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Winsome Textile Industries
BSE: 514470|ISIN: INE837B01031|SECTOR: Textiles - Spinning - Synthetic Blended
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« Mar 13
Auditor's Report (Winsome Textile Industries) Year End : Mar '14
We have audited the Accompanying financial statements of Winsome
 Textile Industries Limited, which comprise the balance sheet as at 31st
 March 2014, and the statement of the profit and loss and 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 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 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. 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 un 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 audit opinion.
 
 Basis for Qualified Opinion:-
 
 Attention is drawn to :
 
 Note no. 27.7(i) regarding non provision for shortfall in recovery
 (amount unascertainable) against overdue debt of Rs. 85.15 lacs as
 stated in the said note for which legal and other persuasive action for
 recovery has been initiated, in the opinion of the management these
 debts are good and recoverable as stated in the said note and our
 inability to comment thereon.
 
 We further report that the profit for the year, the balance in reserve
 & surplus, receivable and profit for the year are without considering
 items mentioned in (i) above, the effect of which could not be
 determined.
 
 Qualified Opinion
 
 In our opinion and to the best of our information and according to the
 explanations given to us, except for the effects of the matter
 described under the head Basis for Qualified Opinion paragraph, 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 the affairs of
 the Company as at 31st March 2014,
 
 b.  In case of the statement of the profit and loss, of the profit for
 the year ended on that date, and
 
 c.  In case of the cash flow statement, of the cash flows for the year
 ended on that date.
 
 Emphasis of Matter
 
 Note no. 27.7(ii) regarding balances of certain receivables, loans and
 advances (including capital advances), trade and other payables are
 subject to confirmation/reconciliation.
 
 Report on other legal and the regulatory requirements:
 
 1.  As required by the Companies (Auditor''s Report) Order, 2003(the
 Order) issued by the Central Government of India in terms of
 sub-section (4A) of section 227 of the Act, we give the Annexure a
 statement on the, matters specified in the 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 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 Sleet, Statement of Profit & Loss and Cash Flow
 Statement referred to in this report are in agreement with the books of
 account;
 
 d.  In our opinion, the Balance Sheet, Statement of Profit & Loss and
 Cash Flow Statement dealt with by this report comply with the
 accounting standards referred to in Section 211(3C) of the Companies
 Act, 1956 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 and taken on records by the Board of Directors, we report
 that none of the directors of the Company is disqualified as on 31st
 March 2014 from being appointed as a Director of the Company in terms
 of clause (g) of subsection (1) of section 274 of the Companies Act,
 1956.
 
 ANNEXURE TO THE AUDITORS'' REPORT
 
 (Referred to in paragraph 1 of our Report of even date on Winsome
 Textile Industries Limited for the year ended 31st March, 2014)
 
 i.  (a) The Company has maintained records in respect of fixed assets
 showing full particulars including quantitative details and situation 
 of fixed assets except in respect of certain fixed assets (and also 
 at new project location), where the same are in process of compilation
 /updation.
 
 (b) As per information & explanations given to us, physical
 verification of the certain fixed assets are in process, according to
 the regular programme of physical verification once in every three
 years, in phased manner, which in our opinion is reasonable having
 regard to the size of the Company and the nature of its fixed assets.
 
 (c) As per the records and information and explanation given to us,
 fixed assets disposed off during the year were not substantial.
 
 ii.  (a) As explained to us, the inventories of the Company (except
 stock lying with the third parties; and in transit) have been 
 physically verified by the management during the year.
 
 (b) In our Opinion and according to information & explanation 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) According to the information and explanation given to us, we are of
 the opinion that the Company is maintaining proper records of
 inventories (In case of process stock, records are updated on monthly
 physical verification of stock). As per records and information made
 available the discrepancies noticed on verification between the
 physical stock and the book records were not material in relation to
 the operation of the Company.
 
 iii.  As per the information and explanations given to us the Company
 has neither granted nor taken during the year
 any loans, secured or unsecured to and from companies, firms or other
 parties listed in the register maintained under section 301 of the Act.
 Accordingly, the provisions of clause 4 (iii) (b) to (d) and (f) & (g)
 of the Order are not applicable to the Company.
 
 iv.  In our opinion and according to the information and explanations
 given to us, having regard to the explanation
 that some of the items purchased are of special nature and suitable
 alternative sources do not exist for obtaining comparable quotation or
 where user department has shown specific preference, where, as
 
 explained, rates were determined considering the quality, volume,
 nature of the items and market conditions prevailing at that time,
 there are internal control system commensurate with size of the Company
 and nature of its business with regard to the purchase of inventory,
 fixed assets, services and for the sale of goods and services which
 needs to be further strengthen (read with note no. 27.2, 27.7 and
 27.11). Based on the audit procedure performed and information &
 explanation provided by the management, during the course of our audit,
 we have not observed any continuing failure to correct major weaknesses
 in internal control system nor been identified by the management.
 
