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Carnation Industries | Auditor's Report > Castings & Forgings > Auditor's Report from Carnation Industries - BSE: 530609, NSE: N.A
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Carnation Industries

BSE: 530609|ISIN: INE081B01010|SECTOR: Castings & Forgings
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VOLUME 15
Carnation Industries is not listed on NSE
Mar 14
Auditor's Report (Carnation Industries) Year End : Mar '15
 We have audited the accompanying financial statements of CARNATION
 INDUSTRIES LIMITED (''the company''), which comprise the balance sheet as
 at 31 March 2015, the statement of profit and loss and the cash low
 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 and presentation of these financial statements that
 give a true and fair view of the financial position, financial
 performance and cash lows 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.
 
 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
 there under.
 
 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 operating
 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 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 31st March, 2015, and its profit/loss and its cash lows for the year
 ended on that date.
 
 Emphasis of Matters
 
 We draw attention to the following matter in the Notes to the financial
 statements:
 
 (i) Note 16(a) to the financial statements which describes the overdue
 receivables from a related party.
 
 Our opinion is not modified in respect of this matter.
 
 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 terms of
 subsection (11) of section 143 of the Act, we give in the Annexure a
 statement on the matters specified in the paragraph 3 and 4 of the
 Order, to the extent applicable.
 
 2.  As required by Section 143 (3) of 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 it appears from our examination of those
 books;
 
 (c) The balance sheet, the statement of profit and loss and the cash
 low statement dealt with by this Report are in agreement with the books
 of accounts;
 
 (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 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; and
 
 (f) With respect to the other matters to be included in the Auditors''
 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 28(ii) to
 the financial statements;
 
 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- Refer Note
 28(xv) to the financial statements;
 
 iii. There has been no delay transferring amounts, required to be
 transferred, to the Investor Education and protection Fund by the
 company.
 
 Annexure to the Independent Auditors'' Report
 
 The Annexure referred to in our Independent Auditors Report to the
 members of the company on the financial statements for the year ended 31
 March 2015, we report that:
 
 1.  The company is maintaining proper records showing full particulars,
 including quantitative details and situation of fixed assets. As
 informed to us all fixed assets (except lying with outside parties)
 have been physically verified by the management at reasonable intervals
 and no material discrepancies were noticed on such verification.
 
 2.  The management has conducted physical verification of inventory at
 the end of the year (except stock lying with outside parties). 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. The company is maintaining
 proper records of inventory and no material discrepancies were noticed
 on such physical verification.
 
 3.  The Company has not granted any loan, secured or unsecured to
 companies, firms or other parties covered in the register maintained
 under section 189 of the Companies Act 2013.
 
 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 and fixed assets and for the
 sale of goods.  Further, on the basis of our examination of the books
 and records of the Company, carried out in accordance with the
 generally accepted auditing practices in India, we have neither come
 across nor have we been informed of any instance of a continuing
 failure to correct major weakness in the aforesaid internal control
 procedures.
 
 5.  The Company has not accepted any deposits from the public.
 
 6.  The Central Government has prescribed the maintenance of cost
 records under section 148(1) of the Companies Act, 2013 for the
 products of the company. We have broadly reviewed such records
 maintained by the company 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 a view to
 determine whether they are accurate or complete.
 
 7.  According to the records of the Company, the Company is generally
 regular in depositing undisputed statutory dues including Provident
 Fund, Employees'' State Insurance, Income Tax, Sales-Tax, Wealth Tax,
 Service Tax, Custom Duty, Excise Duty, Value Added Tax, Cess and Other
 Statutory Dues applicable to it with the appropriate authorities.
 According to the information and explanations given to us, no
 undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales
 Tax, Service Tax, Custom Duty, Excise Duty and Value Added Tax were
 outstanding at the year end for a period of more than six months from
 the date they became payable.
 
 Further according to the records of the Company, there are no dues
 outstanding of Sales Tax, Income Tax, Custom Duties, Wealth Tax,
 Service Tax, Excise Duty, Value Added Tax, Cess on Account of any
 dispute other than the following:
 
 Name of the      Nature of Dues        Amount            Forum Where
 Status                                  (Rs.)            Dispute
                                                          is Pending
 
 West Bengal      Value Value          100.13 lacs     Before the West
 Added Tax Act,   Added Tax for                        Bengal Commercial
 2003             the Financial                        Taxes Applellate
                  Year 2007-2008                       & Revisional
                                                       Board.
 
 
 Cental Excise    Duty and Penalty     136.56 lacs     Before the
 Act,  1944                                            Commissioner
                                                       (Appeal - I & II)
                                                       of Central Excise.
 
 According to the information and explanations given to us the amounts
 which were required to be transferred to the investor education and
 protection fund in accordance with the relevant provisions of the
 Companies Act, 1956 (1 of 1956) and rules there under has been
 transferred to such fund within time.
 
 8.  The Company does not have any accumulated losses at the end of the
 financial year and has not incurred cash losses in the financial year
 and in the immediately preceding financial year.
 
 9.  Based on our audit procedures and on the information and
 explanations given by the management, we are of the opinion that the
 company has not defaulted in repayment of dues to bank.
 
 10.  In our opinion and according to the information and the
 explanations given to us, the company has not given any guarantee for
 loans taken by others from banks or financial institutions.
 
 11.  The term loans were applied for the purpose for which the loans
 were obtained.
 
 12.  According to the information and explanations given to us, no
 material fraud on or by the Company has been noticed or reported during
 the course of our audit.
 
                                                      For JAIN & BAGARIA
                                                   Chartered Accountants
 
 
                                                          B. K. Agarwal
 27/8A, Waterloo Street                                     (Partner)
 Kolkata - 700 069                                  Membership No.065361
 Dated : 26th May, 2015                                 FRN : 310045E
 
 
 
 
 
Source : Dion Global Solutions Limited
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