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Updated:12 Apr, 2021, 15:59 PM IST

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Updated:12 Apr, 2021, 16:00 PM IST

Disclosure in auditor’s report explanatory

To the Members of Dixon Technologies (India) Private Limited

Report on the Consolidated Financial Statements

We have audited the accompanying consolidated financial statements of Dixon Technologies (India) Private Limited (hereinafter referred to as “the Holding Company”) and its subsidiaries (the Holding Company and its subsidiaries together referred to as “the Group”) and its associate, comprising of the Consolidated Balance Sheet as at 31st March, 2015, the Consolidated Statement of Profit and Loss, the Consolidated Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “the consolidated financial statements”).

Management’s Responsibility for the Consolidated Financial Statements

The Holding Company’s Board of Directors is responsible for the preparation of these consolidated financial statements in terms of the requirements of the Companies Act, 2013 (hereinafter referred to as “the Act”) that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Group including its Associate 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. 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 and for preventing and detecting frauds and other irregularities; the 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, which have been used for the purpose of presentation of the consolidated financial statements by the Directors of the Holding Company, as aforesaid.


Auditor’s Responsibility

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, 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 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 ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, 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 on whether the Holding Company has 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 Holding Company’s Board of Directors, as well as evaluating the overall presentation of the consolidated financial statements.

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 Other Matters paragraph below, is sufficient and appropriate to provide a basis for our qualified audit opinion on the consolidated financial statements.

Basis for Qualified Opinion

In case of one of the subsidiaries of the Holding Company audited by us, we reported that the management has not made provisions for demand raised for VAT, CST and SAD (Special Additional Duty) of Rs. 34,994,270/– as per order of the Deputy Commissioner of Commercial Tax Department Uttarakhand and Joint Commissioner of Central Excise Commissionerate Noida as stated in Note No. – (1) of Other notes 27(B). Our report states that had the management made provision for such demand raised, the profit for the year after tax Rs. 110,226,648/– would have resulted in Profit Rs. 75,232,378/–, Reserves and Surplus (Surplus in Statement of Profit and Loss) would have been Rs. 785,150,337/– instead of Surplus (Reserve & Surplus) of Rs 820,144,607/–.

Qualified Opinion
In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion paragraph above, 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 India, of the consolidated state of affairs of the Group and its associate as at 31st March, 2015, and their consolidated profit and their consolidated cash flows for the year ended on that date.

Other Matters

We did not audit the financial statements of 2 subsidiaries, whose financial statements reflect total assets of Rs. 408,328,641/– as at 31st March, 2015, total revenues of Rs. 5,182,079,142/– and net cash flows amounting to Rs. 24,227,408/– for the year ended on that date, as considered in the consolidated financial statements. The consolidated financial statements also include the Group’s share of net profit (Profit after tax) of Rs. 10,234,803/– for the year ended 31st March, 2015 as considered in the consolidated financial statements. These financial statements have been audited by other auditors whose reports have been furnished to us by the Management and our opinion on the consolidated financial statements, in so far 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, in so far 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 and the financial statements certified by the management.

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 of India in terms of sub–section (11) of section 143 of the Act, based on the comments in the auditor’s reports of the Holding company, subsidiary companies and associate company, 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, 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 purposes of our audit of the aforesaid consolidated financial statements.

b. In our opinion, proper books of account as required by law relating to preparation of the aforesaid consolidated financial statements have been kept so far as it appears from our examination of those books and the reports of the other auditors.

c. The Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss, and the Consolidated Cash Flow Statement dealt with by this Report are in agreement with the relevant books of account maintained for the purpose of preparation of the consolidated financial statements.

d. In our opinion, except for the effect of the matters described in the Basis for Qualified Opinion paragraph above, 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. The matter described in the Basis for Qualified Opinion paragraph above, in our opinion, may have an adverse effect on the functioning of the Group.

