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Adani Ports & Special Economic Zone Ltd.

BSE: 532921 Sector: Others
NSE: ADANIPORTS ISIN Code: INE742F01042
BSE LIVE 15:40 | 22 Sep 401.25 -8.80
(-2.15%)
OPEN

410.00

HIGH

410.00

LOW

398.95

NSE 15:45 | 22 Sep 401.20 -9.00
(-2.19%)
OPEN

409.00

HIGH

409.50

LOW

398.60

OPEN 410.00
PREVIOUS CLOSE 410.05
VOLUME 1216394
52-Week high 421.60
52-Week low 246.00
P/E 26.91
Mkt Cap.(Rs cr) 83,097
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 410.00
CLOSE 410.05
VOLUME 1216394
52-Week high 421.60
52-Week low 246.00
P/E 26.91
Mkt Cap.(Rs cr) 83,097
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Adani Ports & Special Economic Zone Ltd. (ADANIPORTS) - Auditors Report

Company auditors report

To the Members of

Adani Ports and Special Economic Zone Limited

Report on the Ind AS financial statements

We have audited the accompanying standalone Ind AS financial statements of Adani Portsand Special Economic Zone Limited ("the Company") which comprise the BalanceSheet as at March 31 2017 the Statement of Profit statements. The including othercomprehensive income Cash Flow Statement and Statement of Changes in Equity for the yearthen ended and other anda summary of significant explanatory information.

Management's Responsibility for the Ind AS 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 Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with accounting principles generallyaccepted in India including the Accounting Standards specified under section 133 of theAct read with the Companies (Indian Accounting Standards) Rules 2015 as amended. Thisresponsibility includes maintenance of adequate accounting records in accordance with theprovisions of the Act for safeguarding of the assets of the Company and for preventing anddetecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; andthe design implementation and maintenance of adequate internal financial control thatwere operating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the Ind AS financial statementsthat give a true and fair view and are free from material misstatement whether due tofraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit. We have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder. We conductedour audit in accordance with the Standards on Auditing issued by the Institute ofChartered Accountants of India as specified under Section 143(10) of the Act. ThoseStandards require that we comply with ethical requirements and plan and perform the auditto obtain reasonable assurance about whether the standalone Ind AS financial statementsare free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the and Loss standalone Ind AS financial selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the standaloneInd AS financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financialcontrol relevant to the Company'spreparation of the standalone Ind AS financial statements that give a true and fair viewin order to design audit procedures that are appropriate in the circumstances. An auditalso includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the standalone Ind AS financial statements. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the standalone Ind AS financialstatements give the information required bythe Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2017 its profit and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to:

(a) Note 38(l) of the accompanying standalone Ind AS financialstatements regardingrecognition of Minimum Alternate Tax ('MAT') credit entitlement in respect of certaininterest income based on the consideration that the Company would be able to claim taxholiday benefits on the same as per provisions of section 80IAB of the Income Tax Act1961 more fully described in the said note.

(b) Note 41(a) of the accompanying standalone Ind AS financial statements regarding thebasis of recognition of certain projects service revenue during the earlier year as morefully described in the said note.

(c) Note 4(c)(i) of the accompanying standalone Ind AS financial statements whichindicates that one of the subsidiary company has accumulated losses and its net worth hasbeen eroded the subsidiary company has incurred a net cash loss during the current yearand previous year. These conditions along with other matters set forth in Note 4(c)(i)indicate the existence of material uncertainty that may impact the subsidiary company'sability to continue as a going concern. However the financial statements of thesubsidiary company have been prepared on going concern basis for the reasons stated in thesaid Note.

Our opinion is not qualified in respect of these matters.

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 terms of sub-section (11) of section 143 ofthe Act we give in the Annexure 1 a statement on the matters specified in paragraphs 3and 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 purpose 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 Statement of Profit and Loss including the Statement of OtherComprehensive Income the Cash Flow Statement and Statement of Changes in Equity dealtwith by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Accounting Standards specified under section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 as amended;

(e) On the basis of written representations received from the directors as on March 312017 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of section 164 (2) ofthe Act;

(f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure 2" to this report;

(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 standalone Ind AS financial statements Refer Note 38 to the standalone IndAS financial statements;

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 Refer Note 15 to the standalone Ind AS financial statements;

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

iv. The Company has provided requisite disclosures in Note 43 to these standalone IndAS financial statements as to the holdings and dealing in Specified Bank Notes as definedin the notification S.O. 3407 (E) dated November 08 2016 of the Ministry of Financeduring the period from November 8 2016 to December 30 2016. Based on the audit procedureperformed and the representation provided to us by the management we report that thedisclosures are in accordance with the books of accounts maintained by the Company more sodescribed in Note 43.

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Arpit K Patel
Place of Signature: Ahmedabad Partner
Date: May 24 2017 Membership Number: 34032

Annexure 1 referred to in Paragraph 1 of Report on Other Legal and RegulatoryRequirements of our report of even date for the year ended March 31 2017

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) The Company has regular programme of physical which all verification the fixedassets are verified in a phased manner over a period of three years. In our opinionphysical to the verification size of the Company and the nature of its assets. No materialdiscrepancies were noticed on such verification

(c) According to information and explanations given by the management the title deedsof immovable properties included in fixed assets except for the immovable property in thenature of reclaimed land having Gross Book Value (GBV) aggregating H202.21 crores and NetBook Value (NBV) aggregating H171.87 crores and residential flats having GBV of H139.94crores and NBV of H125.63 crores which are not registered in the name of the Company. Alsorefer note 3(a) of the standalone Ind AS financial statements.

