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Essar Ports Ltd.

BSE: 500630 Sector: Infrastructure
NSE: ESSARPORTS ISIN Code: INE282A01024
BSE 00:00 | 04 Mar Essar Ports Ltd
NSE 05:30 | 01 Jan Essar Ports Ltd
OPEN 138.00
PREVIOUS CLOSE 124.30
VOLUME 700113
52-Week high 140.50
52-Week low 0.00
P/E
Mkt Cap.(Rs cr) 5,323
Buy Price 0.00
Buy Qty 0.00
Sell Price 124.30
Sell Qty 33.00
OPEN 138.00
CLOSE 124.30
VOLUME 700113
52-Week high 140.50
52-Week low 0.00
P/E
Mkt Cap.(Rs cr) 5,323
Buy Price 0.00
Buy Qty 0.00
Sell Price 124.30
Sell Qty 33.00

Essar Ports Ltd. (ESSARPORTS) - Auditors Report

Company auditors report

INDEPENDENT AUDITOR'S REPORT

TO THE MEMBERS OF ESSAR PORTS LIMITED Report on the Standalone Ind AS FinancialStatements

We have audited the accompanying standalone Ind AS financial statements of EssarPorts Limited ("the Company") which comprise the Balance Sheet as at 31stMarch 2017 the Statement of Profit and Loss (including Other Comprehensive Income) the

Statement of Cash Flow and the Statement of Changes in Equity for the year then endedand a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Ind AS 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 Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) prescribedunder Section 133 of the Act read with Companies (Indian Accounting Standards) Rules2015 as amended.

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 standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based 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 of the standalone Ind AS financial statements in accordance withthe Standards on Auditing specified under Section 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 standalone Ind AS financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the standalone Ind AS 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 the Company'sDirectors as well as evaluating the overall presentation of the standalone Ind ASfinancial statements. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion on the standalone Ind ASfinancial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of affairs(financial position) of the Company as at 31st March 2017 and its loss (financialperformance including other comprehensive income) its cash flows and the changes inequity for the year ended on that date.

Emphasis of Matter

We draw attention to Note 44 of standalone Ind AS financial statements regardingreduction in share capital and transfer of investments in certain subsidiaries andrelated assets and liabilities at their respective carrying values as on 30 June 2016 and1 July 2016 (appointed dates) pursuant to a Composite Scheme of Arrangement which becameeffective on 26th August 2016.

Our opinion is not modified in respect of this matter.

Other Matters a) The Indian GAAP financial statements of the Company for the yearended 31st March 2016 were audited by another auditor whose report dated November 252016 expressed an unmodified opinion on those statements. b) The comparative financialinformation of the Company for the year ended 31st March 2016 and the transition dateopening balance sheet as at 1st April 2015 included in these

Ind AS financial statements are based on the previously issued statutory financialstatements prepared in accordance with the Companies (Accounts) Rules 2014 audited by thepredecessor auditor whose report for the year ended 31st March 2016 dated November 252016 expressed a unmodified opinion and 31st March 2015 dated May 14 2015 respectivelyexpressed an unmodified audit opinion on those financial statements as adjusted for thedifferences in the accounting principles adopted by the Company on transition to the IndAS which have been audited by us.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143 (3) of the Act we report that: (a) We have sought andobtained all the information and explanations 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 ourexamination of those books

(c) The Balance Sheet the Statement of Profit and Loss the

Statement of Cash Flow and the Statement of Changes in Equity dealt with by this Reportare in agreement with the books of account.

(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Accounting Standards specified under Section 133 of the Act read with the

Companies (Indian Accounting Standards) Rules 2015.

(e) On the basis of the written representations received from the directors as on 31stMarch 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31st 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 A' (g) With respect to the other matters to be includedin the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 in our opinion and to the best of our information and according to theexplanations given to us: i. The Company has disclosed the impact of pending litigationson its financial position in its Ind AS financial statements Refer Note 35 to thestandalone Ind AS financial statements. ii. The Company did not have any long-termcontracts including derivative contracts for which there were any material foreseeablelosses. iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company. iv. The Company did not have any holdings ordealings in Specified Bank Notes during the period from 8th November 2016 to 30thDecember 2016 Refer Note 13 to the standalone Ind AS financial statements.

2. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of sub-section 11 of section 143 of the Act wegive in the ‘Annexure B' a statement on the matters specified in paragraphs 3 and 4of the Order.

For MSKA & Associates
(Formerly Known as MZSK & Associates)
Chartered Accountants
Firm Registration No. 105047W
Anita Somani
Place : Mumbai Partner
Date : November 24 2017 Membership No. 124118

ANNEXURE A TO THE INDEPENDENT AUDITOR'S REPORT

OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF ESSAR PORTS 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 EssarPorts Limited ("the Company") as of March 31

2017 in conjunction with our 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 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 Reporting issued by the Institute of Chartered

Accountants of India (ICAI) (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 Act.

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 and the Standards on Auditing as specified under section 143(10) ofthe Act to the extent applicable to an audit of internal financial controls. 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 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 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 system over 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 unauthorized 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.

