To the Members of Bedmutha Industries Limited Report on the Standalone FinancialStatements
We have audited the accompanying standalone financial statements of BedmuthaIndustries Ltd ("the Company") which comprise the Balance Sheet as at 31stMarch 2017 the Statement of Profit and Loss the Cash Flow Statement for the yearthen ended and a summary of the significant accounting policies and other explanatoryinformation.
Management's Responsibility for the Standalone Financial Statements
The Company's 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 standalone financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding the assets of the Companyand for preventing and detecting 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 standalone financial statements that give a true and fair view and are free frommaterial 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 and the Order under section 143(11) ofthe Act.
We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India and specified under sec. 143(10) of the Act.Those Standards require that we comply with the ethical requirements and plan and performthe audit to obtain reasonable assurance about whether the financial statements are freefrom material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone financial statements. The procedures selected depend onthe auditor's judgment including the of material misstatement of the standalone financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders the internal control relevant to the Company's preparation and fair presentationof the standalone financial statements in order to design audit procedures that areappropriate in the circumstances. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made by theCompany's Directors as well as evaluating the overall presentation of the standalonefinancial statements.
We believe that the audit evidence we have obtained is sufficientand appropriate toprovide a basis for our audit opinion on the standalone 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 March2017 and its loss and cash flows for the year ended on that 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 ofthe Act we give in the Annexure a statement on the matters specified in paragraphs 3 and4 of the Order to the extent 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 books.
(c) The Balance Sheet Statement of Profit and Loss and the Cash Flow Statement dealtwith by this Report are in agreement with the books of account.
(d) In our opinion the standalone financial statements comply with the AccountingStandards specified under section 133 of the Companies Act 2013 read with Rule 7 of theCompanies (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 terms ofsub-section (2) of section 164 of the Act.
(f) With respect to the adequacy of the internal financialcontrols over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in "Annexure B" and
(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 explanation given to us:
i. the Company has disclosed the impact of pending litigations on its financialfinancial statements;
ii. the Company has made provision as required under the applicable law or accountingstandards 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 standalonefinancialstatementsas to holdings as well as dealings in Specified BankNotesasdefinedin notification S.O.3407 (E) dated 8 th November 2016 during the period from 8th November 2016 to 30thDecember 2016 .Based on audit procedures performed and the representations provided to usby the management we report that these are in accordance with the books of accountsmaintained by the Company. Refer Note 44 of the Financial Statements.
ANNEXURE - A TO THE AUDITORS' REPORT
The Annexure referred to in Independent Auditors' Report to the members of the Companyon the standalone financial statements for the year ended March 31st 2017 we report that(i) (a) The company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) The Company has a regular programme of physical verification of fixed assets bywhich fixed assets are verified in a phased manner over a period of three years. Inaccordance with this programme certain fixed assets were verified during the year and nomaterial discrepancies were noticed on such verification. In our opinion this periodicityof physical verification is reasonable having regard to the size of the company and thenature of its assets.
(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the company the title deeds of immovable properties areheld in the name of the company.
(ii) As explained to us physical verification of inventory has been conducted atreasonable intervals by the Management and no material discrepancies were noticed on suchverification.
(iii) The company has not granted any loans secured or unsecured to companies firmsLimited Liability Partnerships or other parties covered in the Register maintained undersection 189 of the Companies Act 2013.
(iv) In our opinion and according to the information and explanation given to us theCompany has complied with the provisions of Sections 185 and 186 of the Companies Act2013 in respect of grant of loans making investments and providing guarantees andsecurities as applicable.
(v) The company has not accepted any deposits from the public within the meaning ofsection 73 to 76 of the Act and the rules framed there under to the extent notified.
(vi) We have broadly reviewed the books of accounts maintained by the company pursuantto the Companies (Cost Records and Audit) Rules 2014 as prescribed by Central Governmentof India under sub-section (1) of section 148 of the Companies Act 2013 and are ofopinion that prima facie the prescribed accounts and records have been made andmaintained. We have however not made a detailed examination of cost records with theview to determine whether they are accurate or complete.
