| We have audited the accompanying financial statements of XL Energy
Limited ("the Company"), which comprise the Balance Sheet as at 31st
March, 2015, the Statement of Profit and Loss, 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 Standalone Financial Statements
The Company's Board of Directors is responsible for the matters in
section 134(5) of the Companies Act, 2013 ("the Act") 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 the maintenance of
adequate accounting records in accordance with the provision of the Act
for safeguarding of the assets of the Company and for preventing and
detecting the 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
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
thereunder.
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 misstatements.
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 true and fair view in
order to design audit procedures that are appropriate in the
circumstances, but not for the purpose for expressing an opinion on
whether the company has in place an adequate internal financial control
system over financial reporting and the operating effectiveness of such
controls. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of the accounting
estimates made by 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.
Emphasis of Matters
We draw attention to the following matters in the Notes to the
financial statements:
Note 2.42 to the financial statements which, describes the balances
appearing under other long term liabilities, short term borrowings,
trade payables, other current liabilities, long term loans and
advances, CWIP advances, trade receivables short term loans and
advances and other current assets are subject to confirmation and / or
reconciliation if any.
Note 2.28 in the financial statement which indicates that the Company
has not provided for interest on borrowings from banks.
Our opinion is not modified in respect of these matters.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid 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 31st March, 2015 and its 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.
2. As required by section 143(3) of the Act, we report that:
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.
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
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
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.
On the basis of written representations received from the directors as
on 31st March, 2015, taken on record by the Board of Directors, none of
the directors is disqualified as on 31st March, 2015, from being
appointed as a director in terms of Section 164(2) of the Act.
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 the best of our information and according
to the explanations given to us :
i. The Company does not have any pending litigations which would impact
its financial position other than those mentioned in financial
statements.
ii. The Company did not have any long term contracts including
derivative contracts for which there were any material foreseeable
losses
iii. The provisions relating to transferring any amounts to the
Investor Education and Protection Fund is not applicable to the Company
during the year
Annexure referred to in paragraph 1 of Our Report of even date to the
members of XL Energy Limited on the accounts of the company for the
year ended 31st March, 2015 Under "Report on other Legal & Regulatory
Requirements"
On the basis of such checks as we considered appropriate and according
to the information and explanations given to us during the course of
our audit, we report that:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
(b) As explained to us, some of the fixed assets have been physically
verified by the management at reasonable intervals; as informed to us
no material discrepancies were noticed on such verification.
(a) As explained to us, the Inventory has been physically verified
during the year by the Management and in our opinion, the frequency of
verification is reasonable
(b) In our opinion, the procedures of the physical verification of
inventory followed by the Management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) In our opinion, the Company is maintaining proper records of
inventory and as explained to us, no material discrepancies were
noticed on physical verification of stocks as compared to book records.
The company has granted any loans, secured or unsecured to companies,
firms or other parties covered in the register maintained under section
189 of the Companies Act 2013 other than those disclosed in note no
2.34 of notes to audited financial statements.
In our opinion and according to the information and explanations given
to us, the quantum of operation of the company is at low scale. This
does not call for a comprehensive internal control systems and
procedures at present.
The Company has not accepted any deposits from the public covered under
Section 73 to 76 of the Companies Act, 2013.
The Central Government has not prescribed the maintenance of cost
records under sub-section (1) of Section 148 of the Act, for any of the
services rendered by company.
(a )According to the information and explanations given to us and based
on the records of the company examined by us, the company is not
regular in depositing the following undisputed statutory dues including
Provident Fund, Employees State Insurance, Income tax, and other
material statutory dues applicable to it.
Provident Fund Dues ' 15.16 Lakhs
ESI ' 2.05 Lakhs
T ax Deducted At Source ' 28.06 Lakhs
Total ' 45.27 Lakhs
(b) There were no undisputed amounts payable in respect of Service Tax,
and other material statutory dues in arrears as at 31st March 2015 for a
period of more than 6 months for the date they became payable.
(c) There are no amounts that are due to be transferred to the
Investors Education and protection Fund in accordance with the relevant
provisions of the Companies Act, 1956 [1 of 1956] and rules made there
under for the financial year 2014-15.
In our opinion the accumulated losses of the company are more than 50%
of its net worth. The company incurred a cash loss of ' 94.15 lakhs
during the current accounting year. The cash loss during immediately
preceding accounting year is ' 177.99 lakhs.
The company has defaulted in the repayment of dues to banks and
financial institutions, for both term loans and working capital loans.
The company has submitted a proposal to the banks for One Time
Settlement (OTS). Reference is invited to note no 2.28 of notes to
financial statements.
In our opinion, and according to the information and explanations given
to us by the management, the terms and conditions of guarantees given
by the Company for loan taken by others from bank or financial
institutions in the form of Corporate guarantee to M/s Soft Projex
(India) Limited are not prejudicial to the interest of the company.
In our opinion, and according to the information and explanations given
to us, the term loans have been applied, on an overall basis for the
purposes for which they were obtained.
To the best of our knowledge and according to the information and
explanations given to us, no fraud by the Company and no material fraud
on the company has been noticed or reported during the year.
FOR M/s V N R ASSOCIATES
CHARTERED ACCOUNTANTS
Firm Regn: 004478S
Sd/-
Place: Hyderabad V N RAO
Date: 05.06.2015 PROPREITOR
M. No: 18492. |