| 1. We have audited the accompanying financial statements of KND
Engineering Technologies Limited, ("the Company"), which comprise the
Balance Sheet as at March 31st 2014, the Statement of Profit and Loss
and Cash Flow Statement for the year ended 31st March, 2014 and a
summary of significant accounting policies and other explanatory
information.
Management's Responsibility for the Financial Statements
2. The Company's 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 notified under the
Companies Act, 1956 ("the Act") (which continue to be applicable in
respect of Section 133 of the Companies Act, 2013 in terms of General
Circular 15/2013 dated 13th September, 2013 of the Ministry of
Corporate Affairs) and in accordance with the accounting principles
generally accepted in India. 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.
Auditors' Responsibility
3. 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.
4. An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditors' 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 and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for 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.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion
6. In our opinion and to the best of our information and according to
the explanations given to us, the aforesaid 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:
i) In the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2014;
ii) In the case of Statement of Profit and Loss, of the profit for the
year ended on that date; and
iii) In the case of the Cash Flow Statement, of the cash flows of the
company for the year ended on that date.
Emphasis of Matter
Attention is invited to point no 5 in note 2 on financial statement.
Property at 30 Shakespeare Sarani, Kolkata has been sold in 2009. The
same property was released as per Hon'ble Calcutta High Court & Bombay
High Court orders dated 16/03/2009 & dated 7/05/2009 respectively.
However M/S Fab Leathers Ltd. has gone to Supreme Court claiming
transfer of ownership of the said property & case is pending in Supreme
Court. Our opinion is not qualified in respect of this matter
7. Report on Other Legal and Regulatory Requirement
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 enclose in the Annexure
a statement on the matters specified in paragraphs 4 and 5 of the said
Order.
8. 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 it appears from our examination of
those books.
c. The Balance Sheet, the Statement of Profit & Loss and the Cash Flow
Statement dealt with by this report are in agreement with the books of
account.
d. In our opinion, the Balance Sheet, the Statement of Profit & Loss
and the Cash Flow Statement comply with Accounting Standards notified
under the Act (which continues to be applicable in respect of Section
133 of the Companies Act, 2013 in terms of General Circular 15/2013
dated 13th September, 2013 of the Ministry of Corporate Affairs).
e. On the basis of written representations received from the
Directors, as on 31st March, 2014 and taken on record by the Board of
Directors, none of the Directors are disqualified as on 31st March,
2014 from being appointed as a Director in terms of clause (g) of
sub-section (1) of Section 274 of the Act.
ANNEXURE TO AUDITORS' REPORT
(Referred to in Paragraph 5 of our report of even date)
(i) In respect of its Fixed Assets.
a. As informed, the Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
b. During the year, Fixed Asset has been physically verified by the
management.
c. During the year, the Company has not disposed off any substantial
part of the assets.
(ii) In respect of its Inventories :
a) During the year, inventory has been physi- cally verified at
reasonable intervals by the management.
b) Inventory has been physically verified at reasonable intervals by
the Management but we are unable to make our comment on procedures of
physical verification.
c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of inventory &
no material discrepancies were noticed on physical verifications.
(iii) In respect of loans, secured or unsecured, granted or taken by
the Company to/from Companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act 1956.
a. The Company has not granted any Loans secured or unsecured to
Companies, firms or other parties covered in the register main- tained
under section 301of the Act. There- fore, clause 3(b) to 3(d) of the
Companies (Auditors' Report) Order 2003 are not appli- cable to the
Company.
b. The Company has not taken any loans se- cured or unsecured from
Companies, firms or other parties covered in the register main- tained
under section 301 of the Act. There- fore, clause 3(e) to 3(g) of the
Companies (Auditors' Report) Order 2003 is not appli- cable to the
Company.
(iv) In our opinion and according to the information and explanations
given to us, there seems to be an internal control system for the
purchase of inven- tory, fixed assets and for the sale of goods and
services but the same needs to be further strengthened.
(v) In respect on transactions covered under Section 301 of the
Companies Act 1956:
In our opinion and according to the information and explanations given
to us, there are no particu- lars of contracts or agreements that need
to be entered into in the register in pursuance of Sec- tion 301 of the
Companies Act, 1956. Therefore, clause 5(b) of the Companies (Auditors'
Report) Order 2003 is not applicable to the Company.
(vi) The Company has not accepted deposits from the public.
(vii) During the year internal audit has been conducted internally but
the internal audit system needs to be strengthened.
(viii) In our opinion the company is not a manufacturing Company. There
fore clause 4 (viii) of the compa- nies (Auditors' Report) Order 2003
is not appli- cable to the Company.
(ix) In respect of statutory dues:
a. According to the records of the Company and information and
explanations given to us, in our opinion the Company has gener- ally
been regular in depositing undisputed statutory dues including
Employees State In- surance, Income Tax, Sales Tax, Wealth Tax, Service
Tax, Customs Duty, Excise Duty, and any material statutory dues except
some ESI & Service Tax applicable to it with appropri- ate authorities.
b. According to the information and explana- tions given to us and the
records of the com- pany examined by us, there are disputed dues with
respect to sales tax/Vat and ser- vice tax are as follows :
Name of the Nature of Amount Period to Forum
statute dispute (Rs.) which the where
relates the dispute
is pending
Assam General Asseement 63816 AY 1999-00 Commissioner
Sales Tax Act 93 dues of Taxes
Commissioner of Service Tax 12371352 1.10.04 to CESTAT 8
Service Tax 31.03.07 Calcutta
High Cout
Commissioner of Service Tax 24352206 23.08.2007 to CESTAT
of Service Tax 31.03.2010
The Income Tax 3552860 AY 2010
Commissioner -2011 Appeal
of Income Tax
(x) The Company has no accumulated losses at the end of the financial
year and has not incurred cash losses during the financial year as well
as in the immediately preceding financial year.
(xi) In our opinion and according to the information and explanation
given to us, the Company has delayed in repayment of some dues to
finan- cial institutions, banks at the end of the year.(Please refer to
note 2.3.a.1 of Financial Statements)
(xii) In our opinion and according to the information and explanation
given to us, the Company has not granted any loans against Co's Fixed
De- posits.
(xiii) In our opinion, the Company is not chit fund or a Nidhi /Mutual
benefit fund/ society. Therefore, the provisions of clause 4(xiii) of
the Compa- nies (Auditors' Report) Order 2003 are not ap- plicable to
the Company.
(xiv) The Company has not dealt in the securities, debentures and other
investment. Accordingly the provisions of clause 4(xiv) of the Compa-
nies (Auditors' Report) Order 2003 are not ap- plicable to the Company.
(xv) The Company has not given any guarantees for loans taken by others
from banks or finan- cial institutions.
(xvi) During the year, the company has raised term loans. It has been
applied for the purpose for which loans have been obtained.
(xvii) According to the information and explanations given to us and on
an overall examination of the Balance Sheet of the Company we are of
the opinion that no funds raised on short-term basis have been used for
long-term invest- ments.
(xviii) During the year the Company has not made any preferential
allotment of shares to parties and companies covered in the Register
main- tained under Section 301 of the Companies Act 1956.
(xix) The Company has not raised any money by way of debentures issued
during the year.
(xx) The company has not raised any money by way of public issue during
the year.
(xxi) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
has been noticed or reported during the year.
For L N Todi & Co.
Chartered Accountants
Registration No. 304022E
Lalit Todi
PLACE: Kolkata
Partner
Dated : May 28th, 2014 Membership No. 054847 | 