1. We have audited the accompanying financial statements of NAKODA
LIMITED which comprises the Balance Sheet as at 31st DECEMBER, 2013 and
the statement of Profit & loss for the year ended, and a summary of
significant accounting policies and other explanatory information,
which we have signed under reference to this report.
Management''s Responsibility for the Financial Statements:
2. 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 of the company in accordance
with the Accounting Standard referred to in sub-section (3C) of section
211 of ''the companies Act 1956'' of 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 free from material misstatement, whether
due to fraud and error.
3. 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.
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 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. 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.
5. 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 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
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at December 31,2013;
(b) in the case of the Profit and Loss Account, PROFIT for the year
ended on that date; and Report on Other legal and Regulatory
1. As required by the Companies (Auditor''s Report) order 2003, as
amended by ''the Companies (Auditor''s Report) (Amendment) order 2004''
issued by the Central Government of India in terms of sub section (4A)
of section 227 of the Act 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 explanation given to us, we give in that
Annexure a statement on the matters specified in paragraph 4 and 5 of
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 the
(c) the Balance Sheet and the Profit and Loss Account dealt with by
this report are in agreement with the books of account;
(d) in our opinion, the Profit and Loss Account and the Balance Sheet
comply with the Accounting Standards referred to in sub- section (3C)
of Section 211 of the Companies Act, 1956;
(e) on the basis of the written representations received from the
directors as on 31st December, 2013 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
31st December, 2013 from being appointed as a director in terms of
clause (g) of sub-section (1) of Section 274 of the Companies Act,
1. (a) The company has maintained proper records showing full
particulars including quantative details and situation of fixed assets
on the basis of available information.
(b) As explained to us, the fixed assets have been physically verified
by the management during the year in phased periodical manner, which in
our opinion is reasonable, having regard to the size of company and
nature of its assets. No material discrepancies were noticed on such
(c) In our opinion, the company has not disposed off a substantial part
of its fixed assets during the year and the going concern status of the
Company is not affected.
2. (a) As explained to us, inventories have been physically verified
during the year by the management at regular intervals.
(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 nature of its business.
(c) The company has maintained proper records of inventories. As
explained to us there were no material discrepancies noticed on
physical verification of inventories as compared to the book records.
3. The company has neither granted nor taken any loans secured or
unsecured to/from the companies/firms or parties covered in the
register maintained Under Section 301 of the companies act 1956 except
Sr Name O/s
1 Nakoda Financial Services Pvt Limited 12233500 Loan Given
2 Nakoda Green Power Ltd 8419219 Loan Given
3 Nakoda Holdings Mauritius Ltd 1618917 Loan Given
4 Indo Korean Petrochem Ltd. 844482715 Loan Given
(b) The loan granted to the parties covered in the register maintained
U/s 301 of the Companies Act 1956, are interest free loan.
(c) Loan granted to the parties/Companies (As Covered under Sec 301)
stated herein below are not revenue generating companies hence the
repayment of loan in this scenario is doubtful.
a. Nakoda Financial Services Pvt Ltd.
b. Nakoda Green Power Limited.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the company and the nature of its
business for the purchase of inventory, fixed assets and also for the
sale of goods. During the course of our audit, we have not observed any
major weaknesses in internal controls.
5. (a) According to the information and explanations given to us, the
particulars of contracts or arrangements referred to in Section 301 of
the Companies Act, 1956 that needed to be entered in the Register
maintained under the said Section have been so entered.
(b) In our opinion and according to the information and explanations
made in pursuance of such contracts or arrangements and exceeding the
value of Rupees Five Lakhs in respect of any party during the year have
been made at prices which are reasonable having regard to the
prevailing market prices at the relevant time.
6. The company has not accepted any deposit from the public.
7. In our opinion, the internal audit system of the company is
commensurate with the size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government for the
maintenance of cost records under Section 209 (1) (d) of the Companies
Act, 1956 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 said records with a view to
determine whether they are accurate or complete.
9. (a) According to the records of the company undisputed statutory
dues including Provident Fund, Investor Education and Protection Fund,
Income Tax, Sales Tax, Excise and Custom, Wealth Tax, Estate Duty have
been generally regularly deposited with the appropriate authorities.
(b) According to the information and explanation given to us, no
undisputed amounts payable in respect of the aforesaid dues were
outstanding as at 31st December 2013 for the period of more than six
months for the date of becoming payable.
(c) According to records of the company, following disputed statutory
dues have not been deposited with appropriate authorities.
(Rs. In Lacs)
No Name of Statute Nature of
the dues Forum where dispute
is pending Amount
1 Central Excise
Act 1944 Excise Duty CEGATE and Commissioner
of Excise 24.18
10. The company has no accumulated losses at the end of the financial
year and it has not incurred cash losses in the current and immediately
preceding financial year.
11. Based on our audit procedures it is observed that there has been
constant delays in payment of installment and interest of Term Loan ,
Corporate Loan and Working capital Interest during the year . At the
end of the year i.e as on 31/12/2013, such payments of Rs 24.62 Crore
had remained outstanding.
12. 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, the Company is not a chit fund or a nidhi/mutual
benefit fund/society. Therefore, the provisions of clause 4(xiii) of
the Companies (Auditor''s Report) Order, 2003 (as amended) are not
applicable to the Company.
14. In respect of dealing/trading in securities, 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 securities have been held by
the Company in its own name.
15. According to the information and explanations given to us, the
company has given guarantees for loans taken by others from bank or
financial institutions and we are of the opinion that the terms and
conditions thereof are not prima facie prejudicial to the interest of
16. According to information and explanations given to us and based on
the documents and records produced to us, the company has applied the
term loans for the purpose for which the loan were obtained.
17. According to the information and explanations given to us and an
overall examination of the Balance Sheet and Cash Flow Statement of the
company, we report that no funds raised on short-term basis have been
used for long-term investment.
18. The company has not made preferential allotment of shares during
the year to parties or companies covered in the register maintained
under section 301 of the Companies Act, 1956
19. The company has not issued any debenture.
20. The company has raised Rs.37.30 Crore through promoter''s Group of
Company''s and strategic investors.
21. Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no material fraud on or by the Company has been noticed or
reported during the course of our audit except the proceeds of GDR
issue made by the Company amounting to USD 24,250,000/- deposited in
EURAM BANK, Austria are fraudulently adjusted by the Bank against the
third party borrowings. We received various documentation raised by the
company against the bank and explanation given by the management that
the company made efforts to settle the issue.
For N. M. SINGAPURI & CO.
Place : Surat Membership No. 11601
Date : 01.03.2014 Registration No. 110264W