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Modern India Ltd.

BSE: 503015 Sector: Others
NSE: N.A. ISIN Code: INE251D01023
BSE LIVE 14:48 | 24 Nov 54.10 -2.70
(-4.75%)
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54.10

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NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 54.05
PREVIOUS CLOSE 56.80
VOLUME 320
52-Week high 89.30
52-Week low 32.30
P/E
Mkt Cap.(Rs cr) 203
Buy Price 54.05
Buy Qty 295.00
Sell Price 59.60
Sell Qty 270.00
OPEN 54.05
CLOSE 56.80
VOLUME 320
52-Week high 89.30
52-Week low 32.30
P/E
Mkt Cap.(Rs cr) 203
Buy Price 54.05
Buy Qty 295.00
Sell Price 59.60
Sell Qty 270.00

Modern India Ltd. (MODERNINDIA) - Auditors Report

Company auditors report

To the Members of Modern India Limited

Report on the Financial Statements

We have audited the accompanying financial statements of Modern India Limited(‘the Company’) which comprise the Balance Sheet as at March 31 2017 theStatement of Profit and Loss the Cash Flow Statement for the year then ended and asummary of the significant accounting policies and other explanatory information.

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 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 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.

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 there under.

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 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 the accounting policies used and the reasonableness ofthe accounting estimates made by the Company’s Directors as well as evaluating theoverall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our qualified audit

opinion on the financial statements.

Basis for Qualified Opinion

Trade receivables as on March 31 2017 include an amount of Rs 135950849 (net off Rs9360905 recovered till date) outstanding in respect of commodities trading transactiondone on National Spot Exchange Limited (NSEL). The company has filed a representative suitin the high court of Bombay for recovery of this amount. In the meanwhile various decreeshave been passed by the High Court of Bombay against defaulters including for sale ofcommodities and assets which are in process of implementation. Economic Offence Wing andEnforcement Directorate are also in process of liquidating assets of defaulters. Pendingoutcome of the legal suit and resolution of uncertainties involved the management hasconsidered the receivable as good for recovery. However in the absence of appropriateaudit evidence we are unable to determine the extent of recovery possible in this case.

Qualified Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us except for the effects of the matters described in Basis for QualifiedOpinion paragraph above the aforesaid financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of affairs of theCompany as at March 31 2017 and its loss and its cash flows for the year ended on thatdate.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order 2016 (`the Order’)issued by the Government of India – Ministry of Corporate Affairs in terms ofsub-section (11) of section 143 of the Act we enclose in the Annexure – A astatement on the matters specified in paragraphs 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) Except for the effects of the matters prescribed in the Basis for Qualified Opinionparagraph above in our opinion proper books of account as required by law have been keptby the Company 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) Except for the effects of the matters prescribed in the Basis for Qualified Opinionparagraph above in our opinion the aforesaid standalone financial statements comply withthe Accounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014;

(e) The matter described in the Basis for Qualified Opinion paragraph above in ouropinion may have an adverse effect on the functioning of the Company;

(f) On the basis of the written representations received from the directors as on March31 2017 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of Section 164 (2) of theAct;

(g) The qualification relating to the maintenance of accounts and other mattersconnected therewith are as stated in the Basis for Qualified Opinion paragraph;

(h) 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

(i) 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 no. 31 to the standalone financialstatements;

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 its standalone financialstatements as to holdings as well as dealings in Specified Bank Notes during the periodfrom 8th November 2016 to 30th December 2016 and these are inaccordance with the books of accounts maintained by the Company. Refer note no. 35 to thestandalone financial statements.

For K. S. Aiyar & Co.
Chartered Accountants
ICAI Firm Registration No. 100186W
Sd/-
Satish Kelkar
Place: Mumbai Partner
Date: May 19 2017 Membership No: 38934

Annexure – A to the Auditor’s Report

(Referred to in paragraph 1 under the heading ‘Report on Other Legal andRegulatory Requirements’ of our Report of even date on the financial statements forthe year ended on March 31 2017 of Modern India Limited)

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

(b) The fixed assets have been physically verified by the management during the year.In our opinion the frequency of verification is reasonable having regard to the size ofthe Company and the nature of its assets.

No 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) (a) The inventory has been physically verified during the year by the managementat reasonable intervals.

(b) The procedures of physical verification of inventories followed by the managementare reasonable and adequate in relation to the size of the company and the nature of itsbusiness.

(c) In our opinion and according to the explanations given to us the Company ismaintaining proper records of inventory. The discrepancies noticed on verification betweenthe physical stocks and the book records were not material and properly dealt with in thebooks of account

(iii) During the year the Company has not granted any loans secured or unsecured toCompanies Firms Limited Liability Partnerships or other parties covered in the registermaintained under Section 189 of the Companies Act 2013. Accordingly sub-clause (a) (b)and (c) are not applicable.

(iv) In our opinion and according to the information and explanations given to us inrespect of loans investments guarantees and security provided provisions of section 185and 186 of the Companies Act 2013 have been complied with.

(v) The Company has not accepted any deposits from the public to which the provisionsof section 73 to 76 or any other relevant provisions of the Companies Act 2013 or theCompanies (Acceptance of Deposit) Rules 2014 or the directives issued by the Reserve Bankof India apply.

(vi) We have been informed that the Company is not required to maintain cost recordsunder sub-section (1) of section 148 of the Companies Act 2013 which has been reliedupon.

(vii) (a) According to the records of the Company Provident Fund Employees’State Insurance Income Tax Sales Tax Service Tax Customs Duty Excise Duty ValueAdded Tax Cess and other material statutory dues applicable to it have been generallyregularly deposited during the year with the appropriate authorities.

According to the information and explanations given to us no undisputed amountspayable in respect of above were in arrears as at March 31 2017 for a period of morethan six months from the date on which they became payable.

(b) According to the records of the Company there are no dues of income tax salestax service tax custom duty excise duty and cess which have not been deposited onaccount of any dispute.

(viii) The company has not defaulted in repayment of principal and interest tofinancial institutions banks government or dues to Debenture holders.

(ix) The Company has not raised any moneys by way of initial public offer or furtherpublic offer (including debt instruments) but through term loans during the year has beenapplied for the purpose for which it was raised.

(x) According to the information and explanations furnished by the management whichhave been relied upon by us there were no frauds on or by the Company noticed or reportedduring the course of our audit.

(xi) The remuneration paid during the year to the managerial personnel is in accordancewith the requisite approvals mandated by the provisions of section 197 read with scheduleV to the companies Act.

(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 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 and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review and henceclause 3 (xiv) is not applicable to the Company.

(xv) The Company has not entered into any non-cash transactions with directors orpersons connected with him and hence clause 3(xv) is not applicable to the Company.

(xvi) According to the information and explanations given to us the Company is notrequired to be registered under section 45-IA of the Reserve Bank of India Act 1934.

For K. S. Aiyar & Co.
Chartered Accountants
ICAI Firm Registration No. 100186W
Sd/-
Satish Kelkar
Place: Mumbai Partner
Date: May 19 2017 Membership No: 38934

Annexure-B to Auditors report

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 ModernIndia Limited ("the Company") as of 31 March 2017 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

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’). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company’s policies the safeguardingof its assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation 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 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 controlssystem over financial 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 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 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 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 K. S. Aiyar & Co.
Chartered Accountants
ICAI Firm Registration No. 100186W
Sd/-
Satish Kelkar
Place: Mumbai Partner
Date: May 19 2017 Membership No: 38934