JET KNITWEARS LIMITED.
REPORT ON THE FINANCIAL STATEMENTS
We have audited the accompanying financial statements of JET KNITWEARS LIMITED . (the Company), which comprise the Balance Sheet as at March 31, 2025 and also the Statement of Profit and Loss and the Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information.
MANAGEMENT'S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
The Company's Board of Directors is responsible for the matter stated in Section 134(5) of the Companies Act, 2013 ("the Act”) with respect to the preparation of these financial statements that give a true and fair view of the state of affairs(financial position), profit or loss(financial performance) and Cash flow of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards prescribed under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rule 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 the 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.
AUDITORS' RESPONSIBILITY
Our responsibility is to express an opinion on these 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 rules made thereunder.
We conducted our audit of the financial statements 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 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 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 accounting policies used and the reasonableness of the accounting estimates made by 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 statements.
EMPHASIS OF MATTERS
The balances of Loans and advances, Sundry Debtors, Sundry Creditors, Current Liabilities & Provisions and other personal accounts are subject to confirmation and reconciliation, if any. Our opinion is not qualified in respect of this matter.
The company's trade receivables (classified as unsecured and considered good by the management & Net of Provisions) are carried at Rs. 1792.48 lakhs, out of which Rs. 1387.54 lakhs are outstanding for a period more than six months, which is abnormally high as compared to the turnover of the company. Also out of the above, receivables of Rs. 557.16 lakhs are aged more than three years. The balances of these parties are subject to confirmation, and as per the management of the company is recoverable.
We draw attention to are of the Financial Statements, which describes a petition filed by a shareholder under Sections 241, 242, and 244 of the Companies Act, 2013, alleging oppression and mismanagement by the current Board of Directors. This petition is currently pending before the National Company Law Tribunal, Allahabad Bench. The outcome of this matter is uncertain, and as stated in the said note, the management does not anticipate any impact on the Company at this time.
The company's records relating to the WIP stock are not commensurate with the magnitude of data involved, as more than 30 job workers and 4 different stages are engaged in the process. According to management, a system for data maintenance is currently under development.
Additionally, we have not verified the physical inventory and have relied upon the physical verification reports provided by the management in this behalf. The value of the total inventory is abnormally high compared to the turnover, and there is no proper record of the ageing of the inventory. As a result, nonmoving or obsolete inventory could not be ascertained.
Further, the company had been sanctioned a new Skill Development Project under Deen Dayal Upadhyay -Grameen Kaushalya Yojna (DDU GKY Scheme) of Assam State Rural Livelihoods Mission (ASRLM) to train 1000 Candidates in projects (Rural Youth as defined in guidelines of DDU-GKY) with placement linkage by setting up a training/skill center at Majuli and Karimganj for the State of Assam.
We did not audit the financial statements and other financial information, in respect of this scheme. Amounts received and expanded under this scheme is subject to audit by a separate auditor, which financial statement and other financial information and auditor's reports for the year ended on 31.03.2025 have been furnished to us by the management. As informed by the management there was no further progress so status quo was maintained. Our opinion on the financial statements, in so far as it relates to the amounts and disclosures included in respect of this scheme and our report in terms of sub-sections (3) of Section 143 of the Act, in so far as it relates to the aforesaid scheme is based solely on the report of such other auditor.
OPINION
In our opinion and to the best of our information and according to the explanations given to us, because of the significance of matters described except for the effect/possible effect of the matter
described in the basis of Emphasis of Matters given in above paragraph, 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 Including the:
(a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2025;
(b) In the case of the Statement of Profit and Loss, of the ‘Profit’ of the Company for the year ended on that date;
(c) In the case of Cash Flow Statements, 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, 2020 (the Order) issued by the Central
Government of India in terms of sub-section (11) of Section 143 of the Act, 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 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 purpose of our audit;
b. In our opinion, proper books of account as required by law have been kept by the Company so far as 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 aforesaid Financial Statements comply with Indian Accounting Standard Specified under section 133 of the Act read with Rule 7 of the Companies (Accounts) Rule, 2014.
e. On the basis of the written representations received from the directors as on March 31, 2025, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2025, from being appointed as a director in terms of Section 164(2) of the Act.
f. With respect to the adequacy of the Internal financial controls over financial reporting of the company and the operating effectiveness of such controls, refer to our separate report in Annexure B, and
g. With respect to the other matters to be included in the Auditor's Report in accordance with Rule llof 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 as at 31 March 2025 on its financial position in its standalone financial statements.
ii) The Company did not have any long-term contracts including derivatives contracts for which there were any material foreseeable losses.
iii) There were no amounts which required to be transferred by the Company to the Investor Education and Protection Funds.
h. Based on our examination which included test checks, the Company, in respect of financial year commencing on 1 April 2025, has used an accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility and the same has been operated throughout the year for all relevant transactions recorded in the software. Further, during the course of our audit we did not come across any instance of audit trail feature being tampered with. As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from April 01, 2023.
On the basis of the written representations received from the directors as on 3 lmarch, 2025;
(a) The management has represented that, to the best of its Knowledge and belief, other than as disclosed in the notes to the Accounts, no funds have been advanced or loaned or invested (either From borrowed funds or share premium or any other sources or kind Of funds) by the company to or in any other person(s) or entity (ies), Including foreign entities ("intermediaries"), with the understanding, Whether recorded in writing or otherwise, that the intermediary shall, Whether, directly or indirectly lend or invest in other persons or Entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries:
(b) The management has represented, that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been received by the company from any person(s) or entity (ies), including foreign entities ("Funding Parties'),n with the understanding, whether recorded in writing or otherwise, that the company shall, whether, directly or indirectly, lend or invest other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provided any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
a) Nothing has come to our notice that has caused us to believe that the representations under sub-clause (a) and (b) contain any material mis-statement.
b) No dividend declared or paid during the year by the company is in compliance with section 123 of the Companies Act, 2013.
c) In our opinion and according to the information and explanations given to us, the remuneration paid by the company to its directors during to current year is in accordance with the provisions of section 197 read with Schedule V of the Act. The remuneration paid to to any director s not in excess of the limit laid down under section 197 of the Act. The ministry of Corporate Affairs has not prescribed other details under Section 197(16) which are required to be commented upon by us.
For KAMAL GUPTA ASSOCIATES CHARTERED ACCOUNTANTS FRN 000752C Sd/-
CA. NEHA AGARWAL (PARTNER)
(MRN 406713)
PLACE: KANPUR
DATED: - 29/05/2025
UDIN: - 25406713BMOQOR4485
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