The Shareholders of
KINGS INDIA CHEMICALS CORPORATION LIMITED
Report on the Financial Statements:
We have audited the accompanying Standalone Financial Statements of KINGS INDIACHEMICALS CORPORATION LTD. Chennai which comprises of the Balance Sheet as at 31stMarch 2017 and the Statement of Profit and Loss for the year then ended and a summary ofthe significant accounting policies and other explanatory information.
Management's Responsibility for the Standalone Financial Statements:
The Company's Board of Directors is responsible for the matters in section 134(5) ofthe Companies Act 2013 with respect to the preparation of these Standalone financialstatements that give a true and fair view of the financial position financial performanceand cash flows of the Company in accordance with the Accounting principles generallyaccepted in India including the Accounting Standards specified under section 133 of theAct read with rule 7 of the Companies (Accounts) Rules 2014 ("the Act"). Thisresponsibility also includes the maintenance of adequate accounting records in accordancewith the provision of the Act for safeguarding of the assets of the Company and forpreventing and detecting the frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrol that were operating effectively for ensuring the accuracy and completeness of theaccounting records relevant to the preparation and presentation of the financialstatements that give a true and fair view and are free from material misstatement whetherdue 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 there under.
We have conducted our audit in accordance with the Standards on Auditing specifiedunder section 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 anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal control relevant to the Company's preparation of the financialstatements tha^give a true and fair view in order to design audit procedures that areappropriate in the circumstances but not for the purpose of expressing an opinion onwhether the Company has in place an adequate internal financial controls system overfinancial reporting and the operating effectiveness of such controls. An audit alsoincludes evaluating the appropriateness of accounting policies used and the reasonablenessof the accounting estimates made by Company's Directors as well as evaluating the overallpresentation 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 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:
(a) in the case of the Balance Sheet of the state of affairs of the Company as at 31st March 2017; and
(b) in the case of the Profit and Loss account of the Loss of the Company for the yearended on that date.
Report on other Legal and Regulatory Requirements:
As required by the Companies (Auditor's Report) Order 2016 ("the Order") asamended issued by the Government of India in terms of sub-section (11) of section 143 ofthe Act we give in the "Annexure A" a statement on the matters specifiedin paragraphs 3 and 4 of the Order
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 per opinion proper books of accounts as required by Law have been kept by theCompany so far as 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 accounts.
(d) In our opinion the aforesaid (Standalone) financial statements comply with theAccounting Standards specified under section Sec. 133 of the Act; read with Rule 7 of theCompanies (Accounts) Rules 2014; and
(e) On the basis of written representations received from the Directors as on March312017 taken on record by the Board of Directors none of the Directors is disqualifiedas on 31 st March 2017 from being appointed as a director in terms of Sec. 164(2) of theAct.
(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"
(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:
1. The Company does not have any pending litigations which would impact its financialposition.
2. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
3. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
4. The company has provided requisite disclosures in its financial statements as toholdings as well as dealings in Specified Bank Notes during the period from 8th November2016 to 30th December 2016. The same are in accordance with the books of accountsmaintained by the company.
For DURAIRAJ AND ASSOCIATES
(TT DURAIRAJ KANDIAR)
"ANNEXURE A" TO THE INDEPENDENT AUDITORS' REPORT: 2016-17
Referred to in paragraph 1 under the heading Report on Other Legal &Regulatory Requirement' of our report of even date to the financial statements of theCompany for the year ended March 312017:
1. (a) The company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets;
(b) The Fixed Assets have been physically verified by the management in a phasedmanner designed to cover all the items over a period of three years which in ouropinion is reasonable having regard to the size of the company and nature of itsbusiness. Pursuant to the program a portion of the fixed asset has been physicallyverified by the management during the year and no material discrepancies between the booksrecords and the physical fixed assets have been noticed.
(c) The title deeds of immovable properties are held in the name of the company.
2. The management has conducted the physical verification of inventory at reasonableintervals and no material discrepancies were noticed.
3. The company has not granted any loan secured or unsecured to companies firmsLimited Liability partnerships or other parties covered in the register maintained U/S.189of the Act. Accordingly the provisions of clause 3 (iii) (a) to (c) of the Order are notapplicable to the Company and hence not commented upon.
4. The company has complied-with the provisions of section 185 and 186 of the CompaniesAct 2013 in respect of loans investments provided by the Company. The company has notprovided any guarantee or security to any company covered under Section 185.
5. The Company has not accepted any deposits from the public attracting the provisionsof Sec.73 of the Companies Act 2013.
6. The maintenance of cost records as prescribed by the Central Government undersub-section (1) of section 148 of the Act is not applicable to this company;
7. (a) According to the information and explanations given to us and on the basis ofour examination of the books of account and records the company has been generallyregular in depositing undisputed statutory dues including Provident Fund Employee's StateInsurance Income-tax Sales-tax Service Tax Duty of Customs Duty of Excise Valueadded Tax Cess and any other statutory dues with the appropriate authorities. Acco'rdingto the information and explanations given to us no undisputed amounts payable in respectof the above were in arrears as at March 312017 for a period of more than six months fromthe date on when they become payable.
b) According to the information and explanations given to us there are no dues ofincome tax sales tax service tax duty of customs duty of excise value added taxoutstanding on account of any dispute.
8. In our opinion and according to the information and explanations given to us theCompany has not defaulted in the repayment of dues to banks. The Company has not taken anyloan either from financial institutions or from the government and has not issued anydebentures.
9. The company has not raised moneys by way of initial public offer or further publicoffer including debt instruments and term Loans. Accordingly the provisions of clause 3(ix) of the Order are not applicable to the Company and hence not commented upon.
10. We report that no fraud by the Company or on the company by its officers oremployees has been noticed or reported during the year.
11. The managerial remuneration has been paid or provided in accordance with therequisite approvals mandated by the provisions of section 197 read with Schedule V to theCompanies Act;
12. In our opinion the Company is not a Nidhi Company. Therefore the provisions ofclause 4 (xii) of the Order are not applicable to the Company.
13. In our opinion all transactions with the related parties are in compliance withsection 177 and 188 of Companies Act 2013 and the details have been disclosed in theFinancial Statements as required by the applicable accounting standards.
14. The company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year under review. Accordingly theprovisions of clause 3 (xiv) of the Order are not applicable to the Company and hence notcommented upon.
15. The company has not entered into any non-cash transactions with directors orpersons connected with him.
Accordingly the provisions of clause 3 (xv) of the Order are not applicable to theCompany and hence not commented upon. .
16. In our opinion fhe company is not required to be registered under section 451A ofthe Reserve Bank of India Act 1934 and accordingly the provisions of clause 3 (xvi) ofthe Order are not applicable to the Company and hence not commented upon.
For DURAIRAJ AND ASSOCIATES
(TT DURAIRAJ KANDIAR)
"ANNEXURE B" TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS: 2016-17
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 KINGSINDIA CHEMICALS CORPORATION LTD as at March 312017 in conjunction with our audit ofthe standalone 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"criteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India". Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required 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 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 - reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgement including the assessment of therisks of material 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 re&sonable assurance regarding the reliability of financial reporting andthe preparation 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.
In our opinion the Company has in all material respects an adequate internalfinancial control system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 312017 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 DURAIRAJ AND ASSOCIATES
(TT DURAIRAJ KANDIAR)