A and M Jumbo Bags Ltd.
|BSE: 535046||Sector: Industrials|
|NSE: AMJUMBO||ISIN Code: INE749Y01014|
|BSE 05:30 | 01 Jan||A and M Jumbo Bags Ltd|
|NSE 05:30 | 01 Jan||A and M Jumbo Bags Ltd|
A and M Jumbo Bags Ltd. (AMJUMBO) - Auditors Report
Company auditors report
To The Members
A AND M JUMBO BAGS LIMITED
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of theA AND M JUMBO BAGS LIMITED which comprise of the Balance Sheet as at 31st March 2021 theStatement of Profit and Loss for the year ended Cash Flow Statement Statement of changesin equity for the year ended and a summary of significant accounting policies and otherexplanatory information.
Management's Responsibility for the Ind As standalone FinancialStatements The Company's Board of Directors is responsible for the matters stated inSection 134(5) of the Companies Act 2013 ("the Act") with respect to thepreparation and presentation of these Ind AS financial statements that give a true andfair view of the financial position financial performance and cash flows and changes inequity of the Company in accordance with the accounting principles generally accepted inIndia including the Indian Accounting Standards specified under Section 133 of the Act
This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and delecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing the financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.
The Board of Directors arc responsible for overseeing the Company'sfinancial reporting process.
Our responsibility is to express an opinion on these Ind AS financialstatements based on our audit We conducted our audit in accordance with the Standards onAuditing issued the institute of Chartered Accountants of India as specified u/s 143(10)of the act. Those Standards require that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance about whether the Ind AS financialstatements are free from material misstatement
An audit involves performing procedures to obtain audit evidence aboutthe amounts and disclosures in the Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud nr error. In making thoserisk assessments the auditor considers internal control relevant to the Company'spreparation and fair presentation of the Ind AS financial statements in order to designaudit procedures that are appropriate in the circumstances but not for the purpose ofexpressing an opinion on the effectiveness of the entity's internal control. An audit alsoincludes evaluating the appropriateness of accounting policies used and the reasonablenessof the accounting estimates made by management as well as evaluating the overallpresentation the Ind AS financial statements.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our qualified audit opinion
We have audited the accompanying financial statements of A AND M JumboBags Limited (herein after referred to as the "Company") which comprise theBalance Sheet as at March 31 2021 the statement of Profit and Loss Statement of changesin Equity and the Statement of Cash Flows for the year ended and notes to the financialstatements including a summary of significant accounting policies (hereinafter referredto as the "financial statements")
In our opinion and to the best of our information and according to theexplanations given to us. except for the matters described in qualified opinion theaccompanying financial statements give a true and fair view in conformity with theaccounting principles generally accepted in Indianstate of affairs of the Company as atMarch 31 2021 of its profit position of changes in equity and the cash flows for theyear then ended.
Basis for Qualified Opinion:
As per the information and explanations given to us. we draw attentionthat
1. Company has defaulted in repayment of principal and interest ofvarious loans from banks and NBFC during the year. It includes defaults in repayment ofterm loan CC car loan All unsecured loan from various NBFCs. We are unable to mentionamount of overdue in absence of details and information provided to us for theverification.
2. Company has defaulted in payment of statutory dues like TDSliability of the year of Rs. 72654/-
Also jobwork income of Rs. 9634512/- shown as Indirect income for thesame supporting documents has not been provided to us for verification and GST liabilityof Rs. 1734212/- 16% on the same has not been created in books and also not paid.
Also tds liability of Rs. 66370/- u/s 194C @ 2% on shedconstruction jobwork of Rs. 3318488/- has not been created in books of account and alsonot paid for during the year and supporting documents of job work also has not beenprovided to us for the verification.
3. Income tax liability (excluding interest u/s 234A 234B and234 C of income tax act) of Rs. 4733219/- for the year 2018-19 and liability of Rs.398149/- for the financial year 2019-20 is also pending to pay as on reporting date.
4. We have not been provided statements of Gujarat Mercantile bankloan. HDFC car loan Hero Fincorp term loan Cosmos cooperative bank (closed) Dena bank(closed) SBI current account (closed) and Statement from all NBFCs for unsecured loanduring the year for verification and we have relied upon management certificates for thesame.
