| Report on the financial statements
We have audited the accompanying financial statements of Balaji
Galvanising Industries Limited ("the Company"), which comprise the
Balance Sheet as at March 31, 2014 and the Statement of Profit and Loss
and Cash Flow Statement for the year then ended, and a summary of
significant accounting policies and other explanatory information.
Management's responsibility for the financial statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the company in accordance with
the Accounting Standards referred to in sub-section (3C) of section 211
of the Companies Act, 1956 ("the Act") read with the General Circular
15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in
respect of section 133 of the Companies Act, 2013. This responsibility
includes the design, implementation and maintenance of internal control
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor's responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor's judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the company's preparation of the
financial statements in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the company's internal control. An
audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of the accounting estimates made
by management, as well as evaluating the overall presentation of the
financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
a) in the case of the Balance Sheet, of the state of affairs of the
company as at March 31,2014;
b) in the case of the statement of Profit and Loss, of the loss for the
year ended on that date; and
c) in the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2003 ("the
Order") issued by the Central
Government of India in terms of sub-section (4A) of section 227 of the
Act, we give in the Annexure
a statement on the matters specified in paragraphs 4 and 5 of the
Order.
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 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 the company so far as appears from our examination of those
books
c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books
of account.
d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and
Cash Flow Statement comply with the Accounting Standards referred to
in subsection (3C) of section 211 of the Companies Act, 1956 read
with the General Circular 15/2013 dated 13 September 2013 of the
Ministry of Corporate Affairs in respect of section 133 of the
Companies Act, 2013;and
e) on the basis of written representations received from the directors
as on March 31,2014, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2014, from
being appointed as a director in terms of clause (g) of sub-section
(1) of section 274 of the Companies Act, 1956.
ANNEXURE TO AUDITOR'S REPORT
Annexure referred to in paragraph 1 of Our Report of even date to the
members of Balaji Galvanising Industries Limited on the accounts of the
company for the year ended 31 st March, 2014.
On the basis of such checks as we considered appropriate and according
to the information and explanation given to us during the course of our
audit, we report that:
1. (a) The company has maintained proper records showing full
particulars including quantitative details and situation of its fixed
assets.
(b) As explained to us, fixed assets have been physically verified by
the management at reasonable intervals; no material discrepancies were
noticed on such verification.
(c) In our opinion and according to the information and explanations
given to us, no fixed asset has been disposed off during the year. As
such going concern status of the company has not been affected.
2. (a) As explained to us, inventories have been physically verified
during the year by the management
at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
(c) In our opinion and on the basis of our examination of the records,
the company is generally maintaining proper records of its inventories.
No material discrepancy was noticed on physical verification of stocks
by the management as compared to book records.
3. (a) According to the information and explanations given to us and
on the basis of our examination of
the books of account, the company has not granted any loan, secured or
unsecured to Companies, firms or other parties listed in the register
maintained under section 301 of the Companies Act, 1956, but has taken
loan from three parties, listed in the register maintained under
section 301 of the Companies Act, 1956. The maximum amount involved
during the year was Rs. 1,17,81,433/ - and the year end balance of loan
taken from such parties was Rs. 1,17,81,433/-.
(b) In our opinion and according to the information and explanations
given to us, the rate of interest, wherever applicable and other terms
and conditions on which such loans have been taken are not prima facie
prejudicial to the interest of the company.
(c) In respect of loans taken by the company, the interest payments are
regular and the principal amounts are repayable on demand.
(d) There is no overdue amount of loans taken from such parties listed
in the register maintained under section 301 of the Companies Act,
1956.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the company and the nature of its business with regard
to purchase of inventories, fixed assets & for sale of goods and
services. During the course of our audit, no major instance of
continuing failure to correct any major weaknesses in the internal
controls has been noticed.
5. a) Based on the audit procedures applied by us and according to the
information and explanations provided by the management, the
particulars of contracts or arrangements referred to in section 301 of
the Act have been entere in the register maintained under that section.
b) As per the information & explanations given to us and in our
opinion, the transactions entered into by the company with parties
covered u/s 301 of the Act have been made at prices which appear
reasonable having regard to the prevailing market prices at the
relevant time.
6. According to the information and explanation given to us, the
company has not accepted any deposits from the public within the
meaning of the provisions of Section 58A and 58AA of the Companies Act,
1956 and Companies (Acceptance of Deposits) Rules 1975.
7. As per the information & explanations given by the management, the
company has an internal audit system commensurate with its size and
nature of its business.
8. As per information & explanation given by the management,
maintenance of cost records has been prescribed by the Central
Government under clause (d) of sub-section (1) of section 209 of the
Act and we are of the opinion that prima facie the prescribed accounts
and records have been made and maintained. We have, however, not made a
detailed examination of the cost records with a view to determine
whether they are accurate or complete.
9. (a) According to the records of the company, undisputed statutory
dues including Provident Fund, Investor Education and Protection Fund,
Employees' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service
Tax, Custom Duty, Excise Duty, cess to the extent applicable and any
other statutory dues have generally been regularly deposited with the
appropriate authorities. According to the information and explanations
given to us there were no outstanding statutory dues as on 31st of
March, 2014 for a period of more than six months from the date they
became payable.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of income tax, wealth tax, sales
tax, customs duty, excise duty and cess are in arrears as at 31 st
March 2014 for a period of more than six months from the date they
became payable.
(c) According to the information and explanation given to us, there are
no dues of sales tax, income tax, customs duty, wealth tax, excise duty
and cess which have been deposited on account of any dispute, except
under mentioned dues.
Name of the Statute Central Excise Act, 1944
Nature of Dues Excise Duty
Period to which the dispute
related 2012-13
Forum where dispute is pending Commissioner of Central Excise
(Appeals)
Amount (Rs.) 17,95,647
10. In our opinion, the accumulated losses of the Company at the end
of the year under report are more than 50% of the company's net worth.
The company has incurred cash loss during the finacial year covered by
our audit and also in the immediately preceding financial year.
11. According to the records of the company examined by us and as per
the information and explanations given to us, the company has not taken
any loans and borrowings from any financial institution or bank nor
issued any debentures.
12. According to the information and explanations given to us, the
company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
13. The Company is not a chit fund or a nidhi /mutual benefit
fund/society. Accordingly, paragraph 4(xiii) of the order is not
applicable.
14. According to information and explanations given to us, the company
is not dealing in or trading in Shares, securities, debentures and
other investments. Accordingly, the provisions of clause 4(xiv) of the
Companies (Auditor's Report) order, 2003 are not applicable to the
company.
15. According to the information and explanations given to us, the
company has not given any guarantee for loan taken by others from a
bank or financial institution.
16. Based on our audit procedures and as per the information given by
the management, we report that the company has not raised any term loan
during the year.
17. Based on the information and explanations given to us and on an
overall examination of the Balance Sheet of the company as at 31st
March, 2014, we report that no funds raised on short-term basis have
been used for long-term investment by the company,
18. Based on the audit procedures performed and the information and
explanations given to us by the management, we report that the company
has not made any preferential allotment of shares during the year.
19. According to the information and explanation given to us, the
company has not issued any secured debentures during the year.
20. The company has not raised any money by public issue during the
year under audit.
21. Based on the audit procedures performed and the information and
explanations given to us, we report that no fraud on or by the company
has been noticed or reported during the year, nor have we been informed
of such case by the management.
For DAGLIYA & CO.
Chartered Accountants
ICAI Firm Regn. No. 00671S
Date : 30-05-2014 (Jitendra Kumar Jain)
Place : Secunderabad Partner
M. No.18398 |