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KMC Speciality Hospitals (India) Ltd.

BSE: 524520 Sector: Health care
NSE: N.A. ISIN Code: INE879K01018
BSE LIVE 15:40 | 22 Nov 22.30 -0.50
(-2.19%)
OPEN

23.25

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23.25

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NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 23.25
PREVIOUS CLOSE 22.80
VOLUME 52010
52-Week high 30.90
52-Week low 9.10
P/E 57.18
Mkt Cap.(Rs cr) 364
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 23.25
CLOSE 22.80
VOLUME 52010
52-Week high 30.90
52-Week low 9.10
P/E 57.18
Mkt Cap.(Rs cr) 364
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

KMC Speciality Hospitals (India) Ltd. (KMCSPECIALITY) - Auditors Report

Company auditors report

To

The Members

KMC Speciality Hospitals (India) Limited

Report on the financial statements

We have audited the accompanying financial statements of KMC Speciality Hospitals(India) Limited ("the Company") which comprise the balance sheet as atMarch 31 2016 the statement of profit and loss the cash flow statement for the yearthen ended and a summary of the 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 preparationand presentation of these financial statements that give a true and fair view of thefinancial position financial performance and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the accounting standardsspecified under section 133 of the Act read with rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditors' 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 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 financial statements are free from materialmisstatement.

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 theappropriateness of the 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 obtained by us 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 March31 2016 and its profits and cash flows 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 enclose in the "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the said 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 statement of profit and loss and cash flow statement dealt withby 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 theCompanies(Accounts) Rules 2014;

(e) on the basis of the written representations received from the directors as on March31 2016 taken on record by the board of directors none of the directors is disqualifiedas on March 31 2016 from being appointed as a director in terms of section 164 (2) of theAct ;

(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"; and

(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 30 to the financial statements;

ii the Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses; and

iii there were no amounts which were required to be transferred to the investoreducation and protection fund by the Company.

for B S R & Co. LLP

Chartered Accountants

ICAI Firm Registration Number: 101248W/W-100022

Chinnsamy Ganesan

Partner

Membership No: 27501

Place : Chennai

Date : May 30 2016

Annexure ‘A’ to the Independent Auditors' Report

To the members of KMC Speciality Hospitals (India) Limited for the year ended March 312016

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

(b) The Company has a regular programme of physical verification of its fixed assets bywhich all fixed assets are verified in a phased manner over a period of three years. Inour opinion this periodicity of physical verification is reasonable having regard to thesize of the Company and the nature of its assets. Pursuant to the aforesaid program aportion of fixed asset has been physically verified by the management during the year andno material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company

(ii) The inventory has been physically verified by the management during the year. Inour opinion the frequency of such verification is reasonable. During the course ofreconciliation of inventory records with the physical inventory for the current year themanagement has observed certain discrepancies. The management is in the process ofcarrying out a comprehensive evaluation for identification of the reasons for thesediscrepancies and in the opinion of the management the impact if any arising on accountof the said evaluation will be not be material to the financial statements.

(iii) The Company has not granted any loan secured or unsecured to companies firms orother parties covered by section 2(76) of the Companies Act 2013. Accordingly paragraph3(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) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits and accordingly paragraph 3 (v) of the Order is notapplicable.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules prescribed by the Central Government for the maintenance of cost recordsunder section 148 of the Companies Act 2013 and are of the opinion that prima facie theprescribed accounts and records have been made and maintained. However we have not made adetailed examination of the records.

(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' stateinsurance income-tax sales tax service tax value added tax and other materialstatutory dues have generally regularly been deposited by the Company with the appropriateauthorities except for certain delays in remittances of tax deducted at source rangingfrom 1 to 11 days remittances of service tax ranging from 1 to 30 days and with respectto remittances of provident fund ranging from 1 to 4 days. As explained to us the Companydid not have any dues on account of excise duty customs duty and cess.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income-tax sales taxservice tax value added tax and other material statutory dues were in arrears as at March31 2016 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us the following are thedues which have

not been deposited by the Company on account of disputes;

Nature of the Statute Nature of the Dues Amount (Rs.) Period to which the amount relates Forum where the dispute is pending
Customs Act 1962 Customs Duty 8524905 * 1989 to 1993 Director General of Health Services

* Includes amount paid under dispute amounting to Rs. 913510/-

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of dues to its bankers. The Company did nothave any outstanding loans or borrowings from any financial institutions government ordues to debenture holders during the year.

(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. Accordinglyparagraph 3 (ix) of the Order is not applicable.

(x) As more fully discussed in note 40 to the financial statements an employee hasmisappropriated cash collected from certain customers aggregating to Rs. 585354/- duringthe year. On the basis of the information and explanations given to us no other fraud bythe Company or on the Company by its officers or employees has been noticed or reportedduring the course of our audit.

(xi) 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 managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with schedule V of the Companies Act 2013.

(xii) 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 Order is notapplicable.

(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. The details of suchrelated party transactions have been disclosed in the financial statements as required bythe applicable accounting standards.

(xiv) 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 under review.

(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. Accordingly 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 B S R & Co. LLP

Chartered Accountants

ICAI Firm Registration Number: 101248W/W-100022

Chinnsamy Ganesan

Partner

Membership No: 27501

Place : Chennai

Date : May 30 2016

Annexure "B" to Independent Auditors’ Report on the Internal FinancialControls under clause (i) of sub- . . section 3 of section 143 of the Companies Act 2013( " the Act " ) Page 1 of 2

We have audited the internal financial controls over financial reporting of KMCSpeciality Hospitals (India) Limited ("the Company") as of March 31 2016 inconjunction with our audit of the financial statements of the Company for the year endedon 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 ('ICAI').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 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 and the Standards on Auditing to the extent applicable to an auditof internal financial controls both issued by ICAI. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in allmaterial 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 on the Company's internal financial controls systemover financial reporting.

Annexure "B" to Independent Auditors’ Report on the Internal FinancialControls under clause (i) of sub- . .

section 3 of section 143 of the Companies Act 2013 ( " the Act " )

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 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 2016 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the said Guidance Note.

for B S R & Co. LLP

Chartered Accountants

ICAI Firm Registration Number: 101248W/W-100022

Chinnsamy Ganesan

Partner

Membership No: 27501

Place : Chennai

Date : May 30 2016