The Members of
Artson Engineering Limited
Report on the Financial Statements
We have audited the accompanying Ind AS financial statements of Artson EngineeringLimited ("the Company") which comprise the Balance Sheet as at 31 March 2017the Statement of Profit and Loss (including other comprehensive income) the statement ofcash flows and the statement of changes in equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information (herein afterreferred to as "Financial statements").
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 ofthese financial statements that give a true and fair view of the financial positionfinancial performance including other comprehensive income cash flows and changes inequity of the Company in accordance with the accounting principles generally accepted inIndia including the Accounting Standards (Ind AS) specified under Section 133 of the Actread with relevant rules issued thereunder.
This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the financialstatements that give a true and fair view and are free from material misstatement whetherdue 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 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 performingprocedures to obtain audit evidence about the amounts and the disclosures in the financialstatements. The procedures selected depend on the auditor's judgment including theassessment of the risks of material misstatement of the financial statements whether dueto fraud or error. In making those risk assessments the auditor considers internalfinancial control relevant to the Company's preparationof the financial statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by Company'sDirectors as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our 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 Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the financial position of the Company as at 31March 2017 and its financial performance including other comprehensive income its cashflows and the changes in equity 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 theCompanies Act 2013 we give in the Annexure A a statement on the matters specified inparagraphs 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 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 statement of cash flowsand the statement of changes in equity dealt with by this Report are in agreement with thebooks of account.
d. In our opinion the aforesaid financial statements comply with the AccountingStandards specified under Section 133 of the Act read with relevant rule issuedthere-under;
e. On the basis of the written representations received from the directors as on 31March 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2017 from being appointed as a director in terms of Section164(2) of the 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 B". Our report expresses unmodified opinion on theadequacy and the operating effectiveness of the Company's internal financial controls overfinancial reporting.
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 note 46 to its financial statements.
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. The Company is not required to transfer funds to the Investors Education andProtection Fund.
iv. The Company has provided requisite disclosures in the financial statements as toholdings as well as dealings in Specified Bank Notes during the period from 8thNovember 2016 to 30 th December 2016. Refer note 42 of financial statement.
For Chokshi & Chokshi LLP
Place : Mumbai
Date : 2nd May 2017
ANNEXURE A TO THE INDEPENDENT AUDITORS' REPORT
(Referred to in paragraph 1 under Report on Other Legal and RegulatoryRequirements' section of our report of even date)
1) In respect of its fixed assets:
a. According to the information and explanations given to us the Company ismaintaining records showing full particulars including quantitative details andsituations of all the fixed assets.
b. According to the information and explanations given to us the fixed assets arebeing physically verified by the Management at all its location in a phased manner atreasonable intervals which in our opinion is reasonable having regard to the size of theCompany and nature of assets. The discrepancies noticed have been properly dealt with inthe books of account.
c. According to the information and explanations given to us the title deeds ofimmovable properties are held in the name of the Company.
2) According to the information and explanations given to us the inventory has beenphysically verified by the management during the year at reasonable intervals which isreasonable and adequate in relation to the size of the Company and the nature of itsbusiness. The discrepancies noticed have been properly dealt with in the books ofaccounts.
3) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies Limited Liability Partnershipsfirms or other parties covered in the register maintained under Section 189 of theCompanies Act 2013. Accordingly clause 3(iii)(a) to 3(iii)(c) are not applicable to theCompany.
4) According to the information and explanations given to us the Company has not given/ made any loans guarantee and security to which provision of section 185 of theCompanies act 2013 apply.
Further as per information and explanations given to us provisions of Section 186 ofthe Companies Act 2013 is not applicable to Company.
5) The Company has not accepted any public deposits within the meaning of sections 73to 76 of Companies Act 2013 and rules framed there under;
6) We have broadly reviewed the books of account maintained by the Company pursuant tosub-section (1) of section 148 of the Companies Act 2013 and are of the opinion thatprimafacie the prescribed accounts and records have been made and maintained. We havehowever not undertaken a detailed examination of the records with a view to determinewhether they are accurate or complete.
