| We have audited the accompanying financial Statements of M/s K2 SYSTEMS
LIMITED which comprise the Balance Sheet as at 31st March 2014, The
statement of Profit & Loss Account and the cash flow Statement for the
year ended, and a summary of the significant accounting policies and
other explanatory information.
Managements Responsibility for the Financial Statements
The Companies management is responsible for the preparation of these
financial statements that give a true and fair view of the financial
position and financial performance of the company in accordance with
the accounting standards referred to in Sub-section (3C) of section 211
of the companies Act, 1956. This responsibility includes the design,
Implementation and maintenance of internal control relevant to the
preparation and presentation of the financial statements that give a
true and fair view and are free from material misstatements, whether
due to fraud or error.
Auditors Responsibility
We have audited the attached Balance Sheet of M/s K2 SYSTEMS LIMITED,
Hyderabad as at 31st March 2014, the Profit & Loss Account and also the
Cash Flow statement for the year ended on that date annexed thereto.
These financial statements are the responsibility of the company's
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in India. These standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatements. An audit includes
examining on test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by the management as well as evaluating the overall financial statement
presentation.
We believe that our audit evidence, we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us the said accounts read with other notes to
accounts and accounting policies give the information required by the
Companies Act 1956, in the manner so required and give a true and fair
view:-
i) In the case of Balance Sheet of the state of the affairs of the
Company as at 31st March 2014 and
ii) In the case of Profit & Loss Account of the Loss of the Company for
the year ended on that date.
iii) In the Cash Flow statement of the Cash Flow for the year ended on
that date.
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 in 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:
(a) We have 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 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 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.
(e) 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 Auditors' Report (referred to in paragraph 3 of our
Report of even Date to the Members of K2 SYSTEMS LIMITED for the year
ended March 31,2014)
1.
(a) The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
(b) Fixed Assets have been physically verified by the management and,
in our opinion, the verification is reasonable having regard to the
size of the company and the nature of its assets. There is no
discrepancies were noticed on such verification.
(c) No substantial part of fixed assets has been disposed off during
the year.
2. In our opinion and according to the information and explanations
given to us, the Company having inventory. Accordingly, the provisions
of clause 4(ii) of the Order are applicable to the Company.
3. In our opinion and according to the information and explanations
given to us, the company has not granted or not taken any loans secured
or unsecured to or from companies, firms or other parties covered in
the register maintained under Section 301 of the Companies Act, 1956.
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 with
regard to the sale of goods.
5. Based on the audit procedures applied by us and according to the
information and explanations provided by the management, we are of the
opinion that there are no transactions that need to be entered into the
register maintained under section 301.
6. a) In our opinion and according to the information and explanations
given to us, there are no transactions made in pursuance of contracts
or arrangements needs to enter in the registers maintained under
section 301 and exceeding the value of five lakh rupees in respect of
any party during the year.
b) In our opinion and according to the information and explanations
given to us, the company has not accepted any deposits within the
meaning of Sections 58A and 58AA of the Companies Act, 1956 and the
Companies (Acceptance of Deposits) Rules, 1975 with regard to the
deposits accepted from the public.
7. In our opinion, the company has an internal audit system
commensurate with the size and nature if its business.
8. The Central Government has not prescribed the maintenance of records
in pursuant to the Rules made by the Central Government for the
maintenance of cost records under Section 209 (1) (d) of the Companies
Act, 1956.
9. According to the records of the company, there are no dues to
statutory authorities.
a) According to the information and explanations given to us, no
undisputed amounts payable in respect of income tax, wealth tax, sales
tax, customs duty and excise duty were outstanding, as at 31.03.2014
for a period of more than six months from the date they became payable.
b) According to the records of the company, there are no dues of sale
tax, income tax, customs tax/wealth-tax, excise duty/cess within have
not been deposited on account of any dispute.
10. The company has incurred accumulated losses Rs.41,002,659 /- as at
the end of the financial year. The Company has not incurred any cash
losses during the financial year covered by our audit and no cash
losses in the immediately preceding financial year.
11. Based on our examination of documents and records, we are of the
opinion that the company has not granted any loans and advances on the
basis of security by way of pledge of shares, debentures and other
securities.
12. Based on our examination of the records and evaluation of the
related internal controls, we are of the opinion that proper records
have been maintained of the transaction and contracts and timely
entries have been made in those records. We also report that the
company has not held any shares, securities, debentures and other
securities in its own name.
13. In our opinion, the Company is not a chit or a Nidhi / mutual
benefit fund / society. Therefore, the provisions of clause 4(xiii) of
the Order are not applicable to the Company.
14. The company is not in the business of dealing or trading in shares,
securities, debenture and other instruments. Accordingly, the
provisions of clause 4(xiv) of the Order are not applicable to the
Company.
15. The company has not given any guarantee for loans taken by others
from banks or financial institutions.
16. The company has not taken any term loans from financial
institutions.
17. Based on our examination of the balance sheet of the company as at
31.03.2014, since there is no loans availed by the company, the
utilization of funds does not arise.
18. The company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under section
301 of the Companies Act, 1956.
19. During the period covered by our audit report, the company does not
have any outstanding debentures during the year.
20. During the year the company has not raised any money through the
public issue.
21. Based upon the audit procedures performed and information and
explanations given by the management, we report that no fraud on or by
the company has been noticed or reported during the course of our
audit.
For M M REDDY & CO.
Date: 13.08.2014 Chartered Accountants
Place: Hyderabad Firm Reg. No. 010371S
Sd/-
(M.Madhusudhana Reddy)
Partner
Membership No.213077 |