To the Members of SUNSHINE CAPITAL LIMITED
Report on the Financial Statements
I have audited the accompanying financial statements of M/s SUNSHINE CAPITAL LIMITED(the Company) which comprise the Balance Sheet as at March 31 2016 and theStatement of Profit and Loss the Cash Flow Statement for the year then ended and asummary of significant accounting policies and other explanatory information.
Managements Responsibility for the Financial Statements
The Companys Management is responsible for the matters in section 134(5) of theCompanies Act 2013 (the Act) with respect to preparation of these financial statementsthat give a true and fair view of the financial position financial performance and cashflows of the Company in accordance with the accounting principles generally accepted inIndia including the Accounting Standards specified under section 133 the Companies Act2013 read with rule 7 of Companies (Accounts) Amendment Rules 2015. This responsibilityalso includes the maintenance of adequate accounting records in accordance with theprovision of the act for the safeguarding of Assets of the company and for preventing anddetecting the frauds and other irregularities selection and application of appropriateaccounting policies making judgments and estimated that are reasonable and prudent anddesign implementation and maintenance of internal financial control that were operatingeffectively for ensuring the accuracy and completeness of the accounting records relevantto the preparation and presentation of the financial statements that give a true and fairview and are free from material misstatement whether due to fraud or error.
My responsibility is to express an opinion on these financial statements based on myaudit. I have taken into account the provisions of the act the accounting and Auditingstandards and matter which are required to be included in the audit report under theprovision of the act and the rules made thereunder. I conducted my audit in accordancewith the Standards on Auditing specified under section 143 (10) of the act.Those Standardsrequire that I comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the financial statements are free from materialmisstatement.
An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on theauditors 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 control relevant to the Companys preparation and fairpresentation of the financial statements in order to design audit procedures that areappropriate in the circumstances. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made bymanagement as well as evaluating the overall presentation of the financial statements.
I believe that the audit evidence I have obtained is sufficient and appropriate toprovide a basis for my audit opinion on the financial statements.
In my opinion and to the best of my information and according to the explanations givento me the financial statements read together with NOTES thereon subject to Note No. 24regarding non provision of diminution in the value of Non Current Investment to the tuneof Rs 25.03 Crores (Previous Year 12.00 Crore) by virtue of which profit of the companyhas been overstated by Rs 25.03 Crores. Further as per AS-2 the inventories are to bevalued at cost or market value whichever is less. There is non provision for shortfall invalue of inventories to the tune of Rs 19.17 Crore by virtue of which profit of thecompany has been overstated by Rs 19.17 Crore give the information required by the Act inthe manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India:
(a) In the case of the Balance Sheet of the state of affairs of the Company as at 31stMarch 2016;
(b) In the case of the Statement of Profit and Loss of the Profit for the year endedon that date; (C) In the case of the Cash Flow Statement of the Cash Outflows for theyear ended on that date;
Report on other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order 2016 (theOrder) issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act I give in the Annexure A statement on the mattersSpecified in paragraphs 3 and 4 of the Order.
2. As required by section 143(3) of the Act I report that:
a) I have sought and obtained all the information and explanations which to the best ofmy knowledge and belief were necessary for the purpose of my audit;
b) in my opinion proper books of account as required by law have been kept by theCompany so far as appears from my examination of those book;
c) the Balance Sheet Statement of Profit and Loss and cash flow Statement dealt withby this Report are in agreement with the books of account;
d) In my opinion the aforesaid Financial Statements comply with the AccountingStandards specified under section 133 of the act read with 7 of Companies (Accounts)Amendment Rules 2015.
e) on the basis of written representations received from the directors as on 31stMarch 2016 and 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 ofsection 164(2) of the act
. f) with respect to adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to myseparate report in Annexure Band
g) with respect to the other matters to be included in the Auditors Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in my opinionand to the best of my 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 Statement as referred to in note no. 27 (a) (b) and (c) to thefinancial statement.
. (ii) the Company did not have any long-term contracts including derivative contractsfor which 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
''ANNEXUREANNEXURE A TO THE AUDITORS REPORT
The Annexure referred to in my report of even date to the members of M/s SUNSHINECAPITAL LIMITED as at and for the year ended 31st March 2016 I report that:
1. Fixed Assets:
a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets on the basis of available information.
b) As explained to me all the fixed assets have been physically verified by themanagement in a phased periodical manner which in my opinion is reasonable having regardto the size of the Company and nature of its assets. No material discrepancies werenoticed on such physical verification.
a) The inventories have been physically verified during the year by the management. Inmy opinion the frequency of verification is reasonable.
b) In my opinion and according to the information and explanations given to me theprocedures of physical verification of inventories followed by the management arereasonable and adequate in relation to the size of the Company and the nature of itsbusiness.
c) The Company has maintained proper records of inventories. As per the information andexplanation given to me no material discrepancies were noticed on physical verification.
3. Secured or unsecured Loans
The company has not granted any loans secured or unsecured to companies firmsLimited Liability Partnerships or other parties covered in the register maintained undersection 189 of the Companies Act 2013. So Further provisions of clause do not apply.
4. The company has complied with the provision of section 185 & 186 in respect ofloans investments guarantees and security.
5. In my opinion and according to the Information & Explanation given to me TheCompany has not accepted deposits under the provisions of sections 73 to 76 are notapplicable or any other relevant provisions of the Companies Act 2013 and the rulesframed there under.
