on Financial Statements to the Members
We have audited the accompanying standalone financial statements of Superb PapersLimited (the Company) comprising the Balance Sheet as at 31st March 2016 theStatement of Profit and Loss and the Cash Flow Statement for the year then ended and asummary of significant accounting policies and other explanatory information.
The Company's Board of Directors is responsible for matters stated in Section 134(5) ofthe Companies Act 2013 (the Act) with respect to the preparation of these financialstatements that give a true and fair view of the financial position financial performanceand cash flows of the Company in accordance with the accounting principles generallyaccepted in India including the Accounting Standards specified under Section 133 of theAct read with Rule 7 of the Companies (Accounts) Rules 2014. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of 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 misstatement whether due to fraud orerror.
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 the Rules made thereunder. We conducted our audit in accordancewith the Standards on Auditing specified under section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the financial statements are free from any materialmisstatement.
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 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 the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation 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 statements.
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 profit and its cash flows for the year ended on that date.
Emphasis of Matter
Without qualifying our opinion we draw attention to the following matters in the Notesto the financial statements:
(a) Point "K(a)" of Note 11 to the financial statements indicates that theCompany has accumulated losses and its net worth has been significantly eroded. Theseconditions indicate the existence of a material uncertainty that may cast significantdoubt about the Company's ability to continue as a going concern. However the financialstatements of the Company has been prepared on a going concern basis for the reasonsstated in the said Note.
(b) Point "K(b)" of Note 11 to the financial statements indicates thatcertain companies to whom the Company had given significant loans/advances have beenstatutorily declared defunct by the Registrar of Companies Gujarat under the Ministry ofCorporate Affairs. These conditions indicate the existence of uncertainty of realisingsuch loans/ advances.
(c) Point "K(c)" of Note 11 to the financial statements indicates thatcertain quoted investments made by the Company in companies which have been since eithersuspended or delisted by the stock exchanges. These conditions indicate the existence ofuncertainty of realising such investments.
Report on other legal and regulatory requirements
(1) As required by the Companies (Auditor's Report) Order 2015 (CARO) issued by theCentral Government of Indiain terms of section 143(11) of the Act we give in the'Appendix A' a statement on the matters specified in paragraphs 3 and 4 of CARO to theextent 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 purposes of our audit;
(b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those book;
(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 applicableAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.
(e) The matter under the Emphasis of Matters paragraph above in our opinion dependingon the potential outcome may have an adverse effect on the functioning of the Company.
(f) On the basis of the written representations received from the directors and takenon record by the Board of Directors none of the directors except Mr. R. C. Dedhia isdisqualified as on 31st March 2016 from being appointed as a director in terms of Section164 (2) of the Act.
(g) With respect to the adequacy of the internal financial controls over financialreporting of the Company and theoperating effectiveness of such controls refer to ourseparate Report in 'Appendix B'.
(h) 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 disclosed the impact of pending litigations on its financialposition in its financial statements;
(ii) The Company has made provision as required under any law or accounting standardsfor material foreseeable losses (refer point 'K' of Note 11) if any on long termcontracts including derivative contracts;
(iii) There were no amounts in the opinion of the management of the Company whichwere required to be transferred to the Investor Education and Protection Fund by theCompany.
For Manoj Mehta & Co
(M. No. 44355)
Mumbai 30th May 2016
"Appendix A" to the Independent Auditors' Report dated 30th May 2016
(referred to in paragraph 1 under the heading 'Other Legal and RegulatoryRequirements'):
In our opinion subject to the extent of information and explanations available orprovided to us we report that:
(i) The company did not have any fixed assets as on 31st March 2016 consequentlysub-clauses (a) to (c) of this clause are not applicable.
(ii) The company did not hold any inventories as on 31st March 2016 consequentlyclauses 3(ii) of CARO is not applicable.
(iii) The company has not granted any loans secured or unsecured to companies firmsLLP s or other parties covered in the register specified under section 189 of the Actconsequently sub-clauses (a) to (c) of this clause are not applicable.
(iv) The aggregate of investments made in other body corporate and loans and advancesgiven by the Company (refer clause T and 'J' of Note 11) are in excess of the limitsspecified under section 186 (2) and such loans/ advances are interest free except loans/advances to two parties covered in the register maintained under section 186 (9) of theAct.
(v) The Company has not accepted any deposits in terms of directives issued by ReserveBank of India and the provisions of sections 73 to 76 of the Act and the rules framedthere under.
(vi) We are informed that the central government has not prescribed maintenance of costrecords under section 148(1) of the Act which has been relied upon.
(vii) In respect of statutory dues:
(a) The Company is generally regular in depositing undisputed statutory dues includingprovident fund employees' state insurance income tax sales tax wealth tax servicetax duty of customs duty of excise value added tax cess and any other statutory dues(as applicable) with the appropriate authorities during the year except outstandingincome tax dues (net of TDS) for financial years 2009-10 Rs 29191/- 2010-11 Rs 38716/-and 2013-14 Rs 140527/- were in arrears as at 31st March 2016 for a period of more thansix months from the date they became payable.
(b) There are no dues of income tax sales tax wealth tax service tax customs dutyexcise duty value added tax or cess that have not been deposited on account of anydispute.
(viii) The Company has no dues payable to financial institution bank government ordebenture holders.
(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loans during the year.
(x) We are informed that there have been no cases of fraud on or by the Company noticedor reported during the year which has been relied upon.
(xi) The Company has not paid any managerial remuneration in terms of section 197 readwith Schedule V to the Act.
(xii) We are informed that the Company is not a Nidhi company which has been reliedupon.
(xiii) The transactions with related parties (refer clause 'M' of Note 11) comprisepayment of sitting fees to directors during the year and certain transactions comprisingtrade deposits given interest free advance of Rs 50000/ - given and investments made bythe Company not entered into during the year and whose balances are carried forward inaccounts. We are informed that the transactions with the related parties are in compliancewith sections 177 and 188 of the Act (as applicable) and details of such transactions havebeen disclosed in the financial statements as required by the applicable accountingstandards which has been relied upon.
(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year.
(xv) We are informed that the Company has not entered into non-cash transactions withdirectors or persons connected with him which has been relied upon.
(xvi) The Company is not required (refer clause 'N' of Note 11) to be registered undersection 45-IA of the Reserve Bank of India Act 1934.
"Appendix B" to the Independent Auditor's Report dated 30th May. 2016 Reporton the Internal Financial Controls under section 143(3) (il of the Act
We have audited the internal financial controls over financial reporting of SuperbPapers Limited as of 31st March 2016 in conjunction with our audit of the standalonefinancial 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 (ICAI).
These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Act.
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 the Institute ofChartered Accountants of India and deemed to be prescribed under section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controlsboth applicable to an audit of Internal Financial Controls and both issued by theInstitute of Chartered Accountants of India.
Those Standards and the Guidance Note require that we comply with ethical requirementsand plan and perform the audit to obtain reasonable assurance about whether adequateinternal financial controls over financial reporting was established and maintained and ifsuch 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 Company7 s internal financialcontrols system over 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 authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised 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.
As per the information and explanations provided to us and based on our examination ofthe records in accordance with the essential components of internal controls stated in theGuidance Note the Company has in all material respects a system of internal checks onits day to day transactions which acts as an informal internal financial control systemover financial reporting which commensurate with its size and the nature of its businessis adequate and operating effectively as at 31st March 2016.
For Manoj Mehta & Co
(M.M. Mehta) Proprietor
Mumbai 30th May 2016