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PCS Technology Ltd.

BSE: 517119 Sector: Consumer
NSE: N.A. ISIN Code: INE834B01012
BSE LIVE 15:41 | 22 Sep 21.50 0.30
(1.42%)
OPEN

21.70

HIGH

22.40

LOW

21.05

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 21.70
PREVIOUS CLOSE 21.20
VOLUME 2425
52-Week high 36.00
52-Week low 19.00
P/E 10.80
Mkt Cap.(Rs cr) 45
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 21.70
CLOSE 21.20
VOLUME 2425
52-Week high 36.00
52-Week low 19.00
P/E 10.80
Mkt Cap.(Rs cr) 45
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

PCS Technology Ltd. (PCSTECHNOLOGY) - Auditors Report

Company auditors report

TO THE MEMBERS OF PCS TECHNOLOGY LIMITED

1. Report on the Standalone Financial Statements

I have audited the accompanying standalone financial statements of PCS TechnologyLimited ("the Company") which comprise the Balance Sheet as at 31st March2016 the Statement of Profit and Loss the Cash Flow Statement for the year then endedand a summary of the significant accounting policies and other explanatory information.

2. 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. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding 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.

3. Auditor’s Responsibility

My responsibility is to express an opinion on these standalone financial statementsbased on our audit.

4. I 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.

5. I conducted my audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that I comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.

6. An audit involves performing procedures to obtain audit evidence about the amountsand the 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 but not for the purpose ofexpressing an opinion on whether the Company has in place an adequate internal financialcontrols system over financial reporting and the operating effectiveness of such controls.An audit also includes evaluating the appropriateness of the accounting policies used andthe reasonableness of the accounting estimates made by the Company’s Directors aswell as evaluating the overall presentation of the financial statements.

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

8. Opinion

In my opinion and to the best of our information and according to the explanationsgiven to me 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 India of the state of affairs of the Companyas at 31st March 2016 and its profit and its cash flows for the year ended onthat date.

9. Report on Other Legal and Regulatory Requirements

As required by ‘the Companies (Auditor’s Report) Order 2016’ issued bythe Central Government of India in terms of sub-section (11) of section 143 of the Act(hereinafter referred to as the "Order") and on the basis of such checks of thebooks and records of the Company as I considered appropriate and according to theinformation and explanations given to me I give in the Annexure-"A" a statementon the matters specified in paragraphs 3 and 4 of the Order.

10. As required by Section 143 (3) of the Act I report that:

1. I have sought and obtained all the information and explanations which to the best ofI knowledge and belief were necessary for the purposes of my audit.

2. In my 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.

3. 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.

4. In my 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; read with Note 29 to the financial statements for theyear ended 31st March 2016 regarding scheme of Amalgamation and Arrangement.

5. 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 termsof Section 164 (2) of the Act.

6. With respect to the adequacy of the internal financial controls over financialreporting of the company and the operating effectiveness of such controls refer to myseparate report in Annexure-"B" and

7. 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 my opinionand to the best of our information and according to the explanations given to me:

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.

iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.

For S.C. Bandi & Co.
Chartered Accountants
Firm Reg. No.130850W
S.C. BANDI
Place: Mumbai (Proprietor)
M.No.16932
Date : 16th May 2016

ANNEXURE-A TO THE AUDITOR’S REPORT

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

(b) The assets have been physically verified by the management during the year and nomajor discrepancies were noticed on such verification.

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

(ii) (a) The inventory has been physically verified during the year by the management.In my opinion the frequency of verification is reasonable.

(b) The discrepancies noticed on verification have been properly dealt within the booksof accounts.

(iii) The Company has granted interest free unsecured loans to its wholly ownedsubsidiary in earlier periods.

(a) The terms and conditions of grant of unsecured loans to parties covered under 189of the Companies Act are not prejudicial to the Company’s interest.

(b) There is no stipulation as to the time period for payment of the principal amountof unsecured loans granted. Hence the provisions of sub-clauses (b) and (c) of clause(iii) of paragraph 3 of the Order are not applicable.

(iv) In respect of loans investments guarantees and securities the provisions ofsection 185 and 186 of the Companies Act 2013 have been complied with by the Company.

(v) The Company has not accepted any deposits hence the directives issued by theReserve Bank of India and the provisions of sections 73 to 76 or any other relevantprovisions of the Companies Act 2013 and the rules framed thereunder are not applicableto the Company.

(vi) The Central Government has not prescribed the maintenance of cost records undersub-section (1) of section 148 of the Companies Act 2013 for any of the products of theCompany.

(vii) (a) The Company is generally regular in depositing undisputed statutory duesincluding provident fund employees’ state insurance income-tax sales-taxservice-tax duty of customs duty of excise value added tax cess and any otherstatutory dues to the appropriate authorities.

According to the information and explanations given to me no undisputed amountspayable in respect of provident fund employees’ state insurance income-taxsales-tax service-tax duty of customs duty of excise value added tax cess and anyother statutory dues were in arrears as at 31st March 2016 for a period of morethan six months from the date they became payable.

(b) According to the information and explanations given to me the status of disputeddues payable in respect of income tax sales tax service tax duty of customs duty ofexcise value added tax as at 31st March 2016 is as follows:

1 The Commissioner Of Service Tax Mumbai has passed an order confirming the demand ofRs.22904559 (Previous Year: Rs.46924929) u/s 73 of Finance Act 1994 purchase ofsoftware under category of Intellectual Property Rights for the period Dec 2004 – Mar2009.