f. On the basis of the written representations received from the directors of the Holding Company as on 31st March, 2015 taken on record by the Board of Directors of the Holding Company, the subsidiary companies, reports of the other statutory auditors of its subsidiary companies and associate company, none of the directors of the group and its associate is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

g. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditor’s) 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 of pending litigations on the consolidated financial position of the group & its associate – Refer Note 27B 1 (f), (g), (h), (i), (j) to the Consolidated Financial Statements;

ii. a. The Group & its associate has not made provision, as required under the accounting standards for material foreseeable losses, on long term contracts – Refer Note 27B 1 (e) to the Consolidated Financial Statements;

b. The Group & its associate did not have any material foreseeable losses on long term derivative contracts.

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education & Protection Fund by the Holding company, its subsidiary companies and its associate company.



For SINGHI & CO.
Chartered Accountants
Firm Registration No. 302049E


B.L. Choraria
Place: New Delhi Partner
Date: 20th April’2015 Membership No. 22973

Disclosure relating to quantitative details of fixed assets

The Group & its associate is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets.

Disclosure relating to physical verification and material discrepancies of fixed assets

As informed to us, the Group & its associate has a phased programme of physical verification of its fixed assets, which in our opinion is reasonable having regard to the size of the Group & its associate and the nature of their fixed assets. Management has physically verified certain fixed assets during the year as per the phased programme as mentioned above and as informed to us, no material discrepancies were noticed as compared to books of accounts.

Disclosure of physical verification of inventories at fixed intervals

As explained to us, inventories (except stock lying with third parties and in–transit) were physically verified during the year by the Internal Auditors/management. In our opinion, the frequency of verification is reasonable.

Disclosure of procedure followed for physical verification of inventories

In our opinion and according to the information and explanations given to us and based on the report of its subsidiaries, wherever applicable, the procedures of physical verification of inventories are commensurate with the size of the Group & its associate and the nature of their business.

Disclosure about maintenance of inventory records and material discrepancies

In our opinion and according to the information and explanation given to us and based on the report of its subsidiaries, wherever applicable, we are of the opinion that the Group & its associate is maintaining proper records of inventories, the discrepancy between physical stock and book stocks were not significant and the same has been properly adjusted in the books of accounts.

Disclosure in auditors report relating to internal control system

In our opinion and according to the information and explanations given to us and based on the report of its subsidiaries, wherever applicable, there is an adequate internal control system commensurate with the size of the Group & its associate and the nature of their business, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, no major weakness in internal control system has been noticed.

Disclosure in auditors report relating to maintenance of cost records

The Group & its associate is required to maintain cost records pursuant to the rules made by the central government for the maintenance of cost records under sub–section (1) of section 148 of the Act; we are of the opinion that prima facie the prescribed accounts and records have been made and maintained, wherever applicable. We have not, however, made a detailed examination of the records with a view to determining whether they are accurate or complete.

Disclosure in auditors report relating to accumulated losses

The Group does not have any accumulated losses as on 31st March’15 and it has not incurred any cash losses in the current year or in the immediately preceding financial year.

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

Based on our audit procedures and on the information and explanations given by the management and based on the reports of its subsidiaries, we are of the opinion that the Group & its associate has not defaulted in repayment of dues to financial institutions, banks & debenture holders.

Disclosure in auditors report relating to guarantee given

According to the information and explanations given to us and based on the reports of its subsidiaries, the group has & its associate not given corporate guarantee (except Inter Group of Rs. 640,000,000/–) for loans taken by others from bank or financial institution, the terms and conditions whereof are prejudicial to the interest of the group

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

To the best of our knowledge and belief and according to the information and explanations given to us and based on the reports of its subsidiaries, the Group & its associate has obtained term loans for financing of vehicles/assets during the year against hypothecation of the assets. These have been applied for the purpose for which they were raised.

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

Based on our examination of the books and records of the Group & its associate, carried out in accordance with the generally accepted auditing practice in India and according to the information and explanations given to us, no fraud on or by the Group & its associate, has been noticed or reported during the year.

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