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PVP Ventures Ltd.

BSE: 517556 Sector: Infrastructure
NSE: PVP ISIN Code: INE362A01016
BSE 14:58 | 19 Jan 8.46 -0.44
(-4.94%)
OPEN

8.50

HIGH

8.80

LOW

8.46

NSE 15:52 | 19 Jan 8.50 -0.40
(-4.49%)
OPEN

8.55

HIGH

8.80

LOW

8.50

OPEN 8.50
PREVIOUS CLOSE 8.90
VOLUME 68573
52-Week high 10.70
52-Week low 4.50
P/E 9.40
Mkt Cap.(Rs cr) 207
Buy Price 0.00
Buy Qty 0.00
Sell Price 8.46
Sell Qty 11793.00
OPEN 8.50
CLOSE 8.90
VOLUME 68573
52-Week high 10.70
52-Week low 4.50
P/E 9.40
Mkt Cap.(Rs cr) 207
Buy Price 0.00
Buy Qty 0.00
Sell Price 8.46
Sell Qty 11793.00

PVP Ventures Ltd. (PVP) - Auditors Report

Company auditors report

Standalone Financial Section

INDEPENDENT AUDITOR'S REPORT

To the Members of PVP Ventures Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying Standalone Ind AS Financial Statements of PVPVentures Limited ("the Company") which comprise the Balance Sheet as at31st March 2017 and the Statement of Profit and Loss (including Other ComprehensiveIncome) the Statement of Cash Flows and the Statement of Changes in Equity for the yearthen ended and a summary of significant accounting policies and other explanatoryinformation.

Management's Responsibility for the Standalone Ind AS 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 Ind AS Financial Statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) specifiedunder Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.This responsibility also includes maintenance of adequate accounting records in accordancewith the provisions of the Act for safeguarding the assets of the Company and forpreventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the Standalone IndAS Financial Statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these Standalone Ind AS FinancialStatements based on our audit. In conducting our audit we have taken into account theprovisions of the Act the accounting and auditing standards and matters which arerequired to be included in the audit report under the provisions of the Act and the Rulesmade thereunder.

We conducted our audit of the Standalone Ind AS Financial Statements in accordance withthe Standards on Auditing specified under Section 143 (10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the Standalone Financial Statements are free frommaterial misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the Standalone Ind AS Financial Statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the Standalone Ind AS financial statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the Standalone Ind ASFinancial Statements.

We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our audit opinion on Standalone Ind AS Financial Statements.

Basis for Qualified Opinion

As stated in Note No: 26.8 to the Standalone Ind AS Financial Statements in relationto investment in few subsidiary companies net off provision amounting to Rs.56005.15Lakhs. Considering the market value of the assets and expected cash flows from thebusiness of these subsidiary companies management considers these investments as good andrecoverable and the provision to the extent already made is adequate. However the erosionin the net worth of these subsidiary companies their dependence on the holding company tocontinue as a going concern absence of cash flows delay in commencement of projects andother related factors indicate the existence of material uncertainty in recoverability ofnet carrying value of investments. Hence we were unable to determine whether anyadjustments to these net carrying amounts are necessary and additional provision fordiminution if any to be made are not quantifiable at this point of time.

Qualified Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us except for the possible effects of the matter described in the Basis forQualified Opinion Paragraph the aforesaid Standalone Ind AS Financial Statements give theinformation required by the Act in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India including Ind ASspecified under section 133 of the Companies Act of the state of affairs (financialposition) of the Company as at 31st March 2017 and its profits (financial performanceincluding other comprehensive loss) its cash flows and the changes in equity for the yearended on that date.

Emphasis of Matter

We draw attention to a) As stated in Note No: 26.9 to the Standalone Ind AS FinancialStatements certain assets of the company have been pledged as security by way of mortgageto the lenders for the borrowings by third parties and the borrowers have not repaid theloan along with interest to the lenders on the due dates. The outstanding loan by thesecompanies as on 31st March 2017 is Rs.2734.40 Lakhs. The realisable value of mortgagedassets is dependent on the repayment of the loans by the third parties. The managementasserts that no adjustment to the carrying value is required as it is confident that thepayment obligations will be met by the third party borrower in due course. Relying on thesame no adjustments have been made to the carrying value of the assets. b) As stated inNote No: 26.11 to the Standalone Ind AS Financial Statements the obligations towardsdisputed income tax matters amounting to Rs.2129.65 Lakhs are pending before differentjudicial forums. Pending disposal of these appeals the eventual obligation in this regardis unascertainable at this time. Based on the management's assessment and based on theexperts view on the merits of the dispute no provision is considered necessary in thisregard.

