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Updated:19 Aug, 2019, 15:59 PM IST

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Updated:19 Aug, 2019, 16:01 PM IST

Disclosure in auditors report relating to fixed assets

The Holding Company and its subsidiaries incorporated in Indiaaremaintaining proper records showing full particulars, including quantitative details and situation, of fixed assets. (b) The fixed assets are physically verified by the respective Managements of the Holding Company and its subsidiariesincorporated in Indiaaccording to a phased programme designed to cover all the items over a period which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the respective Managements of the aforesaid Holding Company and its subsidiaries during the year and no material discrepancies have been noticed on such verification.

Disclosure in auditors report relating to inventories

The inventoryhas been physically verified by the respective Managements of the Holding Company and its subsidiariesincorporated in Indiaduring the year. In our opinion, the frequency of verification is reasonable. (b) In our opinion, the procedures of physical verification of inventory followed by the respective Managements of the Holding Company and its subsidiariesincorporated in Indiaare reasonable and adequate in relation to the size of the aforesaid Holding Company and its subsidiariesand the nature of theirrespective businesses. (c) On the basis of our examination of the inventory records and the reports of the other auditors, in our opinion, the Holding Company and its subsidiariesincorporated in Indiaaremaintaining proper records of inventory.The discrepancies noticed on physical verification of inventory of the aforesaid Holding Company and its subsidiariesas compared to the respective book records were not material.

Disclosure in auditors report relating to loans

The Holding Company and its subsidiariesincorporated in Indiahavenot grantedany loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 189of the Act. Therefore, the provisions of Clause 3(iii)(a) and (iii)(b) of the said Order are not applicable to the aforesaid Holding Company and its subsidiaries.

Disclosure in auditors report relating to internal control system

In our opinion, and according to the information and explanations given to us, there is an adequate internal control systemcommensurate with the size of the Holding Company and its subsidiariesincorporated in Indiaand the nature of theirrespective businesses for the purchase of inventory and fixed assets and for the sale of goods and services.Further, on the basis of our examination of the books and records of the aforesaid Holding Company and the reports of the other auditors on the subsidiariesas furnished to us, and according to the information and explanations given to us, we have neither come across, nor have been informed of, any continuing failure to correct major weaknesses in the aforesaid internal control system.

Disclosure in auditors report relating to maintenance of cost records

The Central Government of India has not specified the maintenance of cost records under sub–section (1) of Section 148 of the Act for any of the products of the Holding Company andits subsidiariesincorporated in India.

Disclosure in auditors report relating to accumulated losses

The Holding Company and its subsidiaries incorporated in India have no accumulated lossesas at the end of the financial yearand they have not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.

Disclosure in auditors report relating to default in repayment of financial dues

According to the records of the Holding Company examined by us and the information and explanations given to us and based on the reports of the other auditors, the Holding Company and its subsidiariesincorporated in Indiahavenot defaulted in repayment of dues to any financial institution or bank or debenture holders as at the balance sheet date.

Disclosure in auditors report relating to guarantee given

In our opinion, and according to the information and explanations given to us, and based on the reports of the other auditors,the terms and conditions of the guarantees given by the Holding Company and its subsidiaries incorporated in India for loans taken by others from banks or financial institutions during the year, are not prejudicial to the interest of the respective aforesaid Holding Company and its subsidiaries.

Disclosure in auditors report relating to term loans used for purpose other than for purpose they were raised

In our opinion, and according to the information and explanations given to us and based on the reports of the other auditors, the term loans obtained by the Holding Company and its subsidiaries incorporated in Indiahave been applied for the purposes for which they were obtained.

Disclosure in auditors report relating to any material fraud reported during period

During the course of our examination of the books and records of the Holding Company carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us and based on the reports of the other auditors, we/the other auditors have neither come across anyinstance of materialfraud on or by the Holding Company andits subsidiaries incorporated in Indianoticed or reported during the year, nor have we/the other auditors been informed of any such case by the respective Managements of the aforesaid Holding Company and its subsidiaries.