7) (a) In our opinion and according to the information and explanations given to usthe Company is generally regular in depositing applicable undisputed statutory duesincluding provident fund employees' state insurance income tax sales tax wealth taxservice tax custom duty duty of excise value added tax cess and any other statutorydues with the appropriate authorities during the year and no such dues are outstanding formore than six months from the date they became payable.
(b) As at March 31 2017 according to the records of the Company and the informationand explanations given to us disputed dues payable by the Company on account of IncomeTax/ Sales Tax/ Wealth Tax/ Service Tax/ Duty of Custom / Duty of Excise are as under:
| || || || || ||(Rs. in lakhs) |
|S. No. ||Nature of Dues ||Name of Statute ||For the year ended March 2017 ||Period ||Forum |
|1 ||Andhra Pradesh Vat Act 2005 ||Commercial Tax (Andhra Pradesh) ||12.21 ||F.Y. 1998-99 ||Commisioner (Appeal) |
|2 ||West Bengal Vat Act 2003 ||Commercial Tax (West Bengal) ||2.08 ||F.Y. 1998-99 ||Commisioner (Appeal) |
|3 ||Central Excise Act 1994 ||Commercial Tax (Punjab) ||8.03 ||F.Y. 2010-11 ||Joint Director cum Deputy Excise & Taxation Commisioner (Appeal) |
|4 ||MVAT Act 2002 ||Vat (Maharashtra) ||41.40 ||FY-2007-08 ||The Maharashtra Sales Tax Tribunal |
|5 ||MVAT Act 2002 ||Vat (Maharashtra) ||2.39 ||FY-2008-09 ||Commisioner (Appeal) |
|6 ||MVAT Act 2002 ||Vat (Maharashtra) ||1.60 ||FY-2011-12 ||Deputy Commisioner of Sales Tax (Appeal) |
8) According to the information and explanations given to us and on the basis of ourexamination of the books of accounts in our opinion the Company has not defaulted inrepayment of dues to any financial institutions banks or debenture holders.
9) According to the information and explanations given to us the Company has notraised any fund by way of public issue and the money raised by the way of term loans havebeen applied by the company during the year for the purpose for which they were raised.
10) According to the information and explanation given to us we have not come acrossany instance of fraud by the Company or any fraud on the Company by its officers oremployees either noticed or reported during the year on or by the Company.
11) According to the information and explanations given to us the Company has not paidor provided any managerial remuneration during the year and hence clause 3(xi) of theOrder is not applicable to the Company.
12) The Company is not in the nature of a Nidhi Company as defined under section 406the Companies Act 2013.
13) According to the information and explanations given to us all transactions withthe related parties are in compliance with sections 177 and 188 of Companies Act 2013where applicable and the details have been disclosed in note 29 of the financialStatements 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.
15) According to the information and explanations given to us the company has notentered into any non-cash transactions with directors or persons connected with him andhence clause 3(xv) of the Order is not applicable to the Company.
16) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.
For Chokshi & Chokshi LLP
Place : Mumbai
Date : 2nd May 2017.
ANNEXURE B TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE FINANCIAL STATEMENTSOF ARTSON ENGINEERING 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 ArtsonEngineering Limited. ("the Company") as of 31 March 2017 in conjunction withour audit of the financial 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 criteria established by the Company considering the sizeof Company and essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India ("the Guidance Note"). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to 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.
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 issued by Institute ofChartered Accountants of India (ICAI) and deemed to be prescribed under section 143(10) ofthe Companies Act 2013 to the extent applicable to an audit of internal financialcontrols both applicable to an audit of Internal Financial Controls and both issued bythe Institute of Chartered Accountants of India. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in allmaterial 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 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 judgment including the assessment of the risks of materialmisstatement 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 controls systemover financial 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 preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the Company are being made only in accordance with authorizations 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 the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlswere operating effectively as at 31 March 2017 based on the assessment of essentialcomponents of internal controls over financial reporting stated in the Guidance Notecarried out by the Company and representation to that effect is made available to us bythe Company.
For Chokshi & Chokshi LLP
Place : Mumbai
Date : 2nd May 2017.