The Members of TARINI INTERNATIONAL LIMITED
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of TARINI INTERNATIONAL LIMITED ("the Company"), which comprise the Balance sheet as at March 31, 2015, the Statement of profit and loss, cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information.
Managements Responsibility for the Standalone Financial Statements
The Companys 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 and presentation of these standalone 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 Rule7of 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.
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 thereunder.
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 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 financial control relevant to the Companys 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 Companys 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 on the standalone financial statements.
Basis for qualified opinion
(a) The company has made certain advances amounting to Rs. 100 Lakhs for which documents related to such advances given by the company were not available as the documents were impounded by the income tax authorities as mentioned in note no 26 of the financial statements. Further, confirmation from the parties as at end of the year was not found on records. In view of non-availability of related documents and other alternate audit evidence to corroborate the managements assessment of recoverability of these advances, we are unable to comment on the extent to which these balances are recoverable.
(b) We draw attention to the note 28 of the financial statements whereby the company has raised the money by way of Public Issue, during the year. Further, there has been variation in the utilisation of money, between the objects of public issue contained in the prospectus and actual utilisation, which was needed to be authorised from the members. In view of this, we are unable to comment upon the appropriateness of variation in utilisation of money.
(c) We draw attention to note 31 to Financial Statement regarding the investment amounting Rs.68, 00,000 in a subsidiary, which has suffered recurring losses and has a net capital deficiency. The financial statements of that subsidiary have been prepared assuming that the Company will continue as a going concern. These conditions raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts that might result that the subsidiary be unable to continue as a going concern.
In our opinion and to the best of our information and according to the explanations given to us, except for the effect of matter described in Basis for qualified opinion paragraph, the standalone 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 31st March, 2015;
(b) in the case of the Statement of Profit and Loss, of the profit of the Company for the year ended on that date, and
(c) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.
Emphasis of Matters
1. We draw attention to the note 21 of the standalone financial statements, in respect of trade receivables and trade payables external confirmations of the balances were not obtained by the Company. Management does not expect any material adjustment in respect of these balances. Due to non availability of confirmation of balances, we are unable to quantify the impact, if any, arising from the confirmation of balances.
2. We draw attention to the note 26 of the standalone financial statements regarding the survey operations conducted u/s 133A of income tax Act, 1961 by the Income tax Authorities in the companys premises during the previous year of which outcome is awaited. However, the management is confident about no adverse impact due to such outcome.
3. The company has given the collateral guarantee for the loan taken by its associate company / directors & loans / advances granted amounting to Rs. 1917.65 Lakhs to group companies / associated companies in which directors are interested; the company is yet to comply within the provisions of section 186 of the Companies Act, 2013.
Our Opinion is not qualified in respect of these matters.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors 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 the paragraph 3 and 4 of the Order.
2. As required by section 143 (3) of the Act, we report that:
a. we have sought and except for the matters described in the Basis for qualified opinion paragraph, obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b. except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, 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 and proper returns adequate for the purpose of our audit.
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. except for the possible effect of the matters described in the Basis for qualified opinion paragraph, 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 March 31, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015 from being appointed as a director in terms of Section 164 (2) of the Act; and
f. in our opinion and to the best of our information and according to the explanation given to us, we report as under with respect to the other matters to be included in the Auditors Report in accordance with Rule 11 of the companies (Audit and Auditors) Rules, 2014:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements. Refer Note 28 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.
For V C G & CO.
Firm Registration No.021837N
VISHAL CHANDRA GUPTA
Membership No. 093908
Place: New Delhi
Date: May 30, 2015
ANNEXURE REFERRED IN INDEPENDENT AUDITORS REPORT OF EVEN DATE
The Annexure referred to paragraph (1) in our Independent Auditors Report to the members of the Company on the standalone financial statements for the year ended March 31, 2015, we report that:
i. a. The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.
b. A major portion of the fixed assets has been physically verified by the management during the year pursuant to a programme for physical verification of fixed assets, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. According to the information and explanations given to us, no material discrepancies were noticed on such verification.
ii. As per the information and explanations provided to us, the company does not have any inventory; therefore, the provisions of clause 3 (ii) (a), (b) & (c) of the Companies (Auditors Report) Order, 2015 are not applicable to the company.
iii. According to the information and explanations provided to us, the Company has granted interest free loan, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act, 2013. There was no stipulation of repayment.
iv. In our opinion and according to the information and explanations provided to us, there exists an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, we have neither observed nor have been informed of any continuing failure to correct major weaknesses in internal control system of the Company.
v. According to the information and explanations given to us, the Company has not accepted any deposit as per the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act 2013 and the rules framed there under. No order against the Company has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal.
vi. According to the information and explanations given to us, the Company does not covered under specified category for the maintenance of cost records under Sub Section (1) of Section 148 of the Companies Act, 2013 as prescribed by the Central Government, therefore, clause 3 (vi) of the Companies (Auditors Report) Order, 2015 is not applicable to the company.
vii. a. According to the records of the company and Information & explanation provided to us, the Company, during the year, is generally regular in depositing undisputed statutory dues including provident fund, income tax, service tax and other statutory dues, as applicable with the appropriate authorities.
b. According to the information and explanation given to us, there were no disputed amounts payable in respect of income tax, sales tax, service tax, duty of customs, value added tax or cess as at March 31, 2015 except for the following:
|S. No Name of the Statute||Nature of Dues||Amount (Rs.)||Period to which amount relates||Forum where dispute is pending|
|1 Income tax Act||Income tax||12,26,350||A.Y. 2012-13||CIT Appeals|
|2 Income tax Act||Income tax||34,89,680||A.Y. 2011-12||CIT Appeals|
c. According to the information and explanations provided to us, the company does not have the required amount, which need to be transferred to Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder, therefore clause 3(vii) (c) of the Companies (Auditors Report) Order, 2015 is not applicable to the company.
viii. The Company does not have accumulated losses at the end of financial year March 31, 2015. The company has not incurred cash losses in this financial year and in the immediately preceding financial year.
ix. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank. The Company has not issued any debentures.
x. According to the information and explanations given to us, the Company has given guarantee for loans taken by other group company / directors from bank or financial institutions. In our opinion, based on the information and explanations provided to us, the terms and conditions on which the company has given the guarantees by way of equitable mortgage of its immovable property for loans taken by other companies / directors from banks or financial institutions are prima facie not prejudicial to the interest of the company.
xi. According to the information and explanations given to us, term loans have been applied for the purpose for which the loans were obtained.
xii. Based upon the audit procedures performed information and explanations given to us, we report that to the best of our knowledge and belief and according to the information and explanations provided to us, no fraud on or by the Company has been noticed or reported during the course of our audit.
For V C G & CO.
Firm Registration No.021837N
VISHAL CHANDRA GUPTA
Membership No. 093908
Place: New Delhi
Date: May 30, 2015