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CL Educate Ltd.

BSE: 540403 Sector: Others
NSE: CLEDUCATE ISIN Code: INE201M01011
BSE LIVE 15:40 | 21 Nov 322.30 -2.55
(-0.78%)
OPEN

330.95

HIGH

330.95

LOW

321.40

NSE 15:40 | 21 Nov 320.40 -5.35
(-1.64%)
OPEN

329.80

HIGH

329.80

LOW

318.95

OPEN 330.95
PREVIOUS CLOSE 324.85
VOLUME 1288
52-Week high 474.00
52-Week low 314.00
P/E 59.69
Mkt Cap.(Rs cr) 457
Buy Price 323.10
Buy Qty 30.00
Sell Price 0.00
Sell Qty 0.00
OPEN 330.95
CLOSE 324.85
VOLUME 1288
52-Week high 474.00
52-Week low 314.00
P/E 59.69
Mkt Cap.(Rs cr) 457
Buy Price 323.10
Buy Qty 30.00
Sell Price 0.00
Sell Qty 0.00

CL Educate Ltd. (CLEDUCATE) - Auditors Report

Company auditors report

To the Members of CL Educate Limited

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of CL Educate Limited("the Company") which comprise the Balance Sheet as at March 31 2017 theStatement of Profit and Loss the Cash Flow Statement for the year then ended and asummary of significant 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 of 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 and ensuring their operating effectiveness and the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone financial statements that give a true and fair view and are freefrom material misstatement 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 standalone financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the standalone financial statements. The procedures selected depend on theauditors' judgment 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 standalone 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 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.

Opinion

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 March 31 2017 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 (Auditors' 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 "Annexure 1" 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 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 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) of theAct;

f. With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls we give ourseparate Report in "Annexure 2".

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 financial statements – Refer Note 31 on ContingentLiabilities and Note 45 in respect of other pending litigations;

(ii) The Company did not have any long-term contracts including derivative contracts.Hence the quesion of any material foreseeable losses does not arise;

(iii) There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.

(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 November 82016 to December 30 2016. Based on audit procedures and relying on the managementrepresentation we report that the disclosures are in accordance with the books ofaccount maintained by the company and as produced to us by the Management (Refer Note No.49 to the financial statements)

For Haribhakti & Co. LLP
Chartered Accountants
ICAI Firm Registration No.:103523W/W100048
sd/-
Raj Kumar Agarwal
Partner
Membership No.:074715
Place: New Delhi
Date : May 29 2017

ANNEXURE 1 TO THE INDEPENDENT AUDITOR'S REPORT

[Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements' in the Independent Auditor's Report of even date to the members of CLEducate Limited on the standalone financial statements 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) During the year the fixed assets of the Company have been physically verified bythe management and as informed no material discrepancies were noticed on suchverification. In our opinion the frequency of verification is reasonable having regard tothe size of the Company and the nature of its assets.

(c) The title deeds of immovable properties recorded in the books of account of theCompany are held in the name of the Company.

(ii) The inventory has been physically verified by the management during the year. Inour opinion the frequency of verification is reasonable. As informed no materialdiscrepancies were noticed on physical verification carried out during the year.

(iii) The Company has granted unsecured loans to companies and other parties covered inthe register maintained under Section 189 of the Act.

(a) According to the information and explanations given to us and based on the auditprocedures conducted by us we are of the opinion that the terms and conditions of loansgranted by the Company to 2 parties covered in the register maintained under Section 189of the Act (total loan amount granted during the year Rs. 110240 and balance outstandingas at balance sheet date Rs. 53846311) are prejudicial to the Company's interest onaccount of the fact that the Company is not charging any interest on such loans.

(b) The schedule of repayment of principal and payment of interest in respect of suchloans has not been stipulated and thus we are unable to comment whether the repayments orreceipts are regular and report amounts overdue for more than ninety days if any asrequired under paragraph 3(iii)(c) of the Order.

