TO THE MEMBERS OF SYSTEMATIX CORPORATE SERVICES LIMITED
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of SYSTEMATIXCORPORATE SERVICES LIMITED ("the Company") which comprise the Balance Sheet asat 31st March 2017 the Statement of Profit and Loss and the Cash FlowStatement for the year then ended and a summary of significant accounting policies andother explanatory information.
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 preparationand presentation of these standalone financial statements that give a true and fair viewof the financial position financial performance and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.
Our responsibility is to express an opinion on these standalone financial statementsbased on our audit. We have taken into account the provisions of the Act the accountingand auditing standards and matters which are required to be included in the audit reportunder the provisions of the Act and the Rules made thereunder. We conducted our audit inaccordance with the Standards on Auditing specified under Section 143(10) of the Act.Those Standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the financial statements are free frommaterial 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 give 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 the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us 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 2017 and its Profit and its cash fllows for the year ended on thatdate.
Emphasis of Matters
We draw attention to the following matters in the Notes to the financial statements. Wedraw attention to the following matter Note no 22 in the Notes to the financialstatements:
"A massive fire broke out in the office of the Company at J K Somani Building 2ndFloor British Hotel Lane Fort Mumbai - 400001 on 30/11/2016 at 21.30 hours in which thefixed assets including IT Systems books of account maintained in the IT systems billsVouchers Statutory records like Service Tax Returns e-TDS Returns correspondence withSEBI and clients got destroyed. However the books of accounts have been recovered fromthe mirror server maintained as a part of disaster recovery system (DRS); copies of bankstatements have been obtained. Soft copies of the various statutory returns such asService Tax returns e-TDS Returns and Returns to SEBI have been downloaded from therespective websites Confirmations of balances were sent to all clients subsequently. Thusthe accounts have been complied for the period up to 30/11/2016 and were subject to audit"
In accordance with Standards on auditing we applied other alternate audit procedure soas to obtain sufficient and appropriate audit evidence and found that the financialstatements prepared from the books of account and other records retrieved as mentionedabove are free from material misstatement enabling us to express opinion on true and fairview of the financial statements.
Report on Other Legal and Regulatory Requirements
1. 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 standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.
(e) On the basis of the written representations received from the directors as on 31stMarch 2017 and 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 of Section164 (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 A".
(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 no pending litigation impacting the financial position in itsfinancial statements .
(ii) the Company did not have any long-term contracts including derivative contracts;and
(iii) There has not been an occasion in case of the Company during the year underreport to transfer any sums to the investor Education and protection Fund. Therefore thequestion
of delay in transferring such sums does not arise.
(iv) The Company has provided requisite disclosure in the financial statements as toholdings as well as dealings in specified bank Notes during the period from 8th November2016 to 30th December 2016.Based on the Audit procedure and relying on the managementrepresentation we report that the disclosure are in accordance with books of accountmaintained by the company and as produced to us by the management. (Refer Note 27)
2. 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 "B" a statement on the matters specified in theParagraphs 3 and 4 of the Order to the extent applicable.
| ||For Maharaj N R Suresh and Co |
| ||FRN001931S |
| ||Chartered Accountants |
| ||Sd/- |
| ||K V Srinivasan |
|Place : Mumbai ||Partner |
|Date : 30.05.2017 ||M.No: 204368 |
ANNEXURE "A" to The Independent Auditor's Report of even date on theStandalone Financial Statements of Systematix Corporate Services Limited.
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 SystematixCorporate Services Limited ("the Company") as of March 312017 in conjunctionwith our audit of the Standalone Financial Statements of the Company for the year ended onthat 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 :
(i) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(ii) 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
(iii) 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 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 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 March 31 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.
Annexure "B" to the Independent Auditors' Report of even date on theStandalone Financial Statements of Systematix Corporate Services Limited
(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) These fixed assets have been physically verified by the Management at reasonableintervals which in our opinion is reasonable having regard to the size of the Companyand the nature of its assets. No material discrepancies were noticed on such verification.
(c) According to the information and explanation received by us as the company owns noimmovable properties the requirements on reporting whether title deeds of immovableproperties held in the name of the Company not applicable.
(ii) According to the information and explanations given to us and having regard tothe company's business reporting on clause 3(ii) of the Companies (Auditor's report) order2016 does not arise.
(iii) The Company has not granted any loans secured or unsecured to Companies FirmsLLPs or other parties covered in the register maintained under section 189 of theCompanies Act 2013.
(iv) The Company has complied with the provisions of Section 185 and 186 of theCompanies Act 2013 in respect of Investments and Guarantees provided by the company. Thecompany has not granted loans to any company covered under Section 185
(v) The Company has not accepted any deposits from the public
(vi) As per the explanation and information given to us the Company is not required tomaintain cost Records pursuant to Sub-section (1) of Section 148 of the Companies Act2013. Accordingly the clause 3 (vi) of the order is not applicable to the company.
(vii) According to the information and explanations given to us in respect of Statutorydues : (a) The company is regular in depositing with appropriate authorities undisputedstatutory dues including Income Tax Wealth Tax Service Tax and other material statutorydues applicable to it. There were no undisputed amounts payable in respect of Income TaxWealth Tax and Service Tax were in arrears as at 31st March 2017 for a period of morethan six months from the date they became payable.
(b) According to the information and explanation given to us there are no dues ofSales Tax Income Tax Customs Duty Wealth Tax Excise Duty Service Tax and cess whichhave not been deposited on account of any dispute :
(viii) The Company has not defaulted in repayment of dues to financial institutionsbanks Government or to debenture holders.
(ix) In our opinion and according to the information and explanations given to us thecompany has not raised any money by way of initial public offer or further public offerterm loans (including debt instruments) during the year.
(x) According to the information and explanations given to us no fraud on or by theCompany has been noticed or reported during the year.
(xi) The managerial remuneration has been paid or provided in accordance with therequisite approvals mandated by the provisions of section 197 read with Schedule V to theCompanies Act.
(xii) The Company is not a Nidhi Company and hence clause (xii) of Paragraph 3 is notapplicable to the Company.
(xiii) All Transactions with the related parties are in compliance with section 177 and188 of Companies Act 2013where applicable and the details have been disclosed in thefinancial 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.
(xv) The company has not entered into any non-cash transactions with directors orpersons connected with him.
(xvi) The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.
| ||For Maharaj N R Suresh and Co |
| ||FRN001931S |
| ||Chartered Accountants |
| || |
| ||Sd/- |
| ||K V Srinivasan |
|Place : Mumbai ||Partner |
|Date : 30.05.2017 ||M.No: 204368 |