The Members BF Utilities Limited Pune.
Report on the Standalone Financial Statements
We Joshi Apte & Co. Chartered Accountants have audited the accompanying standalonefinancial statements of BF UTILITIES LIMITED ("the Company") which comprise theBalance Sheet as at 31 March 2017 the Statement of Profit and Loss and the Cash Flowstatement for the year then ended and a summary of significant accounting policies andother explanatory information.
Management' 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 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 as applicable. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.
Our responsibility is to express an opinion on these standalone financial statementsbased on our audit.
In conducting 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 and the Orderunder section 143 (11) of the Act.
We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing specified under section 143(10) of the Act and other applicableauthoritative pronouncements issued by the Institute of Chartered Accountants of India.Those Standards and pronouncements require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether the financialstatements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgement including the assessment of the risks of material misstatement of thestandalone financial statements whether due to fraud or error. In making those riskassessments the 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 accounting policies used and the reasonableness of theaccounting estimates made by the Company's Directors as well as evaluating the overallpresentation of the standalone financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the 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 31 March 2017 and its profit and its cash flows for the year then ended on thatdate.
Emphasis of Matters
Without qualifying our Audit Report we draw attention to the following matters in theNotes to the financial statements:
(a) We draw attention to Note No.35 to the accompanying financial results. As mentionedtherein there are certain litigations by and against the Company and the subsidiaries ofthe Company that are yet to be decided by various courts and the matter is subjudice. Nocognizance thereof is taken in the preparation of the financial statements pending thefinal outcome of these cases. During the year due to dispute with the service providerCompany's windmills were partly non-operational there by adversely affecting powergeneration. The management has taken all possible steps to restore the operations.
Certain litigations by and against the Company and the subsidiaries of the Company arepending in various courts and the matter is subjudice. No cognizance thereof is taken inthe preparation of the financial statements pending final outcome of the cases. Duringthe year due to dispute with the service provider Company's windmills were partlynon-operational there by adversely affecting power generation. The management has takenall possible steps to restore the operations.
(b) As stated in Note No.38 to the accompanying financial statements ConsolidatedFinancial Statements have not been prepared.
Nandi Highway Developers Ltd. (NHDL) Nandi Infrastructure Corridor Enterprises Ltd.(NICE) and Nandi Economic Corridor Enterprises Ltd. (NECE) which are the subsidiaries ofthe Company are in the process of finalising their accounts for the financial year ended31st March 2017 and hence they have not yet submitted the said audited financials to theCompany.
The Company will prepare consolidated financials once the audited accounts of all theabove mentioned subsidiaries are made available to the Company.
(c) As stated in Note No.39 to the accompanying financial statements diminution otherthan temporary if any in the value of investment in Nandi Highway Developers Ltd (NHDL)Nandi Infrastructure Corridor Enterprise Ltd (NICE) and Nandi Economic Corridor EnterpriseLtd (NECE) could not be tested pending finalisation of accounts of NHDL NICE and NECE forthe financial year ended 31 March 2017 as explained in Note no. 38. The Company hasrecorded these investments at cost as on the date of Balance Sheet.
Diminution other than temporary if any in the value of investment in Nandi HighwayDevelopers Ltd. (NHDL) Nandi Infrastructure Corridor Enterprise Ltd (NICE) and NandiEconomic Corridor Enterprise Ltd (NECE) could not be tested pending finalisation ofaccounts of NHDL NICE and NECE for the financial year ended 31st March 2017 asexplained in Note no. 38. The Company has recorded these investments at cost as on thedate of Balance Sheet.
Report on Other Legal and Regulatory Requirements
1. As required by section 143(3) of the Companies Act 2013 based on our audit wereport to the extent applicable that:
(i) We have sought and obtained all the information and explanation which to the bestof our knowledge and belief were necessary for the purpose of our audit;
(ii) 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.
(iii) The Balance Sheet the statement of Profit and Loss and the Cash Flow Statementdealt with by us in the Report are in agreement with the relevant books of account.
(iv) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act as applicable.
(v) 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.
(vi) 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 A". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.
(vii) 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 as amended inour opinion and to the best of our information and according to the explanations given tous:
a) The Company has in accordance with generally accepted accounting practicedisclosed the impact of pending litigations on its financial position in its financialstatements Refer Note 26 & 27 to the financial statement;
b) The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
c) There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
d) The Company had provided requisite disclosures in its standalone financialstatements as regards holdings as well as dealings in Specified Bank Notes as defined inthe Notification S.O. 3407(E) dated the 08 November 2016 of the Ministry of Financeduring the period from 08 November 2016 to 30 December 2016; and such disclosures are inaccordance with the books of accounts maintained by the Company Refer note no. 44.
2. 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 B" a statement on the matters specified inparagraph 3 and 4 of the Order .
For Joshi Apte & Co.