Disclosure in auditor’s report explanatory

INDEPENDENT AUDITORS' REPORT

To the Members of Avenue Supermarts Limited

Report on the Consolidated Financial Statements

1.       We have audited the accompanying consolidated financial statements  of Avenue Supermarts Limited (�hereinafter referred to as the Holding Company�) and its  subsidiaries(the Holding Company and its subsidiaries together referred to as �the Group�); (refer Note [1] to the attached consolidated financial statements), comprising of the consolidated Balance Sheet as at March 31, 2015, the consolidated Statement of Profit and Loss (refer Note 1 to the attached consolidated financial statements) and a summary of significant accounting policies and other explanatory information preparedbased on the relevant records (hereinafter referred to as �the Consolidated Financial Statements�). 

Management's Responsibility for the Consolidated Financial Statements

2.       The Holding Company's Board of Directors is responsible for thepreparation of these consolidated financial statements in terms of the requirements of the Companies Act, 2013 (hereinafter referred to as �the Act�) thatgive a true and fair view of the consolidated financial position and consolidated financial performance of the Groupin accordance with accounting principles generally accepted in Indiaincluding the Accounting Standards specified under Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules, 2014. The Holding Company's Board of Directors is also responsible for ensuring accuracy of records including financial information considered necessary for the preparation of Consolidated Financial Statements. The respective Board of Directors of the companies included in the Group are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Group respectively and for preventing and detecting frauds and other irregularities; the selection and application of appropriate accounting policies; making judgements and estimates that are reasonable and prudent; and the 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, which has been used for the purpose of preparation of the consolidated financial statements by the Directors of the Holding Company, as aforesaid.

Auditors' Responsibility

3.       Our responsibility is to express an opinion on these consolidated financial statements based on our audit. While conducting the audit, we have taken into account the provisions of the Act and the Rules made thereunder including the accounting standards and matters which are required to be included in the audit report.

 

4.       We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

 

5.       An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditors' judgement, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Holding Company's preparation of the consolidated 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 onwhether the Holding Company has an adequate internal financial controls system over financial reporting in place 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 Holding Company's Board of Directors, as well as evaluating the overall presentation of the consolidated financial statements.

 

6.       We believe that the audit evidence obtained by us and the audit evidence obtained by the other auditors in terms of their reports referred to in sub–paragraph 8 of the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the consolidated financial statements.

 

Opinion

 

7.       In our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidated 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 Indiaof the consolidated state of affairs of the Group as at March 31, 2015, and theirconsolidated profitfor the year ended on that date.

Other Matter

 

8.      We did not audit the financial statements of two subsidiaries whose financial statements reflecttotal assets of Rs1313.54 lacs and net assets of Rs 426.98 lacs as at March 31, 2015, total revenue of Rs. 558.32 lacs and net profit of Rs 119.72 lacs for the year ended on that date, as considered in the consolidated financial statements. These financial statementshave been audited by other auditors whose reports have been furnished to us by the Management, and our opinion on the consolidated financial statements insofar as it relates to the amounts and disclosures included in respect of these subsidiaries and our report in terms of sub–sections (3) and (11) of Section 143 of the Act insofar as it relates to the aforesaid subsidiaries, is based solely on the reports of the other auditors.

 

Our opinion on the consolidated financial statements and our report on Other Legal and Regulatory Requirements below, is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors.

 

Report on Other Legal and Regulatory Requirements

 

9.       As required by the Companies (Auditor's Report) Order, 2015 (�the Order�), issued by the CentralGovernment of India in terms of sub–section (11) of Section 143 of the Act, based on the comments in the auditors' reports of the Holding company andthe subsidiary companies incorporated in India (Refer Note 1 to the consolidated financial statements), we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

 

10.   As required bySection143(3) of the Act, we report, to the extent applicable, 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 purposesof our audit of the aforesaid consolidated

financial statements.

 

(b) In our opinion, proper books of account as required by lawmaintained by the Holding Company, its subsidiaries included in the Groupincorporated in India including relevant records relating to preparation of the aforesaidconsolidated financial statements have been kept so far as it appears from our examination of thosebooks and records of the Holding Company and the reports of the other auditors.

 

(c) The Consolidated Balance Sheet and the Consolidated Statement of Profit and Loss dealt with by this Report are in agreement with the relevant books of account maintained by the Holding Company, its subsidiaries included in the Group incorporated in India including relevant recordsrelating to the preparation of the consolidated financialstatements.

