| We have audited the accompanying financial statements of CABLE
CORPORATION OF INDIA LIMITED ("the Company"), which comprise the
Balance Sheet as at 31st March, 2014, the Statement of Profit and Loss
and the Cash Flow Statement for the year then ended, and a summary of
the significant accounting policies and other explanatory information,
in which are incorporated the unaudited accounts of Bangladesh Office.
Management's Responsibility for the Financial Statements
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 notified under the Companies Act, 1956 ('the
Act') read with the General Circular 15/2013 dated 13th September, 2013
of the Ministry of Corporate Affairs in respect of Section 133 of the
Companies Act, 2013. 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 misstatement, whether due
to fraud or error.
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 Auditing issued by the Institute of Chartered
Accountants of India. 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 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 of error. In making those risk
assessments, 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.
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 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
We draw attention to Note No. 43 regarding Addendum Agreement between
the Company and CCI Projects Private Limited (CCIPL) for sharing of
revenues and payment by CCIPL to the Company based on the Present Value
of the Company's share in the revenues from the Project calculated in
accordance with the Discounted Cash Flow Method. Pursuant to the
Agreements the Company has accounted Rs. 3,320 Lacs (Previous Year Rs.
8,894 Lacs) as Income from Real Estate. Our opinion is not qualified in
respect of this matter.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. 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 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 the branches not 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 the branches not visited by
us.
(d) In our opinion, the Balance Sheet, Statement of Profit and Loss,
and Cash Flow Statement comply with the Accounting Standards notified
under the Companies Act, 1956 ('the Act') read with the General
Circular 15/2013 dated 13th September, 2013 of the Ministry of
Corporate Affairs in respect of Section 133 of the Companies Act, 2013.
(e) On the basis of the written representations received from the
directors as on 31st March, 2014 and 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 clause (g) of
sub-section (1) of Section 274 of the Companies Act, 1956.
ANNEXURE TO THE AUDITORS' REPORT
Referred to in paragraph 1 of our Report of even date.
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of its Fixed
Assets except those in respect of Plant and Machinery installed prior
to 1st January, 1967.
(b) All the assets have not been physically verified by the management
during the year but there is a regular programme of verification which,
in our opinion, is reasonable having regard to the size of the Company
and the nature of its assets. No material discrepancies were noticed on
such verification.
(c) According to the information and explanations given to us, the
Company has not disposed off a substantial part of its Fixed Assets
during the year.
(ii) (a) The inventory has 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 in relation to
the size of the Company and the nature of its business.
(c) On the basis of our examination of the records of inventory, we are
of the opinion that the Company is maintaining proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records were not material.
(iii) (a) The Company has not granted any Loans, Secured or Unsecured,
to Companies, Firms or other parties covered in the register maintained
under Section 301 of the Companies Act, 1956. Accordingly, the clauses
4 (iii) (b) to (d) of the Order are not applicable.
(e) The Company has not taken any loans, Secured or Unsecured, from
Companies, Firms or other parties covered in the register maintained
under Section 301 of the Companies Act, 1956. Accordingly, the clauses
4(iii) (f) and (g) of the Order are not applicable.
(iv) In our opinion and according to the information and explanations
given to us, the Company requires strengthening of its internal control
procedures to make it commensurate with the size of the Company and the
nature of its business, with regard to purchases of inventory and fixed
assets and for the sale of goods and services. During the course of our
audit, we have not observed any continuing failure to correct major
weaknesses in the internal controls. Attention is invited to the
matters stated in Note 40.
(v) (a) In our opinion and according to the information and
explanations given to us, there are no contracts or arrangements as
referred to in Section 301 of the Companies Act, 1956 that need to be
entered into the register maintained under that section. Accordingly
the clause 4(v)(b) of the Order is not applicable.
(vi) The Company has not accepted fresh deposits from the public after
August, 2000 and hence, according to the information and explanations
given to us, provisions of sections 58A and 58AA and other relevant
provisions of the Companies Act, 1956 and the Companies (Acceptance of
Deposits) Rules, 1975 with regard to the deposits accepted from the
public are not applicable.
