We have audited the accompanying standalone financial statements of
SUNDRAM FASTENERS LIMITED, Chennai - 600 004 (the Company), which
comprise the Balance Sheet as at 31st March, 2015, the Statement of
Profit and Loss, the Cash Flow Statement for the year then ended, and a
summary of the significant accounting policies and other explanatory
Management''s Responsibility for the Standalone 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 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 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 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 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 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 auditors'' 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 auditors consider 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
In our opinion and to the best of our 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 a true and fair view in conformity with the accounting principles
generally accepted in India;
i. in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2015;
ii. in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
iii. in the case of the Cash Flow Statement, of the 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 in terms of sub-section (11)
of section 143 of the Act, we give in 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 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
(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 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 no.
31(29)(A) to the financial statements;
ii. The Company did not have any long-term contracts including
derivative contract for which there were any material foreseeable
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT TO THE MEMBERS OF SUNDRAM
FASTENERS LIMITED, CHENNAI FOR THE YEAR ENDED 31ST MARCH 2015 Annexure
referred to in our report of even date on the financial statements for
the year ended 31st March 2015
(i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
(b) All the fixed assets have not been physically verified by the
management during the year but there is a regular programme of physical
verification at reasonable intervals, which, in our opinion is
reasonable having regard to the size of the company and nature of its
assets. No material discrepancies were noticed on such verification.
(ii) (a) The inventory other than in transit has been physically
verified at reasonable intervals during the year by the management. In
our opinion, the frequency of such verification is adequate. In respect
of inventories lying with third parties, which are not physically
verified, there is a process of obtaining confirmation from such
(b) In our opinion and according to the information and explanations
given to us, the procedures for physical verification of inventory
followed by the management were reasonable and adequate in relation to
the size of the company and the nature of its business.
(c) In our opinion, the company has maintained proper records of
inventory. The discrepancies noticed between the physical stocks and
the books were not material and have been properly dealt with in the
books of account.
(iii) During the year, 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 Companies Act, 2013. The
Company has waived interest due of Rs. 132.09 lakhs from a subsidiary
Company viz. Peiner Umformtechnik GmbH, Peine, Germany for the period
upto 31st December, 2014 on a loan granted upto 31st March, 2014.
Interest has been charged on the loan granted on or after 1st April,
(iv) 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, with regard to purchase of inventory, fixed assets and for
the sale of goods. During the course of our audit, no minor or major
continuing failure has been noticed in the internal control system.
(v) The Company has not accepted deposits within the meaning of
sections 73 to 76 of the Companies Act, 2013, during the year.
(vi) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government under
section 148(1) of the Companies Act, 2013 for maintenance of cost
records and are of the opinion that prima-facie, the prescribed
accounts and records have been made and maintained. We have, however,
not made a detailed examination of the cost records with a view to
determine whether they are accurate or complete.
(vii) (a) According to the records provided to us, 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 Customs, Duty of Excise, Value Added Tax, Cess and
other statutory dues with the appropriate authorities. However, certain
delays were noticed in respect of remittance of service tax, employees''
state insurance and Income tax into the Government. (b) According to
the information and explanations given to us, no undisputed amounts
payable in respect of Income Tax, Wealth Tax, Sales Tax, Service Tax,
Duty of Customs, Duty of Excise, Value Added Tax and Cess were in
arrears, as at 31st March 2015 for a period of more than six months
from the date they became payable.
According to information and explanations furnished to us, the
following are the details of the disputed dues that were not deposited
with the concerned authorities:
Nature of Amount
Name of the statute Forum Where the dispute
Central Excise Act, Excise Duty 2.54 The Honourable High Court
of Judicature at
15.02 Customs Excise and Service
61.95 Commissioner (Appeals)
50.22 Additional / Assistant
Finance Act, 1994 Service Tax 66.56 Customs Excise and
Service Tax Appellate
41.07 Commissioner (Appeals),
50.69 Joint / Deputy /
Property Tax Property Tax 1.56 The Honourable High Court
of Judicature at
Income Tax Act, Income tax 19.64 The Honourable High Court
of Judicature at
331.72 Commissioner of Income
Customs Act, 1962 Customs duty 229.25 Customs Excise and
Service Tax Appellate
(c) During the year, the Company has transferred the amount 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 thereunder within time.
(viii) The Company neither has accumulated losses as at the end of the
financial year nor has incurred cash losses during the financial year
and in the immediately preceding financial year.
(ix) Based on our verification and according to the information and
explanations given by the management, the Company has not defaulted in
repayment of dues to its banks.
(x) The Company has furnished guarantee to banks and financial
institution for loans availed by subsidiary companies. The terms and
conditions of such guarantees are not prejudicial to the interests of
(xi) The term loans were applied for the purpose for which the loans
(xii) Based on the audit procedures adopted and information and
explanations given to us by the management, no fraud on or by the
Company has been noticed or reported during the course of our audit.
For SUNDARAM & SRINIVASAN
Regn. No. 004207S
May 29, 2015 Membership No. F7945