(c) In respect of the aforesaid loans as the schedule of repayment of principal hasnot been stipulated we are unable to comment whether there is any overdue amount of loansgranted to company and other parties listed in the register maintained under Section 189of the Act.

(iv) According to the information and explanation given to us in respect of loansinvestments guarantees and securities the Company has complied with the provisions ofSection 185 and 186 of the Act except for the details given below:

Nature of non-compliance Name of Company/party Amount granted during the year Balance as at March 31 2016
Loan given at rate of interest lower than prescribed Kestone Asia Hub Pte Ltd. Nil 833500
Career Launcher Education Foundation 110240 53012811

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public within the provisions of Sections 73to 76 of the Act and the rules framed there under.

(vi) We have broadly reviewed the books of account maintained by the Company in respectof services where the maintenance of cost records has been specified by the CentralGovernment under sub-section (1) of Section 148 of the Act and the rules framed thereunder and we are of the opinion that prima facie the prescribed accounts andrecords have been made and maintained. We have not however made a detailed examinationof the records with a view to determine whether they are accurate or complete.

(vii) (a) The Company is generally regular in depositing with appropriate authoritiesundisputed statutory dues including provident fund employees' state insurance incometax sales tax service tax value added tax customs duty excise duty cess and anyother material statutory dues applicable to it however there have been slight delays infew cases. According to the information and explanations given to us undisputed dues inrespect of provident fund employees' state insurance income tax sales tax service taxvalue added tax customs duty excise duty cess and any other material statutory duesapplicable to it which were outstanding at the year-end for a period of more than sixmonths from the date they became payable are as follows:

Name of the statute Nature of the dues Amount ` Period to which the amount relates Due Date Date of Payment
Income Tax Act 1961 Advance Tax 3432887 April 1 2016 to June 30 2016 June 15 2016 Not yet paid
Income Tax Act 1961 Advance Tax 6865773 July 1 2016 to September 30 2016 September 15 2016 Not yet paid

(b) According to the information and explanation given to us the dues outstanding withrespect to income tax sales tax service tax value added tax customs duty excise dutyon account of any dispute are as follows:

Name of the statute Nature of dues Amount Disputed Rs. Amount paid under protest Period to which the amount re- lates Forum where dispute is pending
Finance Act 1994 Service Tax 16635768 - October 2010 to September 2011 Commissioner of Service Tax (Appeals) New Delhi
Finance Act 1994 Service Tax 12553238 - October 2011 to June 2012 Commissioner of Service Tax (Appeals) New Delhi
Finance Act 1994 Cenvat credit reversal 4648826 - September 2004 to March 2007 Central Excise and Service Tax Appellate Tribunal New Delhi
Finance Act 1994 Cenvat credit reversal 1569481 - October 2007 to March 2008 Central Excise and Service Tax Appellate Tribunal New Delhi
Finance Act 1994 Cenvat credit reversal 40097178 - April 2008 to March 2012 Central Excise and Service Tax Appellate Tribunal New Delhi
Income Tax Act 1961 Tax deducted at Source 35557912 - FY 2002-03 to FY 2005-06 Income Tax Appellate Tribunal New Delhi
Income Tax Act 1961 Tax deducted at Source 27330519 - FY 2006-07 to 2008-09 Income Tax Appellate Tribunal New Delhi
Income Tax Act 1961 Tax deducted at Source 38064894 - FY 2009-10 Income Tax Appellate Tribunal New Delhi
Income Tax Act 1961 Tax deducted at Source 15716776 - FY 2010-11 Commissioner of Income Tax (Appeals) New Delhi
Income Tax Act 1961 Tax deducted at Source 87668910 - FY 2011-12 Income Tax Appellate Tribunal New Delhi

(viii) According to the information and explanations given to us the Company has notdefaulted in repayment of loans or borrowings to financial institution and banks. Thereare no debenture holders.

