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Galada Power & Telecommunication Ltd.

BSE: 504697 Sector: Metals & Mining
NSE: GALPOWTEL ISIN Code: INE255C01018
BSE LIVE 12:53 | 15 Dec 7.32 -0.38
(-4.94%)
OPEN

7.32

HIGH

7.32

LOW

7.32

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 7.32
PREVIOUS CLOSE 7.70
VOLUME 700
52-Week high 11.40
52-Week low 6.55
P/E
Mkt Cap.(Rs cr) 5
Buy Price 0.00
Buy Qty 0.00
Sell Price 7.32
Sell Qty 12909.00
OPEN 7.32
CLOSE 7.70
VOLUME 700
52-Week high 11.40
52-Week low 6.55
P/E
Mkt Cap.(Rs cr) 5
Buy Price 0.00
Buy Qty 0.00
Sell Price 7.32
Sell Qty 12909.00

Galada Power & Telecommunication Ltd. (GALPOWTEL) - Auditors Report

Company auditors report

INDEPENDENT AUDITOR'S REPORT

TO THE MEMBERS OF GALADA POWER AND TELECOMMUNICATION LIMITED HYDERABAD.

Report on theFinancial Statements:

We have audited the accompanying financial statements of GALADA POWER ANDTELECOMMUNICATION LIMITED ("the Company") which comprise the Balance Sheet asat 31st March 2016 the Statement of Profit and Loss the Cash Flow Statement for theyear then ended and a summary of the significant accounting policies and otherexplanatory information.

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 financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of 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 controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

Auditor's Responsibility:

Our responsibility is to express an opinion on these financial statements based on ouraudit. 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 there under.

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 financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances.

An audit also includes evaluating the appropriateness of the accounting policies usedand the reasonableness of the accounting estimates made by the Company's Directors aswell as evaluating the overall presentation of the financial statements.

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

Opinion:

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31stMarch 2016 and its Profit and its cash flows for the year ended on that date.

Emphasis of Matter:

We draw attention to the following matters in the Notes to the financial statements:

a. Note 1 to the financial statements regarding the preparation of the financialstatements on a going concern basis despite substantial erosion of the net worth lowercash inflows from the existing business activities and Continuous default in payment ofdues to banks / financial institutions and the legal proceedings initiated by the Bankersof the Company for the recovery of the debts.

b. Note 33 to the financial statements regarding the appointment and payment ofManagerial Remuneration.

c. Note 34 to the financial statements regarding the non-provision of interest onworking Capital Loan.

d. Note 35 to the financial statements on noncompliance with the provisions ofSec-205-A (1) of the Companies Act 1956 regarding transfer of unpaid dividend to aspecial Bank Account.

Our opinion is not qualified in respect of these matters.

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-section (11) of section 143 ofthe Act we give in the Annexure A a statement on the matters specified in paragraphs 3and 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 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 financial statements comply with the AccountingStandards specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014.'

(e) On the basis of the written representations received from the directors as on 31stMarch 2016 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2016 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 B".

(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 financial statements - Refer Note 45 to the financial statements

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

iii. According to the information and explanations given to us there were no amountswhich were required to be transferred to the Investor Education and Protection Fund by theCompany (refer note 35 to the financial Statements)

for BRAHMAYYA & CO;
Chartered Accountants
Firm's Registration Number: 000513S
(P. CHANDRAMOULI)
Place : Hyderabad Partner
Date : 26.05.2016 Membership Number: 025211

Annexure -A to the Auditor's Report:

The Annexure referred to in Para 1 under the heading of "Report on Other Legal andRegulatory Requirements" of our report of even date to the members of GALADAPOWER AND TELECOMMUNICATION LIMITED HYDERABAD for the year ended March 312016.

1. a- The Company has maintained proper records showing full particularsincluding quantitative

details and situation of fixed assets.

b. As explained to us the management has physically verified the fixed assets duringthe year and there is a regular program of physical verification which in our opinion isreasonable having regard to the size of the Company and the nature of the assets. Nodiscrepancies were noticed on such verification.

c- According to the information and explanations given to us and on the basis ofour examination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.

2. The inventory has been physically verified during the year by the management. In ouropinion the frequency of verification is reasonable. No material discrepancies werenoticed on such verification between the physical stocks and book records.

