| 1. We have audited the accompanying financial statements of Koffee
Break Pictures Limited (the "Company"), which comprise the Balance
Sheet as at March 31st, 2014, and the Statement of Profit and Loss and
Cash Flow Statement for the year ended, and a summary of significant
accounting policies and other explanatory information, which we have
signed under reference to this report.
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 referred to in sub-section
(3C) of section 211 of 'the Companies Act, 1956' of India (the "Act").
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 auditors consider 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 the purpose for expressing opinion on the
effectiveness of the entity'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 accompanying 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 31st, 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 the Cash Flow Statement, of the cash flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
7. As required by 'the Companies (Auditor's Report) Order, 2003', as
amended by 'the Companies (Auditor's Report) (Amendment) Order, 2004',
issued by the Central Government of India in terms of sub-section (4A)
of section 227 of the Act (hereinafter referred to as the "Order"), and
on the basis of such checks of the books and records of the Company as
we considered appropriate and according to the information and
explanations given to us, we give in the Annexure a statement on the
matters specified in paragraphs 4 and 5 of the 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 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 dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C) of section 211 of
the Act 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 Act.
ANNEXURE TO INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 7 of the Independent Auditors' Report of even
date to the members of Koffee Break Pictures Limited on the financial
statements as of and for the year ended 31st March, 2014.
i. a) The Company is maintaining proper records showing full
particulars, including quantitative
details and situation, of fixed assets.
b) The company has a program for phased physical verification of all
its fixed assets which in our opinion, is reasonable having regard to
size of company and nature of its assets. As informed, no material
discrepancies have been noticed on such verification.
c) The company has disposed off a substantial part of its fixed assets
during the year however; the going concern assumptions remain
unaffected.
ii. a) The management has conducted physical verification of fixed
assets at reasonable intervals during the year.
b) The procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
company and the nature of its business.
c) The company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification.
iii. a) The company has not given any unsecured interest free loan
during previous years to parties mentioned in the register maintained
u/s 301 of the Act.
b to d) Since the company has not given any unsecured loans to the
parties covered in the register maintained u/s 301 of the Act, hence
paragraph (iii) (b) (c) and (d) of the order, are not applicable
e) The company has not taken any new unsecured interest free loans from
parties covered in the register maintained u/s 301 of the Act under
review.
g) Since the company has not taken any loans from the parties
covered in the register maintained u/s 301 of the Act, hence paragraph
(iii) (f) and (g) of the order, are not applicable.
iv. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business, for the
purchase of inventory, fixed assets and sale of its products and
services. During the course of our audit, no major weakness has been
noticed in the internal control system in respect of these areas.
v. a) To the best of our knowledge and belief and according to the
according to the information's and explanations give to us, we are
of the opinion that the particulars of contracts or arrangements
referred to in section 301 of the act have been entered in the
register required to be maintained under that section; and
b) Transaction made in pursuance of such contracts or arrangements have
been made at prices which are reasonable having regard to the
prevailing market prices at the relevant time.
vi. The company has not accepted any deposit from public. Therefore,
the provision of clause 4 (vi) of the Order are not applicable to the
Company.
vii. The company does not have formal internal audit system but its
financial and internal checks ensures proper recording of financial
transactions
viii. The maintenance of cost records has not been prescribed by the
Central Government u/s (d) of sub-section (1) of section 209 of the
Companies Act, 1956.
ix. According to the information and explanations given to us and
record of the company examined by us, there are no disputed dues of any
statute liabilities. As per our information, no disputed case is
pending
x. According to the information and explanations given to us, the
company has accumulated losses of ' 3,81,02,665/- at the end of the
financial year and it has not incurred cash losses during the current
year but had incurred cash loss of ' 14,389,301/- in the immediately
preceding financial year.
xi. In our opinion and according to the information and explanations
given to us, the company has not made any delay in repayment of dues to
a financial institution or bank
xii. In our opinion and 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, debenture and other
securities.
xiii. In our opinion, the company is not a chit fund or a nidhi /
mutual benefit fund / society. Therefore, the provision of clause 4
(xiii) of the order, are not applicable to the Company.
xiv. In our opinion, the company is not dealing in or trading in
shares, securities, debentures and other investments. Accordingly the
provision of clause 4 (xiv) of the order, are not applicable to the
company
xv. In our opinion and according to the information and explanations
given to us, the Company has not given guarantee for loan taken by
others from banks or financial institution.
xvi. The Company has not raised term loans during the year. The term
loans outstanding at the beginning of the year have been applied for
the purposes for which they were raised.
xvii. According to the information and explanation given to us and on
an overall examination of the balance sheet of the company, we report
that no funds raised on short term basis have been used for long-term
investment by the company.
xviii. According to information and explanation provided to us and on
the basis of records examined by us, the company has not made
preferential allotment of equity shares to companies/persons covered in
the registered maintained u/s 301 of the Companies Act, 1956.
xix. The Company has not issued debentures during the year under review
and therefore the provision of clause 4(xix) of the Order, are not
applicable to the company.
xx. During the year covered by our audit report, the Company has not
raised any money by way of public issue.
xxi. According to the information and explanation given to us, no fraud
on or by the company has been noticed or reported during the course of
our audit.
For Agarwal Desai & Shah
Chartered Accountants
Firm Reg. No.124850W
Rishi Shekhri
Place : MUMBAI. Partner
Date : 30th May, 2014 Membership No. 126656 | 