We have audited the accompanying financial statements of Magnanimous
Trade & Finance Ltd. "the company"), which comprise the Balance Sheet
as at March 31,2014, the Statement of Profit and Loss and Cash Flow
Statement for the year ended on that date and a summary of significant
accounting policies and other explanatory information.
MANAGEMENT'S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
The Company's 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 Companies Act,2013 and in accordance with the accounting
principles generally accepted in India. 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 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 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 accounting policies used and the reasonableness of the accounting
estimates made by 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 infomation 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 sum of Rs. 14,09,033.00 shown under the head long term loans and
advances, recoverable from Shri Prakash Kanodia.No recovery of this
loan have been made. The company has adopted legal recourse for
recovery for the same. However, provision for bad debts has not been
made.
(a) In the case of the Balance Sheet, of the state of affairs of the
Company as at March 31,2014;
(b) In the case of the Statement of Profit and Loss, of the profit of
the company for the year ended on that date; and
(c) In the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Report on Legal and other 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 Section
227( 4A) of the Act, we give in the Annexure hereto 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 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 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
notified under 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 written representations received from the Directors
as on 31 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 INDEPENDENT AUDITORS'REPORT
ANNEXURE REFERED TO IN PARAGRAH 1 UNDER THE HEADING "REPORT ON LEGAL
AND OTHER REGULATORY REQUIREMENTS" OF OUR REPORT OF EVEN DATE
1. In Respect of its Fixed Assets :
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets on the
basis of available information.
(b) As explained to us all fixed assets have been physically verified
by the management in a phased periodical manner, 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) In our opinion, the company has not disposed off any fixed assets
during the year.
2. In Respect of its inventories:
(a) The management has conducted physical verification of inventory at
reasonable intervals.
(b) There is only building in the inventory therefore there is no
requirement of physical verification of the same at reasonable
intervals.
(c) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification.
3. (a) According to the information and explanations given to us the
Company has granted
Unsecured loan to one party whose maximum balance at any time during
the year is Rs.2,52,87,565.00 covered in the register maintained under
section 301 of the Companies Act 1956 and the balance outstanding is
Rs. 2,52,87,565.00 at the end of year.
(b) In our opinion and according to the information and explanations
given to us, the rate of interest and other terms and conditions of the
unsecured loan granted by the company are prima facie not prejudicial
to the interest of the company.
(c) In our opinion and according to the information and explanations
given to us the party is regular in payment of principal and interest
according to the terms and conditions of the loan given during the
year.
(d) In our opinion and according to the information and explanations
given to us there is no overdues on account of loan granted by the
company.
(e) According to the information and explanations given to us the
company has not taken any loan, Secured or unsecured from companies,
firms or other parties covered in the register maintained under section
301 of the Companies Act, 1956. Hence the provisions of sub paragraph
V, VI & VII of paragraph 4(III) of the order are not applicable.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control system commensurate
with the size of the Company and the nature of its business, for the
purchase of inventory and fixed assets and for the sale of goods and
services. During the course of our audit, no major weakness has been
noticed in the internal control system.
5. (a) According to the information and explanation provided to us, we
are of the opinion that The particulars of contracts or arrangements
referred to in Section 301 of the Companies Act, 1956 have been entered
in the register required to be maintained under that Section.
(b) In our opinion and according to the information and explanation
given to us, there is transaction made in pursuance of contract or
arrangement with parties with whom transactions exceeding value of
Rupees Five Lakhs have been entered into during the financial year are
at prices which are reasonable having regard to the prevailing market
prices at the relevant time.
6. In our opinion and according to information and explanation given
to us, the Company has not accepted any deposits from the public.
Therefore the provisions of clause (vi) of paragraph 4 of the order are
not applicable to the company.
7 In our opinion the Company has an in house internal audit system
commensurate with the size and nature of its business.
8. Since the company has not done any production or processing during
the year thus the paragraph (VIII) of the paragraph 4 of the order not
applicable.
9. In Respect Of Statutory Dues :
(a) According to the records of the company and information &
explanation given to us, the Company is regular in depositing
undisputed statutory dues including Provident Fund, Investor Education
and Protection Fund, Employees State Insurance, Income-Tax, Sales-Tax,
Wealth-Tax, Custom Duty, Excise Duty, Service Tax, and Cess and other
statutory dues applicable to it with the appropriate authorities.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales
Tax, Customs Duty, Excise Duty, Service Tax, and Cess were outstanding,
at the year end for a period of more than six months from the date they
became payable.
(b) According to the records of the Company and information and
explanation given to us, there are no dues outstanding of sales Tax,
Income Tax, Custom Duty, Wealth Tax, Excise Duty, Cess, and Service Tax
as applicable which have not been deposited on account of any dispute.
10. The company does not have accumulated losses at the end of the
financial year. The Company has not incurred cash losses in the current
year covered by the audit and in the immediately preceding financial
year.
11. Based on our audit procedures and on the information and
explanations given by the management, the Company does not have any
borrowings from financial institutions, banks or by way of debentures.
12 In our opinion and according to the information and explanations
given to us and based on the documents and records produced to us, the
Company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
13. In our opinion and according to the information and explanations
given to us, the nature of activities of the Company does not attract
any special statute applicable to chit fund and nidhi/mutual benefit
fund/societies. Therefore the provisions of clause 4(xiii) of the order
are not applicable to the company.
14. In respect of dealing/trading in shares, securities, debentures
and other investments in mutual funds, in our opinion and according to
the information and explanations given to us, proper records have been
maintained of the transactions and contracts and timely entries have
been made therein. The shares, securities, debentures and other
investments in mutual funds have been held by the Company, in its own
name.
15. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from bank or financial institutions.
16. The Company did not have any term loans during the year.
17. The Company did not have any borrowings of short term during the
year.
18. The Company has not made any preferential allotment of shares to
parties or companies covered in the register maintained under Section
301 of the Companies Act, 1956.
19. The Company has not issued any debentures.
20. The Company has not raised any money through a public issue during
the year.
21. To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
has been noticed or reported during the course of our audit.
For Om P.Agarwal & Associates
Chartered Accountants
FRN 006948C
Place: Kanpur (Om Prakash Agarwal)
Dated: 28-05-2014 Proprietor
M.No. 17821 |