Our Opinion is not modified in respect of the above matters.

Other Matters

The financial information for the year ended 31st March 2016 and the transition dateopening balance sheet as at 01st April 2015 included in these special purpose StandaloneInd AS Financial Statements are based on the previously issued statutory financialstatements prepared in accordance with the Companies (Accounting Standards) Rules 2006and the other accounting principles generally accepted in India audited by CNGSN &Associates LLP Chartered Accountants whose report dated 23rd May 2016expressed modifiedopinion and 29th May 2015 expressed unmodified opinion on those standalone financialStatements respectively as adjusted for the differences in the accounting principlesadopted by the company on transition to the Ind AS which have been audited by us.

Our Opinion is not modified in respect of this matter.

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 Sub section (11) of Section 143 ofthe Act we give in the "Annexure A" statement on the matters specifiedin the paragraph 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) Except for the possible effects of the matter described in the Basis for QualifiedOpinion Paragraph in our opinion proper books of account as required by law have beenkept by the Company so far as appears from our examination of those books.

c) The Balance Sheet the Statement of Profit and Loss including other comprehensiveincome the Statement of Cash Flows and the Statement of Changes in Equity dealt with bythis Report are in agreement with the books of account.

d) Except for the possible effects of the matter described in the Basis for QualifiedOpinion Paragraph in our opinion the aforesaid Standalone Ind AS Financial Statementscomply with the Ind AS specified under Section 133 of the Companies Act 2013 read withRule 7 of the Companies (Accounts) Rules 2014.

e) On the basis of written representations received from the directors as on 31st March2017 taken on record by the Board of Directors none of the directors of the company isdisqualified as on 31st March 2017 from being appointed as a director in terms of Section164(2) of the Act.

f) With respect to the adequacy of the Internal financial control over financialreporting of the company and operating effectiveness of such controls refer to ourseparate report in "Annexure B"; and

g) With respect to the other matters to be included Auditor's Report in accordance withRule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to the bestof 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 Standalone Ind AS Financial Statements. Refer Note 26.11 to the StandaloneInd AS 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.

iv) The company did not have any holdings or dealings in Specified Bank Notes duringthe period from 08th November 2016 to 30th December 2016. Hence the disclosurerequirement as envisaged in Notification G.S.R 308(E) dated 30th March 2017 is notapplicable to the company. Refer Note No: 26.18 to the Standalone Ind AS FinancialStatements.

For Brahmayya & Co.
Chartered Accountants
Firm Regn. No.000511S
Place : Chennai Sd/-
Date : 30th May 2017 K. Jitendra Kumar
Partner
Membership No.201825

Referred to in Clause 1 of "Report on Other Legal and RegulatoryRequirements" Paragraph of the Independent Auditors' Report of even date themembers of "PVP Ventures Limited" on the Standalone Ind AS FinancialStatements as of and for the year ended 31st March 2017.

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

(b) As explained to us fixed assets have been physically verified by the management atreasonable intervals; 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 there are no immovable properties that are heldin the name of the company.

(ii) In our opinion and according to the information and explanations given to ushaving regard to nature of inventory i.e Land the physical verification of title deedsreconciliations with survey numbers of stock in hand and certification of extent of landsold by competent persons are at reasonable intervals and no material discrepancies werenoticed on physical verification.

(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to Companies Firms Limited Liability Partnershipor other parties covered in the register maintained under section 189 of the CompaniesAct 2013. Therefore the provisions of clause (iii) (iii)(a) (iii)(b) and (iii)(c) ofParagraph 3 of the Order are not applicable to the company.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the

provisions of section 185 and 186 of the Act with respect to the loans giveninvestments made guarantees given and

securities given.

(v) The Company has not accepted any deposits from the public during this year.Therefore the provisions of clause (v) of the Companies (Auditor's Report) Order 2016 arenot applicable to the company.

(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 undersub-section (1) of Section 148 of the Act in respect of Company's products and are of theopinion that prima facie the prescribed accounts and records have been made andmaintained. However we have not made a detailed examination of the cost records with aview to determine whether they are accurate or complete.

