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Nuway Organic Naturals India Ltd.

BSE: 531819 Sector: Others
NSE: N.A. ISIN Code: INE414L01012
BSE 05:30 | 01 Jan Nuway Organic Naturals India Ltd
NSE 05:30 | 01 Jan Nuway Organic Naturals India Ltd

Nuway Organic Naturals India Ltd. (NUWAYORGANIC) - Auditors Report

Company auditors report

TO THE MEMBERS OF NUWAY ORGANIC NATURALS INDIA LIMITED

REPORT ON THE STANDALONE IND AS FINANCIAL STATEMENTS

We have audited the accompanying financial statements of Nuway Organic Naturals IndiaLimited which comprise the Balance Sheet as at March 31 2018 the Statement of Profitand Loss (including Other Comprehensive Income) the Statement of Changes in Equity andStatement of Cash Flows for the year ended and a summary of significant accountingpolicies 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 with respect to the preparation and presentation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance including other comprehensive income changes in equityand cash flows of the Company in accordance with the Indian Accounting Standards (Ind AS)prescribed under section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended and other accounting principles generally accepted inIndia. This responsibility also includes maintenance of adequate accounting records inaccordance with the Profitisions of the Act for safeguarding the assets of the Company andfor preventing and detecting 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 financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting 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.

AUDITOR'S RESPONSIBILITY

Our responsibility is to express an opinion on these standalone financial statementsbased on our audit. We have taken into account the Profitisions of the Act the accountingand auditing standards and matters which are required to be included in the audit reportunder the Profitisions of the Act and the Rules made there under. We conducted our auditin accordance with the Standards on Auditing specified under Section 143(10) of the Act.Those Standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the financial statements are free frommaterial misstatement. An audit involves performing procedures to obtain audit evidenceabout the amounts and the disclosures in the financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error. In making thoserisk assessments the auditor considers internal financial control relevant to theCompany's preparation of the financial statements that give a true and fair view in orderto design audit procedures that are appropriate in the circumstances but not for thepurpose of expressing an opinion on whether the Company has in place an adequate internalfinancial controls system over financial reporting and the operating effectiveness of suchcontrols. An audit also includes evaluating the appropriateness of the accounting policiesused and the reasonableness of the accounting estimates made by the Company's Directorsas well as evaluating the overall presentation of the financial statements. We believethat the audit evidence we have obtained is sufficient and appropriate to Profitide abasis for our audit opinion on the standalone financial statements.

OPINION

We have audited the standalone financial statements of Nuway Organic Naturals IndiaLimited (“the Company”) which comprise the balance sheet as at March 31 2018and the statement of Profit and Loss (statement of changes in equity) and the statementof cash flows for the year then ended and notes to the financial statements including asummary of significant accounting policies and other explanatory information. In ouropinion and to the best of our information and according to the explanations given to usexcept for the effects of the matter described in the Basis for Qualified Opinionsection of our report and Emphasis of Matters the aforesaid financial statementsgive a true and fair view of in conformity with the accounting principles of the state ofaffairs of the Company as at March 31st 2018 and profit/loss (changes in equity) and itscash flows for the year ended on that date.

Basis for Qualified Opinion

1. The company has not Profitided us details in respect of pending litigations andtherefore has not disclosed the impact of pending litigations which describes theuncertainty related to the outcome of the litigations filed against the company

2. The company has not conducted the physical verification of the inventory held at theend of the year and also not Profitided us the sufficient documents in respect ofverification and valuation of stock. Accordingly we are unable to satisfy ourselvesconcerning the inventory quantities held at 31st March 2018 which are stated in theBalance Sheet at Rs.156.73 Lac as per Schedule No 15 of the Financial Statements.

3. The company has not Profitided us any reconciliation/confirmation in respect ofbalances of trade receivables loans advances other current assets trade payablesunsecured loans and current liabilities from the parties.. Accordingly we are unable tosatisfy ourselves about the authenticity of balances as stated in the FinancialStatements. As a result of these matters we were unable to determine whether anyadjustments might have been found necessary in respect of inventories accounts receivablecurrent assets current liabilities and expenditure in the Balance Sheet and thecorresponding elements making up the Statement of Profit and Loss and Cash Flow Statement

4. The Company's various credit facilities have been declared “Non-PerformingAssets” by its bank and the physical possession of the unit has been taken over bythe bank after issue of notice under section 13(4) of the SARFAESI Act.

5. The Company has not Profitided us any details in respect of branches at BaddiLalru Ambala Chandigarh DML Country Liquor in respect of total Asset/Liabilitiesamounted to Rs 344.18 Lacs.

