To the Members of UMANG DAIRIES LIMITED
Report on the Financial Statements
We have audited the accompanying standalone financial statements of UMANG DAIRIESLIMITED ("the Company") which comprise the Balance Sheet as at 31stMarch 2016 the
Statement of Profit and Loss the Cash Flow Statement for the year then ended and asummary of the significant accounting policies and 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 ofthese financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent ; anddesign implementation 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 standalone financial statementsbased on our audit.
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 there under.
We conducted our audit in accordance with the Standards on
Auditing specified under Section 143(10) of the Act. Those
Standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the financial statements are free frommaterial misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditors 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 Companyspreparation of the financial statements that give a true and fair view in order to designaudit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of the accounting policies used and the reasonableness ofthe accounting estimates made by the Companys Directors as well as evaluating theoverall presentation of the standalone 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 standalone financial statements give the information requiredby the Act in the manner so required and 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 2016 and its profit and its cash flows for the year ended onthat date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act and on the basis of such checks of the books and records of theCompany as we considered appropriate and according to the information and explanationsgiven to us during the course of audit we give in the Annexure A statement onthe matters specified in the paragraphs 3 and 4 of the Order.
2. As required by Section 143 (3) of the Act we report that: (a) We have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purposes of our audit. (b) In our opinion proper books ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books. (c) The standalone Balance Sheet the Statement of Profit andLoss and the Cash Flow Statement dealt with by this Report are in agreement with thebooks 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) Rules2014.
(e) On the basis of the written representations received from the directors as on 31stMarch 2016 taken on record by the Board of Directors none of the directors isdisqualified as on 31 st March 2016 from being appointed as a director interms of Section 164 (2) of the Act.
(f) As required by section 143(3)(i) of the Company Act 2013 and based on thechecking of the books and records of the Company as we considered appropriate andaccording to the information and explanations given to us our report on the InternalFinancial Controls over Financial Reporting is as per Annexure B.
(g) 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:
i. The Company has disclosed the impact of pending litigations on its financialposition in its financialstatements refer Note no. 2.24 to the financial statements.
ii. The Company has made provision as required under the applicable law or AccountingStandards for material foreseeable losses if any on long term contracts includingderivative contracts. iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.
ANNEXURE 'A' TO THE AUDITOR'S REPORT
Annexure referred to in paragraph 1 under the heading "Report on Other Legal andRegulatory Requirements" of our report of even date on the standalone financialstatements of Umang Dairies Limited 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 except in case of certain assets wherethe same is in process of updation.
(b) As explained to us the fixed assets have been physically verified by themanagement according to a phased Programme designed to cover all the items over a periodof three years (except assets lying with third parties read with Note no 2.32) which inour opinion is reasonable having regard to the size of the Company and the nature of itsfixed assets. The discrepancies noticed on such physical verification were not material.
(c) As per the records and according to the information and explanations given to ustitle deeds of immovable properties are held in the name of the Company.
2. The inventories of the Company (except stock lying with third parties and intransit) have been physically verified by the management at reasonable intervals. In ouropinion the discrepancies noticed on such physical verification of inventory as comparedto book records were not material.
3. The Company has not granted any loan secured or unsecured to any companies firmsLimited Liability Partnerships or other parties covered in the register maintained underSection 189 of the Companies Act 2013. Accordingly we are not offering any comment onthe provisions of Clause 3(iii) (a) (b) & (c) of the Order.
4. According to the information explanations and representations provided by themanagement and based upon audit procedures performed the company has not given any loansguarantees and security and has not made any investment under the provisions of theSection 185 and 186 of the Companies Act 2013.
5. In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public within the meaning of Section 73 to76 of the Act and rules framed there under and the directives issued by Reserve bank ofIndia or any other relevant provisions of the Act. We have been informed that no order hasbeen passed by the Company Law Board or National Company law Tribunal or Reserve Bank ofIndia or any Court or other tribunal in this regard.
6. We have broadly reviewed the books of accounts required to be maintained by thecompany pursuant to the rules made by the Central Government for the maintenance of costrecords under Section 148(1) of the Companies Act in respect of the Companys productto which the said rules are made applicable and are of the opinion that prima facie theprescribed records have been made and maintained. We have however not made a detailedexamination of the said records with a view to determine whether they are accurate orcomplete.
