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MIRC Electronics Ltd.

BSE: 500279 Sector: Consumer
NSE: MIRCELECTR ISIN Code: INE831A01028
BSE LIVE 15:50 | 21 Nov 39.85 5.75
(16.86%)
OPEN

39.25

HIGH

40.90

LOW

36.90

NSE 15:53 | 21 Nov 39.65 5.60
(16.45%)
OPEN

39.25

HIGH

40.85

LOW

36.85

OPEN 39.25
PREVIOUS CLOSE 34.10
VOLUME 4574283
52-Week high 40.90
52-Week low 11.56
P/E 46.88
Mkt Cap.(Rs cr) 844
Buy Price 0.00
Buy Qty 0.00
Sell Price 39.75
Sell Qty 1209.00
OPEN 39.25
CLOSE 34.10
VOLUME 4574283
52-Week high 40.90
52-Week low 11.56
P/E 46.88
Mkt Cap.(Rs cr) 844
Buy Price 0.00
Buy Qty 0.00
Sell Price 39.75
Sell Qty 1209.00

MIRC Electronics Ltd. (MIRCELECTR) - Auditors Report

Company auditors report

To the Members of MIRC Electronics Limited

Report on the Financial Statements

We have audited the accompanying financial statements of MIRC Electronics Limited("the Company") which comprise the Balance Sheet as at March 31 2017 theStatement of Profit and Loss and Cash Flow Statement for the year then ended and asummary of significant accounting policies and other explanatory 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 accountingprinciples generally accepted in India including the Accounting Standards speci3ed undersection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014 and theCompanies (Accounting Standards) Amendment Rules 2016. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and the design implementationand maintenance of adequate internal financial control that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.

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 thereunder. We conducted our audit in accordancewith the Standards on Auditing issued by the Institute of Chartered Accountants of Indiaas speci3ed under Section 143(10) of the Act. Those Standards require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on theauditor’s 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 Company’spreparation of the financial statements that give a true and fair view in order to designaudit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of accounting policies used and the reasonableness of theaccounting estimates made by the Company’s Directors as well as evaluating theoverall presentation of the financial statements. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide a basis for our audit opinion onthe financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the financial statements give the information required by the Act in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of Affiairs of the Company as at March31 2017 its loss and its 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 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the Annexure 1 a statement on the matters speci3ed inparagraphs 3 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 purpose 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 speci3ed under section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014 and the Companies (Accounting Standards) Amendment Rules 2016;

(e) On the basis of written representations received from the directors as on March 312017 and taken on record by the Board of Directors none of the directors is disquali3edas on March 31 2017 from being appointed as a director in terms of section 164 (2) ofthe 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 2" to this report;

(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 31 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. 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 Note 42 to these financialstatements as to the holding of Speci3ed Bank Notes on November 8 2016 and December 302016 as well as dealings in Speci3ed Bank Notes during the period from November 8 2016 toDecember 30 2016. However as stated in Note 42 to the financial statements amountsaggregating to Rs. 0.44 lacs as represented to us by the management have been utilized forother than permitted transactions.

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Jayesh Gandhi

Partner

Membership Number: 037924

Place of Signature: Mumbai

Date: May 22 2017

Annexure referred to in paragraph 1 under the heading "Report on Other Legal andRegulatory Requirements" of our report of even date

Re: MIRC Electronics Limited (‘the Company’)

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

(b) All fixed assets have not been physically verified by the management during theyear but there is a regular programme of verification which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. No materialdiscrepancies were noticed on such verification.

(c) According to the information and explanations given by the management the titledeeds of immovable properties included in property plant and equipment are held in thename of the Company.

(ii) The management has conducted physical verification of inventory at reasonableintervals during the year and no material discrepancies were noticed on such physicalverification.

(iii) (a) According to the information and explanations given to us the Company hasnot granted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under section 189 of theCompanies Act 2013. Accordingly the provisions of clause 3(iii)(a) (b) and (c) of theOrder are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to usthere are no loans investments guarantees and securities given in respect of whichprovisions of section 185 and 186 of the Companies Act 2013 are applicable and hence notcommented upon.

(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76of the Act and the Companies (Acceptance of Deposits) Rules 2014 (as amended).Accordingly the provisions of clause 3(v) of the Order are not applicable.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Companies Act 2013 related to the manufacture or service ofconsumer appliances and are of the opinion that prima facie the speci3ed accounts andrecords have been made and maintained. We have not however made a detailed examinationof the same.

(vii) (a) Undisputed statutory dues including sales-tax duty of custom duty ofexcise cess and other material statutory dues have been regularly deposited with theappropriate authorities except income-tax value added tax entry tax employees stateinsurance profession tax service tax provident fund labour welfare fund where therehave been delays in few cases which are however not serious.