Opinion

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 operating effectively as at March 31 2017 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note.

For MSKA & Associates
(Formerly Known as MZSK & Associates)
Chartered Accountants
Firm Registration No. 105047W
Anita Somani
Place : Mumbai Partner
Date : November 24 2017 Membership No. 124118

ANNEXURE B TO INDEPENDENT AUDITORS' REPORT

[Referred to in paragraph 2 under ‘Report on Other Legal and RegulatoryRequirements' in the Independent Auditors' Report of even date to the members of EssarPorts Limited on the 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) The fixed assets were physically verified year by the management in accordance witha regular programmers of verification which in our opinion provides for physicalverification of all the fixed assets at reasonable intervals. According to the informationand explanations given to us no material discrepancies were noticed on such verification.

(c) The Company does not have any immovable properties of freehold or leasehold landand building and hence reporting under paragraph 3(i)(c) of the Order is not applicable.

ii. The company does not have any inventory and hence reporting under paragraph 3(ii)of the order is not applicable.

iii. The Company has not granted any loans secured or unsecured to Companies FirmsLimited Liability Partnerships (LLP) or other parties covered in the register maintainedunder section 189 of the Companies Act 2013 (‘the Act'). Accordingly the provisionsstated in paragraph 3 (iii) (a) to (c) of the Order are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us theCompany has not either directly or indirectly granted any loan to any of its directors orto any other person in whom the director is interested in accordance with the provisionsof section 185 of the Act and the Company has not made investments through more than twolayers of investment companies in accordance with the provisions of section 186 of theAct. Accordingly provisions stated in paragraph 3(iv) of the Order are not applicable tothe Company.

v. In our opinion and according to the information and the explanations given to usthe Company has not accepted any deposits from the public within the meaning of Sections73 74 75 and 76 of the Act and the rules framed there under.

vi. The provisions of sub-section (1) of section 148 of the Act are not applicable tothe Company as the Central Government of India has not specified the maintenance of costrecords for any of the products of the Company. Accordingly the provisions stated inparagraph 3 (vi) of the Order are not applicable to the Company.

vii. (a) According to the information and explanations given to us and the records ofthe Company examined by us in our opinion the Company is generally regular in depositingwith appropriate authorities undisputed statutory dues including provident fundsales-tax duty of customs value added tax cess and any other statutory dues applicableto it except income-tax where there were significant delays. As informed to us theprovisions of employees' state insurance and excise duty were not applicable to theCompany during the year.

According to the information and explanations given to us the Company has been regularin depositing undisputed dues in respect of provident fund income-tax sales-tax duty ofcustoms value added tax cess and any other statutory dues except in case of income taxwhich were outstanding as at 31st March 2017 for a period of more than six months fromthe date they became payable are as follows:

Name of the statute Nature of the dues Amount ( Rs. Lakhs) Period to which the amount relates Due Date Date of Payment Remarks
Income Tax Act 1961 Tax Deducted at Source 120.14 April 2016 to August 2016 Various dates Various dates Includes interest amount of Rs. 15.61 lakhs which is still outstanding.

(b) According to the information and explanation given to us and examination of recordsof the Company the outstanding dues of income-tax sales-tax service tax customs dutyexcise duty value added tax cess and any other statutory dues on account of any disputeare as follows:

Name of the statute Nature of dues Amount ( Rs. Lakhs) Period to which the amount relates Forum where dispute is pending
Income Tax Act 1961 Income tax Income tax 91.90 3762.91 AY 12-13 to AY 13-14 AY 10-11 to AY 11-12 Commissioner of Income Tax (Appeal) Income Tax Appellate Tribunal

viii. The Company does not have any loans or borrowings from any financial institutionbanks government or debenture holders during the year. Accordingly the provision statedin paragraph 3(viii) of the Order is not applicable to the Company.

ix. The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loans during the year. Accordingly theprovisions stated in paragraph 3 (ix) of the Order are not applicable to the Company.

x. During the course of our audit 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 material fraud by the Company or on the Company by its officers or employees.

xi. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has paid/ provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.

xii. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi company. Accordingly the provisions stated in paragraph 3(xii) ofthe Order are not applicable to the company.

xiii. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards. xiv. According to the information and explanations given to us andbased on our examination of the records of the Company the Company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the year. Accordingly the provisions stated in paragraph

3 (xiv) of the Order are not applicable to the Company. xv. According to theinformation and explanations given to us and based on our examination of the records ofthe Company the Company has not entered into non-cash transactions with directors orpersons connected with him. Accordingly provisions stated in paragraph 3(xv) of the Orderare not applicable to the Company. xvi. In our opinion the Company is not required to beregistered under section 45 IA of the Reserve Bank of India Act 1934 and accordingly theprovisions stated in paragraph clause 3

(xvi) of the Order are not applicable to the Company.

For MSKA & Associates
(Formerly Known as MZSK & Associates)
Chartered Accountants
Firm Registration No. 105047W
Anita Somani
Place : Mumbai Partner
Date : November 24 2017 Membership No. 124118