7. (a) According to the records of the Company and information and explanations givento us the Company is generally regular in depositing undisputed statutory dues includingprovident fund employees' state insurance income-tax sales-tax service tax duty ofcustoms duty of excise value added tax and cess and other material statutory dues withthe appropriate authorities to the extent applicable and there were no undisputedstatutory dues payable for a period of more than six months from the date they becamepayable as at 31st March 2016 except Sales Tax of Rs. 233677/- and Mandi Taxof Rs. 623000/-.
(b) According to the records and information & explanations given to us there areno dues in respect of Service Tax or Duty of Customs or Duty of Excise or Value Added Taxthat have not been deposited with the appropriate authorities to the extent applicable onaccount of any dispute and the dues in respect of Income tax Sales tax and that have notbeen deposited with the appropriate authorities on account of dispute and the forum wherethe dispute is pending are given below:-
|Name of Statute ||Nature of the dues ||Amount (Rs. in Lacs) ||Period ||Forum where dispute is pending |
|Sales Tax Act ||Sales Tax Demand/ Penalty/ Interest ||1.78 ||1994-95/ 1998- 2000 ||Sales Tax Tribunal |
| || ||40.65 ||1995- 2007 ||Appellate Authorities |
| || ||3.00 ||1995-96 ||High Court |
| || ||31.50 ||2010- 2015 ||Appellate Authorities |
| || ||49.78 ||2013- 2016 || |
|Income Tax Act ||Income Tax ||354.23 ||2011-12 ||CIT(Appeal) |
| || ||463.93 ||2012-13 ||CIT(Appeal) |
8. In our opinion on the basis of audit procedure and according to the information andexplanations given to us by the management we are of the opinion that the Company has notdefaulted in repayment of loans or borrowing to banks. The company does not have any duesto financial institutions government or debenture holders. Read with foot note (b)of Note No. 2.3.
9. In our opinion on the basis of information and explanations given to us during theyear the company did not raised any money by way of initial public offer or further publicoffer (including debt instruments) and term loans were applied for the purpose for whichthese loans were obtained.
10. Based on the audit procedure performed and on the basis of information andexplanations provided by the management no fraud by the Company and no fraud on theCompany by its officers or employees has been noticed or reported during the course of theaudit nor we have been informed about any such instance.
11. On the basis of records and information and explanations made available managerialremuneration which has been paid or provided is in accordance with the requisite approvalsmandated under Section 197 read with Schedule V to the Companies Act.
12. In our opinion and according to information & explanation given to us theCompany is not a nidhi company. Accordingly paragraph 3(xii) of the order is notapplicable.
13. As per the information and explanations and records made available by themanagement of the Company and audit procedure performed for the related partiestransactions entered during the year the Company has complied with the provisions ofSection 177 and 188 of the Companies Act 2013 where applicable. As explained and as perrecords/details made available related parties transactions are disclosed as required bythe applicable Accounting Standards.
14. According to the information explanations and records made available the Companyhas not made any preferential allotment or private placement of shares or fully or partlyconvertible debentures during the year.
15. On the basis of records made available and according to information andexplanations given to us the Company has not entered into non-cash transactions with thedirectors or persons connected with him. Accordingly we are not offering our commentswith respect to compliance of Section 192 of the Companies Act 2013.
16. The Company is not required to be registered under 45-IA of the Reserve Bank ofIndia Act 1934.
ANNEXURE B TO THE INDEPENDENT AUDITORS REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS OF UMANG DAIRIES LIMITED
Report on the Internal Financial Controls over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of UmangDairies Limited ("the Company") as of March 31 2016 in conjunction with ouraudit of the standalone financialstatements of the Company for the year ended on thatdate.
Managements Responsibility for Internal Financial Controls
The Companys 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 Companys 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 Companies Act 2013.
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 auditors 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 Companys 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 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.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financialcontrolsoverfinancialreporting were operating effectively as at March 31 2016 controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.
| ||For LODHA & CO. |
| ||Chartered Accountants |
| ||Firms Registration No. 301051E |
| ||N. K. LODHA |
|Place: New Delhi ||Partner |
|Date: 12th May 2016 ||(Membership No: 85155) |