(b) According to the information and explanations given to us undisputed dues inrespect of provident fund employees’ state insurance income-tax service tax valueadded tax labour welfare fund cess and other statutory dues which were outstanding atthe year end for a period of more than six months from the date they became payable areas follows:

Statement of Arrears of Statutory Dues Outstanding for More than Six Months

Name of the Statute Nature of the Dues Amount (Rs. in lacs) Due Date Date of Payment
The Maharashtra Labour Welfare Fund Act 1953 MLWF 0.01 April 15 2015 Not paid
The Employees State Insurance Act 1948 ESIC 0.25 April 21 2015 Not paid
The Maharashtra State Tax on Professions Trade Callings and Employment Act 1975 Professional Tax 0.15 April 30 2015 Not paid
The Employees Provident Fund and Miscellaneous Provisions Act 1952 Provident Fund 0.71 April 20 2015 Not paid
The Finance act 1994 Service Tax 1.64 April 06 2016 Not paid
The Income Tax Act 1961 TDS 0.65 April 30 2015 Not paid
The Income Tax Act 1961 TDS 2.45 April 30 2015 Not paid
The Maharashtra VAT Act 2002 VAT 5.88 April 22 2016 Not paid
The Maharashtra VAT Act 2002 VAT 0.44 Sept 22 2016 Not paid

(c) According to the records of the Company the dues outstanding of income-taxsales-tax wealth-tax service tax customs duty excise duty value added tax and cess onaccount of any dispute are as follows:

(Rs. in lacs)
Nature of Dues Forum Financial Year Amount
Income Tax ITAT 2010-2013 286.09
CIT(A) 2014-2015 66.44
High Court 2001- 2006 2008 1608.21
Service Tax CESTAT 2005-2015 6078.41
Excise Duty Commissioner (Appeals) 2007-2016 207.85
Commissioner of Central Excise 1998 2000 2.02
High Court 1999 10.00
CESTAT 2000 2005 2007-2012 102.42
Customs Duty CESTAT 2013 174.18
Commissioner of Customs 2013 2014 50.88
Commissioner of Customs (Appeals) 2016 0.10
Deputy Commissioner of Customs 2015 2016 88.74
Supreme Court 2013 1406.94
Additional 2011 0.87
Commissioner (Appeals) Appellate 2012-2014 29.90
Authority Assessing 2011-2013 643.81
Authority Assistant 2012-2015 272.24
Commissioner Board of 1998 9.72
Sales Tax (Centre and state) Madhya Pradesh Commercial Taxes Bhopal Commissioner 1993-1994 1996-1999 2001-2004 2006-2009 129.28
Deputy Commissioner (Appeals) 2001 2009 410.20
Deputy excise and taxation Commissioner 2010 0.14
Deputy 1998 2000-2001 2004- 2006 2008-2013 33.31
Excise & Taxation Officer 2009 2013 4.09
High Court 2003- 2005 2011 225.49
Joint Commissioner 2002 2004 2006 2009 2011 2013 2014 2016 12.89
Joint Commissioner (Appeals) 2006-2010 3846.54
Revisional Board 2006-2011 474.57
VAT Officer 2011-13 16.67
Sr. Joint commissioner 2013 9.99
Supreme Court 2008 2010- 2011 892.66
Tribunal 2003-2004 2006-2007 221.05

(viii) In our opinion and according to the information and explanations given by themanagement the Company has not defaulted in repayment of loans or borrowing to afinancial institution bank or government or dues to debenture holders.

(ix) According to the information and explanations given by the management the Companyhas not raised any money by way of initial public offer / further public offer / debtinstruments and term loans hence reporting under clause (ix) is not applicable to theCompany and hence not commented upon.

(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the Company or no fraud / materialfraud on the Company by the Officers and employees of the Company has been noticed orreported during the year.

(xi) Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that the managerial remuneration has been paid /provided in accordance with the requisite approvals mandated by the provisions of section197 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 and hence not commented upon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given by the management theCompany has complied with provisions of section 42 of the Companies Act 2013 in respectof the preferential allotment or private placement of equity shares during the year.According to the information and explanations given by the management we report that theamounts raised have been used for the purposes for which the funds were raised.

(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 withhim.

(xvi) According to the information and explanations given to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Jayesh Gandhi

Partner

Membership Number: 037924

Place of Signature: Mumbai

Date: May 22 2017

ANNEXURE 2 TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE FINANCIALSTATEMENTS OF MIRC ELECTRONICS LIMITED

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 MIRCElectronics Limited ("the Company") as of March3 313 2017 in conjunction withour audit of the financial statements of the Company for 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 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 e3cient conduct of its businessincluding adherence to the 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.

Auditor’s 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 as speci3ed under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls and both issued by the Institute of Chartered Accountants of India.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and 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 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 internal financial controls system overfinancial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A Company’s 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 Company’s internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reffect 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 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 March33132017 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 S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Jayesh Gandhi

Partner

Membership Number: 037924

Place of Signature: Mumbai

Date: May 22 2017