The Members of
Diana Tea Company Limited
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of Diana TeaCompany Limited (the Company') which comprise the Balance Sheet as at 31stMarch 2017 the Statement of Profit and Loss and the Cash Flow Statement for the yearthen ended and a summary of the significant accoun ng policies and other explanatoryinforma on.
Management's Responsibility for the Standalone Financial Statements
The Company's Board of Directors is responsible for the ma ers stated in Sec on 134(5)of the Companies Act 2013 ("the Act") with respect to the prepara on andpresenta on of these standalone financial statements that give a true and fair view of thefinancial posi on financial performance and cash flows of the Company in accordance withthe accoun ng principles generally accepted in India including the Accoun ng Standardsspecified under Sec on 133 of the Act read with Rule 7 of the Companies (Accounts) Rules2014. This responsibility also includes maintenance of adequate accoun ng records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preven ng and detec ng frauds and other irregularites; selec on and applica on ofappropriate accoun ng policies; making judgments and es mates that are reasonable andprudent; and design implementa on and maintenance of adequate internal financialcontrols that were opera ng e ec vely for ensuring the accuracy and completeness of theaccoun ng records relevant to the prepara on and presenta on of the financial statementsthat give a true and fair view and are free from material misstatement whether due tofraud or error.
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 accoun ng and audi ngstandards and ma ers which are required to be included in the audit report under theprovisions of the Act and the Rules made there under. We conducted our audit in accordancewith the Standards on Audi ng specified under Sec on 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the financial statements are free from materialmisstatement. An audit involves performing procedures to obtain audit evidence about theamounts and the disclosures in the financial statements. The procedures selected depend onthe auditor's judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal financial control relevant to the Company's prepara on ofthe financial statements that give a true and fair view in order to design auditprocedures that are appropriate in the circumstances. An audit also includes evalua ng theappropriateness of the accoun ng policies used and the reasonableness of the accoun ng esmates made by the Company's Directors as well as evalua ng the overall presenta on of thefinancial statements. We believe that the audit evidence we have obtained is su cient andappropriate to provide a basis for our audit opinion on the standalone financialstatements.
In our opinion and to the best of our informa on and according to the explana ons givento us the aforesaid standalone financial statements give the informa on required by theAct in the manner so required and give a true and fair view in conformity with the accounng principles generally accepted in India of the state of a airs of the Company as at31st March 2017 and its profit and its cash flows for the year ended on that date.
Emphasis of Ma er
We draw a en on to following:
a) The Company has not made provision for part of gratuity liability as peractuarial valua on as per Accoun ng Standard 15-Employee Benefits.
b) The loans and advances include amounts receivable from three par es standingsince long in respect of which no confirma on/acknowledgement schedule of delivery andagreement was available and no provision has been made in the books for such loans andadvances. However as per informa on and explana on given to us the Company has ini atedprocess of recovery of the same and as per management no provision for such advances isrequired to be made in the current year ended 31st March 2017.
c) The Company has made long term investments in shares of various companies. Thesaid investments continue to be valued at cost. The market value of said investment arelower than cost however the Company has not made diminu on in value of its investments asrequired under Accoun ng Standard 13 -Accoun ng for Investments as it considers suchinvestment was as long term investment and in view of the management such diminu on aretemporary in nature. Accordingly impact if any on the financial statements is currentlynot ascertainable. Our Opinion is not modified in respect of these ma ers
Report on Other Legal and Regulatory Requirements
As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-sec on (11) of sec on 143 of theAct we give in the Annexure A a statement on the ma ers specified in paragraphs 3 and 4of the Order. As required by Sec on 143 (3) of the Act we report that: a. we have soughtand obtained all the informa on and explana ons which to the best of our knowledge andbelief were necessary for the purposes of our audit; b. in our opinion proper books ofaccount as required by law have been kept by the Company so far as it appears from ourexamina on of those books ; c. the Balance Sheet the statement of profit and loss andthe cash flow statement dealt with by this Report are in agreement with the books ofaccount; d. in our opinion the aforesaid standalone financial statements comply with theAccoun ng Standards specified under Sec on 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014; e. The ma er described in Emphasis of Ma ers paragraphabove in our opinion may not have an adverse e ect on the func oning of the Company; f.on the basis of the wri en representa ons received from the directors as on 31st March2017 taken on record by the Board of Directors none of the directors is disqualified ason 31st March 2017 from being appointed as a director in terms of Sec on 164 (2) of theAct; g. with respect to the adequacy of the internal financial controls over financialrepor ng of the Company and the opera ng e ec veness of such controls refer to ourseparate report in "Annexure B"; and h. with respect to the other ma ers to beincluded in the Auditors' Report in accordance with Rule 11 of the Companies (Audit andAuditors) Rules 2014 in our opinion and to the best of our informa on and according tothe explana ons given to us:
i. The Company has disclosed the impact of pending li ga ons on its financial posi onin its financial statements as stated in Note no 26 (i) to the financial statements;
ii. The Company did not have any long-term contracts including deriva ve contracts forwhich there were any material foreseeable losses;
iii. There has been no delay in transferring amounts required to be transferred tothe Investor Educa on and Protec on Fund by the Company; and
iv. The Company has provided requisite disclosures in its financial statements as toholdings as well as dealings in Specified Bank Notes during the period from 8th November2016 to 30th December 2016 and these are in accordance with the books of accountsmaintained by the Company. Refer Note no 26(xii) to the financial statements.
