Report on the Financial Statements
We have audited the accompanying financial statements of Taneja
Aerospace and Aviation Limited (the company), which comprise the
Balance Sheet as at March 31, 2013, the Statement of Profit and Loss
and the Cash Flow Statement for the year then ended, and a summary of
the significant accounting policies and other explanatory information.
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 referred to in sub-section
(3C) of Section 211 of the Companies Act, 1956 (the Act). 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.
Auditors'' Responsibility
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 the
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 the 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. An audit also includes evaluating the appropriateness of
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.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the 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, 2013;
(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
sub-section (4A) of section 227 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 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
those books.
(c) The Balance Sheet, 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, Statement of Profit and Loss,
and the Cash Flow Statement comply with the Accounting Standards
referred to in sub-section (3C) of section 211 of the Act.
(e) On the basis of the written representations received from the
directors as on March 31, 2013 taken on record by the Board of
Directors, none of the directors is disqualified as on March 31, 2013
from being appointed as a director in terms of clause (g) of
sub-section (1) of section 274 of the Companies Act, 1956.
(Referred to in paragraph 3 of our report of even date)
(i) a. The company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
b. According to the information and explanations given to us, the
physical verification of the fixed assets was undertaken by the
management during the year and no material discrepancies were noticed
on such verification as compared to the book records.
c. According to the information and explanations given to us, the
company has not disposed off substantial part of fixed assets during
the year, which would affect the going concern of the company.
(ii) a. As explained to us, inventories have been physically verified
during the year by the Management. In our opinion, the frequency of
verification is reasonable.
b. The procedures of physical verification of inventories followed by
the management are generally reasonable and adequate in relation to the
size of the company and nature of its business.
c. The company is maintaining proper records of inventory by way of
manual bin cards, except in the case of work in progress. No material
discrepancies were noticed on physical verification as compared to
quantity as per manual records. The company is in the process of
integrating its inventory with financial accounts.
(iii) a. During the year under audit, the company has not granted any
fresh loans, secured or unsecured, to companies, firms or other parties
covered in the register maintained under Section 301 of the Companies
Act, 1956. Out of the advance granted in earlier years by way of Inter
Corporate Deposit, the maximum amount outstanding during the year was
Rs. 29 lakhs and the balance of such loan as at March 31, 2013 is Rs.
nil (Previous Year Rs. 29 lakhs).
b. In our opinion and according to the information and explanations
given to us, the rate of interest and other terms and conditions on
which the Inter Corporate Deposit indicated in paragraph (iii) (a)
above was granted is not, prima facie, prejudicial to the interest of
the company.
c. During the year, the company has taken unsecured loans aggregating
to Rs. 1,645 lakhs from one of the companies covered in the register
maintained under Section 301 of the Companies Act, 1956 (Previous year
Rs. 1,674 lakhs). At the year end, the aggregate amount outstanding was
Rs. 1,050 lakhs (Previous Year Rs. 1,340 lakhs). The maximum balance
outstanding during the year was
Rs. 2,250 lakhs (Previous Year Rs. 2,300 lakhs).
d. As explained to us, the loan (indicated in paragraph (iii) (c)
above) is repayable on demand any time on or after April 01, 2013. In
our opinion and according to the information and explanations given to
us, the rate of interest and other terms and conditions of loan taken
by the company, are prima facie, not prejudicial to the interest of the
company.
e. As the loan is repayable on demand, we are unable to comment on the
regularity of repayment of principal amount and the interest thereon.
(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, for purchase of fixed assets and for the sale of goods and
services. However, the internal control procedure with regard to
inventory control and reconciliation of Trade Receivables'' balances
need to be strengthened considering the increasing sales volume of
business and transactions.
(v) a) According to the information and explanations given to us and to
the best of our knowledge and belief, we are of the opinion that, the
transactions that need to be entered into the register maintained under
Section 301 of the Companies Act, 1956 have been so entered. b) In our
opinion and according to explanations given to us, transactions (other
than secured/unsecured loans given/taken dealt with in paragraph (iii)
above) made in pursuance of contracts or arrangements entered in the
register maintained under section 301 of the Companies Act, 1956 and
exceeding the value of Rupees Five Lakhs have been made at prices which
are reasonable having regard to prevailing market prices at the
relevant time.
(vi) As per explanations given to us, the company has not accepted any
deposits from public to which the provisions of section 58A and 58AA of
the Companies Act, 1956 and the Companies (Acceptance of Deposits)
Rules, 1975 would apply. Therefore, the provisions of clause 4 (vi) of
the Companies (Auditor''s Report) Order, 2003 are not applicable to the
company.
(vii) Internal audit is conducted by a Group Internal Audit Department
headed by senior chartered accountant. In our opinion, the company has
an internal audit system commensurate with the size and nature of its
business. However in our opinion, the scope and coverage of internal
audit needs to be strengthened especially as mentioned in clause (iv)
above.
(viii) As per MCA order dated November 6, 2012, the company cost
records are liable for cost audit from April 01, 2013.
(ix) a) According to the information and explanations given to us, the
company has been generally regular in depositing undisputed statutory
dues including Provident Fund, Investor Education and Protection Fund,
Income-Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise
Duty, Education Cess, Higher Education Cess and any other material
statutory dues with the appropriate authorities during the year.
(x) The company has no accumulated losses as at March 31, 2013. The
company has not incurred any cash losses during the period covered by
our audit and in the immediately preceding financial year.
(xi) According to the records of the company examined by us and the
information and explanations given to us, the company has not defaulted
in repayment of dues to any financial institution or bank.
(xii) According to the explanations given to us, the company has not
granted loans and advances on the basis of security by way of pledge of
shares, debentures and other securities.
(xiii) In our opinion and according to the information and explanations
given to us, the company is not a chit fund or a nidhi/ mutual benefit
fund/society. Therefore, the provisions of clause 4 (xiii) of the
Companies (Auditor''s Report) Order, 2003 are not applicable to the
company.
(xiv) In our opinion and according to the information and explanations
given to us, the company is not dealing or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause 4
(xiv) of the Companies (Auditor''s Report) Order, 2003 are not
applicable to the company.
(xv) In our opinion and according to the information and explanations
given to us, the company has not given any guarantee for loans taken by
others from bank or financial institutions. Hence, the provisions of
clause 4 (xv) of the Companies (Auditor''s Report) Order, 2003 are not
applicable to the company.
(xvi) As per the information and explanations given to us, the company
has raised the Term Loan of Rs. 1,500 Lakhs during the period under
audit. Also, Term Loan taken during year has been, on an overall basis,
applied for the purpose for which the said loans were obtained.
(xvii) According to the information and explanations given to us, and
on an overall examination of the Balance Sheet and the Cash Flow of the
company, we report that no funds raised on short-term basis has been
used for long-term investment.
(xviii) According to the information and explanations given to us,
during the period covered by our audit report, the company has not made
preferential allotment of equity shares to parties and companies
covered in the Register maintained under section 301 of the Companies
Act, 1956.
(xix) In our opinion and according to the information and explanations
given to us, the company has not issued any secured debentures during
the period of our audit. Therefore, clause 4 (xix) of the Companies
(Auditor''s Report) Order, 2003 is not applicable to the company.
(xx) The company has not raised any funds by way of public issue during
the year.
(xxi) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the company
has been noticed or reported during the course of our audit.
For Haresh Upendra & Co.
Chartered Accountants
Firm Reg. No.: 103513W
Haresh B. Shah
Partner
Pune,
August 05, 2013 Membership No.: 32208
