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Orient Abrasives

BSE: 504879|NSE: ORIENTABRA|ISIN: INE569C01020|SECTOR: Abrasives
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« Mar 14
Auditor's Report (Orient Abrasives) Year End : Mar '15
We have audited the accompanying financial statements of Orient
 Abrasives Limited (the Company), which comprise the Balance Sheet
 as at March 31, 2015, and the Statement of Profit and Loss and Cash
 Flow Statement for the year ended, and a summary of significant
 accounting policies and other explanatory information.
 
 MANAGEMENT''S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
 
 The Company''s Board of Directors is responsible for the matters stated
 in Section 134(5) of the Companies Act, 2013 (the Act) with
 respect to 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 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 of 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 error.
 
 AUDITOR''S RESPONSIBILITY
 
 Our responsibility is to express an opinion on these financial
 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 thereunder. 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
 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 financial
 statements.
 
 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, of the state of affairs of the Company as at March 31, 2015, its
 profit and its cash flows for the year ended on that date.
 
 REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
 
 As required by the Companies (Auditor''s report) Order, 2015 (the
 Order) issued by the Central Government of India in terms of
 sub-section (11) of section 143 of the Act, we give in the Annexure 1 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
 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
 account.
 
 (d) In our opinion, the aforesaid stand alone 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 31 March 2015 taken on record by the Board of
 Directors, none of the directors is disqualified as on 31 March 2015
 from being appointed as a director in terms of Section 164 (2) of the
 Act.
 
 (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 has disclosed the impact of pending litigations on its
 financial position in its financial statements - Refer Note 27 and 28
 to the financial statements;
 
 (ii) The Company did not have any long-term contracts including
 derivative contracts for which there were any material foreseeable
 losses;
 
 (iii) There has been no delay in transferring amounts to the Investor
 Education and Protection Fund by the Company.
 
 ANNEXURE REFERRED TO IN PARAGRAPH ON REPORT ON OTHER LEGAL AND
 REGULATORY REQUIREMENTS OF OUR REPORT OF EVEN DATE Re: Orient 
 Abrasives Limited (''the Company'')
 
 (i) (a) The Company has maintained proper records showing full
 particulars, including quantitative details and situation of fixed
 assets.
 
 (b) All fixed assets have not been physically verified by the
 management during the year but there is a regular programme of
 verification 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.
 
 (ii) (a) The inventory has been physically verified by the management
 during the year. In our opinion, the frequency of verification is
 reasonable.
 
 (b) 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 except that instructions for
 physical verification of inventory were issued orally and not
 documented.
 
 (c) The Company is maintaining proper records of inventory and no
 material discrepancies were noticed on physical verification.
 
 (iii) (a) According to the information and explanations given to us,
 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 Companies Act, 2013.  Accordingly, the
 provisions of clause 3(iii)(a) and (b) of the Order are not applicable
 to the Company and hence not commented upon.
 
 (iv) In our opinion and according to the information and explanations
 given to us, there is an 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.
 During the course of our audit, we have not observed any major weakness
 or continuing failure to correct any major weakness in the internal
 control system of the company in respect of these areas.
 
 (v) The Company has not accepted any deposits from the public.
 
 (vi) 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 148(1) of the Companies Act,
 2013, related to the manufacture of aluminium oxide grains and calcined
 products, and generation of power, and are of the opinion that prima
 facie, the specified accounts and records have been made and
 maintained. We have not however, made a detailed examination of the
 same.
 
 (vii) (a) The Company is generally regular in depositing with
 appropriate authorities undisputed statutory dues including provident
 fund, employees'' state insurance, income-tax, sales-tax, wealth-tax,
 service tax, professional tax, customs duty, excise duty, value added
 tax, cess and other material statutory dues applicable to it.
 
 (b) According to the information and explanations given to us, no
 undisputed amounts payable in respect of provident fund, employees''
 state insurance, income-tax, wealth-tax, service tax, sales-tax,
 customs duty, excise duty, value added tax, cess and other material
 statutory dues were outstanding, at the year end, for a period of more
 than six months from the date they became payable.
 
 (c) According to the records of the Company, the dues outstanding of
 income-tax, sales-tax, wealth-tax, service tax, customs duty, excise
 duty, value added tax and cess on account of any dispute, are as
 follows:
 
 Name of the          Nature of dues
 Statue
 
 West Bengal Sales    Sales tax and Interest demand for 
 Tax Act, 1994        non- submission of sales tax declaration forms
                      for the year 1993-94
 
 Sales Tax Act,       Entry tax demand for entry of goods in
 1944                 Rajasthan for the year 2006-07
 
 Service Tax Act,     Service tax demand for input tax credit availed
 1994                 on foreign business auxiliary services and
                      other consulting services
 
 Income Tax Act,      Disallowance of various expenses /
 1961                 deductions (under section 80IA) claimed by
                      the Company for the year 2007-08
 
 
 
 Name of the Statute       Amount         Forum where dispute 
                        (Rs. in lacs)     is pending
 
 West Bengal Sales Tax        3.75        Sales Tax Commissioner (Appeal)
 Act 1994
 
 Sales Tax Act, 1944         36.06        Hon''ble High Court of Rajasthan
 
 Service Tax Act, 1994       85.48        Joint Commissioner Excise, 
                                          Jaipur
 
 Income Tax Act, 1961        55.42        ITAT
 
 Name of the             Nature of dues
 Statue
 
 Income Tax Act,         Penalty proceedings for error made in the 
 1961                    return filed by the Company for the
                         assessment year 2009-10
 
 Income Tax Act,         Disallowance of depreciation u/s 32 for the
 1961                    assessment year 2010-11
 
 Customs Act,            Differential custom duty on account of
 1962                    misclassification on import of coal.
 
 
 Name of the Statute     Amount      Forum where dispute 
                      (Rs. in lacs)  is pending
 
 Income Tax Act, 1961    159.79      Assessing Officer
 
 Income Tax Act, 1961     40.24      Commissioner of Income
                                     Tax (Appeal)
 
 Income Tax Act, 1962     37.68      Commissioner of Customs (Appeal)
 
 (d) According to the information and explanations given to us, the
 amount required to be transferred to investor education and protection
 fund in accordance with the relevant provisions of the Companies Act,
 1956 (1 of 1956) and rules made thereunder has been transferred to such
 fund within time.
 
 (viii) 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.
 
 (ix) Based on our audit procedures and as per the information and
 explanations given by the management, we are of the opinion that the
 Company has not defaulted in repayment of dues to banks. The Company
 has not issued any debentures and has not borrowed funds from financial
 institutions
 
 (x) 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.
 
 (xi) Based on the information and explanations given to us by the
 management, term loans were applied for the purpose for which the loans
 were obtained.
 
 (xii) 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 fraud on or by the Company has been noticed or reported during
 the year.
 
 
 
                                    For S. R. Batliboi & Co. LLP
                                        Chartered Accountants
                              ICAI Firm Registration Number: 301003E
 
                                                  Sd/-
                                              Per Vikas Mehra
                                                Partner
                                             Membership No.: 94421 
 Place of Signature : New Delhi 
 Date : May 16, 2015
Source : Dion Global Solutions Limited
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