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 2017 the Statement of Profit and Loss the Cash Flow Statement for the year thenended and a summary of the significant accounting policies and other explanatoryinformation.
Management's Responsibility for the Financial Statements The Company's Board ofDirectors is responsible for the matters stated 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 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; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the 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
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 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 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. An audit also includes evaluating theappropriateness of the accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof 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 2017 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 (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub section (11) of section 143 theAct and on the basis of such checks of the books and records of the Company as weconsidered appropriate and according to the information and explanation given to us duringthe course of audit we give in the Annexure A' statement on the mattersspecified 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 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 books.
(c) The standalone Balance Sheet the Statement of Profit and Loss and the Cash FlowStatement dealt with by this Report are in agreement with the books 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) Rules 2014.
(e) On the basis of the written representations received from the directors as on 31stMarch 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2017 from being appointed as a director in termsof Section 164 (2) of the Act;
(f) As required by section 143(3)(i) of the Companies 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 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 - Refer Note no. 2.24
For LODHA & CO.
Firm's Registration No. 301051E
N. K. LODHA
(Membership No. 85155)
Place: New Delhi
Dated: 26th May 2017
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 be transferred tothe Investor Education and Protection Fund by the Company; and
iv. The Company has provided requisite disclosures in its standalone financialstatements as to holdings as well as dealings in Specified Bank Notes during the periodfrom 8th November 2016 to 30th December 2016 and based on auditprocedures & relying on the management representation we report that the disclosureare in accordance with the books of accounts maintained by the Company. (Refer Note No.2.29 to the standalone financial statements).
ANNEXURE 'A' TO THE AUDITOR'S REPORT
The Annexure referred to in paragraph 1 under the heading "Report on Other Legaland Regulatory Requirements" of our report of even date on the standalone financialstatements of umang Dairies Limited for the year ended 31st March 2017 wereport that:
(i) (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.
(ii) 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.
(iii) The Company has not granted any loan secured or unsecured to any companiesfirms Limited Liability Partnerships or other parties covered in the register maintainedunder section 189 of the Companies Act 2013 (the Act'). Accordingly we are notoffering any comment on the provisions of Clause 3(iii) (a) (b) (c) of the Order.
(iv) 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.
(v) 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 any other tribunal in this regard.
(vi) We have broadly reviewed the books of account required to be maintained by thecompany pursuant to the rules made by the Central Government for the maintenance of thecost records under section 148(1) of the Companies
Act in respect of the Company's product to which the said rules are made applicable andare of the opinion that prima facie the prescribed records have been made andmaintained. We have however not made a detailed examination of the said records with aview to determine whether they are accurate or complete.
(vii) (a) According to the records of the Company and information and explanationsgiven to us the Company is generally regular in depositing undisputed statutory duesincluding provident fund employees' state insurance income tax sales tax service taxduty of customs duty of excise value added tax entry tax cess and other materialstatutory dues with the appropriate authorities to the extent applicable and there were noundisputed statutory dues payable for a period of more than six months from the date theybecome payable as at 31st March 2017 except Mandi Tax of ' 623000/-.
(b) According to the records and information & explanations given to us there areno dues in respect of Service tax Duty of Customs Duty of Excise or Value Added Tax thathave 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/ Interest ||1.78 ||1994-95/1998-2000 ||Sales Tax Tribunal |
| || ||40.65 ||1995-2007 ||Appellate Authorities |
| || ||3.00 ||1995-96 ||High Court |
| || ||41.74 ||2010-2015 ||Appellate Authorities |
|Income ||Income ||311.20 ||2011-12 ||CIT(Appeal) |
|Tax Act ||Tax ||393.93 ||2012-13 ||CIT(Appeal) |
| || ||239.69 ||2013-14 ||CIT(Appeal) |
(viii) In our opinion on the basis of audit procedure and according to the informationand explanations given to us by the management we are of the opinion that the Company hasnot defaulted in repayment of loans or borrowing to banks. The company does not have anydues to financial institutions government or debenture holders - Read with footnote (a)of Note No. 2.3.
(ix) In our opinion on the basis of information and explanations given to us duringthe year the company did not raised any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loans were applied for the purpose forwhich these loans were obtained.
x) 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.
(xi) On the basis of records and information and explanations made availablemanagerial remuneration which has been paid or provided is in accordance with therequisite approvals mandated under Section 197 read with Schedule V to the Companies Act.
(xii) In our opinion and according to information & explanation given to us theCompany is not a chit fund or a nidhi company. Accordingly paragraph 3(xii) of the orderis not applicable.
(xiii) As per the information and explanations and records made available by themanagement of the Company and audit procedures 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 perthe records/details made available related parties transactions are disclosed as requiredby the applicable Accounting Standards.
(xiv) According to the information explanations and records made available theCompany has not made any preferential allotment or private placement of shares orfully/partly convertible debentures during the year.
(xv) On the basis of records made available and according to information andexplanations given to us the Company has not entered into non-cash transactions withdirectors or persons connected with him. Accordingly we are not offering our commentswith respect to compliance of Section 192 of the companies Act 2013.
(xvi) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.
For LODHA & CO.
Firm's Registration No. 301051E
(Membership No. 85155)
Place: New Delhi
Dated: 26th May 2017
ANNEXURE 'B' TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONEFINANCIAL 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 31st March 2017 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.
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'). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required 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 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 controls systemover 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 financial controlsover financial reporting were operating effectively as at 31st March 2017based on the internal control over financial reporting criteria established by the Companyconsidering 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.
For LODHA & CO.
Firm's Registration No. 301051E
(Membership No. 85155)
Place: New Delhi
Date: 26th May 2017.