The Member of
RASOYA PROTEINS LIMITED
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of Rasoya ProteinsLimited ("the Company") which comprise the Balance Sheet as at March 312016the Statement of Profit and Loss the Cash Flow Statement for the year then ended and asummary of the 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 stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone financial statements to give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making judgments and estimates thatare reasonable and prudent; and design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are freefrom materialmisstatement whether due 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 and the Rules made thereunderincluding the accounting standards and matters which are required to be included in theaudit report.
We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act and other applicable authoritative pronouncements issued by theInstitute of Chartered Accountants of India. Those Standards and pronouncements requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the financial statements are free from materialmisstatement.
An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditors' judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances. An audit also includes evaluating theappropriateness ofthe accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof thefinancial 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.
Basis for Qualified Opinion
a) During the year the company has written off trade receivable to the extent of Rs.197.91 crores. We are not completely satisfied about the write off of these tradereceivables without the company having taken proper recovery efforts or legal action.
b) During the year thecompanyhas written off stockworth Rs. 92.82 crores. Howeversubsequently the company has sold the stock at scrap value proceeds of which are shownunder miscellaneous receipts. However we cannot comment on the quality of the stock sincethere was no appropriate certification from any outside agency regarding such stock.
c) Statement / confirmation for the bill discounting facility taken by the company forRs. 19.99 crores from Bank of Baroda cash credit facilities from State Bank of India forRs. 68.32 crores and secured loan taken from a NBFC outstanding for Rs. 5 crores was notmade available for verification and the same is subject to confirmation from therespective companies.
d) As per the accounting policy of the company and as per the Accounting Standard-11 -The Effects of Changes in Foreign Exchange rates; the exchange differences that arise onsettlement of monetary items or on reporting at each balance sheet date of the Company'smonetary items at the closing rate are recognised as income or expense in the period inwhich they arise. However the company has not recognised exchange gain of Rs. 41 croreson account of advance given to a subsidiary company.
e) The company in contravention of section 138 of the Companies Act 2013 has notappointed any internal auditor with regards to the internal audit of the company. Alsothe company has not appointed any cost auditor for the year under review which iscontravention of sub section (2) of section 148 ofthe Companies Act 2013.
f) Attention ofthe members is invited to note no. 30 regarding thefinancial statementsofthe Company having been prepared on a going concern basis notwithstanding the fact thatits net worth is completely eroded due to cash losses in previous and the year underreview inability to pay bank debts substantial write offs of trade receivables andstock. The appropriateness of the said basis is interalia dependent on the Company'sability to infuse requisite funds for meeting its obligations.
In our opinion and to the best of our information and according to the explanationsgiven to us except for the effects of the matters described in the Basis for Qualifiedopinion paragraph above the aforesaid standalone financial statements give theinformation required by the Act in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India ofthe state ofaffairs of the Company as at March 312016 and its loss and its cash flows for the yearended on that date.
Report on Other Legal and Regulatory Requirements
1. 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 our opinion except for the effect of the matters described in paragraph forBasis of Qualified Opinion above proper books of account as required by law have beenkept by the Company so far as it 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 except for the effect of the matters described in paragraph forBasis of Qualified Opinion above the aforesaid standalone financial statements complywith the Accounting Standards specified under Section 133 of the Act read with Rule 7 ofthe Companies (Accounts) Rules 2014.
(e) On the basis of the written representations received from the directors as on March31 2016 taken on record by the Board of Directors none of the directors is disqualifiedas on March 312016from being appointed as a director in terms of Section 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 A.
(g) With respect to the other matters to be included in the Auditors' Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our knowledge and belief and according to the information andexplanations given to us:
i. The Company has disclosed the impact if any of pending litigations as at March 312016 on its financial position in its standalone financial statements as referred to inNote No. 31 to the financial statements.
ii. The Company has made provision as at March 312016 as required under theapplicable law or accounting standards for material foreseeable losses if any onlong-term contracts including derivative contracts.
iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company during the year ended March312016.
2. As required by 'the Companies (Auditor's Report) Order 2016' issued by the CentralGovernment of India in terms of sub-section (11)
of section 143 of the Act (hereinafter referred to as the "Order") and onthe basis of such checks of the books and records of the Company as we consideredappropriate and according to the information and explanations given to us we give in theAnnexure B a statement on the matters specified in paragraphs 3 and 4 of the Order.
| ||For M/s. V.N. Bhuwania & Co. |
| ||Chartered Accountants |
| ||Firm Reg. No.: 101482W |
|Place: Nagpur ||V.N. Bhuwania |
|Date : May 30 2016 ||Proprietor |
| ||Mem.No: 7068 |