We have audited the accompanying standalone financial statements
of Heritage Foods Limited, 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 the significant accounting
policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements:
The Company''s Board of Directors are responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 (the Act) with respect
to the preparation of these standalone financial statements that give
a true and fair view of the financial position, financial performance
and cash fl ows 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
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; 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
Our responsibility is to express an opinion on these standalone fi
nancial 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
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.
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 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 the accounting policies used
and the reasonableness of the accounting estimates made by the
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 standalone
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone 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,
i) in the case of the standalone Balance Sheet, state of affairs of the
company as at 31 March 2015;
ii) in the case of the standalone Statement of Profit and Loss, profi
t of the company for the year ended on that date; and
iii) in the case of the standalone Cash Flow Statement, cash flows of
the company for the year ended on that date.
Report on Other Legal and Regulatory Requirements:
As required by ''the Companies (Auditor''s Report) Order, 2015'', issued
by the Central Government of India in terms of sub– section (II)of
section 143 of the Act (hereinafter referred to as the Order), and on
the basis of such checks of the books and records of the Company as we
considered appropriate and according to the information and
explanations given to us, we give in the Annexure a statement on the
matters specified in paragraphs 3 and 4 of the Order.
As required by Section 143 (3) of the Act, we 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
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
(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 aforesaid standalone financial statements
comply with the Accounting Standards specified under Section 133 of
the Act, read with Rule 7 of the Companies (Accounts)Rules, 2014.
(e) On the basis of the 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
(f) With respect to the other matters to be 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, except as listed in the notes to accounts
ii. The Company did not have any material foreseeable losses on
long-term contracts including derivative contracts.
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Annexure to the Auditor''s Report
The Annexure referred to in our Report of even date to the members of
Heritage Foods Limited on the accounts of the company for the year
ended 31st March, 2015.
i. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
(b) These fixed assets have been physically verified by the
management during the year and discrepancies noticed on such verifi
cation have been properly dealt with in the books of account. In our
opinion, the frequency of verification is reasonable having regard to
the size of the company and the nature of the assets.
c) No substantial part of fixed assets has been disposed off during
ii. (a) The inventory has been physically verified during the year by
the management. In our opinion, the frequency of verification is
(b) In our opinion, the procedures of 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) 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. 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.
iv. In our opinion and according to the information and explanations
given to us, considering the size of the company and nature of business
of various divisions of the company with regard to purchase of
inventory and fixed assets and with regard to sale of goods and
services, the internal control system commensurate with the size of the
company and nature of its business. During the course of our audit, we
have not observed any continuing failure to correct major weaknesses in
internal control system.
v. The Company has not accepted any deposits from the public within
the meaning of Sections 73 and 74 of the Act and the rules framed there
under to the extent notified .
vi. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the rules made by the
Central Government of India, the maintenance of cost records has been
specified under sub– section (1) of Section 148 of the Act, and 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 the records with a view to determine whether they are
accurate or complete.
vii. (a) The company is regular in depositing undisputed statutory
dues including Provident Fund, Employees'' State Insurance, Income Tax,
Sales Tax, Wealth Tax, Service Tax, Duty of Customs, Duty of Excise,
Value Added Tax, Cess and any other statutory dues with the appropriate
authorities. There are no undisputed statutory dues outstanding for
more than six months as on 31.3.2015.
b) According to the information and explanations given to us, following
are the disputed dues relating to income tax, wealth tax, cess and
sales tax, which have not been deposited as at 31st march, 2015
Nature of Amount Period to
State which the Forum where
Nature of Dispute In Lakhs) amounts
A.P.G.S.T Levy of purchase
tax on purchase
of milk 83.75 2001-02 High Court
C.S.T ACT Levy of
purchase tax on
purchase of milk 37.34 2002-03 A.P.S.TA.T
C.S.T ACT Levy of purchase
tax on purchase
of milk 1.42 1998-99 High court
AP VAT Input tax credit
others 40.25 2009-10 Appellate
AP VAT Input tax credit
others 1.79 2008-09 High Court
Act Input tax credit
disallowed 24.38 2013-14 CTO
(c) The amount required to be transferred to Investor Education and
Protection Fund has been transferred within the stipulated time in
accordance with the provisions of the Companies Act, 2013 (Companies
Act, 1956) and the rules made there under.
viii. The company does not have any accumulated losses as at the end of
the financial year under reference and the company has not incurred
cash loss in the financial year under reference and in the financial
year immediately preceding such financial year.
ix. The Company has not defaulted in repayment of dues to any fi
nancial institution or bank or debenture holders as at the balance
x. The company has not given any guarantee for loans taken by others
from banks or financial institutions.
xi. In our opinion, the term loans taken by the Company were applied
for the purpose for which they were obtained.
xii Based on the audit procedures performed and the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
year, nor have we been informed of such case by the management.
For Raju and Prasad
Y Bala Krishna Reddy
26th May, 2015 M. No. 223701