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INDEPENDENT AUDITORS REPORT
TO THE MEMBERS OF K A WIRES LIMITED
We have audited the accompanying standalone financial statements of K A Wires Ltd. ("the Company), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss for the year then ended, cash flow statement, of the Cash Flow for the year ended on that date 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 of these standalone financial statement that give a true and fair view of the financial position, financial performance of the company in accordance with the accounting principles generally accepted in India including 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 of 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 standalone 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 misstatements.
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, 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 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 standalone financial statements.
Basis for Qualified Opinion
The Companys inventories are carried in the Balance Sheet at Rs 7,81,49,741/- (As at 31st March 2017: Rs 8,86,01,082/-). The Management has not stated the inventories at the lower of cost and net realisable value but has stated them solely at estimated market price, which constitutes a departure from the Accounting Standard - 2 "Valuation of Inventories". The Companys records indicate that had the Management stated the inventories at the lower of cost and net realisable value, an amount of Rs. 2,86.70.443/- and 2,79,43,108 /- would have been required to write down the opening inventories and closing inventories respectively to their net realisable value. Accordingly, cost of sales would have been decreased by Rs 7,27,335 /- and income tax, profit for the year and shareholders funds would have been increased by Rs. 1,38,594/-, Rs. 7,27,335 /- and Rs 5,88,741 /- respectively. This matter was also mentioned in our report on the financial statements for th 31st March 2017
In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion paragraph above, the aforesaid 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 March 31, 2018;
(b) In the case of the Statement of Profit and Loss, of the profit for the year ended on that date.
(c) In the case of cash flow statement, of the Cash Flow for the year ended on that date
Report on Other Legal and Regulatory Requirements
1 As required by Companies (Auditors Report) order, 2016 issued by the central government of India in terms of Section 143(11) of the Companies Act,2013, we give in the annexure a statement on the matters specified in paragraphs 3 and 4 of the said order
2 As required by section 143(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 as far as appears from our examination of the books of the company.
c) The Balance Sheet and the Profit & Loss Account dealt with by this report are in agreement with the books of account submitted to us.
d) In our opinion the Profit & Loss Account and the Balance Sheet comply with the accounting standards referred to Sub-Section 133 of the Companies Act, 2013 read with rule 7 of the Companies (Accounts) Rules,2014
e Based on the written representations received from the directors and taken on record by the board, we are of the opinion that none of the directors are disqualified for appointment under section 164(2) of the Companies Act, 2013.
f) With respect to the adequacy of the internal financial controls over financial reporting of the company and the operating effectiveness of such controls .refer to our separate report in "Annexure B", and
g) With respect to the other matters included in the Auditors Report and to our 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 as referred to in Note 29
ii The Company did not have any long-term contracts including derivatives contracts for which there were any material foreseeable losses.
in There were no amounts required to be transferred, to the Investor Education and Protection Fund by the Company.
|46 B B Ganguly Street,||For S.N. Kedia & Associates|
|4lh Floor, Room No. 11,||Chartered Accountants|
|Kolkata - 700 012.||FRN - 3J9025E|
Dated the 16th day of May, 2018.
Membership No. - 054075
ANNEXURE TO INDEPENDENT AUDITORS REPORT
RE KA WIRES LIMITED
Referred to in para 1 in Report on Other Legal 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.
b) The Company has regular programme of physical verification of its fixed assets by which fixed assets are verified in a phased manner over a period of three years. In accordance with this programme, certain fixed assets were verified during the year and no material discrepencies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of company and nature of its assets.
c) According to the information and explanation given to us and on the basis of our examination of the records of the company,the title deeds of immovable properties are held in the name of company.
ii) In respect of its inventories:
a) The inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.
b) In our opinion and according to the information and explanations given to us. the procedures of physical verification of inventories followed by the management are reasonable and adequate to the size of the Company and nature of its business.
. c) The Company has maintained proper records of the inventories. As per the information and explanation given to us, no material discrepancies were noticed on physical verification.
iii) According to the information and explanation given to us and on the basis of our examination of the books of account, 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, 2013.
iv) In our opinion and according to the information and explanations given to us. the company has complied with the provisons of section 185 & 186 of the Act, with respect to loans and investment made
v) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposit from the Public. Therefore, the provisions of clause (v) of paragraph 3 of CARO 2016 are not applicable to the company.
vi) According to the information and explanations given to us the Central government has not prescribed maintenance of cost records under sub-section (1) of section 148 of the Companies Act, 2013. Therefore, the provisions of clause (vi) of paragraph 3 of CARO 2016 are not
. applicable to the company.
vn) a) According to the information and explanation given to us and on basis of our examination of the records of the Company, amounts deducted/accrued in books of account in respect of undisputed statutory dues including provident fund,ESI, income tax, sales tax. vaule added tax. duty of customs, Excise, service tax, cess and material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities
According to the information and explanation given to us.no undisputed amounts paybale in respect of provident fund,income tax,value added tax,duty of customs,service tax,cess and other material statutory dues were in arrears as at 31s March 2018 for a period of more than six months from the date they become paybale.
b) According to information and explanations given to us, there are no material dues of duty of customs, sales tax, duty of excise, service tax and value added tax which has not been deposited with appropriate authorities on account of any dispute. However, according to information and explanation to given to us, the following dues of income tax, have not been deposited by the Company on account of disputes:
|Sr No||Name of the statute||Nature of Dues||Amount (Rs. In||Period to which the amount relates||Forum where dispute is pending|
|1||Income tax||Demand u/s 143(3)||44,14,910/-||A Y. 2012-13||CIT(Appeals)-3|
viii) In our opinion and according to the information and explanation given to us, The company has not defaulted in the repayment of dues to a financial institution, bank, government or dues to debenture holders
ix) Based upon the audit procedure performed and the information and explanation given by the management, the Company did not raise any money by way of initial public offer or further public offer (including debt insturements during the year. The company has raised term loans from bank during the year and were utilized for the purpose said loans were raised
x) According to information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.
xi) According to information and explanations given to us and based on our examination of the records of the Company, the company has paid/provided for managerial remunaration in accordance with the requisite approvals mandated by the provisons of section 197 read with schedule V of the Act.
xii) In our opinion and according to the information and explanation given to us, the Company is not a Nidhi Company Accordingly, paragraph 3(xii) of the order is not applicable.
xiii) According to information and explanations given to us and based on our examination of the records of the Company,transactions with the related parties are in compliance with section 177 & 188 of the Act where applicable and details of such transaction have been disclosed in the financial statements as required by the applicable accounting standared
xiv) According to information and explanations given to us and based on our examination of the records of the Company,the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.
xv) According to information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the order is not applicable.
xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.
|46, B.B Ganguly Street,||For S.N. Kedia & Associates|
|4 Floor, Room No. 11,||Chartered Accountants|
|Kolkata - 700 012.||FRN No. 319025E|
|Membership No. - 054075|
|Dated the 16th day of May, 2018|