We have audited the accompanying financial statements of LYKIS Limited
(the Company), which comprise the Balance Sheet as at March 31,2014,
the Statement of Profit and Loss and Cash Flow Statement for the year
then ended, and a summary of significant accounting policies and other
MANAGEMENT''S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
The Company''s 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 notified under 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 and in accordance with the
accounting principles generally accepted in India. 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.
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 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 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 our audit 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:
(a) In the case of the Balance Sheet, of the state of affairs of the
Company as at March 31,2014;
(b) In the case of the Statement of Profit and Loss, of the profit of
the Company for the year ended on that date; and
(c) In the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
REPORT ON OTHER LEGAL AND 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 Section
227(4A) of the Act, we give in the Annexure a statement on the matters
specified in 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 purpose of our
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
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 Balance Sheet, the Statement of Profit and
Loss, and the Cash Flow Statement comply with Accounting Standards
notified under 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.
e. On the basis of the written representations received from the
directors as on March 31,2014, taken on record by the Board of
Directors, none of the directors is disqualified as on March 31,2014,
from being appointed as a director in terms of Section 274(1)(g) of the
Annexure to Independent Auditors'' Report
Referred to in Paragraph I under the heading of Report on other Legal
and regulatory requirements of our report of even date:
i. The Company has made available the fixed asset records showing full
particulars including quantitative details and situation of fixed
assets of the company during the audit period under review. As
explained to us, all the fixed assets have been physically verified by
the management in a phased periodical manner, 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 physical
ii. The Stock of inventories has been physically verified during the
period by the Management at reasonable intervals, in our opinion, the
procedure of 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. The company has maintained the
proper records of inventories. The discrepancies noticed on physical
verification of stocks as compared to books record were not material.
However the same has been properly dealt with the books of account.
iii. The company has not granted but taken unsecured loans and advances
from companies, firms and/or other parties covered in the register
maintained under section 301 of the Companies Act, 1956.
The Company has taken interest free loans from its directors & related
companies amounting to Rs. 34,65,000/- (Previous Year (Rs.
1,08,75,000/-)and repaid Rs. 1,43,40,000/- during the year.
iv. In our opinion and according to the information and explanations
given to us, there is adequate internal control procedure commensurate
with the size of the company and the nature of its business with regard
to purchase of inventory and fixed assets and with regard to the sale
of goods. Further on the basis of our examination and according to the
information and explanations given to us, we have neither come across
nor have been informed of any instance of continuing failure or major
weakness in the internal control systems.
v. In respect of the contract or arrangement referred to in section
301 of the companies Act 1956:
a) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements that need to be entered in the register maintained under
section 301 of the CompaniesAct,1956 have been entered.
b) In our Opinion and according to the information and explanations
given to us, the transactions made in pursuance of
contracts/arrangements entered in the register maintained under section
301 of the Companies Act,1956 and exceeding the value of Rs.
5,00,000/-in respect of each party during the year have been made at
prices which appear reasonable as per information available with the
vi. The Company has not accepted any deposits from the public and
consequently, the directives issued by the Reserve Bank of India, the
provisions of Section 58A and 58AA or any other relevant provision of
the Companies Act, 1956 and the rules framed there under are not
vii. In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
viii. The Central Government has prescribed the maintenance of cost
records under clause (d) of sub-section (l) of Section 209 of the
Companies Act, 1956 in respect of activities carried out by the
company. We have broadly reviewed the cost records maintained by the
company and are of the opinion that prima facie the prescribed cost
records have been maintained. However, we have not made a detailed
examination of the cost records with a view to determine whether they
are accurate or complete.
ix. According to the information and explanation given to us and on
the basis of our examination of the books of account, the Company is
regular in depositing the amount of undisputed statutory dues of
Provident fund, Sale- tax, VAT, Cess on green leaf and other Statutory
dues with appropriate authorities . However, there are outstanding
settled amount of Rs. 21,13,109/- in respect of Cess on Greenleaf as on
31.03.2014. According to the information and explanation given to us,
there were no undisputed amounts payable in respect of Sales tax and
Vat, Customs Duty and Excise Duty as on 31st March 2014 for a period of
more than six months from the date of becoming payable. Further there
were disputed demand of Rs. 6,79,380/- on account of Agricultural
Income Tax for the Asst.Year 2007-08.
x. The Company''s accumulated loss at the end of the year is less than
the fifty percent of its net worth. The company has not incurred cash
losses during the current financial year covered by the audit and in
the immediately preceeding financial year.
xi. Based on our audit procedures and according to the information and
explanations given to us we are of the opinion that Company has not
defaulted in repayment of dues to financial institutions ,banks and
xii. The Company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures during the
period.Accordingly, Clause 4(xii) of the order is not applicable.
xiii. The Company is not a chit fund, nidhi, mutual benefit fund or a
society. Accordingly, clause 4(xiii) of the order is not applicable.
xiv. The company has invested in shares during the period . Proper
records have been maintained of the transactions and contracts. The
shares have been held by the company, in its own name except to the
extent of the exemption, if any, granted under section 49 of the
xv. According to the information and explanations, the company has not
given any guarantee for loans taken by other from banks and
xvi. During the period, the company has not obtained any fresh Term
loans; accordingly, clause 4(xvi) of the order is not applicable.
xvii. According to information and explanation given to us, the fund
raised on short-term basis has not been used for long-term investments.
xviii. The Company has not made any preferential allotment of Equity
shares to parties and companies covered in the register maintained
under section 301 of the Act during the current financial year.
xix. The Company has not issued any debentures. Accordingly clause
4(xix) of the order is not applicable.
xx. The Company has not raised any money by public issues during the
period. Accordingly, clause 4(xx) of the order is not applicable.
xxi. In our opinion and according to the information and explanations
given to us, no fraud on or by the company has been noticed or reported
during the period.
For SANJAY P AGARWAL & ASSOCIATES
Firm Regn. No. 325683E
Place : Kolkata (SANJAY AGARWAL)
Date : 30th May, 2014 Mem. No. 062218