Chartered Accountants ICAI Firm Registration Number: 104370W
per Varad Waman Joshi
Partner Membership Number: 137763
25 May 2017
ANNEXURE "A" TO THE INDEPENDENT AUDITORS' REPORT
(Refer to in paragraph 1 to 'Report on Other Legal and Regulatory Requirements' of ourreport of even date) Report on the Internal Financial Controls Over Financial Reportingunder Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("theAct")
We have audited the internal financial controls over financial reporting of BFUtilities Limited ("the Company") as of 31 March 2017 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.
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 company's policies the safe guarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe 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") issued by Institute of Chartered Accountants of India andthe Standards on Auditing prescribed under section 143(10) of the Companies Act 2013 tothe extent applicable to an audit of internal financial controls both applicable to anaudit of Internal Financial Controls. Those Standards and the Guidance Note require thatwe comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about 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 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 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 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 31 March 2017 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.
|For Joshi Apte & Co. |
|Chartered Accountants |
|ICAI Firm Registration Number: 104370W |
|per Varad Waman Joshi |
|Membership Number: 137763 |
25 May 2017
ANNEXURE "B" TO THE INDEPENDENT AUDITORS' REPORT
(Referred to in paragraph 2 under 'Report on Other Legal and Regulatory Requirements'section of our report of even date) Re: BF Utilities Limited ("the Company") i.In respect of the Company's fixed assets: (a) The Company ismaintaining proper recordsshowing full particulars including quantitative details and situation of fixed assets;(b) There is a regular programme of verification which in our opinion is reasonablehaving regards to the size of the Company and the nature of its assets.No materialdiscrepancies were noticed on such verification.
(c) According to the information and explanations given to us and the records examinedby us and based on the examination of registered documents provided to us we report thatthe title deeds comprising all the immovable properties of land and buildings which arefreehold are held in the name of the Company as at the balance sheet date. ii. Theinventory has been physically verified by the management during the year. In our opinionthe frequency of verification is reasonable. No material discrepancies were noticed onsuch physical verification.
As explained to us inventories of Certified Emission Reduction (CER) and RenewableEnergy Certificate (REC) were verified electronically during theyear by the management atreasonable intervals since the same is not physically verifiable and no materialdiscrepancies were noticed. iii. During the year the Company has not granted any loanssecured or unsecured to companies firms or other parties covered in the Registermaintained under Section 189 of the Act. iv. In our opinion and according to theinformation and explanations given to usthe Company has complied with the provisions ofsection 185 and 186 of the Companies Act 2013 in respect of grant of loans makinginvestments and providing guarantees and securities as applicable. v. According to theinformation and explanations given to us the Company has not accepted any deposits fromthe public. vi. The provisions of clause (3) (vi) of the Order are not applicable to theCompany as the Company is not covered by the Companies (Cost Records and Audit) Rules2014. vii. According to the information and explanations given to us in respect ofstatutory dues: (a) The Company is generally regular in depositing undisputed statutorydues including provident fund income tax sales tax wealth tax service tax value addedtax cess and any other statutory dues to the appropriate authorities and there are noarrears ofoutstanding statutory dues as at the last day of financial yearconcerned for aperiod of more than six months from the date they became payable except in case ofelectricity duty payable for the period 1 April 2014 to 31 August 2016total amounting Rs.17856207.
(b) According to the information and explanations given to us there were no dues ofincome tax sales tax service tax duty of customs duty of excise value added tax whichhave not been deposited as at 31March 2017 on account of disputes. viii. In our opinionand according to the information and explanations given to us the Company has notdefaulted in repayment of loans from the government. The Company has not taken any loansor borrowingsfrom financial institution and bankand has not issued debentures during theyear. ix. The Company has not raised moneys by way of initial public offer or furtherpublic offer (including debt instruments) or term loans and hence reporting under clause 3(ix) of the Order is not applicable to the Company. x. To the best of our knowledge andbelief and according to the information and explanations given to us no fraud by theCompany and no fraud on the Company by its officers or employees has been noticed orreported during theyear. xi. Based on our audit procedures and as per the information andexplanations given by the management we are of the opinion that managerial remunerationhas been paid or provided in accordance with the requisite approvals mandated by theprovisions of section 197 read with Schedule V to the Act. xii. The Company is not a NidhiCompany and hencereporting under clause 3 (xii) of the Order is not applicable. xiii. Inour opinion and according to the information and explanations given to us the Company isin compliance with section177 and 188 of Companies Act 2013 where applicable for allthe transactions with the related parties and the details of related party transactionshavebeen disclosed in the standalone Financial Statements etc. as required by theapplicableaccounting standards. xiv. During the year the Company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures and hence reporting under clause 3 (xiv) of the Order is not applicable to theCompany. xv. In our opinion and according to the information and explanations given to usduring the yearthe Company has not entered into any non-cash transactions with anydirectors or persons connected with him and hence provisions of section 192 of theCompanies Act 2013 are not applicable. xvi. According to the information and explanationsgiven to us the provisions of section 45-IA of the Reserve Bank of India Act 1934 arenot applicable to the Company.
|For Joshi Apte & Co. |
|Chartered Accountants |
|ICAI Firm Registration Number: 104370W |
|per Varad Waman Joshi |
|Membership Number: 137763 |