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Future Enterprises Ltd.

BSE: 523574 Sector: Industrials
NSE: FEL ISIN Code: INE623B01027
BSE LIVE 19:47 | 19 Oct 49.80 0.75
(1.53%)
OPEN

50.60

HIGH

50.75

LOW

49.20

NSE 19:31 | 19 Oct 49.60 0.50
(1.02%)
OPEN

50.40

HIGH

50.60

LOW

49.10

OPEN 50.60
PREVIOUS CLOSE 49.05
VOLUME 44990
52-Week high 62.05
52-Week low 14.20
P/E
Mkt Cap.(Rs cr) 2,341
Buy Price 49.80
Buy Qty 100.00
Sell Price 0.00
Sell Qty 0.00
OPEN 50.60
CLOSE 49.05
VOLUME 44990
52-Week high 62.05
52-Week low 14.20
P/E
Mkt Cap.(Rs cr) 2,341
Buy Price 49.80
Buy Qty 100.00
Sell Price 0.00
Sell Qty 0.00

Future Enterprises Ltd. (FEL) - Auditors Report

Company auditors report

To

The Members of FUTURE ENTERPRISES LIMITED (formerly known as Future RetailLimited)

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS Financial Statements of FUTUREENTERPRISES LIMITED ("the Company") which comprise the Balance Sheet as atMarch 31 2017 the Statement of Profit and Loss (including other comprehensive income)the Cash Flow Statement and the statement of Changes in Equity for the year then ended anda summary of significant accounting policies and other explanatory information(hereinafter referred to as "Ind 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 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 Accounting Standards specified under Section133 of the Companies Act 2013 read with relevant rules issued thereunder. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial control that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone Ind AS FinancialStatements that give a true and fair view and are free from material misstatement whetherdue 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 theprovision of the Act and the Rules made thereunder. We conducted our audit in accordancewith the 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 anddisclosures in the standalone Ind AS Financial Statements. The procedures selected dependon the auditor's judgement including the assessment of the risks of material misstatementof the standalone Ind AS Financial Statements whether due to fraud or error. In makingthose risk assessments the auditor considers internal financial control relevant to theCompany's preparation of the standalone Ind AS Financial Statements that give a true andfair view in order to design audit procedures that are appropriate in the circumstances.An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by the Company Directors as well asevaluating the overall presentation of the standalone Ind AS Financial Statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on Financial Statements.

Opinion

In our opinion and to the best of information and according to the explanation given tous the aforesaid standalone Ind AS Financial Statements give the information required bythe Act in the manner so required and give true and fair view in conformity with theaccounting principles generally accepted in India including the Ind AS of the state ofaffairs of Company as at March 31 2017 its profit and its cash flow and the changes inequity 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 ofthe Act we give in the "Annexure A" statement on the matters specified in theparagraph 3 and 4 of the Order.

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 purpose of our audit;

b. In our opinion proper books of account as required by law have been kept by theCompany so far as appears from our examination of those books;

c. The Balance Sheetthe Statement of Profit and Loss and the Cash Flow Statement andthe statement of Changes in Equity dealt with by this Report are in agreement with thebooks of account;

d. In our opinion the aforesaid standalone Ind AS Financial Statements comply with theAccounting Standards specified under Section 133 of the Act read with relevant rulesthereunder;

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) ofthe Act;

f. With respect to the adequacy of internal financial controls over financial reportingof the Company and the operating effectiveness of such control refer to our separatereport in "Annexure B"; and 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 theexplanation given to us:

i. The Company has disclose the impact of pending litigation on its financial positionin its standalone Ind AS Financial Statements. Refer Note 41 to the standalone Ind ASFinancial Statement;

ii. The Company did not have any long term contracts including derivative contract forwhich there were any material foreseeable losses;

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company; and

iv. The Company has provided requisite disclosures in its standalone Ind AS FinancialStatements as to holdings as well as dealings in specified Bank Notes during the periodfrom November 8 2016 to December 30 2016 and these are in accordance with the books ofaccount maintained by the Company. Based on audit procedure and reliance on managementrepresentation we report that the disclosures are in accordance with books of accountsand other records maintained by the Company and as produced to us by the management of theCompany. Refer Note 47 to the standalone Ind AS Financial Statements.

