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63 Moons Technologies Ltd.

BSE: 526881 Sector: IT
NSE: FINANTECH ISIN Code: INE111B01023
BSE LIVE 15:40 | 05 Dec 72.95 0.70
(0.97%)
OPEN

73.25

HIGH

73.65

LOW

72.40

NSE LIVE 15:41 | 05 Dec 72.85 0.45
(0.62%)
OPEN

73.00

HIGH

73.40

LOW

72.15

OPEN 73.25
PREVIOUS CLOSE 72.25
VOLUME 17058
52-Week high 134.30
52-Week low 69.00
P/E
Mkt Cap.(Rs cr) 336.30
Buy Price 72.95
Buy Qty 492.00
Sell Price 0.00
Sell Qty 0.00
OPEN 73.25
CLOSE 72.25
VOLUME 17058
52-Week high 134.30
52-Week low 69.00
P/E
Mkt Cap.(Rs cr) 336.30
Buy Price 72.95
Buy Qty 492.00
Sell Price 0.00
Sell Qty 0.00

63 Moons Technologies Ltd. (FINANTECH) - Auditors Report

Company auditors report

INDEPENDENT AUDITORS' REPORT

To the members of 63 moons technologies limited (Formerly Financial Technologies(India) Limited)

REPORT ON THE STANDALONE FINANCIAL STATEMENTS

We have audited the accompanying standalone financial statements of 63 moonstechnologies limited (formerly Financial Technologies (India) Limited) (‘theCompany’) which comprise the balance sheet as at 31 March 2016 the statement ofProfit and loss the cash flow statement for the year then ended and a summary of thesignificant accounting policies and other explanatory information.

MANAGEMENT’S RESPONSIBILITY FOR THE STANDALONE FINANCIAL STATEMENTS

The Company’s board of directors is responsible for the matters stated in section134(5) of the Companies Act 2013 (‘the Act’) with respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified under section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on these standalone financial statementsbased on our audit.

We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified undersection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditor’s judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal financial control relevant to the Company’spreparation of the financial statements that give a true and fair view in order to designaudit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of the accounting policies used and the reasonableness ofthe accounting estimates made by the Company’s Directors as well as evaluating theoverall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our qualified audit opinion on the standalone financial statements.

BASIS FOR QUALIFIED OPINION

As stated by the Management of the Company in Note 56 to the financial statement WritPetitions (WP) Public Interest Litigation (PIL) and Civil Suits have been filed againstthe Company in relation to event occurred on NSEL’s trading platform wherein theCompany has been made a party in the WP and Civil Suits. These matters are pending atvarious stages of adjudication. As stated in the said note the management of the Companydoes not foresee that the parties who have filed the WP PIL Civil Suits would be able tosustain any claim against the Company. In addition as stated by the management in note46 56 and 57 to the financial statement there are First InformationReports/complaints/notice registered/received against various parties including theCompany with the Economic OFFences Wing of the Mumbai Police (EOW) Central Bureau ofInvestigation (CBI) and MIDC Police Station Mumbai District. Above matters are pending atvarious stages of adjudication/investigation.

In this regard the Management and those charged with Governance have represented to usthat other than as stated in the said note to the financial statement there are noclaims litigations potential settlements involving the Company directly or indirectlywhich require adjustments to/disclosures in the financial statement. In the light of theabove representations regarding the ongoing investigations and matters the outcome ofwhich is not known and is uncertain at this stage we are unable to comment on theconsequential impact in respect of the same on the results for the year ended 31 March2016.

QUALIFIED OPINION

Except for the possible effects of the matter specified under ‘Basis for QualifiedOpinion’ and based on our audit conducted as stated above nothing has come toour attention that causes us to believe that the accompanying Statement prepared inaccordance with the applicable accounting standards as specified under section 133 of theCompanies Act 2013 and other recognised accounting practices and policies generallyaccepted in India has not disclosed the information required to be disclosed in terms ofRegulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 including the manner in which it is to be disclosed or that it contains any materialmisstatement.

EMPHASIS OF MATTER

1. We draw attention to Note 54 to the financial statement which describes the passingof the final order of amalgamation of National Spot Exchange Limited with the Company byMinistry of Corporate Affairs Government of India. The Company has filed a Writ Petitionbefore the Honourable Bombay High Court challenging the said order and the HonourableBombay High Court has stayed the notification of the said order.

2. We draw attention to Note 55 to the financial statement. Government of India hasfiled the Company Petition before the Principal Bench of the Company Law Board under theCompanies Act 1956 seeking inter alia removal and supersession of the Board of Directorsof the Company which has been protested by the Company and the matter is pending beforeCLB for consideration.

3. We draw attention to Note 59 to the financial statement regarding utilisation ofunexpired MAT credit entitlement by the Company. The Company has a total MAT creditentitlement of Rs. 17681.31 Lacs as at 31 March 2016. Based on the projections made bythe Company’s management regarding income-tax liability of the Company Management isof the view that the Company will be able to utilise the unexpired MAT credit entitlementin eligible projected years.

Our opinion is not qualified in respect these matters of emphasis.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditor’s Report) Order 2016 (‘theOrder’) issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in Annexure ‘A’ a statement on the mattersspecified in paragraphs 3 and 4 of the Order.

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 bestof our knowledge and belief were necessary for the purposes of our audit;

b) in our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books;

c) the balance sheet the statement of Profit and loss and the cash flow statementdealt with by this report are in agreement with the books of account;

d) in our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under section 133 of the Act read with rule 7 of theCompanies (Accounts) Rules 2014;

e) on the basis of the written representations received from the directors as on 31March 2016 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2016 from being appointed as a director in terms of section164 (2) of the Act; f) With respect to the adequacy of the internal financial controlsover financial reporting of the Company and the operating effectiveness of such controlsrefer to our separate report in Annexure B; and

g) with respect to the other matters to be included in the Auditor’s Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements to the extent it is ascertainable; [Refer note 29and ‘Basis for Qualified Opinion’ above]

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts; and

iii. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company.

