REPORT ON THE FINANCIAL STATEMENTS
We have audited the accompanying financial statements of HYDRO S & S
INDUSTRIES LIMITED (The Company ) which comprise the Balance
Sheet as at March 31, 2014, the Statement of Profit and Loss and Cash
Flow Statement for year then ended, 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 the 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 given a true and fair view and are free from material
misstatement, whether due to fraud or error.
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.
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, 2014:
(b) In the case of the statement of profit and loss, of the loss 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 OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the Companies (Auditor''s Report) Order, 2003 (as
amended)(the Order) issued by the Central Government of India in terms
of section 227(4A) 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 purposes of our
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
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 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 the written representations received from the
directors, as on March 31, 2014 and taken on record by the Board of
Directors, none of the directors is disqualified as on March 31, 2014,
from being appointed as a director in terms of section 274(1) (g) of
Annexure referred to in paragraph 1 under the heading AAI- Report on
Other Legal and Regulatory Requirements'' of our report of even date on
the financial statements for the year ended on 31st March 2014:
i) a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
b) These fixed assets have been physically verified by the management
at the end of the financial year, which in our opinion is reasonable
having regard to the size of the Company and the nature of its assets.
According to the information and explanations given to us, no material
discrepancies were noticed on such verification.
c) In our opinion, the fixed assets disposed off during the year, do
not constitute a substantial part of the fixed assets of the company
and such disposal has not affected the going concern status of the
ii) a) As explained to us, the inventories held by the Company were
physically verified during the year by the management at reasonable
b) In our opinion and according to the information and explanations
given to us, 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) In our opinion and according to the information and explanations
given to us, the company is maintaining proper records of its
inventories and no material discrepancies were noticed on physical
iii) a) The Company has not granted any loans, secured or unsecured to
companies, firms or other parties covered in the register maintained
u/s 301 of the Act.
b) The company has taken an unsecured loan from a Company covered in
the register maintained u/s 301 of the Act. The maximum balance
outstanding during the year is Rs. 1476 lakhs and the balance as at
31st March 2014 is Rs.1442 lakhs.
iv) In our opinion and according to the information and explanations
given to us, there exists an adequate internal control system
commensurate with the size of the Company and the nature of its
business with regard to the purchase of inventory and fixed assets and
for the sale of goods and services. Further on the basis of our
examination of the books and records of the Company, there is no
continuing failure to correct major weaknesses in the aforesaid
internal control system of the company.
v) a) The entries relating to particulars of contracts or arrangements
referred to in section 301 of the Act have been made in the register
required to be maintained under that section ADs- and
b) In our opinion and to the best of our knowledge and belief, wherever
applicable the transactions made in pursuance of such contracts or
arrangements have been made at prices which are reasonable having
regard to the prevailing market prices at the relevant time.
vi) The Company has not accepted any deposits from the public during
the year to which the directives issued by the Reserve Bank of India
and the provisions of sections 58 A and 58 AA or any other relevant
provisions of the Act and the rules framed there under are applicable.
vii) In our opinion, the company has an internal audit system
commensurate with its size and nature of its business.
viii) According to the records produced and information given to us,
the cost records prescribed by the Central Government under Sec.209 (1)
(d) of are being maintained by the Company. No examination of such
records has been carried out by us.
ix) According to the records of the Company,
a) The Company is regular in depositing undisputed statutory dues
including provident fund, investor education and protection fund,
employee''s state insurance, income tax, sales tax, wealth tax, service
tax, customs duty, excise duties and cess and any other statutory dues
applicable to it, with the appropriate authorities during the year.
b) there are no dues of income tax, sales tax, wealth tax, service tax,
customs duty, excise duty and cess which have not been deposited on
account of any dispute except the following pending in appeals:
(i) Income tax of Rs. 45.05 lakhs before the First Appellate Authority
(ii) Customs duty of Rs. 26.78 lakhs before the First Appellate
(iii) Sales tax of Rs. 12.75 lakhs before the First Appellate Authority
(iv) Central Excise and Service tax authorities as under:
a. First Appellate Authority Rs. 12.63 lakhs and
b. Second Appellate Authority Rs. 2.42 lakhs
x) The Company has accumulated loss at the end of the financial year
i.e. 31.03.2014 which is more than fifty percent of its net worth. The
Company has incurred cash loss in this financial year ended 31.03.2014
and in the preceding financial year ended 31.03.2013.
xi) On the basis of records produced, the Company has not defaulted in
repayment of the dues to any financial institution or bank during the
xii) As per the records maintained, no loans or advances have been
granted by the Company on the basis of security by way of pledge of
shares, debentures and other securities.
xiii) The provisions of Special statute applicable to chit, nidhi,
mutual fund / societies are not applicable to the Company.
xiv) On the basis of records maintained and in our opinion, the Company
does not deal or trade in shares, securities, debentures and other
xv) 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.
xvi) As per the information and explanations given to us, term loans
have been applied for the purpose for which these term loans were
xvii) In our opinion, based on the information and explanations given
to us and on an overall examination of the books and records of the
company, the funds raised on short term basis prima facie have not been
used for long term investments. No long term funds have been used to
finance short-term assets except permanent working capital.
xviii) The company has not made any preferential allotment of shares
during the financial year to any party.
xix) The company has not issued any debentures during the financial
xx) The company has not raised any money by public issues during the
xxi) On the basis of the audit procedures carried out and information
and explanations given by the management, we state that no fraud on or
by the Company has been noticed or reported during the course of our
For P. SRINIVASAN ACY- Co.,
(Firm Registration No. : 004054S)
Place : Chennai CA. P. SRINIVASAN
Date : 28.05.2014 Partner
Membership No. : 02090