 

(d) In our opinion, the aforesaid consolidated 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 of the Holding Company ason 31st March, 2015 taken on record by the Board of Directors of the Holding Company and the

reports of the statutory auditors of its subsidiary companies incorporated in India, none of the directors of the Group companiesincorporatedin India is disqualified as on March 31, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

 

(f) With respect to the other matters to be included in the Auditors' Report in accordance with Rule 11 ofthe 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 consolidated financial statements disclose the impact, if any, of pending litigations as at March 31, 2015 on theconsolidatedfinancial position of the Group.

 

ii. The Group has made provision as at March 31, 2015, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long–term contracts. The Group did not have any derivative contracts as at March 31, 2015.

 

iii. There were no amounts which were required to be transferred to the Investor Education andProtection Fund by the Holding Company and its subsidiary companies incorporated in India during the year ended March 31, 2015.

 

 

For Dalaland Shah

Firm Registration Number: 102021W

Chartered Accountants

 

 

 

 

S Venkatesh

Mumbai                                                                                                               Partner

August 28, 2015                                                                                                                Membership Number: 037942

 

 

 

(1)    ke a suitable qualification in the audit report on the financial statements.

 

(2)    Reporting on all matters: The Order requires that the auditor should make a statement on all the matters contained therein. There may be situations where one or more of the clauses are not applicable. For example, the requirement regarding internal audit system does not apply in case of all the companies. In such situations, it would be appropriate for the auditor to make a suitable comment in his report bringing out the fact of non–applicability of a particular clause, or, alternatively, to combine the reporting where multiple clauses are not applicable, as set out in Note 1 in the last page of this report. ]

 

 

 

i.     (a)    The Holding Company and its subsidiaries incorporated in Indiaaremaintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.

 

(b)  

The fixed assets are physically verified by the respective Managements of the Holding Company and its subsidiariesincorporated in Indiaaccording to a phased programme designed to cover all the items over a period which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the respective Managements of the aforesaid Holding Company and its subsidiaries during the year and no material discrepancies have been noticed on such verification.

               

ii.    (a)  The inventoryhas been physically verified by the respective Managements of the Holding Company and its subsidiariesincorporated in Indiaduring the year. In our opinion, the frequency of verification is reasonable.

 

(b)   In our opinion, the procedures of physical verification of inventory followed by the respective Managements of the Holding Company and its subsidiariesincorporated in Indiaare reasonable and adequate in relation to the size of the aforesaid Holding Company and its subsidiariesand the nature of theirrespective businesses.

 

(c)    On the basis of our examination of the inventory records and the reports of the other auditors, in our opinion, the Holding Company and its subsidiariesincorporated in Indiaaremaintaining proper records of inventory.The discrepancies noticed on physical verification of inventory of the aforesaid Holding Company and its subsidiariesas compared to the respective book records were not material.

 

iii.           The Holding Company and its subsidiariesincorporated in Indiahavenot grantedany loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 189of the Act. Therefore, the provisions of Clause 3(iii)(a) and (iii)(b) of the said Order are not applicable to the aforesaid Holding Company and its subsidiaries.

 

iv.           In our opinion, and according to the information and explanations given to us, there is an adequate internal control systemcommensurate with the size of the Holding Company and its subsidiariesincorporated in Indiaand the nature of theirrespective businesses for the purchase of inventory and fixed assets and for the sale of goods and services.Further, on the basis of our examination of the books and records of the aforesaid Holding Company and the reports of the other auditors on the subsidiariesas furnished to us, and according to the information and explanations given to us, we have neither come across, nor have been informed of, any continuing failure to correct major weaknesses in the aforesaid internal control system.

 

v.            The Holding Company andits subsidiariesincorporated in Indiahave not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the rules framed there under to the extent notified.

 

vi.           The Central Government of India has not specified the maintenance of cost records under sub–section (1) of Section 148 of the Act for any of the products of the Holding Company andits subsidiariesincorporated in India.

 

vii. (a)   In our opinion and according to the information and explanations given to us and the records of the Holding Company incorporated in India as examined by us, and based on the reports of the other auditors of the Holding company's subsidiariesincorporated in India, the Company is generally regular in depositing statutory dues in respect ofprovident fund, employees state insurance, income tax, service tax, value added tax,local body tax, profession tax, works contract tax and labour welfare fund, though there has been a slight delay in few cases andthe aforesaid Holding Company and its subsidiariesare regular in depositing undisputed statutory dues, including sales tax, wealth tax, duty of customs, duty of exciseand other material statutory dues, as applicable, with the appropriate authorities.The extent of the arrears of statutory dues outstanding as at March 31, 2015, for a period of more than six months from the date they became payable are as follows:

 

Name of the company

Relationship

Name of the statute

Nature of dues

Amount

(Rs in Lacs.)

