| 1. We have audited the accompanying financial statements of COSBOARD
INDUSTRIES LIMITED ("the Company"), which comprise the Balance Sheet as
at March 31, 2015, the Statement of Profit and Loss and 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 management and Board of Directors of the Company are responsible
for the matters stated 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 Companies (Accounts) Rules, 2014. This responsibility
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; design,
implementation and maintenance of adequate internal financial controls,
that are 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 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. 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.
4. 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 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 accounting policies used and the reasonableness of
the accounting estimates made by the Company's management and Board of
Directors, as well as evaluating the overall presentation of the
financial statements
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion
6. 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:
a) In the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2015; and
b) In the case of the Statement of Profit and Loss Account, of the
Profit 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.
Report on Other Legal and Regulatory Requirements
7. 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 section143 of the Act, we give in the Annexure a
statement on the matters Specified in paragraphs 3 and 4 of the Order.
8. As requires section 143(3) of the Act, we further 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
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 appears from our examination of those
books;
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;
d) in our opinion, the aforesaid financial statements comply with the
applicable 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 March 31, 2015, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2015, from being
appointed as a director in terms of Section 164(2) of the Act
f) In our opinion and to the best of our information and according to
the explanations given to us, we report as under with respect to other
matters to be included in the Auditor's Report in accordance with Rule
11 of the Companies (Audit and Auditors) Rules, 2014:
i) The Company does not have any pending litigations which would impact
its financial position except as mentioned in CARO.
ii) The Company did not have any long-term contracts including
derivative contracts; as such the question of commenting on any
material foreseeable losses thereon does not arise
iii) There has not been an occasion in case of the Company during the
year under report to transfer any sums to the Investor Education and
Protection Fund. The question of delay in transferring such sums does
not arise
Annexure referred to in paragraph 7 Our Report of even date to the
members of COSBOARD INDUSTRIES LIMITED on the accounts of the company
for the year ended 31st March, 2015 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:
i. (a). The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b). We have been informed that 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.
ii. (a) Physical verification of inventory has been conducted at
reasonable intervals by the management
(b) The procedures of physical verification of inventory followed by
the management reasonable and adequate in relation to the size of the
company and the nature of its business
(c) The company is maintaining proper record s of inventory and the
discrepancies between the physical stocks and the book stocks noticed
on physical verification are 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 189 of the Act.
(b) The question of, whether reasonable steps have been taken by the
company for recovery of the principal and interest does not arise.
iv. In our opinion and according to the information and explanations
given to us, there is adequate internal control system commensurate
with the size of the Company and the nature of its business and company
needs to establish some additional controls procedures with regard to
the purchases of inventories, fixed assets and with regard to sales of
goods. Further, on the basis of our examination of the books and
records of the Company and according to the information and
explanations given to us, no major weakness has not been noticed or
reported.
v. The Company has not accepted any deposits from the public covered
under Section 73 to 76 of the Companies Act, 2013
vi. As informed to us, the Central Government has prescribed
maintenance of cost records under sub- section (1) of Section 148 of
the Act ( Cost Audit not yet completed by till date)
vii. (a) According to the information and explanations given to us and
based on the records of the company examined by us, the company is
regular in depositing the undisputed statutory dues, including
Provident Fund, , Employees' State Insurance, Income-tax, Sales-tax,
Wealth Tax, Service Tax, Custom Duty, Excise Duty and other material
statutory dues, as applicable, with the appropriate authorities in
India ;
(b) According to the information and explanations given to us and based
on the records of the company examined by us, there are no dues of
Income Tax, Wealth Tax, Service Tax, Sales Tax, Customs Duty and Excise
Duty which have not been deposited on account of any disputes other
than those mentioned below:
Name of statute Nature of dues Amount Forum where dispute
is
(in lacs) pending
Central Excise Excise Duty 38.93 High Court, Odisha,
Cuttack
CESCO Electricity
demand 190.37 High Court, Odisha,
Cuttack
CESCO Electricity
demand 22.70 High Court, Odisha,
Cuttack
CESCO Electricity
Duty 105.62 High Court, Odisha,
Cuttack
(c) There has not been an occasion in case of the Company during the
year under report to transfer any sums to the Investor Education and
Protection Fund. The question of reporting delay in transferring such
sums does not arise
viii. The Company has accumulated losses at the end of the current
financial year and are less than fifty per cent of its net worth and
Company has not incurred cash losses in Current financial year and also
in the immediately preceding financial year.
ix. According to the records of the company examined by us and as per
the information and explanations given to us, the company has availed
loans from banks and has not issued debentures
x. In our opinion, and according to the information and explanations
given to us, the Company has not given any guarantee for loan taken by
others from a bank or financial institution during the year
xi. In our opinion, and according to the information and explanations
given to us, the company has raised term loan from bank during the
year.
xii. During the course of our examination of the books and records of
the company, carried in accordance with the auditing standards
generally accepted in India, we have neither come across any instance
of fraud on or by the Company noticed or reported during the course of
our audit nor have we been informed of any such instance by the
Management
For B R R & Associates
Chartered Accountants
FRN 013012S
B. Ravinder Rao
Partner
Place: Hyderabad
Date: 30-05-2015
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