For NGS & CO. LLP
Chartered Accountants
Firm Registration No. : 119850W
Ashok A. Trivedi
Place: Mumbai Partner
Date : May 19 2017 Membership No. 042472

Annexure - A to the Auditors' Report

The Annexure referred to in Independent Auditors' Report to the members of the FUTUREENTERPRISES LIMITED on the standalone Ind AS Financial Statements for the yearended March 31 2017 we report that:

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets bywhich fixed assets are verified in a phased manner over a period of three years. Inaccordance with this programme certain fixed assets were verified during the year and nomaterial discrepancies were noticed on such verification. In our opinion this periodicityof physical verification is reasonable having regard to the size of the Company and thenature of its assets. (c) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the title deeds of immovableproperties are held in the name of the Company.

(ii) (a) As explained to us management has conducted physical verification ofinventory at regular intervals during the year.

(b) In our opinion and according to the information and explanations given to us theprocedures of physical verification of inventory followed by the Management werereasonable and adequate in relation to the size of the Company and nature of its business.

(c) In our opinion and according to the information and explanations given to us theCompany has maintained proper records of its inventories and no material discrepancieswere noticed on physical verification.

(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under Section 189 of theCompanies Act 2013. Therefore paragraph 3(iii) of the Order is not applicable.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 185 and 186 of the Act with respectto the loans and investments made.

(v) The Company has not accepted any deposits from the public.

(vi) To the best of our knowledge and as explained the Central Government has notprescribed the maintenance of cost records under Section 148(1) of the Companies Act2013 for any of the products of the Company.

(vii) (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted/ accrued in the books ofaccount in respect of undisputed statutory dues including Provident Fund Employees'State Insurance Custom duty Income tax Sales tax Service tax Value Added Tax cessand other material statutory dues as applicable have been regularly deposited during theyear by the Company with the appropriate authorities. According to the information andexplanations given to us no undisputed amounts payable in respect of income tax servicetax cess and other material statutory dues were in arrears as at March 31 2017 for aperiod of more than six months from the date they became payable.

(b) According to the information and explanations given to us the following dues ofincome tax have not been deposited with the appropriate authorities on account of dispute.

Name of the Statute Nature of the dues Amount (Rs. in Crore) Period to which the amount relates Forum where dispute is pending
The Income Tax Act 1961 Income Tax 4.11 AY:2004-05; 2008-09; 2010-11; 2011-12 Commissioner of Income Tax (Appeal); Income Tax Appellate Tribunal

(viii) Based on our audit procedures and on the basis of information and explanationsgiven by the management we are of the opinion that the Company has not defaulted inrepayment of loans or borrowings from banks and debenture holders. The Company has nottaken any loans from Government or any Financial Institution.

(ix) Based on audit procedure and on the basis of information and explanation given bythe management we are of the opinion that money raised by Company by way of term loanhave been applied for the purpose for which they were raised. The Company did not raisedany money by way of Initial Public offer or further public offer.

(x) To the best of our knowledge and belief and according to the information andexplanations given to us no fraud by the Company was noticed or reported during the yearalthough there were some instances of fraud on the Company noticed by the Management theamounts whereof were not material in the context of the size of the Company and the natureof its business and the amounts were adequately provided for.

(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 provision of Section 197 read with ScheduleV to the Act.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a nidhi company. Therefore paragraph 3(xii) of the Order is notapplicable.

(xiii) According to the information and explanations give 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 and based on ourexamination of the records of the Company the Company has not made any private placementof optionally convertible debentures during the year.

(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Therefore paragraph 3(xv) ofthe Order is not applicable.

(xvi) The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.

For NGS & CO. LLP
Chartered Accountants
Firm Registration No. : 119850W
Ashok A. Trivedi
Place: Mumbai Partner
Date : May 19 2017 Membership No. 042472

Annexure - B to the Auditors' Report

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 FUTUREENTERPRISES LIMITED (Formerly known as FUTURE RETAIL LIMITED) ("theCompany") as of March 31 2017 in conjunction with our audit of the standalone Ind ASFinancial 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 issued by ICAI and deemedto be prescribed under Section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of Internal Financial Controls and both issued by the Institute ofChartered Accountants of India. Those Standards and the Guidance Note require that wecomply 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 theadequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgment including the assessment of therisks of material 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 controlsover 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 on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For NGS & CO. LLP
Chartered Accountants
Firm Registration No. : 119850W
Ashok A. Trivedi
Place: Mumbai Partner
Date : May 19 2017 Membership No. 042472