3. a. During the year the Company has not granted any loans secured or unsecured toCompanies

firms limited liability partnerships or other parties covered in the registermaintained under Section 189 of the Companies Act 2013.

b. In view of our comment in para (a) above Clause (III) (a) (b) and (c) of paragraph3 of the Companies (Auditor's Report) Order 2016 are not applicable to the Company.

4. In our opinion and according to the information and explanations given to us theCompany has not advanced any loan to any Director and no investments were made during theyear as referred to in sections 185 and 186 of the Act. Therefore the provisions ofParagraph 3(iv)of the of the Companies (Auditor's Report) Order 2016 are not applicable tothe Company.

5. The Company has not accepted any deposits from the public. Hence the provisions ofSections 73 to 76 or any other relevant provisions of the Companies Act 2013 and therules framed there under do not apply to this Company.

6. As the overall turnover of the Company for the year from all its products andservices is less than Rs. 35 Crores the provisions relating to maintenance of costrecords under sub-section (1) of 148 section of the Companies Act 2013 are not applicableto the Company.

7. a. According to the records the company is generally regular in depositingundisputed statutory dues including provident fund employees' state insuranceincome-tax sales-tax service tax duty of customs duty of excise value added tax cessand all other material statutory dues with the appropriate authorities. However theextent of the arrears of outstanding statutory dues as at March 31 2016 for a period ofmore than six months from the date they became payable are as follows.

Nature of Statute Nature of the Dues Amount Rs. Period to which the amount relates Due date Date of payment
The Companies Act 1956 Investor Education and Protection Fund # 11556699 1996 30.12.2003 Not yet paid
IFST Loan 311190 1988 25.07.1997 Not yet paid
APGST Act Differed Sales Tax 6710843 1996 01.04.2001
Sales tax 225000 2000 01.08.2001
Customs Act 1942 Duty on Imports 3002346 Not yet paid

# refer note 35 to the financial Statements

b. According to the records of the Company and the information and explanations givento us there were no dues of income tax or sales tax or service tax or duty of customs orduty of excise or value added tax have not been deposited on account of any dispute.

8. In our opinion the company has defaulted in repayment of loans to financialinstitutions and banks. The details of such defaults are

i) Working Capital loan from Syndicate Bank Rs. 264135400/- long Overdue

ii) Stressed Assets Stabilisation Fund - Principal amount of default Rs.95494000/-Period of default - repayable in monthly installments of Rs.50.26 lakhs eachcommencing from September 12014 to March 12016.

9. The Company did not raise any money by way of initial public offer or further publicoffer (including debt instruments) and term loans during the year. Accordingly paragraph3 (ix) of the Companies (Auditor's Report) Order 2016 is not applicable.

10. According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.

11. According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided for remunerationto the Managing Director with effect from 01.01.2015 amounting to Rs. 1342147/- which issubject to the approval of the Central Government as the company has defaulted inrepayment of its debts in the preceding financial year before the date of suchappointment. As such the payment of remuneration is not in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the Act andthe Company has not taken any steps for securing refund of the same.

12. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly paragraph 3(xii) of the Companies (Auditor'sReport) Order 2016 is not applicable

13. 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.

14. According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year.

15. 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. Accordingly paragraph 3(xv) ofthe Companies (Auditor's Report) Order 2016 is not applicable.

16. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

for BRAHMAYYA & CO;
Chartered Accountants
Firm's Registration Number: 000513S
(P. CHANDRAMOULI)
Place : Hyderabad Partner
Date : 26.05.2016 Membership Number: 025211

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 GALADAPOWER AND TELECOMMUNICATION LIMITEDHYDERABAD ("the Company") as of 31 March2016 in conjunction with our audit of the financial statements of the Company for the yearended 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'). 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 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 to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute 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 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 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 sufficient and appropriate toprovide a basis for our audit opinion.

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 of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

2. provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and

3. provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial 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 31 March 2016 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 BRAHMAYYA & CO;
Chartered Accountants
Firm's Registration Number: 000513S
(P. CHANDRAMOULI)
Place : Hyderabad Partner
Date : 26.05.2016 Membership Number: 025211