Annexure A to the Independent Auditors' Report
The Annexure referred to Independent Auditors' Report to the members of the Company onthe standalone fi nancial statements for the year ended 31st March 2017 we report that:
(i) (a) The Company has maintained proper records showing full par culars includingquan ta ve details and situa on of the fixed assets;
(b) the fi xed assets were physically verifi ed during the year under audit by theManagement in accordance with a regular programme of verifi ca on which in our opinionprovides for physical verifi ca on of all the fi xed assets at reasonable intervals.According to the informa on and explana on given to us no material discrepancies were noced on such verifi ca on;
(c) as per informa on and explana on given to us by the management and the recordsverifi ed by us and based on the examina on of the registered sale deed provided to us wereport that all the immovable proper es are held in the name of the Company.
(ii) In our opinion the inventories were physically verifi ed during the year by theManagement at reasonable intervals and as explained to us no material discrepancies wereno ced on physical verifi ca on.
(iii) According to the informa on and explana ons given to us and on the basis of ourexamina on of the books of account the Company has not granted any loans secured orunsecured to companies fi rms limited liability partnerships or other par es covered inthe register maintained under sec on 189 of the Companies Act 2013. Consequently theprovisions of paragraph iii(a)(b) and (c) of the Order are not applicable to the Companyand hence not commented upon.
(iv) In our opinion and according to informa on and explana ons given to us theCompany has not given any loans or made investments guarantees and security hence theprovision of this paragraph is not applicable to the Company.
(v) The Company has not accepted any deposit from the public covered under Sec on 73 to76 of the Companies Act 2013. Therefore the provisions of paragraph 3(v) of the Orderare not applicable to the Company.
(vi) The maintenance of cost records has been specifi ed by the Central Governmentunder sec on 148(1) of the Act. We have broadly reviewed the cost records maintained bythe Company pursuant to the Companies (Cost Records and Audit) Rules 2014 prescribed bythe Central Government under Sec on 148(1)(d) of the Act and are of opinion that primafacie the prescribed cost records have been maintained. We have however not madea detailed examina on of cost records with a view to determine whether they are accurateor not.
(vii) (a) According to the records of the Company undisputed statutory dues includingProvident Fund Income Tax Sales Tax Service Tax Value Added Tax cess or othermaterial statutory dues have been generally regularly deposited during the year by theCompany with appropriate authori es. According to the informa on and explana on given tous no undisputed statutory dues including Provident Fund Income Tax Service Tax ValueAdded Tax cess or other material statutory dues were in arrears as at 31st March 2017 fora period of more than six months from the date they become payable except Income taxpayable amoun ng to Rs.1.20 lakhs rela ng to AY 2011-12.