 v.  a) According to the information and explanations provided by the
 management and based on the audit
 procedure performed, we are of the opinion that the particulars of the
 contracts or arrangements referred to in Section 301 of the Act have
 been entered in the register required to be maintained under that
 section; and b) In our opinion and according to the information and
 explanation given to us, having regard to para iv above, the
 transactions made in pursuance of such contracts or arrangements
 (exceeding the value of Rs. 5 Lacs in respect of each party during the
 financial year) have been made at prices which are generally reasonable
 having regard to the prevailing market prices at the relevant time.
 vi.  According to the information and explanations given to us, the
 Company has not accepted any deposits from
 
 the public within the meaning of Section 58A and 58AA Act and the rules
 framed there under and directives issued by the Reserve bank of India
 and other relevant provisions of the Act.  We have been informed that
 no order has been passed by the Company Law Board or National Company
 Law Tribunal or Reserve Bank of India or any Court or any other
 Tribunal in this regard.  vii.  In our opinion, the Company has an
 internal audit system commensurate with the size of the Company and
 nature of its business.  viii. We have broadly reviewed the books of
 account maintained by the Company as prescribed 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 records have been made and maintained. We have, however,
 not made a detailed examination of the said records with view to
 determine whether they are accurate and complete.
 
 ix.  (a) According to the records of the Company, the Company in
 generally regular in depositing with appropriate
 authorities undisputed statutory dues {(excepts Sales Tax read with
 note no. 27.7(ii)} including Provident Fund, Investor Education and
 Protection Fund, Employees'' State Insurance, Income Tax, Wealth Tax,
 Service tax, Custom Duty, Excise Duty, Cess and other material
 statutory dues applicable to it. According to the information and
 explanations given to us, there are no undisputed statutory dues
 payable for a period more than six months from the date they became
 payable as at 31.03.2014.  (b) According to the records and information
 and explanations given to us, there are no dues in respect of Income
 Tax, Custom Duty, Wealth Tax, Service Tax, Sales Tax and Cess that have
 not been deposited on account of any dispute. In our opinion and
 according to the information and explanations given to us, the dues in
 respect of Excise duty that have not been deposited with the
 appropriate authorities on account of dispute and the forum where the
 disputes are pending are given below:
 
 Name of Statute          Nature of Dues     Amount    Period to which
                                          (Rs. in Lacs) amount relates
 
 Central Excise Act        Excise Duty       1.44          1995-96
                           Excise Duty      62.92          2003-04,
                                                           2005-06
 
                           Excise Duty       3.57       2003-04, 2004-05
                           Excise Duty       1.67       2004-05, 2008-09
 
 
 
 Name of the Statute                                 Forum where dispute
                                                        is pending
 
 Central Excise Act                               Asst. Commissioner
                                                    CESTAT
 
                                                    CESTAT
                                                  Commissioner Appeal
 
 x.  The Company does not have accumulated losses at the end of the
 financial year and has not incurred any cash losses during the current 
 and immediately preceding previous year.
 
 xi.  In our opinion, based on the audit procedures and according to
 information & explanation given to us, the Company has generally not 
 defaulted in repayment of dues to financial institution and banks.
 
 xii.  Based on our examination of the records and the information and
 explanation given to us, the Company has not granted any loans and/or 
 advances on the basis of security by way of pledge of shares, debentures 
 andother securities.  
 
 xiii.  Clause (xiii) of the order is not applicable
 to the Company as the Company is not a Chit Fund Company or
 nidhi/mutual benefit fund/society.  
 
 xiv.  In our opinion and according to the information and explanations 
 provided to us, the Company is not dealing in or trading in shares, 
 securities, debentures and other investment.  
 
 xv. According to the information and explanations given to us, the Company
 has not given any guarantee for loans taken by others from banks and 
 financial institution.  xvi.  According to the information and 
 explanations given to us, the term loans were applied for the purpose for
 which the loans were obtained.  
 
 xvii.  According to the information and explanations given to us and on
 an overall examination of the financial statements, we are of the opinion 
 that no funds raised on short term basis have been used for long term
 investment.  
 
 xviii. According to the information and explanations given
 to us, the Company has not made any preferential
 allotment of shares to parties or companies covered in the register
 maintained under Section 301 of the Act in the current year.  
 
 xix.  No debenture has been issued /outstanding during the year hence 
 the provision of clause 4 (xix) of the said order are not applicable.  
 
 xx.  According to the information and explanations given to us, during 
 the year the Company has not raised fund through public issue.  
 
 xxi.  To the best of our knowledge and belief,based on the audit 
 procedure performed and on the basis of information and explanations 
 provided by the management, no material fraud on or by the Company has 
 been noticed or reported during the course of the audit.
 
                                                    For Lodha & Co.
                                              Chartered Accountants 
                                      Firm Registration No. 301051E
 
 Place : New Delhi                                     N.K. Lodha
 Date : 28.05.2014                                       (Partner)
                                              Membership No.: 85155
Source : Dion Global Solutions Limited
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