To The Members of Agri-Tech (India) Limited Aurangabad
Report on the Financial Statements
We have audited the accompanying financial statements of Agri-Tech (India) Limited("the Company") which comprise the Balance Sheet as at 31st March2017 the Statement of Profit and Loss and Cash Flow Statement for the year then endedand 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 matters stated in section134(5) of the Companies Act 2013 ('the Act') with respect to the preparation andpresentation of these 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.
Our responsibility is to express an opinion on these financial statements based on ouraudit. 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 rules made there-under.
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 of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of the accountingestimates made by the Company's directors as well as evaluating the overall presentationof 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 financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Act inthe manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31stMarch 2017 and its profit and its 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 2016 ("the Order")issued by the Central
Government of India in terms of sub-section (11) of section 143 of the Act we give inthe Annexure
"A" a statement on the matters specified in paragraph 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 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 the Statement Profit and Loss and the Cash Flow Statement dealtwith by this report are in agreement with the books of account;
d) In our opinion the aforesaid financial statements comply with the AccountingStandards specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014;
e) On the basis of written representations received from the directors as on 31stMarch 2017 and taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2017 from being appointed as a director interms of section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financialreporting of the company and operating effectiveness of such controls refer to ourseparate report in Annexure "B"; and
g) With respect to the other matters to be included in the Auditors 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 explanation given to us:
i. the company has disclosed the impact of pending litigations on its financialposition in its financial statements-Refer Note No. 17 to the financial statements.
ii. the Company does not have long term contracts or derivative contracts which requireprovision.
iii. there is no amount required to be transferred to investor education and protectionfund. iv. the company has provided requisite disclosure in its financial statements as toholding as well as dealing in the specified bank notes during the period from 8thNovember 2016 to 30th December 2016 and these are in accordance with the booksof accounts maintained by the Company. Refer Note No 27 to the financial statements.
ANNEXURE "A" TO THE AUDITORS' REPORT
The Annexure referred to in Independent Auditors' Report to the members of the Companyon the financial statements for the year ended 31st March 2017 we report that:
1. (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) The company has regular program of physical verification of its fixed assets bywhich fixed assets are verified in a phased manner over a period of three years. Inaccordance with this program certain fixed assets were verified during the year and nomaterial discrepancies were noticed on such verification. In our opinion this periodicityof physical verification is reasonable having regard to the size of the company and natureof its business.
(c) According to the information and explanations given to us and on the basis of ourexamination of the record of the company the title deeds of the immovable properties areheld in the name of the company.
2. The inventory has been physically verified during the year by the management. Thediscrepancies noticed on verification between the physical stocks and book records werenot material which have been properly dealt with in the books of account.
3. As per the information and explanations given to us the Company has grantednon-interest bearing unsecured loans to six companies covered in the register maintainedunder section 189 of the Act. The terms and conditions of the grant of such loans are notprejudicial to the interest of the company looking to long term businessexigencies/purposes.
No formal schedule of repayment has been made for receipt of the principal amount andas such in absence of such repayment schedule we are unable to comment if the same arebeing repaid timely.
As explained there is no overdue amount for more than ninety days. All the loans whereamount is more than rupees one lac reasonable steps have been taken by the company forrecovery of the principal and interest where applicable.
4. The company has not granted any loans or advances covered under section 185 of theAct. In our opinion and according to the information and explanations given to us thecompany has complied with the provisions of section 186 of the Act with respect to theloans except non-charging of interest.
5. The Company has not accepted deposits within the meaning of sections 73 to 76 or anyother relevant provisions of the Act and the rules framed there under.
6. No maintenance of cost records has been specified by the Central Government undersection 148(1) of the Act for the products of the company.
7. (a) The company is regular in depositing undisputed statutory dues includingprovident fund employees' state insurance income-tax sales-tax wealth tax servicetax duty of customs duty of excise value added tax cess and any other statutory dueswith the appropriate authorities. b) There are no dues of income tax or sales tax orwealth tax or service tax or duty of customs or duty of excise or value added tax or cesswhich have not been deposited on account of any dispute.
8. In our opinion and according to the information and explanations given to us theCompany has not defaulted in payment of dues to financial institution or bank or debentureholders.
9. The company has not raised any moneys by way of initial public offer or furtherpublic offer (including debt instruments) during the year. Further the term loans wereapplied for the purpose for which those are raised.
10. No fraud on or by the company or any fraud on the company by its officers oremployees has been noticed or reported during the year.
11. The company has not paid any managerial remuneration as such para 11 of clause 3 ofthe Order is not applicable.
12. The company is not a Nidhi Company as such provisions of the clause (xii) are notapplicable to the company.
13. All transactions with the related parties are in compliance with section 177 and188 of the Act where applicable and the details have been disclosed in the financialstatements etc. as required by the applicable accounting standards.
14. The company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year under review.
15. The company has not entered into any non-cash transactions with directors orpersons connected with him.
16. The company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.
ANNEXURE "B" TO THE AUDITORS' REPORT
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 internalfinancial controls over financial reporting of Agri-Tech (India) Limited ("theCompany") as of 31stMarch 2017 in conjunction with our audit of thefinancial statements of the Company for the year ended on that date. Management'sResponsibility for Internal Financial Controls The Company's management is responsible forestablishing and maintaining internal financial controls based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia (ICAI).
These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Act. Auditors Responsibility Ourresponsibility is to express an opinion on the Company's internal financial controls overfinancial reporting based on our audit. We conducted our audit in accordance with theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting (the"Guidance Note") issued by the ICAI and the Standards on Auditing deemed to beprescribed under Section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls. 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 theadequacy of the internal financial controls system over financial reporting and theiroperating effectiveness.
Our audit of internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgement including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the Company's internal financial controls system over financialreporting.
Meaning of Internal Financial Controls Over Financial Reporting A company's internalfinancial control over financial reporting is a process designed to provide reasonableassurance regarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally acceptedaccounting principles. A company's internal financial control over financial reportingincludes those policies and procedures that (1) pertain to the maintenance of recordsthat 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 preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures 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.
In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at 31st March 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 ICAI.
For Gautam N Associates
Partner M No 32742