| We have audited the accompanying financial statements of KGN
ENTERPRISES LIMITED("the Company), which comprise the Balance Sheet as
at 31st March, 2015, the statement of Profit & Loss and Cash Flow
Statement for the year ended and a summary of Significant accounting
policies and other explanatory information.
Management's Responsibility for the Financial Statements :
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 flow of the Company in accordance with
accounting principles generally accepted in India including Accounting
Standards referred to in Section 211(3C) of the Companies Act, 2013
("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 auditing standards 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 of
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 assessment, 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. An audit also
includes evaluating the appropriates of the 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 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 on 31st March, 2015.
b) In the case of the Profit & Loss Account Statement Balance, of the
profit for the year ended on 31st March, 2015.
c) In the case of the Cash Flow Statement, of the Cash Flows for the
year ended on 31st March, 2015.
Report on Other Legal and Regulatory Requirements :
1. As required by the Companies (Auditor's Report) Order, 2003 as
amended Companies (Auditor's Report) (Amended) Order, 2004, issued by
the Central Government of India in terms of sub - section (4A) of
Section 227 of Companies Act, 2013, we enclose in the Annexure hereto a
statement specified in paragraph 4 and 5 of the said order.
2. As required by Section 227(3) of the Act, we report that:
(i) We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit ;
(ii) In our opinion, proper books of accounts as required by law have
been kept by the company so far as it appears from our examination of
those books;
(iii) The Balance Sheet and Profit & Loss Statement Balance dealt with
by this report are in agreement with the books of account;
(iv) On the basis of the written representation received from the
directors, as on March 31,2015, and taken on record by the Board of
Directors, we report that none of the Directors is disqualified as on
March 31, 2015 from being appointed as a Director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act, 2013.
(v) In our opinion, the Balance Sheet & Profit & Loss Statement Balance
complies with the mandatory Accounting Standards referred to in Section
211(3C) of the Companies Act, 2013.
ANNEXURE TO INDEPENDENT AUDITORS' REPORT
(Referred to in paragraph 1under the heading of "Report on Other Legal
and Regulatory Requirements" of our report of even date:
1. (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The fixed assets have been physically verified by the management at
reasonable intervals. No material discrepancies were noticed on such
verification by the management.
(c) In our opinion, the Company has not disposed off any substantial
part of fixed assets during the year and the going concern status of
the company is not affected.
2. (a) The Inventory has been physically verified by the management
during 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 management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
3. (a) The Company has granted unsecured loan to its Subsidiary
Companies and parties in the register maintained under Section 189 of
the Companies Act, 2013. The Maximum amount granted during the year and
year end balance of loan to such subsidiaries were as per details given
below. The terms and conditions of such loans are not prima facie
prejudicial to the interest of the Company.
Sr. Name of the Party Relation with
No. the Compant
1 KGN Bio Tech Limited Subsidiary Company
2. KGN Oil & Gas Private Limited Subsidiary Company
Sr. Name of the Party Maximum Closing Balance
No. Outstanding As on 31/03/2015
(in Rs.) (in Rs.)
1 KGN Bio Tech Limited 17953193/- 59081945/-
2. KGN Oil & Gas Private Limited NIL 1,25,11,060/-
(b) The Company has taken loans, secured or unsecured from the
companies or other parties covered in the register maintained u/s 189
of the Companies Act, 2013. The Maximum amount granted during the year
and year end balance of loan to such subsidiaries were as per details
given below. The terms and conditions of such loans are not prima facie
prejudicial to the interest of the Company.
Sr . Name of the Party Relation with
No. the Compant
1 KGN Industries Limited Associates
2. KGN Green Limited Subsidiary
3. KGN Protein Limited Subsidiary
Sr . Name of the Party Maximum Closing Balance
No. Outstanding As on 31/03/2015
(in Rs.) (in Rs.)
1 KGN Industries Limited 14536941/- 144302868/-
2. KGN Green Limited NIL 6,00,000/-
3. KGN Protein Limited NIL 6,55,000/-
4. In our opinion and according to the information and explanation
given to us, there are adequate Internal Control Procedure commensurate
with size of a company and the nature of its business for purchase of
inventory and fixed assets and for the sale of goods and services.
During the course of our audit, no major weakness has been notice in
the internal control system.
5. (a) In our opinion, and according to the information and explanations
given to us, the transactions that need to be entered into the register
maintained under Section 301 of the Companies act, 2013 have been so
entered.
(b) In our opinion, and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangement entered in the register maintained under section 301 of the
companies Act, 2013 and exceeding the value of rupees five lacs in
respect of any party during the year have been made at price which are
reasonable having regard to prevailing market price at the relevant
time.
6. The Company has not accepted deposits from the public, within the
meaning of section 58A and 58AA of the Act and rules framed there
under.
7. In our opinion, the company has an internal audit system
commensurate with the size and nature of the business.
8. We have broadly reviewed the cost records maintained by the Company
pursuant to the Companies (Cost Accounting Records) Rules, 2011
prescribed by the Central Government under Section 209(1) (d) of the
Companies Act, 2013 and are of the opinion that prima facie the
prescribed cost records have been maintained. We have, however, not
made a detailed examination of the cost records with a view to
determine whether they are accurate or complete.
9. (a) According to the information and explanation given to us and the
records of the company examined by us, in our opinion, the Company is
regular in depositing with appropriate authorities undisputed statutory
dues including Provident Fund, Investor Education Fund, Employees State
Insurance, Income Tax, Sales Tax, wealth tax, service tax, custom duty,
excise duty and other material statutory dues applicable to it.
(b) According to the information and explanation given to us, no
undisputed amounts payable in respect of Income Tax, Sales Tax, Service
Tax, Custom Duty and Excise Duty were in arrears, as at 31st March,
2015 for a period of more than six months from the date of they became
payable.
(c) According to the information and explanation given to us, there are
no dues of Income Tax, Sales Tax, Service Tax, Custom Duty and Excise
Duty which have not been deposited on account of any dispute.
10. In our opinion the Company has no accumulated losses at the end of
the financial year and has not incurred any cash losses during the
financial year covered by our audit and the immediately preceding
financial year.
11. Based on our examination of the records and the information and
explanations given to us, the Company has not defaulted in repayment of
dues to a financial institution, bank or debenture holders.
12. Based on our examination or the records and the information and
explanations given to us, the Company has not granted any loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities during the year.
13. In our opinion and according to the information and explanation
given to us, the Company is not a chit fund or a Nidhi / Mutual benefit
fund/society. Accordingly the provisions of the clause 4(xiii) of the
said Order are not applicable to the Company.
14. During the year under audit, Company has not dealt or traded in
shares, securities, debentures and other investments. Therefore we have
no comments to offer under clause (xiv) of the Order.
15. 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.
16. The Company has not obtained any term loan during the year and
therefore, we have no comments to offer under clause (xvi) of the
Order.
17. According to the information and explanations given to us and on
an overall examination of the Balance Sheet of the Company, in our
opinion no funds raised on a short-term basis have not been used for
long term investment and vise-a-versa, during the year.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the Register maintained under Section
301 of the Companies Act, 2013.
19. According to the information and explanations given to us, the
Company has not issued any debentures during the year.
20. According to the information and explanations given to us, the
Company has not raised any money by way of public issue during the year
and accordingly the provision of the relevant clause of the order is
not applicable to the Company.
21. Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the course of our audit.
For Kirit & Co.
Chartered Accountant
Kirit Kumar
Proprietor
Place : Ahmedabad M.No.: 038047
Date : 30.05.2015 FRN : 132282W
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