Southern Gas Ltd.
|BSE: 509910||Sector: Industrials|
|NSE: N.A.||ISIN Code: N.A.|
|BSE 15:19 | 05 Oct||Southern Gas Ltd|
|NSE 05:30 | 01 Jan||Southern Gas Ltd|
|BSE: 509910||Sector: Industrials|
|NSE: N.A.||ISIN Code: N.A.|
|BSE 15:19 | 05 Oct||Southern Gas Ltd|
|NSE 05:30 | 01 Jan||Southern Gas Ltd|
The Southern Gas Limited
Report on the Financial Statements
We have audited the accompanying financial statements of The Southern Gas Limited("the Company") which comprise the Balance Sheet as at 31st March 2017 theStatement of Profit and Loss and the 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 preparationand presentation of these financial statements that give a true and fair view of thefinancial position financial performance and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 ofthe Act read with Rule 7 of the Companies (Accounts) Rules2014.
This responsibility also includes the maintenance of adequate accounting records inaccordance with the provision of the Act for safeguarding the assets of the Company andfor preventing and detecting the 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.
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 anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of the accountingestimates made by Company's Directors as well as evaluating the overall presentation ofthe financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the financial statements.
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 31March 2017 and its profit and its cash flows for the year ended on that date;
Report on Other Legal and Regulatory Requirements
As required by the Companies (Auditor's Report) Order 2016 ("Order") issuedby the Central Government of India in terms of sub-section (11) of section 143 of theCompanies Act 2013 we give in the Annexure A a statement on the matters specified inParagraphs 3 and 4 of the said Order.
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 7 of theCompanies(Accounts) Rules 2014;
e) On the basis of written representations received from the directors as on 31stMarch 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2017 from being appointed as a director in terms ofSection 164(2) of the 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 B"; and
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 pending litigations which are disclosed in the ContingentLiabilities in note No. 2.30 to the accounts. The impact if any on the financial positionon final settlement of the litigation is not ascertainable.
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 which were required to betransferred to the Investor Education and Protection Fund by the Company during the year.
iv. The Company has provided requisite disclosures in its financial statements as toholdings as well as dealings in Specified Bank Notes during the period from 8 November2016 to 30 December 2016 and these are in accordance with the books of accountsmaintained by the Company. Refer Note 2.29 to the financial statements.
ANNEXURE A TO THE AUDITOR'S REPORT
The Annexure referred to in Independent Auditor's Report to the members of the Companyon the financial statements for the year ended 31 st March 2017 we report that:
I. a. The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets;
b. We are informed that all the fixed assets have been physically verified by themanagement during the year except for gas cylinders with customers and which in ouropinion is reasonable having regard to the size of the company and the nature of itsassets and that no material discrepancies have been noticed on such verification.
c. The title deeds of Immovable properties are held in the name of the Company.
ii. We are informed that the physical verification of inventory has been conducted bythe management at reasonable intervals and discrepancies noticed on physical verificationwere properly dealt with in the books of account by the management.
iii. The Company has not granted any loans secured or unsecured to companies firms orother parties covered in the register maintained under section 189 of the Companies Act2013 thus paragraph 3(iii)(a) to 3(iii)(c) of the Order is not applicable to the Company.
iv. In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any transaction which is covered underthe provisions of section 185 and 186 of the Act with respect to the loans investmentsand security made.
v. The Company has not accepted any deposits from the public.
vi. To the best of our knowledge and according to the information and explanationsgiven to us the Central Government has not prescribed the maintenance of cost recordsunder Section 148 (1) of the Act for the company.
vii. a. According to the information and explanations given to us and as perverification of records of the company the company has been generally regular indepositing undisputed statutory dues including Provident Fund Employee's State InsuranceIncome Tax Sales-Tax Service Tax Duty of Customs Duty of Excise Value Added Tax Cessand other statutory dues with the appropriate authorities during the year. There are nomaterial amounts of undisputed statutory dues outstanding at the last day of thefinancials year for a period of more than 6 months from the date on which they becamepayable.
b. According to the information and explanations given to us and as per verification ofrecords of the company disputed amounts of taxes which have not been deposited with theauthorities as at 31 -03- 2017 as per details given below: -
viii. According to the information and explanations given to us the company has notdefaulted in repayment of loans or borrowings to a financial institution or bank. Thecompany has not borrowed any amount from Government or debenture holders.
ix. The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loans during the year. Accordinglyparagraph 3 (ix) of the Order is not applicable.
x. According to the information and explanations given to us no fraud by the Companyor on the Company by its officers or employees has been noticed or reported during thecourse of our audit.
xi. According to the information and explanations give 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 Act.
xii. In our opinion and according to the information and explanations given to us theCompany is not a nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable.
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. According to the information and explanations give 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.
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 non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.
xvi. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.
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")
We have audited the internal financial controls over financial reporting of TheSouthern Gas Limited("the Company") as of 31 March 2017 in conjunction with ouraudit 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 ('ICAI'). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to 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.
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 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 of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(2) Provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and
(3) Provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial 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 proj ections 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.
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 st 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.