THE MEMBERS OF
MODERN MALLEABLES LTD.
REPORT ON THE FINANCIAL STATEMENTS
We have audited the accompanying financial statements of Modern Malleables Limitedwhich comprises the Balance Sheet as at March 31 2014 the Statement of Profit and Lossand Cash Flow Statement for the year then ended and a summary of significant accountingpolicies and other explanatory information.
MANAGEMENT'S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
The Company's Management is responsible for the preparation of these financialstatements that give a true and fair view of the financial position financial performanceand cash flows of the Company in accordance with the Accounting Standards notified underthe Companies Act 1956 read with the General Circular 15/2013 dated 13thSeptember 2013of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act 2013and in accordance with the accounting principles generally accepted in India. Thisresponsibility includes the design implementation and maintenance of internal controlrelevant to the preparation and presentation of the financial statements that give a trueand fair view and are free from material misstatement whether due to 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 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 and fair presentation ofthe financial statements in order to design audit procedures that are appropriate in thecircumstances but not for the purpose of expressing an opinion on the effectiveness ofthe Company's internal control. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made bymanagement as well as evaluating the overall presentation of the financial statements.Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion.
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:
(a) In the case of the Balance Sheet of the state of affairs of the Company as atMarch 31 2014;
(b) In the case of the Statement of Profit and Loss of the profit of the Company forthe year ended on that date; and
(c) In the case of Cash Flow Statement of the cash flow for the year ended on thatdate.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. This report does not include a statement on the matters specified in paragraph 4 ofthe Companies (Auditor's Report) Order 2003issued by the Central Government of India interms of Section 227(4A) of the Act;since in our opinion and according to the informationand explanation given to us the said order is not applicable to the company.
2. As required by Section 227(3) of the Act we report that:
(a) We have obtained all the information and explanations which to the best of ourknowledge 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 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 Balance Sheet the Statement of Profit and Loss and the CashFlow Statement comply with Accounting Standards notified under the Act; read with theGeneral Circular 15/2013 dated 13thSeptember 2013 of the Ministry of Corporate Affairs inrespect of Section 133 of the Companies Act 2013.
(e) On the basis of the written representations received from the directors as on March312014 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2014 from being appointed as a director in terms of Section 274(1)(g) ofthe Act.
For B. R. KHAITAN & CO.
Membership No. 060367
Regn. No. 305012E
Date: 13th May 2014
ANNEXURE TO THE PART OF THE AUDITORS REPORT
(This is annexure referred to in our Report of even date)
In terms of information and explanations given to us and the books and records examinedby us in the normal course of audit and to the best of our knowledge and belief we stateas under:
The company has maintained proper records showing full particulars includingquantitative details and situation of its Fixed Assets. These Fixed Assets were physicallyverified by the management during the year. We have been informed that no materialdiscrepancies were noticed on such verification.
None of the Fixed Assets have been revalued during the year.
The stock of the inventory (Raw materials Components Stores & Spare PartsWork-in-process Finished Goods etc.) have been physically verified by the managementduring the year at reasonable intervals except stock lying with third parties it isstated to us that confirmation of such stocks lying with parties have been obtained by thecompany in most of the cases. In our opinion the procedure of physical verification ofinventory followed by the Management is reasonable and adequate in relation to the size ofthe company and its nature of business. The company is maintaining proper records ofinventory.
The discrepancies noticed on physical verification between physical stock and bookrecords which were of not material value have been properly dealt with in the Books ofaccount.
In our opinion there are adequate internal control procedures commensurate with thesize of the company and the nature of its business for the purchase of inventory and fixedassets and for the sale of goods.
The Central Government has not prescribed the maintenance of Cost records by thecompany U/S 209(1)(d) of the Companies Act-1956 for any of its products.
In case of transaction of purchase of goods and materials and services and sale ofgoods and materials exceeding the vaiue of Rupees Five Lacs in the financial year inrespect of any;
a) Transaction that to be entered into a register in pursuant of section 301 of the Acthave been so entered;
b) In our opinion each of these transactions have been made at prices which arereasonable having regard to the prevailing market prices at the relevant time.
