| We have audited the accompanying financial statements of Fenoplast
Limited ("the Company"), which comprise the Balance Sheet as at 31st
March, 2015, the Statement of Profit and Loss, the Cash Flow Statement
for the year then ended, and a summary of the significant accounting
policies and other explanatory information.
Management's Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to 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 principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, 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 have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
there under.
We conducted our audit in 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 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 the 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 financial control relevant
to the Company's preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on whether the Company has in place an adequate internal
financial controls system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the Company's Directors, 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 qualified audit opinion.
Basis for Qualified Opinion
Note 23.1 to the financial statements, regarding excess managerial
remuneration amounting to Rs.57.43 Lacs paid to Managing Director and
Whole Time Director in excess of limits prescribed under Schedule XIII
of the Companies Act, 1956 in the financial year 2013-14 for which
approval from the Central Government is pending. The ultimate outcome
of this matter cannot presently be determined, accordingly no
adjustments have been made in the financial statements.
Our opinion is qualified in this matter.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, except for the possible effects of the matter
described in the Basis for Qualified Opinion, 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, of the state of
affairs of the Company as at 31st March, 2015, and its profit and its
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, 2015 ("the
Order") issued by the Central Government of India in terms of
sub-section (11) of section 143 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 3 and 4 of the Order.
2. 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 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 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 Statement dealt with by this Report are in agreement with the
books of account.
(d) In our opinion, the aforesaid financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the
directors as on 31st March, 2015 taken on record by the Board of
Directors, none of the directors is disqualified as on31st March, 2015
from being appointed as a director in terms of Section 164 (2) of the
Act.
(f) With respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i) The Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note 31 to the
financial statements;
ii) The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable
losses.
iii) There were no amounts which were required to be transferred to the
Investor Education and Protection Fund by the company Fenoplast Limited
Annexure to the Auditors' Report
The Annexure referred to in our report to the members of Fenoplast
Limited for the year ended on 31st March, 2015. We report that:
(i) (a) The company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets;
(b) As explained to us, the fixed assets have been physically verified
by the management in a phased periodical manner, which in our opinion
is reasonable, having regard to the size of the company and the nature
of its business. No material discrepancies were noticed on such
physical verification.
(ii) (a) The inventories have been physically verified during the year
by the management. In our opinion, the frequency of verification is
reasonable;
(b) 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) The Company has maintained proper records of its inventories. The
discrepancies noticed on verification between the physical stocks and
the book records were not material;
(iii) The Company has not granted any loans, secured or unsecured to
companies, firms or other parties covered in the register maintained
under section 189 of the Companies Act.
(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 for the sale of goods. During
the course of our audit, no major weakness has been noticed in the
internal control system in respect of these areas.
(v) The Company has not accepted deposits within the meaning of Section
73 to 76 of the Act and the rules framed thereunder.
(vi) We have broadly reviewed the cost records maintained by the
company pursuant to the companies (Cost audit and records) Rules 2014
prescribed by the central Government under sub-section (1) of section
148 of the Companies Act, 2013, and are of the opinion that prima facie
the prescribed cost records have been maintained.
(vii) (a) According to the information and explanations given to us and
the records of the company examined by us, the Company is generally
regular in depositing undisputed statutory dues including provident
fund, employees' state insurance, income-tax, service tax, value added
tax, sales tax, custom duty, excise duty, cess and other statutory dues
as applicable with the appropriate authorities and there were no
arrears of outstanding statutory dues as at the last day of the
financial year concerned for a period of more than six months from the
date they became payable.
(b) According to the information and explanations given to us and
records of the Company examined by us, the particulars of sales tax,
income tax, customs duty, excise duty, service tax and wealth tax, as
at 31st March, 2015 which have not been deposited on account of dispute
pending, are as under:
Name of the Nature of the Amount Period to Forum where dispute
Statute Dues (Rs. In which the is pending
Lakhs) amount
relates
Income-tax
Act, 1961 Income-tax 2.20 1999-2000 Income-tax Appellate
Tribunal, Hyderabad
Income-tax
Act, 1961 Income-tax 31.90 2000-2001 Income-tax Appellate
Tribunal, Hyderabad
Income-tax
Act, 1961 Income-tax 10.44 2001-2002 Income-tax Appellate
Tribunal, Hyderabad
Income-tax
Act, 1961 Income-tax 1.89 2002-2003 Income-tax Appellate
Tribunal, Hyderabad
Income-tax
Act, 1961 Income-tax 4.55 2003-2004 Income-tax Appellate
Tribunal, Hyderabad
Income-tax
Act, 1961 Income-tax 74.66 2005-2006 Income-tax Appellate
Tribunal, Hyderabad
Income-tax
Act, 1961 Income-tax 45.62 2006-2007 Income-tax Appellate
Tribunal, Hyderabad
Income-tax
Act, 1961 Income-tax 17.38 2009-2010 Assistant Commissioner
of Income Tax
Central Sales
Tax Act, Central Sales 26.57 2009-2010 Deputy Commissioner
of
Sales 1956 Tax Sales Tax, Appeals
Central Sales
Tax Act, Central Sales 26.97 2010-2011 Deputy Commissioner
of
Sales 1956 Tax Sales Tax, Appeals
Central Sales
Tax Act, Central Sales 258.29 2011-2012 Deputy Commissioner
of
Sales 1956 Tax Sales Tax, Appeals
(c) There are no amounts to be transferred to investor education and
protection fund in accor- dance with the relevant provisions of the
Companies Act, 1956 (1 of 1956) and rules made there under.
(viii) The company has no accumulated losses and it has not incurred
any cash losses during the financial year covered by our audit or in
the immediately preceding financial year;
(x) In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loan taken by
others from banks or financial institutions;
(xi) In our opinion and according to the information and explanations
given to us, the term loans have been applied by the Company during the
year for the purposes for which they were obtained, other than
temporary deployment pending application.
(xii) 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
was noticed or reported during the year.
For M.Anandam & Co.,
Chartered Accountants
(Firm's Registration No. 000125S)
Place: Secunderabad M.V.Ranganath
Date : 27.05.2015 Partner
Membership.No: 028031 |