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Orbit Corporation Ltd.

BSE: 532837 Sector: Infrastructure
NSE: ORBITCORP ISIN Code: INE628H01015
BSE LIVE 15:23 | 11 Dec 1.45 -0.05
(-3.33%)
OPEN

1.57

HIGH

1.57

LOW

1.45

NSE 14:42 | 11 Dec 1.50 0
(0.00%)
OPEN

1.50

HIGH

1.55

LOW

1.50

OPEN 1.57
PREVIOUS CLOSE 1.50
VOLUME 48900
52-Week high 6.40
52-Week low 1.24
P/E
Mkt Cap.(Rs cr) 17
Buy Price 1.45
Buy Qty 1000.00
Sell Price 1.57
Sell Qty 1000.00
OPEN 1.57
CLOSE 1.50
VOLUME 48900
52-Week high 6.40
52-Week low 1.24
P/E
Mkt Cap.(Rs cr) 17
Buy Price 1.45
Buy Qty 1000.00
Sell Price 1.57
Sell Qty 1000.00

Orbit Corporation Ltd. (ORBITCORP) - Auditors Report

Company auditors report

To the Members of Orbit Corporation Limited

Report on the Financial Statements

We have audited the financial statements of Orbit Corporation Limited (the‘Company') which comprise the Balance Sheet as at 31st March 2016 the Statement ofProfit and Loss and the Statement of Cash Flows for the year then ended and a summary ofthe significant accounting policies and other explanatory information.

Responsibilities of Management 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 of thesefinancial statements that give a true and fair view of the financial position financialperformance 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 of 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 Responsibilities

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 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 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 gives 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 reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the over presentation ofthe financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our opinion on the financial statements.

Emphasis of matter

We draw attention to Note 26(2(a)) to the financial statements as regards the incometax demands received by the Company for the assessment years 2004-05 to 2012-13 amountingto Rs. 1884.31millions. The Company has filed appeals against these demands and the matteris sub-judice.

Our opinion is not qualified in respect of this matter.

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 31stMarch 2016 and 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 (the ‘Order')issued by the Central Government of India in terms of Section 143(11) of the Act we givein the Annexure ‘A' a Statement on the matters specified in paragraphs 3 and4 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 8 of the Companies(Accounts) Rules 2014;

(e) on the basis of the written representations 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; and

(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';

(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:

(1) the Company has disclosed the impact of pending litigations on its financialposition in its financial statements - Refer Note 26 to the Financial Statements;

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

(3) there are no amounts that are required to be transferred to the Investor Educationand Protection Fund by the Company.

SHARP & TANNAN
Chartered Accountants
Firm's Registration No.109982W
by the hand of
MILIND P. PHADKE
Partner
Membership No. 033013
Mumbai 18th May 2016

ANNEXURE ‘B' TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2(f) of our report of even date)

We have audited the internal financial controls over financial reporting of OrbitCorporation Limited (the ‘Company') as of 31st March 2016 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 Reporting (the‘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 (the‘Act').

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 issued by ICAI and deemed to beprescribed under Section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the ICAI. Those Standards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.

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 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 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 authorisation 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

According to the information and explanations given to us and based on our audit thefollowing material weaknesses have been identified in the operating effectiveness of thecompany's internal financial controls over financial reporting as at 31st March 2016 : a)The segregation of duties in Finance & accounts department as envisaged in theinternal control system of the company was not effectively implemented due to high rate ofattrition of the staff. This area needs to be strengthened to ensure effective operationof the internal control system

A ‘material weakness' is a deficiency or a combination of deficiencies ininternal financial control over financial reporting such that there is a reasonablepossibility that a material misstatement of the company's annual or interim financialstatements will not be prevented or detected on a timely basis.

In our opinion because of the possible effects of the material weaknesses describedabove on the achievement of the objectives of the control criteria the Company has notmaintained adequate internal financial controls over financial reporting and such internalfinancial controls over financial reporting were not operating effectively as of March 312016 based on "the internal control over financial reporting criteria established bythe Company considering the essential components of internal control stated in GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India".

We have considered the material weaknesses identified and reported above in determiningthe nature timing and extent of audit tests applied in our audit of the March 31 2016standalone financial statements of the Company and these material weaknesses do notaffect our opinion on the financial statements of the Company.

SHARP & TANNAN
Chartered Accountants
Firm's Registration No. 109982W
by the hand of
MILIND P. PHADKE
Partner
Mumbai 18th May 2016 Membership No. 033013