| 1. We have audited the accompanying standalone financial statements of
VXL INSTRUMENTS LIMITED ('the Company'), which comprise the balance
sheet as at 31st March 2015, 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.
Management's Responsibility for the Financial Statements
2. The Company's 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 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 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.
Auditor's Responsibility
3. 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.
4. 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.
5. 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, 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, 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 Company's Directors, as well as
evaluating the overall presentation of the financial statements.
6. 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
Opinion
6. In our opinion and to the best of our information and according to
the explanations given to us, 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, 2015;
b. in the case of the Statement of Profit and Loss, of the loss for
the year ended on that date; and
c. in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date..
Emphasis of Matter
7. Without qualifying our report, we draw attention to:
a. Note No.2 (b) of notes to the accounts, regarding non-provision for
diminution in the value of investment of Rs. 51,69,261/- and
receivables of Rs. 4,96,36,260/- in respect of a subsidiary of the
company whose accumulated losses are in excess of the paid-up capital.
The Company's view is dependent on the projected profitability and cash
flow of the subsidiary Company.
Report on Other Legal and Regulatory Requirements
8. 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 the paragraph 3 and 4 of the
Order, to the extent applicable.
9. 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
purposes of our audit;
b. 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;
c. the Balance Sheet, the Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
d. In our opinion, the aforesaid standalone 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 31 March, 2015, taken on record by the Board of Directors, none
of the directors is disqualified as on 31 March, 2015, from being
appointed as a director in terms of Section 164(2) of the Act;
f. With respect to the other matters included in the Auditor's Report
in accordance with Rule 11 of the Companies (Audit and Auditors) Rules,
2014, in our opinion 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 under contingent
liabilities (refer note 2 (p) of notes on accounts)
ii. The Company did not have any long-term contracts including
derivatives contracts for which there were any material foreseeable
losses
iii. There are no amounts required to be transferred to the Investor
Education and Protection Fund by the Company.
Annexure referred to in our report to the members of VXL INSTRUMENTS
LIMITED for the year ended on March 31, 2015
1. a) The Company has maintained records showing full particulars,
including quantitative details and the
situation of its fixed assets. b) All the assets have been physically
verified by the management during the year which in our opinion, is
reasonable having regard to the size of the company and the nature of
its business. No material discrepancies were noticed on such
verification.
2. a) Inventories other than those lying with third parties have been
physically verified during the year by the management. In our opinion,
the frequency of verification was reasonable.
b) The procedures of physical verification of inventories followed by
the management were reasonable and adequate in relation to the size of
the company and the nature of its business.
c) In our opinion the Company has maintained proper records of
inventory. The discrepancies between the physical stocks and the book
records, where applicable, as noticed on physical verification were not
material and have been properly dealt with in the books of account;
3. The Company has not granted any loans to companies, firms and other
parties covered in the register maintained under section 189 of the
Companies Act, 2013. Hence clause 3 (iii) (a) and (b) of the Companies
Auditor's Report Order, 2015 is not applicable to the Company for the
year under review.
4. In our opinion and according to the information and explanations
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 purchases of inventory, fixed assets and sale
of goods and services. During the course of our audit, we have not
observed any continuing failure to correct major weaknesses in internal
controls.
5. The Company has not accepted any deposits and hence the requirement
of clause 3 (v) of Companies (Auditor's Report) Order, 2015 is not
applicable to the Company during the year under review.
6. We have been informed that maintenance of books of accounts
pursuant to the rules made by the Central Government under sub-section
(1) of Section 148 of the Companies Act, 2013 for maintenance of Cost
records in respect of products of the Company are not applicable to the
Company for the year under review and hence the requirement of clause 3
(vi) of Companies (Auditor's Report) Order, 2015 is not applicable to
the Company during the year under review.
7. a) The Company has been regular in depositing with the appropriate
authorities undisputed statutory dues including provident fund,
employees' state insurance, income tax, sales tax, wealth tax, service
tax, duty of customs, duty of excise, value added tax, cess and other
material statutory dues applicable.There were no undisputed amounts
payable in respect of Provident Fund, Employees' State Insurance,
Income Tax, Sales Tax and Value Added Tax, Wealth Tax, Service Tax,
duty of Customs, duty of Excise, Cess and other material statutory dues
in arrears as at March 31, 2015 for a period of more than six months
from the date they became payable. b) According to the information and
explanation given to us, the following amounts of income tax or sales
tax or wealth tax or service tax or duty of customs or duty of excise
or value added tax or cess which have not been deposited with the
relevant authorities on account of any dispute are detailed under:-
Name of the Nature of dues Related Period
Statute
Central Sales Tax Sales tax 2001-02 to 2004-05
Act, 1956
Finance Act, 1994 Service Tax 2008-09 to 2011-12
Central Excise Education cess 2009-10
Act, 1944 on excise duty
The Customs Customs Duty 2006-07
Act, 1962
Name of the Statute Amount (Rs.) Forum where dispute is pending
Central Sales Tax
Act,1956 66,52,351 Honourable High Court of Karnataka.
Finance Act, 1994 10,34,66,834 Central Excise & Service Tax
Appellate Tribunal
Central Excise 3,26,098 Central Excise & Service Tax
Act, 1944 Appellate Tribunal
The Customs 7,70,839 Central Excise & Service Tax
Act, 1962 Appellate Tribunal
c) There are no amounts required to be transferred to the Investor
Education and Protection Fund by the Company in accordance with
relevant provisions of the Companies Act, 1956 (1 of 1956) and rules
made thereunder. Hence the provisions of clause 3(vii) ( c) of the
Companies (Auditor's Report) Order, 2015 are not applicable to the
company.
8. The accumulated losses of the Company at the end of the financial
year are more than fifty percent of its net worth. The Company has
incurred cash losses during the financial year but had not incurred
cash losses in the preceding financial year.
9. In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to
banks and did not have any amount outstanding to financial institutions
or debenture holders.
10. As far as we could ascertain, the Company has not given guarantees
for loans taken by others from banks or financial institutions and
hence the provisions of clause 3(x) of the Companies (Auditor's Report)
Order, 2015 are not applicable to the company.
11. According to the information and explanations given to us and on an
overall examination of the balance sheet of the company, we report that
term loans were applied for the purpose for which the loans were
obtained.
12. According to the information and explanations given to us, no
material frauds on or by the Company that causes material misstatements
to financial statements have been noticed or reported during the year.
For Ishwar & Gopal
Chartered Accountants
Firm Reg. No. 001154S
K.V. Gopalakrishnayya
Partner
Membership No.: 021748
Date : 22nd May 2015
Place : Bangalore
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