TO THE MEMBERS OF GUJARAT FOILS LIMITED
Report on the Financial Statements
We have audited the accompanying financial statements of GUJARAT FOILS LIMITED
("the Company") which comprise the Balance Sheet as at 31st March,
2017, the Statement of Profit and Loss and the Cash Flow Statement for the year then
ended, and a summary of significant accounting policies and other explanatory information.
Managements Responsibility for the 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 the 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 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
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.
Auditors 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
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. An audit also includes evaluating the
appropriateness of 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 audit opinion on the Financial Statements.
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:
i. in the case of the balance sheet, of the state of affairs of the Company as at 31st
March 2017;
ii. in the case of the statement of profit and loss, of the loss of the Company for the
year ended on that date; and
iii. 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
1. As required by the Companies (Auditors Report) Order, 2016 ("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 a statement on the matters specified in paragraphs 3
and 4 of the Order, to the extent applicable.
2. As required by section 143(3) of the Act, we report that:
a. we have sought & 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 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 Companies Act, 2013, read with rule 7 of the
Companies (Accounts) Rules, 2014, as amended;
e. on the basis of written representations received from the directors as on 31st
March 2017, and taken on record by the Board of Directors, none of the directors is
disqualified as on 31st March 2017, from being appointed as a director in terms
of Section 164 (2) of the Act;
f. with respect to the adequacy of the internal financial control over financial
reporting of the Company and the operating effectiveness of such controls, refer to our
separate report in Annexure - B
g. 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, 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 statement as stated in Note - 25 to the Financial Statements.
ii. The company has made provision, as required under the applicable law or accounting
standards, for material foreseeable losses, if any, as required on long term contracts
including derivative contracts;
iii. No amount is required to be transferred to Investor Education and Protection Fund
in accordance with the relevant provisions of the Companies Act, 2013 and rules made there
under.
h. The company has disclosed in Note - 30 to the accounts of details regarding
Specified Banks Notes properly.
|
For H R Agarwal & Associates |
|
Chartered Accountants |
|
Firms Registration Number: 323029E |
|
Sd/- |
|
(Shyam Sundar Agarwal, FCA) |
| Place: Mumbai |
Partner |
| Date: 29th May, 2017 |
Membership number: 060033 |
The Annexure - A referred to in paragraph 1 under the heading "Report on other and
regulatory requirements" of our report of even date
i) (a) The Company has maintained proper records showing full particulars including
quantitative details and situation of fixed assets on the basis of available information.
(b) Fixed Assets have been physically verified by the management in the phased
periodical manner, which in our opinion is reasonable having regard to the size of the
company and the nature of its Assets. No material discrepancies were noticed on such
verification.
(c) The title deeds of immovable properties are held in the name of the company;
ii) The Inventory has been physically verified during the year by the management. In
our opinion the frequency of verification is reasonable and no material discrepancies were
noticed on such verification.
iii) The company has not granted any loans secured or unsecured to companies, firms,
Limited Liability Partnership or other parties covered in the register maintained under
section 189 of the Companies Act, 2013.
iv) In respect of loans, investments, guarantees, and security provisions of section
185 and 186 of the Companies Act, 2013, have been complied with to the extent applicable.
v) In our opinion and according to the information and explanations given to us, the
Company has not accepted any deposit from the public in pursuance to sections 73 to 76 or
any other relevant provisions of the Companies Act, 2013 and the rules framed there under.
vi) Maintenance of Cost Records has been specified by the Central Government under sub
section (1) of Section 148 of the Companies Act, 2013. These accounts and records have
been so made and maintained. However, we have not made a detailed examination of the Cost
Records with a view to determine whether they are accurate or complete.
vii) a) According to the records of the Company, the Company is generally regular in
depositing with appropriate authorities undisputed statutory dues including Provident
Fund, employees state Insurance, Sales tax, Service Tax, custom duty, excise duty, value
added tax, cess and other material statutory dues applicable to it, except income tax
during the year.
According to the information and explanations given to us, no undisputed amounts
payable in respect of service tax, sales tax, custom duty, excise duty or value added tax
and cess were in arrears, as at 31st March, 2017 for a period of more than six months from
the date they became payable, except Income tax which are due for more than six months
amounting Rs. 2,90,00,000/- for the financial year 2013-14 and Rs. 3,04,80,090/- for the
financial year 2014-15.
b) There is a demand of Rs 10, 87, 88,625/- on account of VAT & CST assessment for
the financial Years 2007-2008 to 20112012, which are pending with Appellate Authority.
