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Magnanimous Trade & Finance Ltd.

BSE: 512377 Sector: Financials
NSE: N.A. ISIN Code: INE664N01018
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Magnanimous Trade & Finance Ltd. (MAGNANIMOUSTRAD) - Auditors Report

Company auditors report

TO

THE MEMBERS OF

MAGNANIMOUS TRADE & FINANCE LTD.

8-C GROUND FLOOR 12-A

NETAJI SUBHASH ROAD KOLKATA

REPORT ON THE FINANCIAL STATEMENTS

We have audited the accompanying standalone financial statements of MAGNANIMOUS TRADE& FINANCE LTD.("the Company") which comprise the Balance Sheet as at31stMarch2017 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 Standalone 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 financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting 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 (as amended). This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding of theassets of the Company and for preventing and detecting frauds and other irregularities;selection and application of appropriate accounting policies; making judgments andestimates that are reasonable and prudent; and design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone financial statementsbased on our audit. We have taken into account the provisions of the Act the accountingand auditing standards and matters which are required to be included in the audiTreportunder the provisions of the Act and the Rules made thereunder.

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 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 we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in IndiaSubject to :

A sum of Rs. 1409033.00 shown under the head long term loans and advancesrecoverable from Shri Prakash Kanodia.No recovery of this loan have been made. The companyhas adopted legal recourse for recovery for the same. However provision for bad debts hasnot been made.(Refer Remarks given in Note No.10 to the Balance sheet)

a) in the case of the Balance Sheet of the state of affairs of the Company as at 31stMarch 2017

b) in the case of Statement of Profit and Loss of the Profit for the year ended onthat date; and

c) in the case of the Cash Flow Statement of the cash flows for the year ended on thatdate.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies(Auditor's Report) Order2016('the Order')issued by theCentral Government of India in terms of sub section (11) of Section 143 of the Act wegive in the "Annexure A" a statement on the matters specified in the paragraphs3 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 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 standalone financial statements comply with theAccounting Standards 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 on31stMarch2017 taken on record by the Board of Directors none of the directors

is disqualified as on 31stMarch2017 from being appointed as a director in terms ofSection 164 (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" ;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 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 were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.

iv. The Company has provided requisite disclosures in the standalone financialstatements as to holding as well as dealing in Specified Bank Notes during the period formNovember 82016 to December 302016. Based on audit procedures and relying on themanagemenTrepresentation we report that the disclosures are in accordance with the booksof account maintained by the Company and as produced to us by the management. (Refer NoteNo.27 to the Balance sheet)

For Om P. Agarwal & Associates

Chartered Accountants

FRN 006948C

(Om Prakash Agarwal)

Proprieto

Membership No. 017821

Place: Kanpur

Dated: 30-05-2017

"ANNEXURE A" TO THE AUDITORS' REPORT

The annexure referred to in Independent Auditors Report to the members of the Companyon the financial statements for the year ended 31st March 2017 we report that;

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

(b) The fixed assets of the Company have been physically verified by the managementaTreasonable intervals during the year; No material discrepancies were noticed on suchverification;

(c) The Title deeds of immovable properties are held in the name of the company.

(ii) (a) The management has conducted the physical verification of inventoryaTreasonable intervals.

(b) The discrepancies noticed on physical verification of the inventory as compared tobooks records which has been properly dealt with in the books of account were notmaterial.

(iii) (a) According to the information and explanations given to us the Company hasgranted Unsecured loan to parties u/s 189 of the Companies Act2013.

(b) In our opinion and according to the information and explanations given to us theparty is regular in payment of principal and interest according to the terms andconditions of the loan given.

(c) In our opinion and according to the information and explanations given to us thereare no overdues on account of loan granted by the company.

(iv) The Company has not granted any loan investment guarantee and security coveredunder the provisions of Section 185 and 186 of the Companies Act 2013. Accordinglyparagraph 3(iv) of the order is not applicable to the Company.

(v) According to the information and explanation given to us and on the basis of theexamination of the records of the Company; The Company has not accepted any deposits frompublic. Therefore paragraph 3(v) of the order is not applicable.

(vi) As informed to us the Company is noTrequired to maintain any cosTrecords thathave been specified by the Central Government under sub-section (1) of section 148 of theCompanies Act 2013. Therefore paragraph 3(vi) of the order is not applicable.

(vii) (a) According to the information and explanation given to us and on the basis ofour examination of the records of the Company the Company has been regular in depositingits undisputed statutory dues including income tax cess and other material statutory dueswith the appropriate authority. As explained to us there are no undisputed statutory duesas mentioned above in arrears as at 31stMarch 2017 for a period of more than six monthsfrom the date they became payable.

(b) According to the information and explanation given to us there are no dues ofincome tax sale tax service tax duty of customs duty of excise value added taxoutstanding on account of any dispute.

(viii) According to the information and explanation given to us and on the basis of ourexamination of records of the Company the Company does not have any loans or borrowingfrom any financial institutions bank Government or dues to debenture holders during theyear. Therefore paragraph 3(viii) of the order is not applicable.

(ix) According to the information and explanation given to us and on the basis of ourexamination of records of the Company the Company did noTraise any money by way ofinitial public offer or further public offer (including debt instruments) and term loansduring the year. Therefore paragraph 3(ix) of the order is not applicable.

(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come to acrossany instance of material fraud by the Company or on the Company by its officers oremployees noticed or reported during the year nor we have been informed of any such caseby the management.

(xi) According to the information and explanation given to us and on the basis of ourexamination the company has paid/ provided for managerial remuneration in accordance withthe requisite approvals mandated by the provisions of Section 197 read with Schedule V tothe Companies Act 2013.

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

(xiii) In our opinion all transactions with the related parties are in compliance withsection 177 & 188 of Companies Act 2013 and the details have been disclosed in theFinancial Statements as required by the applicable accounting standards.

(xiv) According to the information and explanation given to us and on the basis of 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. Therefore paragraph 3(xiv) of the order is not applicable.

(xv) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not entered into any non-cash transactions withdirectors or persons connected with him as specified u/s 192 of the Act. Accordingly theprovisions of clause 3 (xv) of the Order are not applicable to the Company.

(xvi) According to the information & explanation given to us and on the basis ofour examination of the records of the company In our opinion the Company is required tobe registered under section 45 IA of the Reserve Bank of India Act 1934 and accordinglythe company is registered under Section 45IA of Reserve Bank of India Act 1934.

For Om P. Agarwal & Associates

Chartered Accountants

FRN 006948C

(Om Prakash Agarwal)

Proprietor

Membership No. 017821

Place: Kanpur

Dated: 30-05-2017

"Annexure - B" to the Auditors' Report

(Referred to in paragraph 2 under 'Report on Other Legal and Regulatory Requirements'section of Independent Auditor's Report on financial statement of even date.)

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 MAGNANIMOUSTRADE & FINANCE LIMITED ("the Company") as of 31 March 2017 in conjunctionwith our audit of the standalone financial statements of the Company for the year ended onthat 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 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 both 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 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.

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 thaTreceipts 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 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 our audit opinion on the Company's internal financial controlssystem over financial reporting.

For Om P. Agarwal & Associates

Chartered Accountants

FRN 006948C

(Om Prakash Agarwal)

Proprietor

Membership No. 017821

Place: Kanpur

Dated: 30-05-2017