We have audited the accompanying financial statements of Acknit
Industries Limited the Company) which comprise the Balance Sheet as at
31 March 2015, the Statement of Profit and Loss and the 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
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 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.
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
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 misstatements.
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 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 operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of 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
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, of the state of affairs of the Company as
at March 31,2015, and its profit and its cash flows for the year ended
on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2015(the
Order) issued by the Central Government of India in exercise of powers
conferred by sub-section 11 of section 143 of the Act, we enclose in
the Annexure a statement on the matters specified in paragraph 3 and 4
of the Order.
2. 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
purposes of ouraudit.
b. In our opinion, proper books of account as required by law have
been kept by the Company so far as it 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 aforesaid 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 31st March, 2015, taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2015
from being appointed as a director in terms of Section 164 (2) of the
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 29 and
(ii) The Company has made provision, as required under the applicable
law or accounting standards, for material foreseeable losses, if any,
on long-term contracts including derivative contracts.
(iii) There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund (IEPF) by
Annexure to the Auditors'' Report
(Referred to in our report of even date)
(i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
(b) The Company has a regular programme of physical verification of its
fixed assets by which all fixed assets are verified in a phased manner
over a period of one year. In accordance with this programme, a portion
of the fixed assets has been physically verified by the management
during the year and no material discrepancies have been noticed on such
verification. In our opinion, this periodicity of physical verification
is reasonable having regard to the size of the Company and the nature
of its assets.
(ii) (a) The inventory, except goods-in-transit, has been physically
verified by the management during the year. In respect of inventory
lying with third parties, these have substantially been confirmed by
them. In our opinion, the frequency of such verification is reasonable.
(b) The procedures for the 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) 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 Act.
(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 with regard
to purchase of inventories and fixed assets and sale of goods. In our
opinion and according to the information and explanations given to us,
there is no continuing failure to correct major weakness in internal
(v) The Company has not accepted any deposits from the public in
accordance with the provisions of sections 73 to 76 of the Act and the
rules framed there under.
(vi) We have broadly reviewed the records maintained by the Company
pursuant to the rules prescribed by the Central Government for
maintenance of cost records under subsection 1 of Section 148 of the
Act and are of the opinion that prima facie, the prescribed accounts
and records have been made and maintained. However, we have not made a
detailed examination of the records.
(vii) (a) According to the information and explanations given to us and
on the basis of our examination of the records of the Company, amounts
deducted/accrued in the books of account in respect of undisputed
statutory dues including Provident fund, Employees ''State Insurance,
Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise
duty, Value added tax, Cess, Professional tax and other material
statutory dues have been regularly deposited during the year by the
Company with the appropriate authorities.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, Employees''
State Insurance, Income tax, Sales tax, Wealth tax, Service tax,
Customs duty, Excise duty, Value added tax, Cess, Professional tax and
other material statutory dues were in arrears as at March 31, 2015 for
a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us, there
are no dues of Income tax, Wealth tax, Sales tax, Value added tax,
Service tax, Customs duty, Excise duty and Cess which have not been
deposited with the appropriate authorities on account of any dispute
other than those mentioned in Annexure I to this report.
(c) According to the information and explanations given to us and on
the basis of our examination of the records of the Company, the amount
which were 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 there under has been
transferred to such fund within time.
(viii) The Company does not have any accumulated losses at the end of
the year and has not incurred cash losses during the year and in the
immediately preceding financial year.
(ix) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to its
bankers. The Company did not have any outstanding dues to any financial
institution during the year.
(x) The Company has not given any guarantee for loan taken by others
from bank and financial institutions.
(xi) In our opinion, the term loans have been applied for the purpose
for which they were obtained.
(xii) According to the information and explanations given to us no
instances of material fraud on or by the Company has been noticed or
reported during the course of our audit.
Annexure I forming part of the Auditors Report as mentioned in clause
(vii) (b) of Annexure to the Auditors'' report :-
Name of the Name of the Amount Period to Forum where pending
Statute dues (inRs,) which the
West Bengal Assistant Commissioner,
Act, 1994 Sales Tax 13,200/- Year
1996-97 Commercial Taxes,
Calcutta South Circle
West Bengal West Bengal Commercial
Value Added VAT 8,07,300/- Year
2007-08 Taxes, Appellate &
2003 Provisional Board
West Bengal West Bengal Commercial
Value Added VAT 65,42,794/- Year
2008-09 Taxes, Appellate &
2003 Provisional Board
sales West Bengal Commercial
1956 CST 2.66,664/- Year
2008-09 Taxes, Appellate &
ForR. K. Bajaj & Co.
Firm registration number: 314140E
R. K. Bajaj
Membership number: 051715
Date: The 30th day of May 2015.