Hindustan Everest Tools Ltd.
|BSE: 505725||Sector: Engineering|
|NSE: N.A.||ISIN Code: INE598D01019|
|BSE 15:22 | 12 Jun||Hindustan Everest Tools Ltd|
|NSE 05:30 | 01 Jan||Hindustan Everest Tools Ltd|
|BSE: 505725||Sector: Engineering|
|NSE: N.A.||ISIN Code: INE598D01019|
|BSE 15:22 | 12 Jun||Hindustan Everest Tools Ltd|
|NSE 05:30 | 01 Jan||Hindustan Everest Tools Ltd|
TO THE MEMBERS OF HINDUSTAN EVEREST TOOLS LIMITED
Report on the Financial Statements
We have audited the accompanying standalone financial statements of HindustanEverest Tools Limited ("the Company") which comprise the Balance Sheet asat 31st March 2016 the Statement of Profit and Loss the Cash Flow Statement and asummary of the significant accounting policies and other explanatory information for theyear then ended.
Managements Responsibility for the Financial Statements
The Companys 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 and cash flows of the Company in accordance with the accounting principlesgenerally accepted in India including the Accounting Standards specified under Section133 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 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.
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 standalone financial statements are free frommaterial misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on theauditors 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 Companyspreparation of the financial statements that that are appropriate in the circumstances. Anaudit also includes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Companys Directors as wellas 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.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial the information required by the Companies Act 2013in 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 loss and its cash flows for the year ended on that date.
Emphasis of Matters
We draw attention to the following matters in the Notes to the financial statements:
a. The company has incurred a net loss of Rs 64037565 during the year ended 31stMarch2016 thereby complete eroding net worth of the company as on 31st March2016 .TheCompanys total liabilities exceeded it total assets. These conditions along withother matters as set forth in note 27.10 to the financial statements indicate the castsignificant doubt about the Companys ability to continue as a going concern.However in the opinion of the management with the proposed induction of funds ondisposal of certain surplus assets the Company shall be able to discharge its liabilityin the normal course of business and therefore going concern assumption has not beenvitiated and accordingly financial statements have been prepared on going concernassumption.
b. Trade and other Receivables are subject to reconciliation and confirmation.Adjustments in carrying amount if any shall be made on completion of reconciliation andconfirmation thereof .In the opinion of the management there shall not be any materialimpact on carrying amount of these accounts.
c. Inventories except work in progress have not been physically verified during theyear and same has been considered as per quantity appearing in the books of accounts.Adjustments for variances if any shall be made on completion of physical verificationof the inventories. In the opinion of the management there shall not be any materialimpact on carrying value of Inventories. (Refer note 13 to the financial statements)
Our opinion is not modified in respect of these matters.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order 2016 (theOrder) issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Companies Act2013 we give in the Annexure A a statement on thematters specified in paragraphs 3 and 4 of the Order to the extent applicable.
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) The matter about erosion of net worth as on 31st March 2016 and preparation ofaccounts on going concern basis pending reconciliation and confirmation of TradeReceivables and Trade Payables and consideration of inventories as per quantity appearingin books of account as described in sub-paragraph (a) (b) and (c) under the emphasis ofmatters paragraph above in our opinion may have adverse effect on the functioning of theCompany.
f) On the basis of the written representation 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.
g) 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".
h) With respect to the other matters to be included in the Auditors 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 no pending litigation having material impact on its financialposition
ii. There is no long term contract including derivative contract having materialforeseeable losses.
iii. There is no amount required to be transferred to the Investor Education andProtection Fund by the company.
Annexure A referred to in paragraph 1 of our report of even date on the other legal andregulatory requirements (Re: HINDUSTAN EVEREST TOOLS LIMITED)
(i) a. The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets however same is under updation.
b. Fixed Assets have not been physically verified by the management at reasonableintervals. .
c. According to information and explanations given by the management the title deedsof immovable properties included in fixed assets are held in the name of the Company.