(ii) The management has conducted physical verification of inventory at reasonableintervals during the year and no material discrepancies were noticed on such physicalverification

(iii) (a) The Company has granted loans to a company covered in the register maintainedunder section 189 of the Companies Act 2013. In our opinion and according to theinformation and explanations given to us the terms and conditions of the grant of suchloans are not prejudicial to the company's interest.

(b) The Company has granted loans to a firm in the register maintained under section189 of the Companies Act 2013. The schedule of repayment of principal and payment ofinterest has been stipulated for the loans granted and the receipts are regular and therewere no instalment of loan due during the year.

(c) There are no amounts of loans granted to companies firms or other parties listedin the register maintained under section 189 of the Companies Act 2013 which are overduefor more than ninety days.

(iv) In our opinion and according to the information and explanations given to us andconsidering the legal opinion taken by the Company on applicability of section 185 of theCompanies Act 2013 in respect of certain loan transaction and that the same have beengiven in the ordinary course of the business the Company has complied with the provisionsof section 185 of the Companies Act 2013. Further based on the information andexplanations given to us being an infrastructure company provision of section 186 of theCompanies Act 2013 is not applicable to the Company and hence not commented upon.

(v) The Company has not accepted any deposits from the public.

(vi) To the best of our knowledge and as explained the Central Government has notspecified the maintenance of cost records under clause 148(1) of the Companies Act 2013for the services of the Company.

(vii) (a) The Company is regular in depositing with appropriate authorities undisputedstatutory dues including provident fund employees' state insurance income tax salestax service tax duty of customs duty of excise value added tax cess and othermaterial statutory dues applicable to it. (b) According to the information andexplanations given to us no undisputed amounts payable in respect of provident fundemployees' state insurance income tax service tax sales tax duty of custom duty ofexcise value added tax cesscovered and other material statutory dues were outstandingat the year end for a period of more than six months from the date they became payable.

(c) According to the records of the Company the dues outstanding of service taxcustoms duty excise duty and income tax on account of any dispute are as follows:

Name of the statute Nature of Tax Amount Period to which the amount relates Forum where dispute is pending
(Rs in Crores)
Customs Act 1962 Custom Duty 2.00 June 2008 Commissioner of Customs & Central Excise Ahmedabad
Customs Act 1962 Custom Duty 0.14 July 2003 Assistant Commissioner of Customs Mundra
Customs Act 1962 Custom Duty 0.25 August 2007 Deputy Commissioner of Customs Mundra
Finance Act 1994 Service Tax 6.72 December 2004 to March 2006 Supreme court
Service Tax 0.56 October 2003 to August 2005 Commissioner (Appeals) Rajkot
Service Tax 304.71 April 2006 to September 2011 High Court of Gujarat
Service Tax 0.61 September 2009 to March 2010 Commissioner of Service Tax Ahmedabad.
Service Tax 190.04 April 2011 to March 2014 Commissioner / Addl. Commissioner of Service Tax Ahmedabad
Finance Act 1994 Service Tax 6.72 April 2004 to August 2009 High Court of Gujarat
Service Tax 0.17 April 2009 to March 2011 Commissioner of Service Tax Ahmedabad
Income Tax Act Income Tax 75.48 AY 2009 - 10 to AY 2011 - 12 Income Tax Appellate Tribunal
1961 Income Tax 6.74 AY 2012 13 to AY 2013 - 14 CIT (Appeal)

(viii) In our opinion and according to information and explanations given by themanagement the Company has not defaulted in repayment of dues to financial institutionsbanks or debenture holders. The Company does not have any outstanding dues to governmentduring the year.

(ix) In our opinion and according to the information and explanations given by themanagement and on an overall examination of the balance sheet the monies raised by waydebt instruments in the nature of foreign currency bonds and term loans were applied forthe purposes for which those were raised though idle/surplus funds which were notrequired for immediate utilization have been temporarily invested in fixed deposits /mutual funds.

(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the Company or no fraud on the

Company by the officers and employees of the Company has been noticed or reportedduring the year.

(xi) According to the information and explanations given by the management we reportthat the managerial remuneration has been paid / provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) In our opinion the Company is not a nidhi company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the managementtransactions with related parties are in compliance with section 177 and 188 of CompaniesAct 2013 where applicable and the details have been disclosed in the notes to thestandalone Ind AS financial statements as required by the applicable accountingstandards.

(xiv) According to the information and explanations given to us and on an overallexamination of the balance sheet the company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder review and hence reporting requirements under clause 3(xiv) are not applicable tothe Company and hence not commented upon.

(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in section 192 of Companies Act 2013.

(xvi) According to the information and explanations given to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Arpit K Patel
Place of Signature: Ahmedabad Partner
Date: May 24 2017 Membership Number: 34032

Annexure 2 to the Independent Auditor's Report of Even Date on the Standalone Ind ASFinancial Statements of Adani Ports And Special Economic Zone Limited

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of Adani Portsand Special Economic Zone Limited ("the Company") as of March 31 2017 inconjunction with our audit of the standalone Ind AS financial statements of the Companyfor 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 Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to the Company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.

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 on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing as specified under of theCompanies Act 2013 to the extent applicable to an audit of internal financial controlsand both issued by the Institute of Chartered Accountants of India. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated effectively in all material respects.

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 judgement 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 internal financial controls system overfinancial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit 143(10) 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 March 31 2017 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Arpit K Patel
Place of Signature: Ahmedabad Partner
Date: May 24 2017 Membership Number: 34032