Sharp & Tannan Associates
Chartered Accountants
Firm’s registration no. 109983W
by the hand of
Tirtharaj Khot
Mumbai 30 May 2016 Partner
Membership No. (F) 037457

(Referred to paragraph (1) under ‘Report on other legal and regulatoryrequirements’ of our report of even date)

i) a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of all fixed assets.

b) The physical verification of the fixed assets has been carried out by management atreasonable intervals and no material discrepancies were noticed on such verification.

c) The title deeds of immovable properties are held in the name of the Company.

ii) According to the process explained to us as followed by the Company theCompany’s inventory items are directly delivered to its customers on theirprocurement. Accordingly reporting on paragraph 3 (ii) of the Order is not applicable.

iii) The Company has not granted any loans secured or unsecured to companies firmsLimited Liability Partnerships and other parties covered in the register maintained undersection 189 of the Companies Act 2013. Accordingly reporting on paragraphs 3 (iii) (a)(b) and (c) of the Order are not applicable.

iv) In respect of loans investments guarantees and security provisions of section185 and 186 of the Companies Act 2013 have been complied with to the extent applicable.

v) According to the information and explanations given to us the Company has notaccepted deposits from the public and accordingly reporting on paragraph 3 (v) of theOrder is not applicable.

vi) Maintenance of cost records has not been specified by the Central Government undersub-section (1) of section 148 of the Companies Act 2013. Accordingly reporting onparagraph 3 (vi) of the Order is not applicable.

vii) a) According to the information and explanations given to us and the records ofthe Company examined by us in our opinion the Company is generally regular in depositingundisputed statutory dues including provident fund employees state insurance income-taxsales-tax service tax duty of customs duty of excise value added tax cess and otherstatutory dues as applicable with the appropriate authorities. b) According to theinformation and explanations given to us and the records of the Company examined by usthe particulars of income tax service tax excise duty and sales tax as at 31 March 2016which have not been deposited on account of dispute pending are as under:

Name of the Statue Name of the disputed dues Amount in Rs. Lacs Period to which the amount relates Forum where disputes are pending
Income Tax Act 1961 Income tax 677.42 2009-10 Commissioner of Income Tax (Appeals)
Finance Act 1994 Service Tax 165.92 2007-08 Commissioner of Service Tax
Central Excise Act 1944 Excise duty 230.57 2005-06 Superintendent Central Excise
Maharashtra Value Added Tax Act 2002 Value Added Tax 119.21 2007-08 2009-10 2010-11 & 2012-13 Joint Commissioner of Sales Tax (Appeals)

viii) According to the records of the Company examined by us and the information andexplanations given to us the Company has not defaulted in repayment of loans orborrowings to any bank. The Company has not availed any loans or borrowings from financialinstitution government and debenture holder.

ix) In our opinion and according to the information and explanations given to us nomoneys have been raised by way of further public offer (including debt instruments)however term loan being external commercial borrowing has been applied for the purposesfor which they were raised.

x) Except for the matters(s) referred in the ‘Basis for Qualified Opinion’of our audit report which was subjudice and hence are inconclusive to the best of ourknowledge and information and explanations given to us no fraud by the company or anyfraud on the Company by its officers or employees has been noticed or reported during theyear.

xi) Managerial remuneration has been paid or provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct.

xii) The Company is not a Nidhi Company. Accordingly reporting on paragraph 3 (xii) ofthe Order is not applicable.

xiii) All transactions with the related parties are in compliance with sections 177 and188 of Companies Act 2013 and the details have been disclosed in the financial statementsetc. as required by the applicable accounting standards.

xiv) The company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year under review. Accordinglyreporting on paragraph 3 (xiv) of the Order is not applicable.

(xv) The company has not entered into any non-cash transactions with directors orpersons connected with him. Accordingly reporting on paragraph 3 (xv) of the Order is notapplicable.

(xvi) The company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934. Accordingly reporting on paragraph 3 (xvi) of the Order is notapplicable.

Sharp & Tannan Associates
Chartered Accountants
Firm’s registration no. 109983W
by the hand of
Tirtharaj Khot
Mumbai 30 May 2016 Partner
Membership No. (F) 037457

(Referred to in paragraph 2(f) under ‘Report on other legal and regulatoryrequirements’)

Report on the internal financial controls under clause (i) of sub-section (3) ofsection 143 of the Companies Act 2013 (‘the Act’)

We have audited the internal financial controls over financial reporting of 63 moonstechnologies limited (formerly Financial Technologies (India) Limited) (‘theCompany’) as of 31 March 2016 in conjunction with our audit of the standalonefinancial statements of the 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 internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(‘the Guidance Note’) issued by the Institute of Chartered Accountants of India(‘the ICAI’). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and eficient conduct of its business including adherence to theCompany’s policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on the Company’s internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note and the Standards on Auditing issued by ICAI and deemed to beprescribed under section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of internal financial controlsand both issued by the ICAI. Those Standards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor’s judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company’s internal financial controlssystem over financial reporting.

MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

A company’s internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company’s internal financial control overfinancial reporting includes those policies and procedures that: (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reffect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany’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 financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

OPINION

In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31 March 2016 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note issued by theICAI.

Sharp & Tannan Associates
Chartered Accountants
Firm’s registration no. 109983W
by the hand of
Tirtharaj Khot
Mumbai 30 May 2016 Partner
Membership No. (F) 037457

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