Period to which the amount relates

Due date

Date of Payment

Avenue Supermarts Limited

Holding Company

Maharashtra Valued Added Tax Act 2002

Works Contract Tax

1.24

August 2014

Sep 21, 2014

Outstanding as of the date of this report

Align Retail Trades Private Limited

Subsidiary

Provident Fund Act 1952

Provident Fund

0.27

March 2014

April 15, 2014

April 15, 2015

 

 (b)         According to the information and explanations given to us and the records of the Holding Company incorporated in Indiaexamined by us, and based on the reports of the other auditors of the Holding company's subsidiariesincorporated in Indiathere are no dues of sales–tax, wealth–tax, duty of customs and duty of excisewhich have not been deposited on account of any dispute. The particulars of dues of income tax, service tax and value added tax as at March 31, 2015 which have not been deposited on account of a dispute, are as follows:

               

Name of the Company

Relationship

Name of the statute

Nature of dues

Amount

(Rs in Lacs.)

Period to which the amount relates

Forum where the dispute is pending

Avenue Supermarts Limited

Holding Company

Finance Act, 1994

Service Tax

69.13

2008–2013

Commissioner

Avenue Supermarts Limited

Holding Company

Gujarat Value Added Tax Act, 2003

Value Added Tax

167.67

2011–2013

Commercial Taxes Department

Avenue Supermarts Limited

Holding Company

Gujarat Value Added Tax Act, 2003

Value Added Tax

23.31

2008–2009

Commercial Taxes Department

Avenue Supermarts Limited

Holding Company

Gujarat Value Added Tax Act, 2003

Value Added Tax

27.17

2009–2010

Commercial Taxes Department

Avenue Supermarts Limited

Holding Company

Gujarat Value Added Tax Act, 2003

Value Added Tax

41.02

2010–2011

Commercial Taxes Department

Avenue Supermarts Limited

Holding Company

Income Tax Act, 1961

Income Tax

10.71

2009–2010

Appellate Tribunal

Avenue Supermarts Limited

Holding Company

Income Tax Act, 1961

Income Tax

11.65

2010–2011

Appellate Tribunal

 

c)      There are no amounts required to be transferred by the Holding Company and its subsidiaries incorporated in Indiato the Investor Education and Protection Fund in accordance with the provisions of the Companies Act, 1956 and the rules made thereunder.

 

viii.        The Holding Company and its subsidiaries incorporated in India have no accumulated lossesas at the end of the financial yearand they have not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.

 

ix.           According to the records of the Holding Company examined by us and the information and explanations given to us and based on the reports of the other auditors, the Holding Company and its subsidiariesincorporated in Indiahavenot defaulted in repayment of dues to any financial institution or bank or debenture holders as at the balance sheet date.

       

x.            In our opinion, and according to the information and explanations given to us, and based on the reports of the other auditors,the terms and conditions of the guarantees given by the Holding Company and its subsidiaries incorporated in India for loans taken by others from banks or financial institutions during the year, are not prejudicial to the interest of the respective aforesaid Holding Company and its subsidiaries.

 

xi.           In our opinion, and according to the information and explanations given to us and based on the reports of the other auditors, the term loans obtained by the Holding Company and its subsidiaries incorporated in Indiahave been applied for the purposes for which they were obtained.

               

xii.          During the course of our examination of the books and records of the Holding Company carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us and based on the reports of the other auditors, we/the other auditors have neither come across anyinstance of materialfraud on or by the Holding Company andits subsidiaries incorporated in Indianoticed or reported during the year, nor have we/the other auditors been informed of any such case by the respective Managements of the aforesaid Holding Company and its subsidiaries.

 

 

For Dalaland Shah

Firm Registration Number: 102021W

Chartered Accountants

 

 

 

 

S Venkatesh

Mumbai                                                                                                               Partner

August 28, 2015                                                                                                                Membership Number: 037942

 

 

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