(b) According to the informa on and explana on given to us the following dues not beendeposited by the Company on account of dispute as at 31st March 2017 :
|Name of the Statute ||Nature of dues ||Amount (in Rs Lakhs) ||Period to which the amount relates ||Forum where dispute is pending |
|West Bengal Value Added Tax Act 2003 ||Sales Tax ||12.31 ||FY 2010-2011 ||Senior Joint Commissioner of Commercial Taxes Chowringhee Circle Kolkata |
|Central Sales Tax Act 1956 ||CST ||15.28 ||FY 2010-2011 ||Senior Joint Commissioner of Commercial Taxes Chowringhee Circle Kolkata |
|Income Tax Act 1961 ||Income Tax ||0.59 ||AY 2007-2008 ||Deputy Commissioner of Income Tax |
(viii) In our opinion and according to the informa on given to us the Company has notdefaulted in repayment of dues to banks. There were no debentures outstanding during theyear.
(ix) According to informa on and explana on given to us the Company has not raisedmoneys by way of ini al public o er or further public o er (including debt instruments)and term loans during the year ended 31st March 2017. Accordingly paragraph 3(ix) of theOrder is not applicable.
(x) Based on the audit procedures performed and the informa on and explana ons given tous we report that no fraud on or by the Company has been no ced or reported during theyear ended 31st March 2017 nor have we been informed of such case by the management.
(xi) According to informa on and explana on given to us the Company has paid orprovided managerial remunera on in accordance with the provisions of sec on 197 read withSchedule V to the Act.
(xii) In our opinion and according to the informa on and explana on given to us theCompany is not a Nidhi Company and hence the paragraph 3(xii) is not applicable.
(xiii) In our opinion and on the basis of informa on and explana on given to us by themanagement all transactions with the related par es are in compliance with sec ons 177and 188 of Companies Act 2013 where applicable and the details have been disclosed in theFinancial Statements etc. as required by the applicable accoun ng standards.
(xiv) According to informa on and explana on given to us the Company has not made anypreferen al allotment or private placement of shares or fully or partly conver bledebentures during the year under review.
(xv) According to informa on and explana on given to us the Company has not enteredinto any non-cash transactions with directors or persons connected with him. Accordinglythe paragraph 3(xv) is not applicable to the Company.
(xvi) In our opinion and on the basis of informa on and explana on given to us by themanagement the Company is not required to be registered under sec on 45-IA of the ReserveBank of India Act 1934.
Annexure B to the Independent Auditors' Report
Report on the Internal Financial Controls under Clause (i) of Sub-sec on 3 of Sec on143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of DianaTea Company Limited ("the Company") as of 31st March 2017 in conjunc onwith our audit of the standalone financial statements of the Company for the year ended onthat 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 essen al components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Ins tute of Chartered Accountants of India (ICAI'). These responsibilies include the design implementa on and maintenance of adequate internal financialcontrols that were opera ng e ec vely for ensuring the orderly and e cient conduct of itsbusiness including adherence to Company's policies the safeguarding of its assets thepreven on and detec on of frauds and errors the accuracy and completeness of the accounng records and the mely prepara on of reliable financial informa on 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") and the Standards on Audi ng issued by ICAI and deemed tobe prescribed under sec on 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Ins tute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated e ec vely 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 opera ng e ecveness. 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 tes ng and evalua ng the designand opera ng e ec veness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment 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 su cient 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 theprepara on of financial statements for external purposes in accordance with generallyaccepted accoun ng 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 anddisposi ons of the assets of the Company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit prepara on of financial statements inaccordance with generally accepted accoun ng principles and that receipts andexpenditures of the Company are being made only in accordance with authorisa ons ofmanagement and directors of the Company; and (3) provide reasonable assurance regardingpreven on or mely detec on of unauthorised acquisi on use or disposi on of the Company'sassets that could have a material e ect on the financial statements.
Inherent Limita ons of Internal Financial Controls Over Financial Reporting
Because of the inherent limita ons 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 projec ons of any evalua on 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 condi ons 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 controlsover financial reporting were opera ng e ec vely as at 31st March 2017 based on theinternal control over financial reporting criteria established by the Company consideringthe essen al components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting issued by the Ins tute of CharteredAccountants of India.
| ||For DAS & PRASAD |
| ||Chartered Accountants |
| ||Firm Registra on No. 303054E |
| ||Sd/- |
|4 Chowringhee Lane ||A. K. Agarwal |
|Kolkata - 700 016 ||Partner |
|Date : 17th May 2017 ||Membership No. 062368 |