INDEPENDENT AUDITORS REPORT
Gowra Leasing and Finance Limited Secunderabad
Report on the Financial Statements
We have audited the accompanying financial statements of Gowra Leasing and FinanceLimited ("the Company") which comprise the Balance Sheet as atMarch 31 2017 and the Statement of Profit and Loss and Cash Flow Statement for the yearthen ended and a summary of significant accounting policies and other explanatoryinformation.
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 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 accounting recordsrelevant to the preparation and presentation of the financial statements that give a trueand fair view and are free from material misstatement whether due to fraud or error.
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 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 financial statements are free from materialmisstatement.
An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders 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 theappropriateness of accounting policies used and the reasonableness of the accountingestimates made by the Company`s Directors as well as evaluating the overall presentationof 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.
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 2017 its profit and its cash flow for the year ended on that date.
Report on Other Legal and Regulatory Requirements
I. 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 and in terms of the information and explanations sought by us and given by thecompany and the books and records examined by us in the normal course of audit and to thebest of our knowledge and belief we state that:
(i) (a) The company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) All the fixed assets have been physically verified by the management during theyear by the management and no material discrepancies were noticed on such verification.
(c) The title deeds of immovable properties are held in the name of the company.
(ii) As the company has neither purchased nor sold goods during the year and there isno opening & closing stock requirement of reporting on physical verification ofstocks or maintenance of inventory records in our opinion does not arise.
(iii) The company has not granted any loans or advances in the nature of loans toparties covered in the register maintained under section 189 of the Act. Thusparagraph3(iii)of the order is not applicable.
(iv) As explained to us the company has not granted any loans investments or givenguarantees/ security hence the question of compliance to the provisions of Sections 185and 186 of the Act as per clause (iv) of the Order does not arise.
(v) According to the information and explanations given to us by the management thecompany has not accepted any deposits from public and the Board of Directors of thecompany has passed a resolution for the non-acceptance of any deposits. The Company hascomplied with the directions issued by the Reserve Bank of India and the provisions ofSections 73 to 76 or any other relevant provisions of the Companies Act 2013 and therules framed there under as per clause (v) of the Order.
(vi) According to the information and explanations provided by the management thecompany is not engaged in production of any such goods or provision of any such servicesfor which the Central Government has prescribed particulars relating to utilisation ofmaterial or labour or other items of cost. Hence the provisions of section 148(1) of theAct do not apply to the company and in our opinion no comment on maintenance of costrecords under section 148(1) of the Act is required to be given.
(vii) (a) According to the records of the Company the company is regular in depositingwith the appropriate authorities undisputed statutory dues including Provident FundEmployees' State Insurance Income Tax Sales Tax Service Tax Duty of Customs
Duty of Excise Value Added Tax Cess and other material statutory dues to the extentapplicable to it.
Further there were no undisputed amounts payable in respect of aforesaid statutoryliabilities which have remained outstanding as at 31st March 2017 for a period of morethan six months from the date they became payable.
(b) According to the information and explanation given to us there were no dues ofIncome tax Sales tax Service Tax Duty of Customs Duty of Excise or Value added taxwhich have not been deposited on account of any dispute.
(viii) According to the information and explanations given to us the company hasneither borrowed any loans from Financial Institutions Bank Government nor issued anydebentures and consequently the question of default in repayment of such loans does notarise.
(ix) According to the information and explanations given to us no money was raised byway of initial public offer or further public offer by the company the company has nottaken any term loans from any banks or financial institutions during the year. Hence thequestion of application of moneys raised by way of initial public offer further publicoffer and term loans for the purpose for which they were raised does not arise.
(x) To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company or on the Company by its officers or employees hasbeen noticed or reported during the year.
(xi) In our opinion the managerial remuneration has been paid or provided in accordancewith requisite approvals mandated by the provisions of Sec 197 read with Schedule V to theCompanies Act.
(xii) The company is not a Nidhi Company. Therefore the provisions of clause (xii) ofthe Order are not applicable to the company.
(xiii) According to information and explanations given to us the company has compliedwith the provisions of Sections 177 and 188 of the Act and the disclosure of suchtransactions in the Financial Statements etc. have been made as required by applicableAccounting Standards in respect of transactions entered into with related parties.
(xiv) As explained to us the company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearhence the requirement of compliance to provisions of Section 42 of the Act and utilisationof amounts so raised for the purpose for which the funds were raised as per clause (xiv)of the Order does not arise.
(xv) The company has not entered into any non-cash transactions with directors orpersons connected with him; hence the requirement of compliance to provisions of Section192 of the Act as per clause (xv) of the Order does not arise.
(xvi) The company being a Non-Banking financial company is registered under Section45-IA of the Reserve Bank of India Act 1934 hence the requirement of clause (xvi) of theOrder is complied with.
II. As required by section 143(3) of the Act we report that:
(i) 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;
(ii) 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;
(iii) The balance sheet statement of profit & loss and cash flow statement dealtwith by this report are in agreement with the books of account;
(iv) 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.
(v) On the basis of written representations received from the directors as on 31stMarch 2017 and 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 termsof Section 164(2) of the Act.
(vi) 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".
(vii) 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 does not have any pending litigations which would impact its financialposition.
ii) The Company did not have any long-term contracts including derivative contracts 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.
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 8th November2016 to 30th December 2016. Based on audit procedures and relying on the managementrepresentation we report that the disclosures are in accordance with books of accountmaintained by the Company and as produced to us by the Management.
| ||For Dagliya & Co. |
| ||Chartered Accountants |
| ||FRN: 00671S |
| ||Sd/- |
|Place: Secunderabad ||Jitendra Kumar Jain |
|Date: 29.05.2017 ||(Partner) |
| ||M No.: 018398 |
ANNEXURE A - TO THE INDEPENDENT AUDITOR's REPORT OF EVEN DATE ON THE FINANCIALSTATEMENTS OF GOWRA LEASING & FINANCE LIMITED
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Sec. 143of the Companies Act 2013 (gthe Acth)
We have audited the internal financial controls over financial reporting of GowraLeasing & Finance Limited ("the Company") as of
March 31 2017 in conjunction with our audit of the financial statements of the Companyfor 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("Guidance Note") issued by the Institute of Chartered Accountants of India.These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Act.
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 issued by ICAI and deemed to beprescribed under section 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 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 performingprocedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal control based on the assessed risk. 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.
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 un-authorised 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.
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 Dagliya & Co. |
| ||Chartered Accountants |
| ||FRN: 00671S |
| ||Sd/- |
|Place: Secunderabad ||Jitendra Kumar Jain |
|Date: 29.05.2017 ||(Partner) |
| ||M No.: 018398 |