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Heritage Foods
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« Mar 13
Auditor's Report (Heritage Foods) Year End : Mar '14
We have audited the accompanying financial statements of M/s Heritage
 Foods Limited, which comprise the Balance Sheet as at March 31, 2014,
 and 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:
 
 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 referred to in sub- section (3C) of section
 211 of the Companies Act, 1956(“the Act) read with General Circular
 15/2013 dated 13 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.
 
 Auditor''s 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 opinion on the
 effectiveness of entity''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 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 March 31, 2014;
 
 b) In the case of the Statement of Profit and Loss, 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:
 
 1. As required by the Companies (Auditors'' Report) Order, 2003, as
 amended by the companies (Auditor'' Report) Order 2004, 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 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
 accounts.
 
 d) In our opinion, the Balance Sheet, Statement of Profit and Loss, and
 Cash Flow Statement comply with the Accounting Standards referred to in
 subsection (3C) of section 211 of the Companies Act, 1956 (“the Act)
 read with General Circular 15/2013 dated 13 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 March 31, 2014, and taken on record by the Board of Directors,
 none of the directors are disqualified as on March 31, 2014, from being
 appointed as a director in terms of clause (g) of sub-section (1) of
 section 274 of the Companies Act, 1956.
 
 f) Since the Central Government has not issued any notification as to
 the rate at which the cess is to be paid under section 441A of the
 Companies Act, 1956 nor has it issued any Rules under the said section,
 prescribing the manner in which such cess is to be paid, no cess is due
 and payable by the Company.
 
 Annexure to the Auditors'' 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, 2014.
 
 i. a) The Company has maintained proper records showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 b) These fixed assets have been physically verified by the management
 during the year and discrepancies noticed on such verification 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 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) 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) 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 or to companies under the
 same management as defined in section 370(1-B) of the companies
 act,1956. Consequently, clauses (iii) (b), (iii)
 (c) and (iii)(d) are not applicable.
 
 e) The company has not taken any loans secured or unsecured loan from
 companies, firms or parties covered in the register maintained under
 section 301 of the companies act 1956. Accordingly, paragraphs
 4(iii)(e) to 4(iii)(g) of the order are not applicable.
 
 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. a) According to the information and explanations given to us, we are
 of the opinion that the transactions that need to be entered into the
 register maintained under section 301 of the Companies Act, 1956 have
 been so entered.
 
 b) In our opinion and according to the information and explanations
 given to us, the transactions made in pursuance of contracts or
 arrangements entered in the register maintained under section 301 of
 the Companies Act, 1956 and exceeding value of rupees five lakhs in
 respect of any party during the year, have been made at prices which
 are reasonable, having regard to prevailing market prices at the
 relevant time.
 
 vi. The company has not accepted deposits from the public governed by
 section 58A and 58AA of the Companies Act, 1956 for the year under
 reference.
 
 vii. In our opinion, the company has an adequate internal audit system
 commensurate with the size and nature of its business.
 
 viii. The Central Government has prescribed maintenance of Cost records
 under section 209 (1) (d) of the Companies Act, 1956, in respect of its
 products manufactured during the year. We are of the opinion that,
 prima facie, the prescribed accounts and records are properly prepared
 and maintained.  We have not, however, carried out detailed examination
 of the same.
 
 ix. a) The Company is regular in depositing undisputed statutory dues
 with the appropriate authorities including Provident Fund, Investor
 Education and Protections Fund, Employees State Insurance, Income Tax,
 Sales Tax, Wealth Tax and Other Statutory dues applicable to it. There
 are no undisputed statutory dues outstanding for more than six months
 as on 31.3.2014.
 
 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, 2014:
 
 
 Name of the Statue      Nature of the Dispute                     Amount
                                                           (Rs. In Lakhs)
 
 The A.P.G.S.T           General sales tax                           7.41
 ACT 1957
 
 The A.P.G.S.T           General sales tax                          83.75
 ACT 1957
 
 AP VAT ACT              Input tax credit disallowance             127.06
 
 The C.S.T ACT           General sales tax                          37.34
 
 AP C.S.T ACT            Filing Of C Forms                         1.42
 
 AP VAT                  Input tax credit disallowance
                         and others                                 62.04
 
 
 Name of the             Period to which the              Forum where the
 Statue                  amounts relate (A.Y)        disputes is pending.
 
 The A.P.G.S.T           2000-01      2002-03     Commercial Tax Officer.
 ACT 1957
 
 The A.P.G.S.T                  2001-02          Writ petition filed with
 ACT 1957                                         H.C (WP No: 3814/2014).
 
 AP VAT ACT                     2007-08            A.P.S.T.A.T (Tribunal)
 
 The C.S.T ACT                  2002-03            A.P.S.T.A.T (Tribunal)
 
 AP C.S.T ACT                   1998-99          Appeal Pending before AP
                                                 H.C (WP No: 3818 /2014).
 
 AP VAT                  2008-09      2009-10     Additional Commissioner
 
 
 x. 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.
 
 xi. The Company has not defaulted in the repayment of its dues to
 financial institutions or banks.
 
 xii. The company has not granted loans and advances on the basis of
 security by way of pledge of shares, debentures and other securities.
 
 xiii. In our opinion, the company is not a chit fund or nidhi / mutual
 benefit fund / society. Therefore the provisions of clause 4 (xiii) of
 the companies (Auditors'' Report) Order, 2003 are not applicable to the
 company.
 
 xiv. In our opinion, the company is not dealing in or trading in
 shares, securities, debentures and other investments.  Investments have
 been held by the company in its own name.
 
 xv. The company has not given any guarantee for loans taken by others
 from banks or financial institutions.
 
 xvi. In our opinion, the term loans taken by the Company were applied
 for the purpose for which they were taken.
 
 xvii. In our opinion and according to explanations and information
 given to us, funds raised on short-term basis have not been used for
 long term investment.
 
 xviii. According to the information and explanation given to us, during
 the year the company has not made any preferential allotment of equity
 shares/warrants to parties and companies covered in the register
 maintained under section 301 of the companies act, 1956.
 
 xix. The company has not issued any debentures
 
 xx. The company, during the year, has not raised money by public
 issues.
 
 xxi. Based on the audit procedures performed and the information and
 explanations given to us, we report that no material fraud on or by the
 Company has been noticed or reported during the year, nor have we been
 informed of such case by the management.
 
 
 For Raju & Prasad
 
 Chartered Accountants
 (FRN: 003475S)
 
                                                     M. Siva Ram Prasad
 Place : Hyderabad                                              Partner
 Date  : 23-05-2014                                        M No. 018943
Source : Dion Global Solutions Limited
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