dates.

9. In our opinion and on the basis of information and explanations given to us theCompany has not raised money by way of further public offer during the year and term loansavailed by the Company were prima facie applied by the Company for the purpose for whichthe loans were obtained.

10. According to the information and explanations given to us and to the best of ourknowledge and belief no fraud on or by the Company has been noticed or reported during theyear.

11. According to the information and explanations given to us the managerialremuneration paid by the company is in accordance with the Section 197 read with ScheduleV of the companies Act 2013.

12. In our opinion and according to information and explanations given to us thecompany is not a Nidhi Company. Accordingly paragraph 3(xii) of the Order is notapplicable.

13. According to information and explanations given to us and based on our examinationof the records of the company transactions with related parties are in accordance withsection 177 and 188 of the act where applicable and details of such transactions have beendisclosed in Financial Statements as required by applicable accounting standards.

14. According to the information and explanation given to us the Company has not madeany preferential allotment or private placement of shares or fully or partly convertibledebentures during the year.

15. 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. Therefore paragraph 3(xv) of the Order is notapplicable.

16. In our opinion and according to the information and explanations given to us theCompany is not required to be registered under section 45- IA of Reserve Bank of IndiaAct 1934.

For Dayal and Lohia
Chartered Accountants
Firm Regn. No. 102200W
Rinkit K. Uchat
(Partner)
Memb. No: 165557
Place: Mumbai
Date: 30th May 2016

‘’ANNEXURE B" TO THE INDEPENDENT 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")

We have audited the internal financial Rainbow Denim Limited ("theCompany") controls over as of March 31 2016 in conjunction with our audit of thefinancial 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 (ICAI). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to company’s policies the safeguarding of its assetsthe prevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the CompaniesAct 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 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 controlssystem over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

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 reportingincludes those policies and procedures that (1) pertain to the maintenance of recordsthat in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorizations of management and directors of thecompany; and (3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company’s assets that could havea 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 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).

For Dayal and Lohia
Chartered Accountants
Firm Regn. No. 102200W
Rinkit K. Uchat
(Partner)
Memb. No: 165557
Place: Mumbai
Date: 30th May 2016