THE MEMBERS OF
Report on the Financial Statements
We have audited the accompanying financial statements of CPEC LTD whichcomprise the Balance Sheet as at 31' March 2015 and the Statement of Profit and Loss andthe Cash Flow Statement for the year then ended and a summary of the significantaccounting policies and otherexplanatory information.
Managements Responsibility forthe Financial Statements
The Companys Management is responsible for the preparation of these financialstatements that give a true and fair view of the financial position and financialperformance of the Company in accordance with the Accounting Standards prescribed inSection 133 of the Companies Act 2013 and in accordance with the accounting principlesgenerally accepted in India. This responsibility includes the design Implementation andmaintenance of internal control relevant to the preparation and presentation of thefinancial statements that give atrue and fairviewand are free from material misstatementwhetherdueto fraud or error.
Our responsibility is to express an opinion on these financial statements based on ouraudit. We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India. Those Standards require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in thefinancial 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 control relevant to the Companys preparation and fairpresentation of the financial statements in order to design audit procedures that areappropriate in the circumstances but not for the purpose of expressing an opinion on theeffectiveness of the Companys internal control. An audit also includes evaluatingthe appropriateness of the accounting policies used and the reasonableness of theaccounting estimates made by the Management aswell as evaluating the overall presentationof the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide abasisforourauditopinion.
In ouropinion 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 subject to Cash Balanceconfirmation of Rs. 78.34 lacs is in conformity with the accounting principles generallyaccepted in India;
(a) in the case of the Balance Sheet of the state of affairs of the Company as at 31sMarch 2015; and
(b) in the case of the Statement of Profit and Loss of the loss of the Company for theyear ended on that date.
(c) in the case of the Cash Flow Statement of the cash flows of the Company fortheyear ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order 2015 issued by theCentral Government in terms of Section 143(11) of the Act we give in the Annexure astatement on the matters specified in the Order.
2. As required by Section 143(3) of theAct we report that:
(a) We have obtained all the information and explanations which to the best of ourknowledge and belief were necessary for the purposes of our audit;
(b) In ouropinion proper books of accountas required by law have been kept by theCompany so far as appears from our examination of those books;
(c) The Balance Sheet Statement of Profit and Loss and Cash flow statement dealt withby this Report are in agreement with the books of account;
(d) In our opinion the financial statements comply with the prescribed AccountingStandards;
(e) On the basis of the written representations received from the directors as on 31March 2015 taken on record by the Board of Directors none of the directors isdisqualified as on 31* March 2015 from being appointed as a director in terms of Section164(2) of theAct;
(f) The company has adequate internal financial controls system in place and the sameis also operationally effective of such control.
| ||For D. B. Bhanushali & Co. |
| ||CHARTEREDACCOUNTANTS |
| ||(FIRM REGISTRATION NO 118951W) |
| ||D.B. Bhanushali |
|Place: Mumbai ||Partner |
|Date : August 12 2015 ||33 (Membership No. 42844) |
ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT
(Referred to in paragraph 1 under Report on Other Legal and RegulatoryRequirements' section of our report of even date)
(I) (a) The company has freehold Land at Bhachau Gujarat and furniture and fixtures(on rented office premises) as fixed assets and required records of the same are properlymaintained
(b) As explained to us all the fixed assets have been physicallyverified bythemanagement.
(c) The company has not disposed offixed assetsduring theyear.
(ii) (a) There is no opening and closing inventoryhence this clause is not applicable.
(iii) (a) As informed to us the company has granted advances in the nature of Loans toSubsidiary Company. The maximum amount outstanding is Rs.395.12 lakhs and closingoutstanding balance is Rs.2.4 lakhs.
(b) There is no stipulation for payment of interest. The other terms and Conditions ofsuch loans are in our opinion prima facie not prejudicial to the interest of the company
(c) The payment of principal amount is on demand.
(d) There is no stipulation of principal repayment. Hence there is no overdue amount.
(e) As informed to us the company has taken Loan from a Director. The maximum amountoutstanding is Rs.1.37 lakhs and closing outstanding balance is NIL.
(f) There is no stipulation for payment of interest payment of principal amount is ondemand. The other terms and Conditions of such loans are in our opinion prima facie notprejudicial to the interest of the company.
(g) There is no stipulation of principal repayment. Hence there is no overdue amount.
(iv) In our opinion internal control procedures wont apply to the company since thereis no sale of goods and services and purchase of inventory and fixed asset.
(v) According to the information and explanation given to us the companyhas notaccepted deposits within the meaning of the provisions of sections 73 to 76 of theCompanies Act and the rules framed there under; therefore the provisions of this clause isnotapplicable to the Company.
(vi) As informed to us maintenance of cost records has not been specified by theCentral Government under sub-section (1) of section 148 of the Companies Act.
(vii) (a) The company is regular in depositing undisputed statutory dues includingIncome - tax Sales - tax TDS service tax and any other statutory dues with theappropriate authorities during the year except the following:
|Statutory Dues ||Amount |
|1 Income Tax (o/s for more than 6 months) 1. for A.Y. 11-12 ||3467040 |
|2 Income Tax A.Y 13-14 (O/s for more than 2. 6 months) ||870610 |
|3 Service Tax (o/s for more than 6 months) 3. for F.Y. 12-13 ||3054669 |
|4 Sales Tax for F.Y 05-06 (assessed demand order dated 26-09-2014) ||4555982 |
|5 Sales Tax for F.Y 07-08 (assessed demand order. dated) ||921862 |
|6. TDS payable (Current Year) ||238194 |
(b) Demand raised by income tax
|Demand (A.Y) ||Demand Amount ||Forum |
|A.Y. 11-12 ||Rs. 6.9 cr ||CIT- (Appeals) 12 |
|A.Y. 12-13 ||Rs. 2.64 cr ||CIT- (Appeals) 12 |
(c) According to the information and explanation given to us there are no amountrequired to be transferred to investor education and protection fund in accordance withthe relevant provisions of the Companies Act 2013 and rules made there under.
(viii) The company has accumulated losses at the end of the financial year and it hasincurred cash losses during the financial year covered by our audit and has incurred cashloss in the preceding financial year.
(ix) The company has not defaulted in repayment of dues to financial institutions orbankor debenture holders.
(x) According to the information and explanations given to us the company has not givenany guarantee for loans taken by others from bank or financial institution the term andconditions whereoff are prejudicial to the interest of company.
xii) According to the information and explanation given to us during the year no termloans were obtained
(xii) Based on the audit procedures applied and information and explanations given tous we report that no fraud on or by the company has been noticed or reported during thecourse of our audit.
| ||For D. B. Bhanushali & Co. |
| ||CHARTERED ACCOUNTANTS |
| ||(FIRM REGISTRATION NO. 118951W) |
| ||D.B. Bhanushali |
|Place: Mumbai ||Partner |
|Date : August 12 2015 ||(Membership No. 42844) |