The Company has obtained the legal opinion that the software purchase does not attractprovisions of Intellectual Property Rights under Service Tax Rules and now is in processof filing appeal before Appellate Tribunal.

2 The Company has received a demand of Rs.1912633 from the Commissioner Of CentralExcise Pondicherry u/s 11A of Central Excise Act imposing Central Excise on pre-loadingof software for the period Sept 2006 - Mar 2010.

The Company has filed an appeal before Appellant Tribunal Central Excise Customs &Service Tax Chennai. Tribunal has passed the order granting stay on the demand. Theproceedings are pending before the Tribunal at Chennai.

3 The Company has received a demand of Rs.504995 from the Commissioner Of CentralExcise (Appeal) Vapi on the ground of irregular availment of Central Excise during theperiod Apr 2004 - Mar 2005.

The Company has filed appeal before Appellant Tribunal Central Excise Customs &Service Tax Ahmedabad. Tribunal has passed the order granting stay on the demand. Theproceedings are pending before the Tribunal at Ahmedabad.

4 The Company has received a demand of Rs.4428762 from the Commissioner Of CentralExcise (Appeal) Vapi on the ground of irregular availment of Central Excise during April2004 - March 2005.

The Company has filed appeal before Appellant Tribunal Central Excise Customs &Service Tax Ahmedabad. Tribunal has passed the order granting stay on the demand.

The proceedings are pending before the Tribunal at Ahmedabad.

5 The Company has received a Show Cause Notice from Director of Intelligence demandingRs. 21540551 u/s 28 of Custom Act 1962 on account of Custom Duty on import of OPK fromMicrosoft during the period of Apr 2006 - Mar 2007.

The proceedings are pending before Commissioner of Customs Delhi. On the basis of thelegal opinion obtained the matter has merits in favor of the Company. The Company hasdeposited Rs. 50 lakhs as pre-deposit under protest.

6 The Company has received an order of Rs.4311000 in FY 2006-07 from Commissioner ofCentral Excise (Appeal) Mumbai along with pre-deposit of Rs.15 lakhs on account of allegednon-submission of import documents of various goods under Project Import Regulation Act1986.

The Company has filed as appeal before CESTAT Mumbai on the grounds of merits of thecase and proceedings are pending. The Hon'ble High Court of Judicature at Bombay has setaside the order of pre-deposit on appeal by the Company.

7 The Company has received a show cause notice u/s 73 of Finance Act 1994 fromCommissioner Of Service Tax Mumbai demanding Rs.2521282 on account of wrong availmentof Cenvat Credit for the period Apr 2012 - Mar 2013.

The Company has filed its reply denying the demand on the merits and grounds.

(viii) According to the information and explanations given to me the Company has notdefaulted in repayment of dues to financial institutions banks or Government.

(ix) The Company has not raised money by way of initial public offer or further publicoffer (including debt instruments) and has not raised term loan during the year. Hencethe provisions of clause (ix) of paragraph 3 of the Order are not applicable to theCompany. (x) According to the information and explanations given to me no fraud by theCompany or any fraud on the Company by its officers or employees has been noticed orreported during the year.

(xi) According to the information and explanations given to me managerial remunerationhas been paid in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Companies Act.

(xii) The Company is not a Nidhi Company. Hence the provisions of the clause (xii) ofparagraph 3 of the Order are not applicable to the Company. (xiii) According to theinformation and explanations given to me all transactions with the related parties are incompliance with sections 177 and 188 of Companies Act 2013 and the details have beendisclosed in the Financial Statements as required by the applicable accounting 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. Hence theprovisions of clause (xiv) of paragraph 3 of the Order are not applicable to the Company.

(xv) The Company has not entered into any non-cash transactions with directors orpersons connected with him. Hence the provisions of clause (xv) of paragraph 3 of theOrder are not applicable to the Company. (xvi) The Company is not required to beregistered under section 45-IA of the Reserve Bank of India Act 1934. Hence theprovisions of clause (xvi) of paragraph 3 of the Order are not applicable to the Company.

For S.C. Bandi & Co.
Chartered Accountants
Firm Reg. No.130850W
S.C. BANDI
Place: Mumbai (Proprietor)
M.No.16932
Date : 16th May 2016

ANNEXURE-B TO THE AUDITOR’S REPORT

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

I have audited the internal financial controls over financial reporting of PCSTechnology Limited ("the Company") as of 31st March 2016 inconjunction with my audit of the standalone financial statements of the Company for theyear 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 (‘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

My responsibility is to express an opinion on the Company's internal financial controlsover financial reporting based on my audit. I conducted my audit in accordance with theGuidance Note on Audit of Internal Financial Controls over Financial Reporting (the"Guidance Note") and the Standards on Auditing issued by ICAI and deemed to beprescribed under section 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand 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. My audit involves performingprocedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. My audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal control based on the assessed risk. 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. I believe that the audit evidenceI have obtained is sufficient and appropriate to provide a basis for my audit opinion onthe Company’s internal financial controls system over 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 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 my 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 2016 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.C. Bandi & Co.
Chartered Accountants
Firm Reg. No.130850W
S.C. BANDI
Place: Mumbai (Proprietor)
M.No.16932
Date : 16th May 2016