Information other than the Financial Statements and Auditor's ReportThereon;
The company's Board of directors is responsible for the otherinformation. Our opinion on financial statements does not cover the other information andwe do not express any form of assurance conclusion thereon.
Key Audit Matters:
Except for the matters described in the Basis for Qualified Opinionsection we have determines that there are no other key audit mattes to communicate in ourreport.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Older 2016("the Order") issued by the Central Government of India in terms of subsection(11) of section 143 of the Act we give in the Annexure A a statement on the mattersspecified in the paragraph 3 and 4 of the order.
2. As required by section 143(3) of the Act we report that
a. we have obtained all the information and explanations which to thebest of our knowledge and belief were necessary for the purpose of our audit except asmentioned in base for qualified opinion Para.
b. In our opinion proper books of account as required by taw have beenkept by the Company so far as appears from our examination of those books except asmentioned in base for qualified opinion Para.
c. The Balance Sheet The Statement of Profit and Loss The statementof change in equity and the statement of Cash Flows dealt with by this Report are inagreement with the books of account except as mentioned in base for qualified opinionPara.
d. In our opinion the aforesaid Ind AS Statements comply with theIndian Accounting Standards Specified under Section 133 of the Companies Act 2013 readwith Rule 7 of the Companies (Accounts) Rules 2014 except as mentioned in base forqualified opinion Para.
e. On the basts of written representations received from the directorsas on 31st March 2021 and taken on record by the Board of Directors none of thedirectors is disqualified as on 31st March 2021 from being appointed as a director interms of Section 164(2) of the Companies Act 2013.
f. with respect to the adequacy of the internal financial controls overfinancial reporting of the Company and the operating effectiveness of such controls referto our separate report in' Annexure B'; and
g. with respect to the other matters to be included in the Auditors'Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 inour opinion and tu the information and according to the explanations given to US
I. The Company has disclosed the impact of pending litigations on itsfinancial position in its financial statements.
II. The Company has made provision as required under the applicablelaw or accounting standards fur material foreseeable losses if any on long-termcontracts including derivative contracts.
III. The Company is not required to transfer the amount to the Investor
Education and Protection Fund and As per our report of even date
ANNEXURE A TO THE AUDITOR'S REPORT
Referred to in paragraph 1 under the heading Report on otherlegal and regulatory requirements' of our report of even date to the financial statementsof the Company for the year ended on March 31 2021
Based on the audit procedures performed for the purpose of reporting atrue and fair view on the financial statements of the Company and taking intoconsideration the information and explanations given to us and the books of account andother records examined by us in the normal course of audit we report that:
(i) (a) Company is not maintaining proper records showing fullparticulars including quantitative Details and situation of fixed assets.
(b) As per the information and explanation given to us by themanagement these fixed assets have been physically verified by the management atreasonable intervals; no material discrepancies were noticed on such verification but wehave not been provided any documents for verification so we are unable to comment upon thesame and the same has not been physically verified by us.
(c) The title deeds of the properties held by the company arc held inits name or not can not be commented upon in absence of documents provided to us for theverification.
(b) It has been observed that the company is not maintaining properrecords of inventory and the same has not been provided to us for verification though asinformed to us by management no material discrepancies were noticed on physicalverification by management but cannot be relied upon.
(iii) The company has nut granted any loans secured or unsecured tocompanies firms lip's or other Parties covered in the register maintained under section189 of the Companies Act except those in the nature of contractual obligations i.e. wherecompany has made transaction for purchase of machinery and advance has been given for thesame later on transaction being cancelled and advance of Rs 33455360/- has been treatedas loan to party.
(iv) As per the information and explanation given to us the Company hasnot provided loan Guarantees and Securities in respect of which the provisions of Section185 and 186 of the companies act 2013 are applicable. The company has complied with theprovision of section 185 and 186 of companies act 2013 with respect to loan and investmentmade.
(v) In our opinion and according to information and explanation givento us the company has not taken any deposit pursuant to provision of Section 73 to 76 ofthe Companies act 2013.
(vi) According to the information and explanations given to us themaintenance of cost records has not been specified by the Central Government under section148(1) of the Companies Act 2013 for the business activities carried out by the Company.Thus reporting under clause 3(vi) of the order is not applicable to the Company.