(ii) Inventories except work in progress were not physically verified at reasonableintervals .No material discrepancies were noticed on physical verification of work inprogress.
(iii) The Company has not granted any loan secured or unsecured to companies firmsLimited Liability Partnerships or other parties covered in the register maintained underSection 189 of the Companies Act 2013.
(iv) The Company has not granted any loan or investment made or guarantees provided ascovered under Section 185 and 186 of the Companies Act 2013.
(v) The Company has not received any deposits covered under section 76 of theCompanies Act2013. Therefore the provisions of clause 3 (v) of the Order are notapplicable.
vi) As informed to us the Central Government has not prescribed maintenance of costrecords under section 148(1) of the Companies Act 2013. Therefore the provisions ofclause 3 (vi) of the Order are not applicable.
(vii) a. According to the records of the Company the Company is generally regular indepositing undisputed statutory dues including provident fund employees stateinsurance income-tax sales-tax service tax duty of customs duty of excise valueadded tax cess and other statutory dues deducted/ accrued in the books of accounts withthe appropriate authorities though there have been some delays. There was no undisputedoutstanding statutory dues as at the yearend for a period of more than six months from thedate they became payable.
b. According to the records of the Company there are no dues outstanding of incometax sales tax service tax duty of customs duty of excise and value added tax onaccount of any dispute.
(viii) The Company has not defaulted in repayment of loans or borrowings to banks. TheCompany did not have any outstanding loan from any financial institution or fromGovernment and dues to debenture holders.
(ix) The Company has not raised any monies by way of initial public offer or furtherpublic offer (including debt instruments) or through term loan. Therefore the provisionsof the clause 3 (ix) of the Order are not applicable.
(x) Based upon the audit procedures performed in accordance with generally acceptedauditing practice in India for the purpose of reporting the true and fair view of thefinancial statements and according to the information and explanations given to us fraudby the Company or no fraud on the Company by its officers and employees has been noticedor reported during the year.
(xi) According to the information and explanations given by the management managerialremuneration has been paid /provided in accordance with the requisite approvals mandatedby the provisions of section 197 read with schedule V to the Companies Act 2013
(xii) In our opinion the Company is not a Nidhi company. Therefore the provisions ofclause 3(xii) of the Order are not applicable to the Company.
(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 of theCompanies Act 2013 wherever applicable and the details for the same have been disclosedin the Financial Statements as required by the applicable accounting standards.
(xiv) The Company has not made any preferential allotments or private placement ofshares or fully or partly convertible debentures during the year under review. Thereforethe provisions of clause 3(xiv) of the Order are not applicable.
(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withdirectors. Therefore the provisions of clause 3(xv) of the Order are not applicable.
(xvi) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934. Therefore the provisions of clause 3 (xvi) of the Order are notapplicable.
ANNEXURE B Report on the Internal Financial controls under Clause (i) of Sub - section3 of Section 143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of HindustanEverest Tools Ltd. ("the Company") as of March 31 2016 in conjunction withour audit of the standalone financial statements of the Company for the year ended on thatdate.
Managements Responsibility for Internal Financial Controls
The Companys management is responsible for establishing and maintaining internalfinancial controls based on the internal control over the 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. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to companys 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 CompaniesAct 2013.
Our responsibility is to express an opinion on the Companys 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 deemed to be prescribedunder section 143(10) of the Companies Act 2013 to the extent applicable to an audit ofinternal financial controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls 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 exist and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditors 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 Companys internal financial controlssystem over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A companys internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A companys internal; financial controlover financial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company ; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorization ofmanagement and directors of the company ; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of thecompanys 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 overfinancialreporting to future periods are subject to the risk that the internal financialcontrols over financial reporting may become inadequate because of changes in conditionsor that the 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 March31 2016 based on theinternal control over the financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the Institute ofChartered Accountants of India. However same need to be further strengthened.