(vii) In our opinion and according to the information and explanations
given to us, the Company has an internal audit system commensurate with
the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company 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 in respect of Electrical Cables manufactured by the Company.
We are of the opinion that prima facie the prescribed accounts and
records have been made and maintained. We have not, however, made a
detailed examination of these records.
(ix) (a) According to the records of the Company, undisputed statutory
dues including Provident Fund, Investor Education Fund, Employees'
State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom
Duty, Excise Duty and other statutory dues have not generally been
regularly deposited with the appropriate authorities.
The following are the outstanding statutory dues as at the last date of
the financial year which were outstanding for a period of more than six
months from the date they became payable:
Name of the Statute Nature of the Dues Amount
(Rs. in Lacs)
Finance Act, 1994 Service Tax 24
Central Sales Tax Act, 1956 and
Sales Tax Act of Various States Sales Tax 294
Income Tax Act, 1961 Income Tax 47
Name of the Statute Period to which the amount relates
Finance Act, 1994 January 2013 to August 2013
Central Sales Tax Act, 1956 and
Sales Tax Act of Various States March 2011 to August 2013
Income Tax Act, 1961 April 2013 to August 2013
(b) According to the records of the Company, as at 31st March, 2014,
the following are the particulars of disputed dues on account of Income
Tax, Sales Tax, Customs Duty, and Excise Duty matters which have not
been deposited:-
Name of the Statute Nature of Amount
Dues (Rs. in Lacs)
Central Sales Tax Act, 1956 and
Sales Tax Act of Various States Sales Tax 964
Central Excise Act, 1944 Excise Duty 224
Income Tax Act, 1961 Income Tax 523
Name of the Statute Period to which Forum where dispute
the amount relates is pending
Central Sales Tax Act,
1956 and Sales Tax Act Various years from
of Various States 1997-98 to 2004-05 Commissioner (Appeals)
Central Excise Act, 1944 Various years from Commissioner of
2006-07 to 2010-11 Central Excise(Appeals)
and Central Excise
and Service Tax
Appellate Tribunal
Income Tax Act, 1961 Various years from Commissioner of Income
1996-97 to 2004-05 Tax (Appeals)/ITAT
(x) In our opinion, the accumulated losses at the end of the financial
year are not more than fifty percent of its net worth.
The Company has incurred cash losses in the current year, however the
Company has not incurred cash loss in the immediately preceding
financial year.
(xi) The Company has defaulted in the repayment of its Loan dues to a
Financial Institution. An amount of Rs. 50 Lacs on account of Principal
and Interest was overdue as on 31st March 2014, which has subsequently
been paid.
(xii) In our opinion and according to the information and explanations
given by the Management, the Company has not granted any loans and
advances on the basis of security by way of pledge of shares,
debentures or any other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi/mutual
benefit fund/society. Therefore, the provisions of clause 4(xiii) of
the Order are not applicable.
(xiv) In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and any other investments. Therefore,
the provisions of clause 4(xiv) of the Order are not applicable.
(xv) In our opinion and according to the information and explanations
given by the Management, the Company has not given any guarantee for
loans taken by others from banks or financial institutions.
(xvi) On the basis of the records examined by us, and relying on the
information compiled by the Company for co-relating the funds raised to
the end-use of term loans, we state that the Company has, prima facie,
applied the term loans for the purpose for which they were obtained.
(xvii) According to the information and explanations given to us and on
an overall examination of the financial statements and after placing
reliance on the reasonable assumptions made by the Company for
classification of Short-term and Long-term usage of the funds, we are
of the opinion that, prima facie, no funds raised on short-term basis
have been utilized for long-term investment.
(xviii) According to the information and explanations given to us, 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.
(xix) According to the information and explanations given to us, the
Company has not issued any debentures during the year.
(xx) The Company has not made any public issue during the year.
(xxi) Based upon the audit procedures performed and the information and
explanations given by the management, we report that no fraud on or by
the Company has been noticed or reported during the year.
For SORAB S. ENGINEER & CO.
Chartered Accountants
Firm Registration No. 110417W
CA N.D. Anklesaria
Place: Mumbai (Partner)
Date : 23rd May, 2014 (Membership No. 10250) |