(vii) (a) Based on the records produced before us the company is notregular in depositing undisputed statutory dues. Below mentioned statutory dues arcpending till audit date;
Income tax of F.Y. 2018-19 of Rs. 473.3219/- Income tax of F.Y. 2019-20of Rs. 398149/- Tds of F.Y. 2020-21 of Rs. 139024/- GST of F.Y. 2020-21 of Rs. 1734212/-
(b) According to information and explanation given to us there is nodues of providend fund ESIC income tax or sales tax or GST or wealth tax or service taxor duty of customs or duty of excise or value added tax or cess which have not beendeposited on account of any dispute.
(viii) Company has defaulted in repayment principal and interest ofvarious loans from banks and NBFC during the year. It includes defaults in repayment ofterm loan CC A/c car loan. All unsecured loan from various NBFCs. We are unable tomention amount of overdue in absence of details and information provided to us for theverification.
We have been informed that the company has not Issued any Debentureduring the year.
(ix) According to the information's & explanations given to us weobserved that term loans in the books of account were not used for the purpose it wastaken Details of the same are as below;
Machinery Term loan of 23 crores has been taken from SBI andmachinery is not booked in books of account being transaction cancelled later on as perinformation provided to us by the management and payment given to party accounted as loanafter transaction being cancelled.
Machinery Term loan of 37.65 Lacs taken from NBFC and machinery is notbooked in books of account being transaction cancelled later on as per informationprovided to us the management and some amount has been repaid by the supplier directly toNBFC also and now o/s as on 31/03/2021 is of Rs.9.71 Lacs.
Though we have not been provided documentary proof of the transactionbeing cancelled and we relied upon management certificates for the same.
(x) According to the information's & explanations given to us nofraud by the company or any fraud on the Company by its officers or employees has beennoticed or reported during the year.
(xi) Provisions of section 197 read with Schedule V to the CompaniesAct 2013 related to managerial remuneration is applicable to company. The company haspaid Total managerial remuneration of R.s. Nil.
(xii) Provisions specified in Nidhi Rules 2014 are not applicable tocompany.
(xiii) According to the information's & explanations givento us all transactions with the related parties arc in compliance with sections 177 and188 of Companies Act 2013 and the details have been disclosed in the Financial Statementsetc. as required by the applicable Indian accounting standards.
(xiv) According to the information's & explanations given to us thecompany has made preferential allotment of 3490000 equity share of Rs. 10/- each duringthe year under review and it has been utilized for redemption of 332230 preference Shareof Rs. 100/- each during the year.
(xv) According to the information's & explanations given to us thecompany has not entered into any non-cash transactions with directors or persons connectedwith him so the provisions of section 192 of Companies Act 2013 arc not applicable tocompany during the year.
(xvi) Provisions of section 45-IA of the Reserve Bank of India Act1934 are not applicable to company.
ANNEXURE B TO THE AUDITOR'S REPORT
Report on the Internal Financial Controls under Clause (i) ofsub-section 3 of Section 143 of the Companies Act 2013 (the Act')
We have audited the internal financial controls over financialreporting of A & M Jumbo Bags Limited ('the Company') as of 31 March 2021 inConjunction with our audit of the financial statements of the Company for the year endedon that date.
Management's Responsibility for Internal Financial Controls
The Company's management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control staled in the Guidance Note on Audit of Internal Financial Controls overFinancial Reporting issued by the Institute of Chartered Accountants of India ('ICAl').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 the 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 Companies Act 2013.
Our responsibility Is to express on opinion on the Company's internalfinancial controls over financial reporting based on our audit We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls over FinancialReporting ('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 control 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 evidenceabout the adequacy of the internal financial controls system over financial reporting andtheir operating effectiveness. Our audit of internal financial controls over financialreporting included obtaining an understanding of internal financial controls overfinancial reporting assessing the risk that a material weakness exists and testing andevaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditors' judgment including theassessment of the risks of material misstatement of the financial statements whether dueto fraud or error.
We believe that the audit evidence we have obtained is not sufficientand appropriate to provide a basis fur our audit opinion on the Company's internalfinancial controls system over financial reporting in absence of documents provided to us.
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial control over financial reporting is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that
(1) pertain to this maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany;
(2) provide reasonable assurance that transaction 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 the management and directors of thecompany; and
3) provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition use or disposition of the company's assets thatcould have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over FinancialReporting
Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projection of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.
In absence of details and documents provided to us comment uponwhether the Company have in all material respects adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at 31 March 2021 based on the internal 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.