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A R C Finance Ltd.

BSE: 540135 Sector: Financials
NSE: N.A. ISIN Code: INE202R01018
BSE 00:00 | 19 Aug 1.30 0
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NSE 05:30 | 01 Jan A R C Finance Ltd
OPEN 1.33
PREVIOUS CLOSE 1.30
VOLUME 225
52-Week high 4.00
52-Week low 0.61
P/E
Mkt Cap.(Rs cr) 7
Buy Price 1.30
Buy Qty 6.00
Sell Price 1.33
Sell Qty 60.00
OPEN 1.33
CLOSE 1.30
VOLUME 225
52-Week high 4.00
52-Week low 0.61
P/E
Mkt Cap.(Rs cr) 7
Buy Price 1.30
Buy Qty 6.00
Sell Price 1.33
Sell Qty 60.00

A R C Finance Ltd. (ARCFINANCE) - Auditors Report

Company auditors report

TO THE MEMBERS OF ARC FINANCE LIMITED

Report on the Financial Statements

We have audited the financial statements of ARC Finance. Limited ("theCompany") which comprise the Balance Sheet as at March 31 2018 the Statement ofProfit and Loss and Cash Flow Statement for the year then ended and a summary ofsignificant 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 preparation andpresentation of the financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance withaccounting 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 of 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.

Auditor's Responsibility

Our responsibility is to express an opinion on the 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 thereunder. We conducted our audit in accordancewith the Standards on Auditing issued by the Institute of Chartered Accountants of Indiaas specified under Section 143(10) of the Act. Those Standards require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the 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 but not for the purpose of expressing an opinionon whether the Company has in place an adequate internal financial controls system overfinancial reporting and the operating effectiveness of such controls. An audit alsoincludes evaluating the appropriateness of accounting policies used and the reasonablenessof the accounting estimates made by the Company's Directors as well as evaluating theoverall presentation of 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 financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the financial statements give the information required by the Act in themanner so required and give subject to Note No 1 para x.1) and 2) of the Notes to thefinancial statements regarding non-provision of gratuity and leave encashment which aretreated on cash basis a true and fair view in conformity with the accounting principlesgenerally accepted in India;

a) In the case of the Balance Sheet of the state of affairs of the Company as atMarch 31 2018 and

b) In the case of the Statement of Profit and Loss of the Profit of the Company forthe year ended on that date.

c) In the case of the Cash Flow Statement of the cash flow of the Company for the yearended on that date.

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 a statement on the matters specified in paragraphs 3and 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) 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 financial statements comply with the Accounting Standardsspecified under section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014;

(e) On the basis of written representations received from the directors as on March 312018 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2018 from being appointed as a director in terms of Section 164 (2) ofthe Act; and

(f) With respect of the adequacy of the internal financial controls 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 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 does not have any pending litigations which would impact on itsfinancial positions in its 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 SANJEEV NAVIN & ASSOCIATES

Chartered Accountants

FRN No. 326800E

Sd/-

Aditya Nath Mishra

Partner

M. No.: 303977

Place of Signature: Kolkata

Date: 28/05/2018

Annexure A to the Auditor's Report

(Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date of ARC Finance. Limited for the yearended 31st March 2018)

(i) In respect of its Fixed Assets:

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

b) The company has regular programme of physical verification of its fixed assets bywhich fixed assets are verified in phased manner over a period of three years. Inaccordance with this programme certain fixed assets were verified during the year and nomaterial discrepancies were noticed on such verification. In our opinion this periodicityof physical verification is reasonable having regards to the size of the Company and thenature of its assets.

c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.

(ii) In respect of its Inventory:

a) The physical verification of inventory has been conducted at reasonable intervals bythe management which in our opinion having regard to the nature and location of stockfrequency of verification is reasonable.

b) In our opinion and according to the information and explanations given to us theprocedures of physical verification of inventory followed by the management reasonable andadequate in relation to the size of the company and the nature of its business.

c) In our opinion and according to the information and explanations given to us thecompany has maintained proper records of inventory and no material discrepancies werenoticed on physical verification. (iii) The Company has not granted any loans secured orunsecured to any companies firms Limited Liabilities partnerships or other partiescovered in the register maintained under section 189 of the Companies Act 2013.Accordingly provisions of clause 3(iii)(a) to (C ) of the Order is not applicable to thecompany in respect of repayment of the principal amount and overdue interest.

(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 respectto the loans Investments made.

(v) The company has not accepted any deposits from the public and hence the directivesissued by the Reserve Bank o India and the provisions of Sections 73 to 76 or any otherrelevant provisions of the Companies Act 2013 and the Companies (Acceptance of Deposit)Rules 2015 with regard to the deposits accepted from the public are not applicable.

(vi) As informed to us the maintenance of Cost Records has not been specified by theCentral Government under sub-section (1) of Section 148 of the Companies Act 2013 inrespect of the activities carried on by the company.

(vii) a) According to the information and explanations given to us and on the basis ofour examination of the records of the company amount deducted / accrued in the books ofaccounts in respect of undisputed statutory dues including provident fund income taxsales tax/ value added tax service tax wealth tax duty of customs duty of excise cessand other material statutory dues has been regularly deposited during the year by thecompany with appropriate authorities. As explained to us the company did not have anydues on account of employees' state insurance and duty of excise.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund income tax sales tax wealth tax service tax. dutyof custom value added tax cess and other material statutory dues were in arrears as at31st March 2018 for a period of more than six months from the date they becamepayable.

b) According to the information and explanations given to us there are no material duesof Provident fund sales tax wealth tax income tax service tax duty of customs andcess which have not been deposited with the appropriate authorities on account of anydispute.

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of dues to any financial institution or bank.The company has not issued any debentures.

(ix) The company is did not raise money by way of initial public offer (including debtinstruments) and term loans during the year. Accordingly paragraph 3(ix) of the Order isnot applicable.

(x) According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course 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 toexplanations and explanations given to us the Company is not a nidhi company.Accordingly paragraph 3(xii) of the Order is 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 o 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 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.

(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 has obtained registration under section 45-1A of the Reserve Bank ofIndia Act 1934.

For SANJEEV NAVIN & ASSOCIATES

Chartered Accountants

FRN No. 326800E

Sd/-

Aditya Nath Mishra

Partner

M. No.: 303977

Place of Signature: Kolkata

Date: 28/05/2018

Annexure B to the Auditors' 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 ARCFinance Limited (the Company') as of 31 March 2018 in conjunction 'with our audit ofthe 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 the Company's policies the safeguarding of its assetsthe prevention 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.

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 lCAI 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 were established and maintained and if suchcontrols 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 auditors' 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 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 authorizations of theManagement and directors of the Company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized 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 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 March 2018 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 SANJEEV NAVIN & ASSOCIATES

Chartered Accountants

FRN No. 326800E

Sd/-

Aditya Nath Mishra

Partner

M. No.: 303977

Place of Signature: Kolkata

Date: 28/05/2018