The company has not accepted any deposits from the public. In our opinion the directiveissued by the Reserve Bank of India and the provision of the section 58Aand 58AAof the Actand the rules framed thereunder where applicable have been complied with. NationalCompany Law Tribunal or any other Court has not passed any order in this respect.
In our opinion reasonable records have been maintained by the Company for the sale anddisposal of realisable scraps. The Company has no by-products.
The Company is depositing the Provident Fund and employees' State Insurance dues withthe appropriate authority.
According to the information and explanation given to us no undisputed amounts payablein respect of Income Tax Wealth Tax Sales Tax Customs Duty and Excise Duty wereoutstanding as at 31.03.2014 for a period of more than six months from the date theybecome payable (Except as mentioned in Notes on Accounts).
According to the information and explanations given to us no personal expenses ofDirectors or employees have been charged to Profit & Loss Account other than thosepayable under contractual obligations or in accordance with generally accepted businesspractice.
The Company has accumulated losses and incurred loss in the financial year to underreview and has cash losses in the financial year immediately preceding the said financialyear.
The Company has invested in shares as disclosed in respective schedule.
The Company has not given any guarantee for loans taken by others from banks orfinancial institutions.
The Company is a sick industrial unit within the meaning of clause (o) of sub Section(1) of Section 3 of the Sick Industrial Companies (Special Provision) Act 1985. The Boardfor Industrial & Financial Reconstruction (BIFR) had also declared the Company as asick industrial unit.
The Company is a recognized R&D Centre of the Govt of India under its recognitionletter of ministry science and technology.
In respect of trading items according to the information and explanations given to usthere were no damaged goods during the year.
The Company is not a Chit Fund Nidhi or Mutual benefit fund/Society.
During the checks carried out by us any fraud on or by the company has not beennoticed or reported during the year under report.
For B. R. KHAITAN & CO.
Membership No. 060367
Regn. No. 305012E
Date : 13th May 2014
SECRETARIAL AUDIT REPORT
The Board of Directors
Modern Malleables Limited
53B Mirza Ghalib Street
We have examined the registers records and documents of Modern Malleables (*theCompany) for the period commencing from 1st April 2013 to March 2014for compliance ofprovisions of :-
1. The Companies Act 1956 applicable sections of the Companies Act 2013 effectivefrom 12th September 2013 (*New Act) and the Rules and there under :
2. The Depositories Act 1996 and the Regulations and Bye laws framed thereunder.
3. The following Resolutions and Guidelines prescribed under the Securities andExchange Board of India Act 1992 (SEBI Act)
(a) Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations 2011.
(b) Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 1992. (c) Securities and Exchange Board of India (Employees Stock OptionScheme and Employees Stock Purchase Scheme) Guidelines 1999.
4. The Securities Contracts (Regulation) Act 1956 (SCRA) and the Rules madethereunder and
5. The Listing Agreement entered into with BSE Limited and National Stock Exchange ofIndia Limited.
Based on our examination and verification of the registers records and documentsproduced us and according to the information and explanations given to us by the Company.We report that the Company has in our opinion complied with the provisions of theAct/New Act and the Rules made thereunder and with the Memorandum and Articles ofAssociation of the Company with regard to :
(a) Maintenance of various statutory registers and documents and making necessaryentries therein.
(b) Closure of the Register of Member.
(c) Forms Returns documents and resolutions required to be filed with the Registrarof Companies and Central Government.
(d) Service of documents by the Company on its Members and the Registrar of Companies.
(e) Notice of meeting of the Board and Committees thereof.
(f) Minutes of the meetings of the Board and Committees thereof including passing ofresolutions by circulation.
(g) Notice convening the 29th Annual General Meeting held on 26th September 2013.
(h) Minutes of General Meetings.
(i) Approvals of the Members the Board of Directors the Committees of Directors andGovernment authorities wherever required.