(vii) (a) According to the information and explanations given to us and the records ofthe company examined by us in respect of statutory dues the Company is regular indepositing with appropriate authorities undisputed statutory dues including providentfund income tax sales tax service tax employees' state insurance custom duty exciseduty cess and other material statutory dues applicable to it. There have been nostatutory dues in arrears as on 31st March 2017 for a period of more than six months fromthe date they became payable.
(b) According to the information and explanation given to us details of dues of salestax income tax customs duty wealth tax excise duty and cess which have not beendeposited on account of any dispute are stated below:-
| || ||(Rs In Lacs) |
|Department ||Financial Year ||Amount of Dispute & Possible Impact |
|1 The Commissioner Of Income Tax (Appeals)-1 Nashik ||2013-14 ||1.67 |
|2 The Commissioner(Appeals) Of Central Excise and Customs Nagpur ||2011-14 ||119.3 |
(viii) In our opinion and according to the information and explanations given to usthe company has not defaulted in repayment of loansorborrowingstofinancialinstitutionsbanks and government and dues to debenture holders. However the company has got DebtRestructuring scheme approved from financial institution (ix) In our opinion and accordingto the information and explanations given to us money raised during the year by way ofterm loans have been applied by the Company for the purposes for which they were raised oras per purpose revised with appropriate approvals. The Company has neither raised anymoney by way of initial public offer/ further public offer nor such proceeds were pendingto be applied during the current year.
(x) In our opinion and according to the information and explanations given to us nofraud by the Company and no material fraud on the Company by its officers or employees hasbeen noticed or reported during the year. (xi) In our opinion and according to theinformation and explanations given to us having regard to legal opinions obtained by theCompany the Company has paid/provided managerial remuneration in accordance with therequisite approvals mandated by the provisions of section 197 read with Schedule V of theCompanies Act 2013. (xii) The Company is not a Nidhi Company and hence reporting underParagraph 3(xii) of the Order is not applicable. (xiii) In our opinion and according tothe information and explanations given to us the Company is in compliance with Sections177 and 188 of the Companies Act 2013 where applicable for all transactions with therelated parties and the details of related party transactions have been disclosed in thestandalone financial statements as required by the applicable accounting standards.
(xiv) In our opinion and according to the information and explanations given to us theCompany has complied with the requirements of Section 42 of the Companies Act 2013 inrespect of preferential allotment and the amount raised has been used for the purposes forwhich the funds were raised.
(xv) In our opinion and according to the information and explanations given to us theCompany has not entered into any non-cash transactions during the year with its directorsor persons connected with them.
(xvi) 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 the Reserve Bank of IndiaAct 1934.
ANNEXURE - B TO THE AUDITORS' 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 controls overfinancialreporting of BedmuthaIndustries Ltd ("the Company") as of 31st March 2017 in conjunctionwith our audit of the standalone financial statements of the company for the year ended onthat 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 assets theprevention 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 Institute ofChartered Accountants of India and prescribed under section 143(10) of the CompaniesAct2013 to the extent applicable to an audit of internal financial controls. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancials controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofinternal financial controls . Our audit of internalsystem over financial controlsover financial reporting assessing the risk that a material weakness exists and testingand evaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's 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 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 financialreporting is a process designed toprovide reasonable assurance regarding the reliability financialstatements for externalpurposes in of financialreporting and the preparation of 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 an 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.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial controls over financial reporting were operatingeffectively as at 31 reportingandsuchinternal financial st March 2017 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.
| ||For Patil Hiran Jajoo & Co. |
| ||Chartered Accountants |
| ||Aniruddha Jajoo |
| ||Partner |
|Place: Nasik ||Membership No: 103246 |
|Date: 24/05/2017 ||Firm Registration No: 120117W |