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Gretex Industries Ltd.

BSE: 538378 Sector: Industrials
NSE: GRETEX ISIN Code: INE985P01012
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Gretex Industries Ltd. (GRETEX) - Auditors Report

Company auditors report

To the Members of

M/s GRETEX INDUSTRIES LIMITED

1. Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of GRETEX INDUSTRIESLIMITED (Formerly Known As GRETEX INDUSTRIES PRIVATE LIMITED & HERITAGE BARTER PRIVATELIMITED) ("the Company") which comprises the Balance Sheet as at March 312017 the Statement of Profit and Loss for the year ended March 31 2017 Cash FlowStatement for the year ended March 31 2017 and a summary of significant accountingpolicies and other explanatory information.

2. Management's Responsibility for the Standalone Financial Statements

Management is responsible for the matters stated in Section 134(5) of the CompaniesAct 2013 ('the Act') with respect to the preparation of these standalone financialstatements that give a true and fair view of the financial position financial performanceof the Company in accordance with the Accounting principles generally accepted in Indiaincluding the Accounting Standards specified under section 133 of the Act read with Rule7 of the Companies (Accounts) Rules 2014. This responsibility also includes maintenanceof adequate accounting records in accordance with the provisions of the Act forsafeguarding the assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgements 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 standalone financial statements that give a true andfair view and are free from material misstatement whether due to fraud or error.

3. Auditor's Responsibility

Our responsibility is to express an opinion on these standalone financial statementsbased on our audit.

We have taken in to 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 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 standalone financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the standalone financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thestandalone financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to the Company'spreparation of the standalone financial statements that give a true and fair view in orderto design audit procedures that are appropriate in the circumstances. 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 standalone financial statements. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our audit opinion on the standalone financial statements

4. Opinion

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 loss

a) in the case of the Balance Sheet of the state of affairs of the Company as at March31 2017;

b) in the case of the Statement of Profit and Loss of the Loss for the year endedMarch 31 2017;

c) in the case of the Cash Flow Statement of the cash flow for the year ended March31 2017.

5. Report on Other Legal and Regulatory Requirements

5.1 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.

5.2 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 and Statement of Profit and Loss dealt with by this Report are inagreement with the books of account;

d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under the Section 133 of the Act read with rule 7 of theCompanies (Accounts) Rules 2014.

e) On the basis of written representations received from the directors as on March 312017 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of section 164 (2) ofthe Companies Act 2013;

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 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 explanations given to us:

(i) The company does not have any pending litigations as at 31st March 2017which would impact its financial position in its standalone financial statements;

(ii) The company did not have any long term contracts including derivative contractsfor which there were any material foreseeable losses;

(iii) There were no amounts which were required to be transferred to the InvestorEducation and Protection fund by the company.

(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 the same inaccordance with the books of accounts maintained by the company (Refer note 1.8).

For Gupta Agarwal & Associates

Chartered Accountants

FRN: 329001E

Sd/-

Jay Shanker Gupta

(Partner)

Membership No. : 059535

Date: 29.05.2017

Place: Kolkata

"Annexure A" to the Independent Auditor's Report

Referred to in paragraph 1 under the heading 'Report on Other Legal & RegulatoryRequirement' of report of even date to the standalone financial statements of the companyfor the year ended March 31 2017; we report that:

3.1 Clause (i):

(a) The company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets;

(b) These fixed assets have been physically verified by the management at reasonableintervals; whether any material discrepancies were noticed on such verification and if sowhether the same have been properly dealt with in the books of account;

(c) The title deeds of immovable properties are held in the name of the company.

3.2 Clause (ii):

The physical verification of inventory has been conducted at reasonable intervals bythe management and no material discrepancies were noticed and they have been properlydealt with in the books of account.

3.3 Clause (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.

3.4 Clause (iv):

In respect of loans investments guarantees and security the provisions of section185 and 186 of the Companies Act 2013 have been complied with.

3.5 Clause (v):

According to the information and explanation given to us the company has not accepteddeposits from the public during the financial year under audit.

3.6 Clause (vi):

In our opinion and according to information and explanation given to us the companydoes not manufacturing any goods and as such the provision related to maintenance of costrecords by the company under sub section (1) of section 148 of Companies Act 2013 for anyof its products as prescribed by Central Government are not applicable.

3.7 Clause (vii):

(a) The company is regular in depositing undisputed statutory dues including providentfund employees' state insurance income-tax sales-tax duty of customs duty of excisevalue added tax cess and any other statutory dues to the appropriate authorities inIndia.

(b) According to the information and explanations given to us there are no dues ofincome tax or sales tax or service tax or duty of customs or duty of excise or value addedtax which have not been deposited on account of any dispute

3.8 Clause (viii):

According to the records of the company examined by us and as per the information andexplanation given to us the company has not availed of any loans from any financialinstitution or banks and has not issued debentures.

3.9 Clause (ix):

In our opinion and according to information and explanations given to us the companyhas raised money by way of offer for sale (924000 equity shares) and initial publicoffer (1056000 equity shares) on NSE Emerge Platform for Rs. 184.80 Lacs and Rs. 211.20Lacs respectively.

3.10 Clause (x):

No fraud by the company or any fraud on the Company by its officers or employees hasbeen noticed or reported during the year

3.11 Clause (xi):

Managerial remuneration has been paid or provided during the year in accordance withthe requisite approvals mandated by the provisions of section 197 read with Schedule V tothe Companies Act.

3.12 Clause (xii):

In our opinion and according to information and explanations given to us clause (xii)of para 3 to Companies (Auditor's Report) Order 2016 w.r.t. Nidhi Company is notapplicable to company.

3.13 Clause (xiii):

In our opinion all transactions with the related parties are in compliance withsections 177 and 188 of Companies Act 2013 where applicable and the details have beendisclosed in the Standalone Financial Statements etc. as required by the applicableaccounting standards.

3.14 Clause (xiv):

The company has not made any preferential allotment or private placement of shares orfully or partly convertible debentures during the year under review.

3.15 Clause (xv)

The company has not entered into any non-cash transactions with directors or personsconnected with him

3.16 Clause (xvi):

The company is not required to be registered under section 45-IA of the Reserve Bank ofIndia Act 1934.

For Gupta Agarwal & Associates Chartered Accountants FRN: 329001E

Sd/-

Jay Shanker Gupta (Partner)

Membership No. : 059535

Date: 29.05.2017 Place: Kolkata

"Annexure B" to the Independent Auditor's 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 over financial reporting of GRETEXINDUSTRIES LIMITED ("the Company") as of March 31 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). 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.

Auditors' Responsibility

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 judgement 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 of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial 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.

Opinion

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 March 31 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 (ICAI).

For Gupta Agarwal & Associates Chartered Accountants FRN: 329001E

Sd/-

Jay Shanker Gupta (Partner)

Membership No. : 059535

Date: 29.05.2017 Place: Kolkata