We have audited the accompanying standalone financial statements of
FEDDERS LLOYD CORPORATION LIMITED (the Company) which comprise the
Balance Sheet as at 30 June 2015, the Statement of Profit and Loss
Account and the 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 matter stated
in Section 134(5) of the Companies Act, 2013 (the Act) with respect
to the preparation & presentation of these standalone 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 control, 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
misstatements, whether due to fraud or error.
Our responsibility is to express an opinion on these standalone
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
provision of the Act and 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 the 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 amount and disclosures in the financial statements. The procedures
selected depend on the auditors'' judgment, including the assessment of
the risk 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 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 the effectiveness of the
Company''s internal control. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the 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 our audit opinion on the financial
In our opinion and to the best of the information and according to the
explanations given to us, the aforesaid standalone financial statements
give the information required by the Act in the manner so required and
give true and fair view in conformity with the accounting principles
generally accepted in India, of the state of affairs of the Company as
at 30 June 2015 and its profit and its cash flows for the year ended on
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors'' 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 a
statement on the matters specified in paragraphs 3 and 4 of the Order,
to the extent applicable.
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
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
c) The Balance Sheet, the statement of Profit & Loss and Cash Flow
Statement dealt with by this Report are in agreement with the books of
d) In our opinion, the aforesaid standalone financial statements comply
with the Accounting Standards under Section 133 of the Act, read with
the Rule 7 of the Companies (Accounts) Rules, 2014.
e) On the basis of written representations received from the directors
as on 30 June 2015 taken on record by the Board of Directors, none of
the directors is disqualified as on 30 June 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 explanation gives to us:
i) The financial statement have disclosed the impact of pending
litigations on the financial position of the Company as referred to in
note no 38.
ii) The Company has long-term derivative contracts (interest rate swap)
for which there were no material foreseeable losses.
iii) There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Referred to in paragraph 1 under ''Report on Other Legal and Regulatory
Requirements'' section of our report of even date of Fedders Lloyd
Corporation Limited for the year ended 30 June 2015
1. a) The company has maintained proper records showing full
particulars including quantitative details and situation of the Fixed
b) Fixed Assets have been physically verified by the management during
In our opinion the frequency of such verification is reasonable having
regard to the size of the Company and the nature of its fixed assets.
No material discrepancies were noticed on such physical verification.
2. a) The inventory has been physically verified during the year by
the management at reasonable intervals.
b) The procedures of the physical verification of the inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of the Business.
c) The Company is maintaining proper records of the inventory. The
discrepancies noticed on physical stocks and the book records were not
3. a) The Company has given loans to wholly owned subsidiary Fedders
Lloyd Trading FZE AED 11.27 lacs (equivalen to INR 1.51 Crores).
b) In the case of the loans granted to the bodies corporate listed in
the register maintained under section 189 of the Act, the borrowers
have been regular in the payment of the interest as stipulated. The
terms of arrangements do not stipulate any repayment schedule in the
loans are repayable on demand. Accordingly, paragraph 4(iii)(c) of the
Order is not applicable to the Company in respect of repayment of the
c) There are no overdue amounts of more than rupees one lakh in respect
of the loans granted to the bodies corporate listed in the register
maintained under section 189 of the Act.
4. In our opinion and according to the information and explanations
given to us, there is adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchases of inventory, fixed assets and with regard to the sale of
goods and services. During the course of our audit we have not observed
any continuing failure to correct major weakness in the internal
5. According to the information and explanations given to us, the
Company has not accepted any deposit, in terms of the directive issued
by the Reserve Bank of India and the provisions of the Section 73 to 76
or any other relevant provisions of the Companies Act and the rules
framed there under.
6. We have broadly reviewed the cost records maintained by the Company
prescribed by the Central Government under Section 148(1) of the
Companies Act, 2013 and are of the opinion that prima facie the
prescribed cost records have been maintained. We have, however, not
made a detailed examination of the cost records with a view to
determine whether they are accurate or complete.
7. a) According to the records of the Company, the Company is regular
in depositing undisputed Statutory dues including Provident Fund,
Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service
Tax, Duty of Excise, valued added tax cess and any other statutory dues
with the appropriate authorities, however there is some delay in
depositing Govt. dues due to financial difficulties. According to the
information and explanations given to us, no undisputed amounts payable
in respect of Income Tax, Wealth Tax, Sales Tax, Customs Duty, Service
Tax, Excise Duty and Cess were outstanding, at the financial reporting
period ending on 30 June 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 the
amounts which were required to be transferred to the investor education
and protection fund in accordance with the relevant provision of the
Companies Act, 1956 (1 of 1956) and rules thereunder has been
transferred to such fund within time.
8. The Company does not have accumulated Losses at the end of the
financial year. The Company has not incurred any cash loss during the
financial year covered by our audit and the immediate preceding
9. Based on our audit procedures and according to the information and
explanations given to us, we are of the opinion that the company has
not defaulted in repayment of dues of financial institutions, banks and
10. In our opinion and according to the information and explanation
given to us, the terms & conditions of the guarantees given by the
Company for loan taken by the subsidiary Companies from bank are prima
facie not prejudicial to the interest of the company.
11. In our opinion and according to the information and explanation
given to us, the term loans have been applied for the purposes for
which they were obtained.
12. As per information and explanation given to us no fraud on or by
the Company has been noticed or reported during the course of our
For Suresh C. Mathur & Co.
(Firm Registration No. 000891N)
BRIJESH C. MATHUR
Place : New Delhi PARTNER
Date : 13 August 2015 Membership No. 083540