(vii) (a) Undisputed statutory dues including provident fund employee's stateinsurance income tax sales tax service tax duty of custom duty of excise value addedtax cess and other material statutory dues as applicable have not been regularlydeposited with the appropriate authorities and there have been significant delays.Undisputed amounts payable in respect thereof which were outstanding at the year-end fora period of more than six months from the date they became payable are as follows:

Name of the Statue Nature of Dues Amount (in Rs.) Period to which the amount relates Date of Payment
The Tamilnadu Urban Land Ceiling and Regulation Act 1978 Urban Land Tax 677637/- FY 2014-15 Yet to be remitted
The Tamilnadu Urban Land Ceiling and Regulation Act 1978 Urban Land Tax 903516/- FY 2015-16 Yet to be remitted
The Tamilnadu Urban Land Ceiling and Regulation Act 1978 Urban Land Tax 451758/- April 2016 to September 2016 Yet to be remitted

(b) According to the information and explanations given to us the details of dues ofIncome tax which is not deposited on account of any dispute as on March 312017 is givenbelow:-

(Rs. in lakhs)

Nature of Statue Nature of Dues Tax Amount Disputed Period to which Amount Relates Forum where dispute is pending
The Income Tax Act 1961 Income Tax 13.24 Assessment Year 2009-10 ITAT Chennai
The Income Tax Act 1961 Income Tax 493.43 Assessment Year 2013-14 CIT-A Chennai
The Income Tax Act 1961 Penalty 1276.58 Assessment Year 2008-09 CIT-A Chennai
The Income Tax Act 1961 Income Tax 346.40 Assessment Year 2014-15 CIT-A Chennai

(viii) According to the records of the Company examined by us and the information andexplanation given to us the company has not defaulted in repayment of principal to thelenders as on the reporting date.

(ix) The Company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments). The term loans obtained were applied for the purposefor which those were raised.

(x) According to the information and explanations given to us no fraud by the Companyand no fraud on the Company by its officers or employees has been noticed or reportedduring the course of our audit.

(xi) According to the information and explanations given to us and based on ourexamination of the records of the company the company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Companies Act 2013.

(Xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi company. Therefore the provisions of Clause (xii) of Paragraph 3of the Order are not applicable.

(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 Standalone Ind AS Financial Statements as requiredby the applicable accounting standards.

(xiv) According to the information and explanations given to us and based on 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 the provisions of Clause (xiv) of Paragraph 3 of the Order are notapplicable.

(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into any non-cashtransactions with directors or persons connected with them covered under section 192 ofthe Companies Act 2013. Therefore the provisions of Clause (xv) of Paragraph 3 of theOrder are not applicable.

(xvi) The company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934. Therefore the provisions of Clause (xvi) of Paragraph 3 of theCompanies (Auditors Report) Order 2016 are not applicable to the company.

For Brahmayya& Co.
Chartered Accountants
Firm Regn. No.000511S
Place : Chennai Sd/-
Date : 30th May 2017 K. Jitendra Kumar
Partner
Membership No.201825

Annexure B to the Independent 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")

We have audited the internal financial controls over financial reporting of PVPVentures Limited ("the Company") as of 31st March 2017 in conjunction withour audit of the Standalone Ind AS Financial Statements of the Company for the year endedon 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 asissued 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 safeguarding ofits 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 judgement including the assessment of the risks ofmaterial misstatement of the Standalone Financial Statements whether due to fraud orerror.

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 Standalone 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 StandaloneFinancial Statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the StandaloneFinancial 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.

Qualified Opinion

According to the information and explanations given to us and based on our auditprocedure performed the following material weakness has been identified in the operatingeffectiveness of the company's Internal Financial Controls over Financial Reporting as at31st March 2017:

The company's internal financial controls in respect of supervisory and review controlsover process of determining of a) Carrying value of the company's non-current investmentsin its subsidiaries and b) Recoverability of loans to its subsidiaries included underNon-current investments.

Absences of aforesaid assessment in accordance with the accounting principles generallyaccepted in India could potentially result in a material misstatement in the carryingvalue of investments in such subsidiaries and the aforesaid dues from such subsidiariesand consequently could also impact the profit (financial performance including othercomprehensive income) after tax.

A ‘material weakness' is a deficiency or a combination of deficiencies ininternal financial controls 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 except for the possible effects of the material weakness describedabove on the achievement of the objectives of the control criteria the company hasmaintained in all material respects adequate internal financial controls over financialreporting and such internal financial controls over financial reporting were operatingeffectively as at 31st March 2017 based on internal control over financial reportingestablished 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.

We have considered the material weakness identified and reported above in determiningthe nature timing and extent of audit tests applied in our audit of the Standalone Ind ASFinancial Statements of the Company and we have issued a qualified opinion on theStandalone Ind AS Financial Statements.

For Brahmayya& Co.
Chartered Accountants
Firm Regn. No.000511S
Place : Chennai Sd/-
Date : 30th May 2017 K. Jitendra Kumar
Partner
Membership No.201825