(j) Constitution of the Board of Directors/Committee(s) of Directors and appointmentretirement and reappointment of Directors including the Managing Director and ExecutiveDirectors.
(k) Payment of remuneration to the Directors including the Managing Director andExecutive Directors.
(I) Appointment and remuneration of Statutory Auditors and Cost Auditors.
(m) Transfer and transmission of the Company's shares issue and allotment of sharesand issue and delivery of certificate of shares.
(n) Declaration and payment of dividends including interim dividend.
(o) Transfer of amounts as required under the Act to the Investor Education andProtection Fund.
(p) Satisfaction of charges if any registered with the Registrar of Companies.
(q) Form of Balance Sheet as prescribed under Part-1 of Schedule VI to the Act andrequirement as to Profit & Loss Account as per Part-ll of the said Schedule.
(r) Contracts common seal registered office and publication of name of the Company ;and
(s) Generally all other applicable provisions of the Act/the New Act and the Rules madethereunder.
We further report that:
(a) The Directors have complied with the requirements as to disclosure of interests andconcerns in contracts and arrangements shareholdings/debentures holdings and arrangementShareholdings/debentures holdings and directorship in other companies and interest inother entries.
(b) The Directors have complied with the disclosure requirements in respect of theireligibility of appointment their being independent and compliance with the Share DealingCode and Code of Conduct of the Company.
(c) The Company has obtained all necessary approvals under the various provisions ofthe Act/New Act.
(d) There was no prosecution initiated against or show cause notice received by theCompany and no fines or penalties were imposed on the Company during the year under reviewunder the Companies Act SEBI Act SCRA Depositories Act Listing Agreement and Rules andRegulations and Guidelines framed under these Acts against the Company its Directors andOfficers.
We further report that the Company has complied with the provisions of the Depositorsact 1996 and the Bye-laws framed under the Act by the depositories with regard todematerilisation/rematerilisation of securities and reconciliation of records ofdematerialized securities with the securities with the securities issued by the Company.
We further report that
(a) The Company has complied with the requirements under the Listing Agreement enteredint with the BSE
Limited and the National Stock Exchange of India Limited.
(b) The Company has complied with the provisions of the Securities and Exchange Boardof India (Substantial Acquisition of Shares and Take Overs Regulations2011 including theprovisions with regard to disclosures and maintenance of records required under theRegulations.
(c) The Company has complied with the provisions of the Securities and Exchange Boardof India (Prohibition of Insider Trading) Regulations 1992 including the provisions withregard to disclosures and maintenance of records required under the Regulations.
(d) The Company has complied with the provisions of the Securities and Exchange Boardof India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines1999with regard to implementation of 2012.
|Dhrub ||a Charan Sahoo |
|Practicing ||Company Secretary |
|Place : Kolkata ||C.P. No. 5508 |
|Date : 13th May2014 || |
AUDITOR'S CERTIFICATE ON COMPLIANCES WITH THE CORPORATE GOVERNANCE UNDER CLAUSE 49 OFTHE LISTING AGREEMENT
TO THE MEMBERS
We have examined the compliance of the conditions of Corporate Governance by ModernMalleables Limited for the year ended on 31st March 2014as stipulated in Clause 49 of theListing Agreement of the said Company with the Stock Exchange.
The Compliance of the condition of Corporate Governance is the responsibility of theManagement. Our examination was limited to procedures and implementations thereof adoptedby the Company for ensuring the compliance of the conditions of Corporate Governance. Itis neither an audit nor an expression of opinion on the financial statement of theCompany.
In our opinion and to the best of our information and according to the explanationgiven to us and the representation made by the Management we certify that the Company hascomplied with the conditions of Corporate Governance as stipulated in the above mentionedListing Agreement.
We state that such compliance is neither as assurance as to the future viability of theCompany nor the efficiency or effectiveness with which the Management has conducted theaffairs of the Company.
For B. R. KHAITAN & CO.
Membership No. 060367
Regn. No. 305012E
Place : Kolkata
Date : 13th May2014