However, Rs 83, 75,000/- has already been paid against same.
viii) According to records of the company, the company has defaulted in repayment of
loans or borrowings to financial institutions and banks till 31st March, 2017,
the details are as follows:
| Name of the lenders |
Amount of default as at 31.03.2017 (Rs in crores) |
Period of default (no. of days) |
Nature of Facility |
| Allahabad Bank |
54.64 |
182 |
Cash Credit |
| Bank of India |
20.19 |
274 |
Cash Credit |
| Dena Bank |
14.00 |
59 |
Cash Credit |
| IDBI Bank |
49.81 |
365 |
Cash Credit |
| State Bank of India |
24.78 |
123 |
Cash Credit |
| Union Bank of India |
9.57 |
365 |
Cash Credit |
| Bank of India |
10.06 |
274 |
Term Loan |
| Dena Bank |
1.06 |
59 |
Term Loan |
| IDBI Bank |
11.28 |
365 |
Term Loan |
| State Bank of India |
37.19 |
123 |
Term Loan |
| Dena Bank |
4.88 |
158 |
Letter of Credit |
| State Bank of India |
13.63 |
188 |
Letter of Credit |
| Union Bank of India |
32.24 |
516 |
Letter of Credit |
Ix) The company has not raised moneys by way of initial public offer or further public
offer (including debt instruments) and the money raised by way of term loans were applied
for the purposes for which those were raised.
x) No any fraud by the company or any fraud on the company by its officers or employees
has been noticed or reported during the year.
xi) The Managerial Remuneration has been paid / provided in accordance with the
provisions of section 197 read with schedule V to the Companies Act, 2013
xii) The company is not a Nidhi Company. Accordingly, Clause (xii) of paragraph 3 of
the Order are not applicable to the Company.
xiii) The Company has entered into transactions with the related parties in compliance
with section 177 and 188 of the companies Act, 2013 and the details of such transaction
have been disclosed in the Financial statements as required by the applicable accounting
standards;
xiv) The company has not made any preferential allotment or private placement of shares
or fully or partly convertible debentures during the year under review.
xv) According to the information and explanations given to us, the Company has not
entered into non- cash transactions with directors or persons connected with them;
xvi) The Company is not required to be registered under section 45-IA of the RBI Act,
1934.
|
For H R Agarwal & Associates |
|
Chartered Accountants |
|
Firms Registration Number: 323029E |
|
Sd/- |
|
(Shyam Sundar Agarwal, FCA) |
| Place: Mumbai |
Partner |
| Date: 29th May, 2017 |
Membership number: 060033 |
Annexure to the Independent Auditors Report
Annexure-B referred to in paragraph 2(f) under "Report on other legal and
regulatory requirements" of our report of even date)
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section
143 of the Companies Act, 2013 ("the Act")
We have audited the Internal Financial Control over financial reporting of Gujarat
Foils Limited ("the Company") as of 31st March, 2017 in conjunction
with our audit of the financial statements of the Company for the year then ended.
Management Responsibility for the Internal Financial Controls
The Companys management is responsible for establishing and maintaining internal
financial controls based on the internal control over financial reporting criteria
established by the Company considering the essential components of internal control stated
in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting
issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities
include the design, implementation and maintenance of adequate internal financial controls
that were operating effectively for ensuring the orderly and efficient conduct of its
business, including adherence to the Companys policies, the safeguarding of its assets,
the prevention and detection of frauds and errors, the accuracy and completeness of the
accounting records, and the timely preparation of reliable financial information, as
required under the Act.
Auditors Responsibility
Our responsibility is to express an opinion on the Companys internal financial
controls over financial reporting based on our audit. We conducted our audit in accordance
with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting
(the "Guidance Note") and the Standards on Auditing, issued by ICAI and
prescribed under Section 143(10) of the Act, to the extent applicable to an audit of
internal financial controls, both applicable to an audit of Internal Financial Controls
and, both issued by the iCAi. Those Standards and the Guidance Note require that we comply
with ethical requirements and plan and perform the audit to obtain reasonable assurance
about whether adequate internal financial controls over financial reporting was
established and maintained and if such controls operated effectively in all material
respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of
the internal financial controls system over financial reporting and their operating
effectiveness. Our audit of internal financial controls over financial reporting included
obtaining an understanding of internal financial controls over financial reporting,
assessing the risk that a material weakness exists, and testing and evaluating the design
and operating effectiveness of internal control based on the assessed risk. 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.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion on the Companys internal financial controls system
over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A companys internal financial control over financial reporting is a process designed
to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A companys internal financial control over financial
reporting includes those policies and procedures that (1) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2) provide reasonable assurance that
transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of
management and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition of the
companys assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financial
reporting, including the possibility of collusion or improper management override of
controls, material misstatements due to error or fraud may occur and not be detected.
Also, projections of any evaluation of the internal financial controls over financial
reporting to future periods are subject to the risk that the internal financial control
over financial reporting may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal
financial controls system over financial reporting and such internal financial controls
over financial reporting were operating effectively as at 31st March, 2017,
based on the internal control over financial reporting criteria established by the Company
considering the essential components of internal control stated in the Guidance Note on
Audit of Internal Financial Controls over Financial Reporting issued by the ICAI.
|
For H R Agarwal & Associates |
|
Chartered Accountants |
|
Firms Registration Number: 323029E |
|
Sd/- |
|
(Shyam Sundar Agarwal, FCA) |
| Place: Mumbai |
Partner |
| Date: 29th May, 2017 |
Membership number: 060033 |
+91-9892691696