(ix) The Company has made an initial public offer during the year. As explained in Noteno. 47 of financial statements the net proceeds in respect of shares issued in initialpublic offer were received on March 31 2017. In our opinion and according to theinformation and explanations given to us the Company has utilized the money raised by wayof initial public issue offer during the year for the purposes for which they were raisedand the details of utilised/unutilised amount are as under:

Objects Amount (Rs.) Utilised Till March 31 2017 Remarks
Repayment of loan taken by CLIP (step down subsidiary) from HDFC Bank Limited 186040723 186040723 -
Meeting the working capital requirements of CL Educate and its subsidiaries namely Kestone Integrated Marketing Services Private Limited and GK Publications Private Limited 525000000 Nil The Company expects to utilize remaining funds in Financial Year 2017-18. Pending utilization the amounts is presently lying in the current account of the Company.
Funding Acquisitions and other strategic Initiatives 200000000 Nil Do
General Corporate purposes 108571671 Nil Do

Further in our opinion and according to the information and explanations given to usthe Company has utilized the term loans for the purposes for which they were obtained.

(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of fraud by the Company or any fraud on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such instance by themanagement.

(xi) According to the information and explanations given to us managerial remunerationhas been paid/provided in accordance with the requisite approvals mandated by theprovisions of Section 197 read with Schedule V to the Act. (xii) In our opinion andaccording to the information and explanations given to us the Company is not a NidhiCompany. Accordingly paragraph 3(xii) of the Order is not applicable to the Company.

(xiii) According to the information and explanation given to us all transactionsentered into by the Company with the related parties are in compliance with Sections 177and 188 of Act where applicable and the details have been disclosed in the FinancialStatements etc. as required by the applicable accounting standards.

(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review. Thereforeparagraph 3(xiv) of the Order is not applicable to the Company.

(xv) 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. (xvi)According to the information and explanation given to us the Company is not required to beregistered under Section 45-IA of the Reserve Bank of India Act 1934.

For Haribhakti & Co. LLP

Chartered Accountants

ICAI Firm Registration No.:103523W/W100048

sd/-

Raj Kumar Agarwal

Partner

Membership No.:074715

Place: New Delhi

Date : May 29 2017

ANNEXURE 2 TO THE INDEPENDENT AUDITOR'S REPORT

[Referred to in paragraph 2 under ‘Report on Other Legal and RegulatoryRequirements' in the Independent Auditor's Report of even date to the members of CLEducate Limited on the financial statements for the year ended March 31 2017]

Report on the Internal Financial Controls over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We were engaged to audit the internal financial controls over financial reporting of CLEducate Limited ("the Company") as of March 31 2017 in conjunction with ouraudit 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 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 ("ICAI"). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.

Auditors' 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 specified under section143(10) of the Act to the extent applicable to an audit of internal financial controlsboth issued by the ICAI. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls over financial reporting was established andmaintained and if such controls operated 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 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 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.

Qualified opinion

According to the information and explanations given to us and based on our audit thefollowing material weakness has been identified in the operating effectiveness of theCompany's internal financial controls over financial reporting as at March 31 2017:

The procurement policy implemented for purchase of goods and services was not operatingeffectively which could potentially result in the Company procuring unnecessary goods andservices or procuring goods of lower quality or procure goods and services at higherprices.

A ‘material weakness' is a deficiency or a combination of deficiencies ininternal financial control over financial reporting such that there is a reasonablepossibility that a material misstatement of the company's annual or interim financialstatements will not be prevented or detected on a timely basis.

In our opinion the Company has in all material respects maintained adequate internalfinancial controls over financial reporting as of March 31 2017 based on the internalcontrol over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting issued by the ICAI and except for thepossible effects of the material weakness described above on the achievement of theobjectives of the control criteria the Company's internal financial controls overfinancial reporting were operating effectively as of March 31 2017.

We have considered the material weakness identified and reported above in determiningthe nature timing and extent of audit tests applied in our audit of the March 31 2017financial statements of the Company and the material weakness does not affect our opinionon the financial statements of the Company.

For Haribhakti & Co. LLP Chartered Accountants

ICAI Firm Registration No.:103523W/W100048

sd/-Raj Kumar Agarwal

Partner

Membership No.:074715

Place: New Delhi

Date : May 29 2017