| We have audited the accompanying financial statements of "GILADA
FINANCE & INVESTMENTS LIMITED", which comprise the Balance Sheet as at
March 31, 2015, and the Statement of Profit and Loss and Cash Flow
Statement for the year then ended, and a summary of significant
accounting policies and other explanatory information, in which are
incorporated the returns for the year ended on that date of audited by
us of the company's branch at Gulbarga (Karnataka).
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 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 of 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 the design implementation and
maintenance of adequate internal financial control 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 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, issued by the
Institute of Chartered Accountants of India, as 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 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. An audit also includes evaluating the appropriateness of
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 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 of the state of affairs of the Company as at March 31,2015, its
Profit / Loss, 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;
to the extent applicable.
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
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 and proper returns adequate for the purposes of our audit have
been received from branches visited by us;
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 and with the returns received from branches visited by us;
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 written representations received from the directors
as on March 31,2015, and 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;
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 18 (B) (6)
(A) 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.
1. (a) The Company has maintained proper records showing full
particulars including quantitative details & situation of the fixed
assets, except details like year of purchase, cost of purchase etc are
not readily available.
(b) All the fixed assets have not been physically verified by the
management during the year under audit, but there is a regular
programme of verification which, in our opinion, is reasonable having
regard to the size of the company & the nature of its fixed assets. No
material discrepancies were noticed on such verification.
2. The nature of the Company's business / activities during the year
does not involve inventories & accordingly clauses 2(a), 2(b) & 2(c) of
paragraph 4 of the Companies (Auditors Report) order 2015 are not
applicable to the Company.
3. (a) The company has given loans to four parties covered in the
register maintained under section 189 of the Companies Act, 2013. The
maximum amount involved during the year was not determined by the
management, since they are in the nature of current accounts and
repayable on demand. The yearend balance of loan granted together with
corporate guarantee given to such parties was Rs. 518.13 lakhs, which
is within the maximum limits prescribed under section 185 & 186 of the
Companies Act 2013 and under RBI Directions to Non Banking Financial
Companies.
There are no written terms & conditions on which loans granted to
Companies, Firms or other parties listed in the register maintained
under section 189 of the Companies Act, 2013, However, no
irregularities of repayment of principal amount & interest amount by
the parties were noticed.
(b) Since there are no written terms & conditions on which loans
granted to Companies, firms / other parties listed in the register
maintained under section 189 of the Companies Act, 2013, and since they
are in the nature of current accounts repayable on demand there are no
overdue amounts of loans granted.
4. In our opinion & according to the information & explanations given
to us, there is adequate internal control systems/procedures
commensurate with the size of the company & the nature of its business,
with regard to purchases & sales of fixed assets & with regard to
sanction, disbursement & recovery of loans given by the Company. During
the course of our audit, we have not observed any major weakness or
continuing failure to correct any major weaknesses in the internal
control system of the company in respect of these areas. The activities
of the company do not involve purchase of Inventory and the sale of
goods
5. In our opinion & according to the information & explanations given
to us, the company is not required to comply with the directions issued
by Reserve Bank of India under Non Banking Financial Companies (Reserve
Bank) Directions, 1998, with respect to public deposits, since no
deposits have been accepted from the public. No order 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.
6. The Central Government has not prescribed the maintenance of cost
records under section 148 (1) of the Companies Act, 2013 for the nature
of business of Company, Since the Company is not into manufacturing
activity.
7. (a) The company is generally regular in depositing with appropriate
authorities undisputed statutory dues including provident fund,
employees state insurance, income tax, sales tax, wealth tax, service
tax, custom duty, excise duty, value added tax, cess & other material
statutory dues applicable to it. However, we are informed that the
provisions of the Employees Provident Fund & Employees State Insurance
Scheme are not yet applicable to the Company.
According to the information & explanations given to us, no undisputed
amounts payable in respect of provident fund, employees state Insurance
income tax, wealth tax, sales tax, service tax, customs duty, excise
duty, value added tax cess & other material statutory dues were in
arrears, as at 31-3-2015 for a period of more than 6 months from the
date they became payable.
(b) According to the information & explanations given to us, except
income tax, no dues of sale tax, customs duty, wealth tax, excise duty
& cess which have not been deposited on account of any dispute.
There is a disputed income tax liability of Rs. 4,71,077/- for AY
06-07, which is under appeal with Commissioner of Income Tax
(Appeals)-I, Bangalore. The dispute is on account of disallow ability
of deduction claimed under section 10(23G) and expenses disallowed u/s
14Aand u/s 37 of the I.T. Act.
(c) There were no amounts which were required to be transferred to the
Investor Education and protection fund by the company in accordance
with the relevant provisions of the Companies Act, 1956 & rules made
there under.
8. In our opinion, the company had no accumulated losses at the end of
the financial year & the company has not incurred cash losses during
the financial year covered by our audit & has not incurred cash losses
during the immediately preceding financial year.
9. In our opinion & according to the information & explanations given
to us, the company had generally not defaulted in repayment of dues to
a Financial Institution, Bank or debenture holders.
10. We are informed that the company has given guarantee for the loan
taken by another company under the same management from a Co-operative
Bank for a total amount of Rs. 2,00,00,000/-. (Rs. Two crores) on the
terms and conditions whereof, in our opinion, are not prima facie
prejudicial to the interest of the company.
11. We are informed that, no term loans are raised by the Company
during the year under audit. Hence, our comments on its utilization is
not required.
12. According to the information & explanations given to us, no fraud
on or by the company has been noticed or reported during the course of
our audit.
For VISHNUKANT JAJU & ASSOCIATES
CHARTERED ACCOUNTANTS
FRNo.014328W
PLACE : BANGALORE (VBJAJU)
DATE : 6th May,2015 PROPRIETOR
M. No. 044988 |