6. I have been informed that the maintenance of cost records has not been prescribed bythe Central Government under sub-section (1) of section 148 of the Companies Act 2013.
7. Statutory Dues:
a) According to the records of the Company undisputed statutory dues includingProvident Fund Employees State Insurance Income Tax Sales Tax Wealth TaxService Tax duty of Customs Duty of Excise Value Added Tax Cess and other materialstatutory dues have been generally regularly deposited with the appropriate authorities.According to the information and explanations given to me no undisputed amounts payablein respect of the aforesaid dues were outstanding as at March 31 2016 for a period ofmore than six months from the date of becoming payable.
b) According to the information and explanations given to me there is a pending taxdemands of which information given below:
| || || ||(In Rs) |
|ACT ||Appeal pending Before ||Assessment year ||Amount of demand |
|Income Tax Act ||ITAT ||2008-09 ||353380053/- |
|Income Tax Act ||CIT (A) ||2008-09 ||339900000/- |
|Income Tax Act ||ITAT ||2009-10 ||51466300/- |
8. Since the company has not taken any loan or borrowing from a financial institutionbank Government or dues to debenture holders hence the default in repayment of dues tobanks financial institutions and Government does not arise.
9. In my opinion and according to the Information & Explanation given to me thecompany has not raised moneys by way of initial public offer or further public offer(including debt instruments) and term loans so the clause is not applicable for thecompany.
10. Based on the procedure performed and the information and explanation given to me Ireport that no fraud on or by the company has been noticed or reported during the yearnor I have been informed of such cases by the management.
11. In my opinion and according to the information and Explanation given to me thecompany has not paid or provided managerial remuneration.
12. The company is not a Nidhi company hence the provision related to the Nidhi Companyis not applicable.
13. The company has not any related party transaction.
14. The company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year under review.
15. The company has not entered into any non-cash transactions with directors orpersons connected with him.
16. The Company having Certificate of Registration No. B-14.01266 issued on 25.09.1998by Reserve Bank of India New Delhi under Section 45 IA of the RBI Act 1934
Annexure B to the Auditors Report
Report on the Internal Financial Controls under Clause (i) of Sub-- -section 3 ofSection 143 of the Companies Act 2013 (the Act)
I have audited the internal financial controls over financial reporting of M/s SUNSHINECAPITAL LIMITED (the Company) as of 31 March 2016 in conjunction with my auditof the standalone financial statements of the Company for the year ended on that date.Managements Responsibility for Internal Financial Controls The Companysmanagement is responsible for establishing and maintaining internal financial controlsbased on the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the Institute ofChartered Accountants of India (ICAI). These responsibilities include thedesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to companys 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. AuAu Auditorsditors Responsibility Myresponsibility is to express an opinion on the Company's internal financial controls overfinancial reporting based on my audit. I conducted my audit in accordance with theGuidance Note on Audit of Internal Financial Controls over Financial Reporting (theGuidance 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 I 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 performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. My 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 auditors judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.
I believe that the audit evidence I have obtained is sufficient and appropriate toprovide a basis for my audit opinion on the Companys internal financial controlssystem over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting A company's internalfinancial control over financial reporting is a process designed to provide reasonableassurance regarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally acceptedaccounting principles. A company's internal financial control over financial reportingincludes those policies and procedures that Pertain to the maintenance of records that inreasonable detail accurately and fairly reflect the transactions and dispositions of theassets of the company; (2) provide reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorisations of management and directors of thecompany; 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 Financialancial ReportingBecause 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.
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.
(Under RBI Act)
The Board of Directors
M/s Sunshine Capital Limited 209 Bhanot Plaza-II 3. D.B. Gupta Road Paharganj NewDelhi -110055
I have audited the Balance Sheet of M/s Sunshine Capital Limited (theCompany) as at 31st March 2016 and the Statement of Profit and loss for the yearended on that date both annexed thereto.
As required by the Non-Banking Financial Companies Auditors Report (Reserve Bankof India) Directions 2008 dated September 18 2008 issued in term of Sub Section(1A) of Section 45MA of RBI Act 1934 our responsibility is to report on the matterspecified in paragraphs 3 and 4 of the said Direction and now we report on the matter tothe extent applicable to the company as hereunder:
a) The company has obtained a certificate of registration (COR) from the Reserve Bankof India vide Registration No. B - 14.01266 issued on 25th September 1998the company is non-deposit accepting NDSI-NBFC.
b) The company is entitled to continuing to undertake the business of Non BankingFinance Institution. In terms of its assets /income pattern criteria set by RBI videits circular No. DNBS.PD.CC.No.85/03.02.089/2006-07 dated Dec 6 2006).
c) The Board of Directors of the company has passed a resolution for the non acceptanceof any public deposits.
d) The company has not accepted any public deposits during the financial year ended31.03.2016.
e) The Company has complied with the prudential norms relating to income recognitionaccounting standards asset classification and provisioning for bad and doubtful debts asapplicable to it in terms of " "Systemically Important Non-Banking Financial(Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions2015".
f) The Company has complied with the Capital adequacy capital funds riskassets/exposures and risk asset ratio as disclose in the return submitted to the bank inform of NBS_7 has been correctly arrived at such ratio in compliance with the minimumCRAR prescribed by the bank.
g) The company has furnished the annual statement of capital funds risksassets/exposures and risk assets ratio (NBS_7) within the stipulated time to Reserve Bankof India.
h) The company has no branches during the financial year ended 31.03.2016.
Membership No: 086223
PLACE: NEW DELHI