The Members of BMB MUSIC AND MAGNETICS LIMITED
Report on the Financial Statements
We have audited the accompanying financial statements of BMB Music And MagneticsLimited (the Company) which comprise the Balance Sheet as at 31st March 2016the Statement of Profit and Loss for the year then ended the Cash Flow Statement and asummary of significant accounting policies and other explanatory information.
Management s Responsibility for the 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 of thesefinancial statements that give a true and fair view of the financial position andfinancial performance of the Company in accordance with the accounting principlesgenerally accepted in India including the Accounting Standards specified under Section133 of the Act read with the rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate Accounting records in accordance withthe provision of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies ; making judgement 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.
Auditor s Responsibility
Our responsibility is to express an opinion on these financial statements based on ouraudit.
We have taken into account the provision of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovision of the Act and the Rules made there under.
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 the auditors 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 consider 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 controls 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 31March 2016 and its Loss and its 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 bythe Central Government of India in terms of sub-section (11) of section 143 of theCompanies Act 2013 and as per checks as considered appropriate we enclose in Annexurestatement on the matters specified in paragraphs 4 and 5 of the said 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 purpose 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 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 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 2016 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2016 from being appointed as a director interms of Section 164 (2) of the Act; and
f. With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in Annexure I ; 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 explanations given to us :
I. The company does not have any pending litigation which would impact it financialposition.
II. The company did not have any long- term contracts including derivative contractsfor which there were any material foreseeable losses.
III. The transfer to Investor Education and Protection Fund is not applicable to theCompany during the year.
|For Sarda Soni Associates || |
|Chartered Accountants || |
|FRN: 117235 || |
|Manoj Kumar Jain ||Place : Mumbai |
|(Partner) ||Date : 30/05/2016 |
|Membership No.: 120788 || |
ANNEXURE I TO THE INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 2(f) under the heading Report on Other Legal and RegulatoryRequirements of our report of even date)
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 over financial reporting of BMB MusicAnd Magnetics Limited (the Company) as of 31 March 2016 in conjunction with our audit ofthe financial 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 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 ICAI and deemed to beprescribed under section 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial 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 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. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the Company s internal financial controls system overfinancial 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.
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 31 March 2016 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 Sarda Soni Associates || |
|Chartered Accountants || |
|FRN: 117235 || |
|Manoj Kumar Jain ||Place : Mumbai |
|(Partner) ||Date :30/05/2016 |
|Membership No.: 120788 || |
ANNEXURE TO INDEPENDENT AUDITOR S REPORT
Referred to in our Audit Report of Even date
Report on matters to be included pursuant to order issued under section 143(11) of theCompanies Act 2013
The Annexure referred to in our report to the members of M/s BMB MUSIC & MAGNETICSLIMITED for the year Ended on 31.03.2016. We report that:
|S. No. ||Particulars ||Auditors Remark |
|(i) ||(a) Whether the company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets; ||YES |
| ||(b) Whether these fixed assets have been physically verified by the management at reasonable intervals; whether any material discrepancies were noticed on such verification and if so whether the same have been properly dealt with in the books of account; ||YES |
|(ii) ||(a) Whether physical verification of inventory has been conducted at reasonable intervals by the management; ||N.A. Company is not having any physical inventory N.A. |
| ||(b) Are the procedures of physical verification of inventory followed by the management reasonable and adequate in relation to the size of the company and the nature of its business. If not the inadequacies in such procedures should be reported; ||N.A. |
| ||(c) Whether the company is maintaining proper records of inventory and whether any material discrepancies were noticed on physical verification and if so whether the same have been properly dealt with in the books of account; || |
|(iii) ||(iii) Whether the company has granted any loans secured or unsecured to companies firms or other parties covered in the register maintained under section 189 of the Companies Act. If so ||YES |
| ||(a) Whether receipt of the principal amount and interest are also regular; and ||YES |
| ||(b) If overdue amount is more than rupees one lakh whether reasonable steps have been taken by the company for recovery of the principal and interest; ||NO |
|(iv) ||Is there an adequate internal control system commensurate with the size of the company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services. Whether there is a continuing failure to correct major weaknesses in internal control system. ||YES No any failure in internal control system |
|(v) ||In case the company has accepted deposits whether the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed there under where applicable have been complied with? If not the nature of contraventions should be stated; If an order has been passed by Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal whether the same has been complied with or not? ||Not Applicable. The company has not accepted any deposits |
|(vi) ||Where maintenance of cost records has been specified by the Central Government under sub-section (1) of section 148 of the Companies Act whether such accounts and records have been made and maintained; ||NO |
|(vii) ||(a) Is the company regular in depositing undisputed statutory dues including provident fund employees state insurance income-tax sales-tax wealth tax service tax duty of customs duty of excise value added tax cess and any other statutory dues with the appropriate authorities and if not the extent of the arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable shall be indicated by the auditor. ||The following amounts of Undisputed Statutory Dues are outstanding for more than 6 months. TDS Rs. 1681363/- |
| ||(b) In case dues of income tax or sales tax or wealth tax or service tax or duty of customs or duty of excise or value added tax or cess have not been deposited on account of any dispute then the amounts involved and the forum where dispute is pending shall be mentioned. (A mere representation to the concerned Department shall not constitute a dispute). ||There are no such dues which are not deposited on account of any dispute |
| ||(c) Whether the amount required to be transferred to investor education and protection fund in accordance with the relevant provisions of the Companies Act 1956 (1 of 1956) and rules made thereunder has been transferred to such fund within time. ||No amount is required to be transferred |
|(viii) ||Whether in case of a company which has been registered for a period not less than five years its accumulated losses at the end of the financial year are not less than fifty per cent of its net worth and whether it has incurred cash losses in such financial year and in the immediately preceding financial year; ||Yes The company has accumulated losses of Rs. 741.46 Lacs which is more than 50% of the net worth of the company |
|(ix) ||Whether the company has defaulted in repayment of dues to a financial institution or bank or debenture holders? If yes the period and amount of default to be reported; ||No |
|(x) ||Whether the company has given any guarantee for loans taken by others from bank or financial institutions the terms and conditions whereof are prejudicial to the interest of the company; ||No |
|(xi) ||Whether term loans were applied for the purpose for which the loans were obtained; ||N.A. |
|(xii) ||whether any fraud on or by the company has been noticed or reported during the year; If yes the nature and the amount involved is to be indicated. ||No |
| ||For Sarda Soni Associates. |
| ||Chartered Accountants |
| ||FRN: 117235W |
| ||Manoj Kumar Jain |
| ||(Partner) |
| ||Membership No. : 120788 |
|Place: Mumbai || |
|Date: 30/05/2016 || |