Report on the Standalone lnd AS Financial Statements
We have audited the accompanying standalone lnd AS financial statements of Shri Krishna Devcon Limited (“the Company”), which comprise the Balance Sheet as at 31st March, 2018, and the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity 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 Board of Directors is responsible for the matters stated in Section 134(5) ofthe Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone lnd AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the the Indian Accounting Standards (lnd AS) prescribed under Section 133 ofthe Act read with the Companies (Indian Accounting Standards) Rule, 2015, as amended, and other accounting principles generally accepted in India.
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 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 standalone lnd AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these standalone lnd AS financial statements based on our audit.
In conducting 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 ofthe Act and the Rules made thereunder.
We conducted our audit of the standalone lnd AS 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 standalone lnd AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone lnd AS financial statements. The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material misstatement ofthe standalone lnd AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial controls relevant to the Company’s preparation of the standalone lnd AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the standalone lnd AS financial statements.
We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone lnd AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone lnd AS 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 lnd AS and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2018, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Other Matters
The comparative financial information ofthe Company for the year ended 31st March, 2017 and the transition date opening Balance Sheet as at 1st April, 2016 included in these standalone Ind AS financial statements, are based on the statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by other auditor whose report for the year ended 31st March, 2017 and 31st March, 2016 dated 30 May, 2017 and 28 May, 2016 respectively expressed an unmodified opinion on those standalone financial statements, as adjusted for the differences in the accounting principles adopted by the Company on transition to the Ind AS.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor’s Report) Order, 2016 (‘the Order’), issued by the Central Government of India in term of sub-section 11 of section 143 of the Act, we enclose in the Annexure “A” a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by sub-section 3 of Section 143 ofthe Act, we reportthat:
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, the Statement of Profit and Loss including Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the relevant books of account.;
d) in our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 ofthe Act.
e) On the basis of the written representations received from the Directors as on March 31, 2018 taken on record by the Board of Directors, none of the Directors are disqualified as on March 31,2018 from being appointed as a Director in terms of sub-section 2 of Section 164 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 Auditors’ Report in accordance with Rule 11 of 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 does not have any pending litigations which would impact its financial position;
ii. The company did not have any long term contract including derivative contract for which there were any material foreseeable losses; and
iii. The company did not have amount, required to be transferred to the Investor Education and Protection Fund.
ANNEXURE “A” TO THE INDEPENDENT AUDITOR’S REPORT OF SHRI KRISHNA DEVCON LIMITED FOR THE YEAR ENDED 31ST MARCH, 2018.
(Refer to in our report of even date)
i. a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.
b) The fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanation given to us, no material discrepancies were noticed on such verification.
c) According to the information and explanations given to us by management, the Company does not have any immovable property in fixed asset.
ii. The inventory includes land, plots of land, completed buildings or apartments, land under development, building under development etc. The inventory has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable and no material discrepancies were noticed on physical verification.
iii. In our opinion and according to information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 ofthe Act. Accordingly, paragraph 3 (iii) ofthe Order is not applicable to the Company.
iv. In our opinion and According to the information and explanation gives to us, the company has complied with the provisions of section 185 and 186 ofthe Act.
v. The company has not accepted any deposits from the public in accordance with the provisions of sections 73 to 76 ofthe Act and the rules framed there under.
vi. We are informed that the maintenance of cost records has not been specified by the Central Government under sub- section (1) of section 148 ofthe Act.
vii. a) According to the information and explanations given to us, the Company is generally regular in depositing undisputed statutory dues applicable to it including sales-tax, service tax, value added tax, GST, Income Tax, Cess and any other statutory dues with the appropriate authorities.
According to the information and explanations given to us, no undisputed amount payable in respect of provident fund, employees’ state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, GST, cess and any other undisputed statutory dues were outstanding at the end ofthe year for a period of more than six months from the date they become payable,
b) According to the information and explanations given to us there are no dues of provident fund, employees’ state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues outstanding on account of any dispute.
viii. The company has not defaulted in repayment of dues to any Financial Institution or Bank. The company has no debenture holders.
ix. In our opinion and according to the information and explanations given to us, the Company has not raised any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, paragraph 3 (ix) ofthe Order is not applicable.
x. To the best our knowledge and according to the information and explanations given to us, no fraud by the Company or on the company by its officers and employees has been noticed or reported during the year.
xi. According to the information and explanations given to us and based on the examination of records of the company, the company has paid or provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the Companies Act.
xii. According to the information and explanations given to us, the company is not a nidhi company. Accordingly, paragraph 3 (xii) ofthe Order is not applicable.
xiii. According to the information and explanations given to us and based on our examinations ofthe records ofthe Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act, where applicable. The details of such related party transactions have been disclosed in the financial statements as required by applicable lnd AS.
xiv. According to the information and explanations give to us and based on our examination of the records, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.
xv. According to the information and explanations given to us and based on our examination of the records, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.
xvi. According to the information and explanations given to us, the Company is not required to be registered under Section 45-IA ofthe Reserve Bank of India Act, 1934.
ANNEXURE “B” TO THE INDEPENDENT AUDITOR’S REPORT OF SHRI KRISHNA DEVCON LIMITED FOR THE YEAR ENDED 31ST MARCH, 2 018.
(Refer to in our report of even date) Report on the internal financial controls under clause (i) of sub-section 3 of section 143 of the Act.
We have audited the internal financial controls over financial reporting of Shri Krishna Devcon Limited (“the Company”) as of 31 March, 2018 in conjunction with our audit ofthe standalone Ind AS financial statements ofthe Company for the year ended on that date.
Management’s responsibility for internal financial controls
The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal controls over financial reporting criteria established by the Company considering the essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (“ICAI”). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act 2013 (“the Act”).
Auditor’s responsibility
Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal controls based on the assessed risk. 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.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial control system over financial reporting.
Meaning of internal financial controls over financial reporting
A company’s internal financial controls over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial controls over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Inherent limitations of internal financial controls over financial reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial controls over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial control system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2018, based on the internal controls over financial reporting criteria established by the Company considering the essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by Institute of Chartered Accountants of India.
For M A K & Associates
Chartered Accountants
Firm Registration No. 003060C
Kunji Lai Kushwaha
Place: Indore
Partner
Date: 30.05.2018
M.No.415037
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