We conducted our audit in accordance with Standards on Auditing (SAs) specified undersection 143(10) of the Companies Act 2013. Our responsibilities under those Standards arefurther described in the Auditor's Responsibilities for the Audit of the FinancialStatements section of our report. We are independent of the Company in accordance with theCode of Ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the financial statements under theProfitisions of the Companies Act 2013 and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the ICAI's Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate toProfitide a basis for our qualified opinion.

EMPHASIS OF MATTER

1. Reclassification of Long Term Loans into current liabilities

The Company's various credit facilities declared as NPA and as such the amounts of suchterm loans have been

reclassified into current liabilities from non-current liabilities.

2. Going-Concern

The preparation of the financial statements is done on going concern basisconsequently assets and liabilities are being carried at their book value. The company hasaccumulated losses and has incurred losses during the financial year ended 31stMarch 2018. As on date the Company's current liabilities exceeded its current assets andthe Company's net worth has also been eroded. There are negative operating cash flowsindicated by historical financial statements adverse key financial ratios and inabilityto comply with the term loan agreements. These conditions indicate the existence of amaterial uncertainty that may cast significant doubt about the company's ability tocontinue as a going concern. Our Opinion is not qualified in respect of above matters.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

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 the paragraph 3and 4 of the Orderto the extent applicable. 2. As required by Section 143(3) of the Actwe report that: a. We have sought and obtained all the information and explanations whichto the best of our knowledge and belief were necessary for the purposes of our audit; b.In our opinion proper books of account as required by law have been kept by the Companyso far as appears from our examination of those books. c. The Balance Sheet the Statementof Profit and Loss including Other Comprehensive Income Statement of Changes in Equityand the Statement of Cash Flow dealt with by this Report are in agreement with the booksof account. d. In our opinion the aforesaid standalone financial statements comply withthe Indian Accounting Standards prescribed under section 133 of the Act. e. On the basisof the written representations received from the directors as on March 31 2018 taken onrecord by the

Board of Directors none of the directors is disqualified as on March 31 2018 frombeing appointed as a director in terms of Section 164(2) of the Act. f. With respect tothe other matters to be included in the Auditor's Report in accordance with Rule 11 of theCompanies

(Audit and Auditors) Rules 2014 in our opinion and to the best of our information andaccording to the explanations given to us: The Company has not disclosed the impact ofpending litigations on its financial position in its financial statements; The Company hasmade Profitision as required under the applicable law or Indian accounting standards formaterial foreseeable losses if any on long-term contracts including derivativecontracts; There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

For Miglani Rakesh & Associates
(Chartered Accountants)
Reg No. :012227N
Date : 30/06/2018 R.K. Miglani
Place : Rajpura Proprietor
M.No. : 090734

ANNEXURE TO THE AUDITORS' REPORT

The Annexure referred to in our report to the members of the company for the year ended31 March 2018. To the best of our knowledge and belief and information & explanationgiven to us we further report that:- 1. a) The company has maintained proper records toshow full particulars including quantitative details & situation of its fixed assets.b) As explained to us the fixed assets have been physically verified by the management atreasonable intervals which in our opinion is appropriate having regards to size of thecompany and nature of its assets. No material discrepancies have been noticed during theyear. C) The title deeds of immovable properties are held in the name of the Company.

2) The inventory of the company has not been physically verified by the management atreasonable intervals during the

year.

3. The company has not granted loans secured or unsecured to Companies Firms or otherparties covered in the Register maintained u/s 189 of the Company Act 2013 during theyear. 4. In respect of loans investments guarantee and security the Profitisions ofsection 185 and 186 of the Companies Act 2013 have been complied with. 5. The company hasaccepted loans from directors amount 8.07 crores as well as from corporate bodiesamounting to 3.79 crores. The company has not accepted any public deposits hence thedirectives issued by the Reserve Bank of India & the Profitisions of Section 73 to 76of the Companies Act 2013 are not applicable. No order has been passed by the Company LawBoard or National Company Law Tribunal or Reserve Bank of India or any court or any otherTribunal.

6. On the basis of records produced to us we are of the opinion that the cost recordsprescribed by the Central Government of India under section 148(1) of the Act have notbeen made & maintained & also cost audit not conducted.

