| We have audited the accompanying financial statements of M/s.
INTEGRATED THERMOPLASTICS LIMITED ("The Comapny") which comprise of the
Balance Sheet as at 31st March 2014, the statement of Profit and Loss
and also the cash flow statement for the year then ended and a summary
of significant accounting policies and other explanatory information.
2) Management's Responsibility for the Financial Statements:
The Company's Management is responsible for 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 Standards referred to in Section 211
(3C) of the Companies Act, 1956 ("The Act"). This responsibility
includes the design, implementation and maintenance of internal
controls relevant to the preparation and presentation of the financial
statements that give a true and fair view and free from material
misstatement, either due to fraud or error.
3) Auditors Responsibility:
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Accounting issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with the
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, either due to fraud or error. In making the risk
assessment, the auditor considers internal control relevant to the
Company's preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company's internal control. An audit also
includes evaluating the appropriateness of the accounting policies used
and the reasonableness of the accounting estimates made by the
management, 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.
4) 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.
a) in the case of the Balance Sheet, of the state of affairs of the
company as at 31st March, 2014;
b) In the case of the Statement of Profit and Loss, of the loss 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.
5) Report on Other Legal and Regulatory Requirements:
As required by the Companies (Auditor's Report) Order, 2003 ("The
Order") issued by the Central Government in terms of Section 227 (4A)
of the Act, we give the Annexure a statement on the matters specified
in paragraphs 4 and 5 of the Order.
As required by Section 227(3) of the Act, we report that:
i) 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.
ii) In our opinion, proper books of accounts as required by law have
been kept by the Company so far as it appears from our examination of
these books.
iii) 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 accounts.
iv) In our opinion, the Balance Sheet, the Statement of Profit and
Loss, and the Cash Flow Statement comply with the Accounting Standards
referred to in Section 211 (3C) of the Act.
v) On the basis of the written representations received from the
Directors as on 31st March, 2014 taken on record by the Board of
Directors, none of the Directors is disqualified as on 31st March 2014
from being appointed as a director in terms of section 274(1)(g) of the
Act.
ANNEXURE TO THE AUDITOR'S REPORT
(Referred to point no. 5 of our report of even date)
1. a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
Assets.
b) According to the information and explanations given to us the fixed
assets have been physically verified by the management during the year
and no discrepancies were noticed on such verification.
c) No Substantial part of fixed assets have been disposed off during
the year.
2. a) The Inventories have been physically verified by the management
during the year. In our opinion the frequency of verification is
reasonable and adequate.
b) The procedure of physical verification of inventories followed by
the management is reasonable and adequate having regard to the size of
the company, the nature and volume of its business.
c) The Company is maintaining proper records of inventory. The
discrepancies noticed on verification between the physical stocks and
the book records were not material.
3. a) The Company has taken interest free unsecured loan from
companies, listed in the register maintained under sec. 301 of
companies Act, 1956. The amount involved and outstanding is Rs. 205.40
lacs and repaid during the year. The company has not granted loan to
companies, firms or other parties listed in the register maintained
under sec. 301 of Companies Act, 1956.
b) The rate of interest and other terms and conditions of loans given
or taken by the company, secured or unsecured are prima facie not
prejudicial to the interests of the company.
c) The payments of the principal amount and interest amount are
regular.
d) There are no over due amounts of more than rupees one lac.
4. In our opinion, according to the information and explanation given
to us there are adequate internal control procedures commensurate with
the size of the company and the nature of its business with regard to
purchase of inventory, fixed assets and for sale of goods. During the
course of our audit, no major weakness has been observed in the
internal control
5. a) According to the information and explanations given to us, we are
of the opinion that the transactions that need to be entered into
Register maintained under section 301 of the Companies Act, 1956 have
been so entered.
b) In our opinion and according to the information and explanations
given to us, the transactions with parties with whom transactions
exceeding the value of rupees five lacs have been entered into during
the financial year at prices are reasonable, having regard to the
prevailing market prices at the relevant time.
6. The provisions of section 58A and 58AA of the Companies Act, 1956
are not applicable, as the Company has not accepted deposits from the
public.
7. The Company does not have a formal internal audit system.
8. Cost records under Section 209 (1) (d) of the Companies Act 1956,
are not prescribed for the business carried out by this Company.
9. a) According to the information and explanations given to us the
company is regular in depositing undisputed amounts payable in respect
of Provident Fund, Investor Education and Protection Fund, Employees
State Insurance, Income Tax, Sales Tax/VAT, Wealth Tax, Customs Duty,
Excise Duty, Cess and other statutory dues with the appropriate
authorities, which were outstanding as at 31st March 2014 for a period
of more than six months from the date they become payable except the
following;
STATEMENT OF ARREARS OF STATUTORY DUES OUTSTANDING FOR MORE THAN SIX
MONTHS:
S. Nature of Dues Amount Period to which the
No. amount relates to
1. APGST (ST Deferment) 3114718 1998-1999
2. APGST (ST Deferment) 12329041 1999-2000
3. APGST (ST Deferment) 19792919 2000-2001
4. Income Tax 4328070 2010-11
5. Income Tax 3417967 2011-12
6. Income Tax 3749686 2012-13
b) According to the information and explanation given to us the
following are the disputed dues relating to Income Tax, Wealth Tax,
Cess and Sales Tax, Service Tax, Central Excise as on 31.03.2014.
S. Nature of Statute Nature of Amount Period to Forum Where
No. Dues (Rs. in which the Dispute is
Lacs) amount Pending
Relates
1 APGST/VAT Act Sales Tax 66.42 2001-02 Appeal in STAT
2 Central Excise Act Excise Duty 1.04 1998-99 Department
Appeal in
CESTAT
3 Central Excise Act Excise Duty 89.00 Jan'05 to Department
June'05 Appeal in
CESTAT
4 The Finance Act Service Tax 2.09 2003-04 Appeal in
to 2007-08 CESTAT
10. The Company has incurred cash losses of Rs. 1,38,82,547/- during
the year. The accumulated losses are Rs. 2,41,75,668/- as against the
net worth of Rs. 6,28,89,000/-.
11. Based on our audit procedures and the information and explanations
given by the management, the company has default in repayment of dues
to financial institutions i.e., A.P.S.F.C Rs. 3,41,21,661/- (Instalment
Rs. 1,79,29,919/- and Interest due Rs. 1,61,91,742/-).
12. According to the information and explanations given to us the
company has not granted loans and advances on the basis of securities
by way of pledge of shares, debentures and others securities.
13. Clause No. XIII of CARO 2003 is not applicable to the company, as
this company is not a chit fund/nidhi/mutual benefit fund/society.
14. Clause No. XIV of CARO 2003 is not applicable to the company, as
this company is not dealing in shares, securities, debentures and other
investment.
15. According to the information and explanations given to us the
company has not given any guarantee for loans taken by others from bank
or financial institutions.
16. In our opinion the term loans have been applied for the purpose for
which they were raised.
17. The funds raised on short-term basis have not been used for
long-term investment.
18. The company has not made any preferential allotment of shares
during the year.
19. The company has not issued Debentures.
20. The company has not raised any money through public issue during
the year.
21. Based upon the audit procedures performed and information and
explanations given by the management, we report that, no fraud and or
by the company has been noticed or reported during the year.
For L.B. REDDY & CO.,
Chartered Accountants
Firm's Registration No. 8611S
Sd/-
Place : Hyderabad M. THIRUPALU REDDY
Date : 01-09-2014 Partner, M.No. 203098 |