7. (a) According to the books and records as produced and examined by us in accordancewith generally accepted auditing practices in India and also based on Managementrepresentations undisputed statutory dues in respect of Profitident Fund Employee'sState Insurance dues Investor Education and Protection Fund Income Tax Service TaxCess Goods and Services Tax and other material statutory dues have not been regularlydeposited by the Company during the year with the appropriate authorities in India anddetails of arrear outstanding in respect of above for a period of more than six month ason 31.03.2018 were not made available. (b) No information and explanations was given tous regarding dues of sales tax income tax customs duty service tax excise duty andcess which have not been deposited on account of any dispute. 8. During the year ended 31March 2018 the Company has defaulted on timely payment of principal and payment ofinterest on term loans and cash credits. The total outstanding has been recalled by bank.The Company did not raise money by way of initial public offer or further public offer(including debt instruments and term loans during the year). 9. As per the information andexplanation given to us and on the basis of examination of records no material fraud onor by the Company was noticed during the course of our audit. 10. The Company has notobtained the requisite apProfital as mandated by the Profitisions of section 197 read withschedule V of the Companies Act for the payment of managerial remuneration. The details ofthe same have been mentioned in the “Basis of Qualified Opinion” sectionof Audit Report. 11. In our opinion considering the nature of activities carried on bythe Company during the year the Profitisions of any special/statute applicable to NidhiCompany are not applicable to it. 12. All transactions with related parties are inaccordance with section 177 and 188 of the Companies Act 2013 and details have beendisclosed in the financial statements as required by the applicable Ind-AS. 13. TheCompany has not made any preferential allotment or private placement of shares or fully orpartly convertible debentures during the year under review. 14. The Company has notentered into any non-cash transactions with directors or persons connected with him duringthe year under review. 15. The Company is not required to be registered under section45-IA of the Reserve Bank of India 1934.

For Miglani Rakesh & Associates

(Chartered Accountants)

Reg No. :012227N

Date : 30/06/2018 R.K. Miglani
Place : Rajpura Proprietor
M.No. : 090734
Annexure 2

Annexure to the Independent Auditor's Report of even date to the members of NuwayOrganic Naturals India Limited

on the financial statements for the year ended 31st March 2018

Independent Auditor's report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the

Companies Act 2013 (“the Act”)

1. In conjunction with our audit of the financial statements of Nuway Organic NaturalsIndia Limited (“the Company”) as of and for the year ended 31stMarch2018 we have audited the internal financial controls over financial reporting (IFCoFR) ofthe company of as of that date.

Management's Responsibility for Internal Financial Controls

2. The Company's Board of Directors is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting (IFCoFR) 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 the company's business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Act.

Auditors' Responsibility

3. Our responsibility is to express an opinion on the Company's IFCoFR based on ouraudit. We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India (ICAI)and deemed to be prescribed underSection 143(10) of the Act to the extent applicable to an audit of IFCoFR and theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting (the“Guidance Note”) issued by the ICAI. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate IFCoFR were established and maintained and ifsuch controls operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the IFCoFR and their operating effectiveness. Our audit of IFCoFR included obtaining anunderstanding of IFCoFR assessing the risk that a material weakness exists and testingand evaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgement including theassessment of the risks of material misstatement of the financial statements whether dueto fraud or error.

5. We believe that the audit evidence we have obtained is sufficient and appropriate toProfitide basis for our audit opinion on the Company's IFCoFR.

Meaning of Internal Financial Controls over Financial Reporting

6. A Company's IFCoFR is a process designed to Profitide reasonable assurance regardingthe reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with Generally Accepted Accounting Principles. A Company'sIFCoFR 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) Profitide reasonable assurance that transactions are recorded as necessary topermit preparation of financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the Company are being madeonly in accordance with authorisations of management and directors of the company; and (3)Profitide reasonable assurance regarding prevention or timely detection of unauthorisedacquisition use or disposition of the Company's assets that could have a material effecton the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

7. Because of the inherent limitations of IFCoFR including the possibility ofcollusion or improper management override of controls material misstatements due to erroror fraud may occur and not be detected. Also projections of any evaluation of the IFCoFRto future periods are subject to the risk that IFCoFR may become inadequate because ofchanges in conditions or that the degree of compliance with the policies or proceduresmay deteriorate.

Opinion

8. In our opinion the Company has in all material respects adequate internalfinancial controls over financial reporting and such internal financial controls overfinancial reporting were operating effectively as at 31stMarch 2018 based onthe internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the Institute ofChartered Accountants of India.

For Miglani Rakesh & Associates
(Chartered Accountants)
Reg No. :012227N
Date : 30/06/2018 R.K. Miglani
Place : Rajpura Proprietor
M.No. : 090734