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Artefact Projects Ltd.

BSE: 531297 Sector: Engineering
NSE: N.A. ISIN Code: INE885B01014
BSE 00:00 | 18 Oct 38.15 -2.00






NSE 05:30 | 01 Jan Artefact Projects Ltd
OPEN 38.15
52-Week high 51.00
52-Week low 21.35
P/E 9.83
Mkt Cap.(Rs cr) 22
Buy Price 44.45
Buy Qty 10.00
Sell Price 38.15
Sell Qty 15.00
OPEN 38.15
CLOSE 40.15
52-Week high 51.00
52-Week low 21.35
P/E 9.83
Mkt Cap.(Rs cr) 22
Buy Price 44.45
Buy Qty 10.00
Sell Price 38.15
Sell Qty 15.00

Artefact Projects Ltd. (ARTEFACTPROJECT) - Auditors Report

Company auditors report


The Members


Report on the Indian Accounting Standards (Ind AS) Financial Statements

We have audited the accompanying Ind AS financial statements of ARTEFACT PROJECTSLIMITED (“the Company”) which comprise the Balance Sheet as at March 31 2018the Statement of Profit and Loss (including Other Comprehensive Income) the Cash FlowStatement for the year then ended and a summary of significant accounting policies andother explanatory information.

Management's Responsibility for the Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) ofthe Companies Act 2013 (“the Act”) with respect to the preparation ofthese Ind AS financial statements that give a true and fair view of the financialposition financial performance (including Other Comprehensive Income) cash flows andchanges in equity of the Company in accordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards (Ind AS) specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2015.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing 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 Ind ASfinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on these Ind AS financial statements basedon our audit.

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 and the Order under section 143 (11)of the Act.

We conducted our audit of the Ind AS financial statements in accordance with theStandards on Auditing specified under Section 143(10) of the Act. Those Standards requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the Ind AS financial statements are free from materialmisstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the Ind AS financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of theInd AS financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to the Company'spreparation of the Ind AS financial statements that give a true and fair view in order todesign audit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of accounting policies used and the reasonableness of theaccounting estimates made by the Company's directors as well as evaluating the overallpresentation of the Ind AS financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our qualified audit opinion on the Ind AS financial statements.

Basis for Qualified Opinion

Attention is drawn to:

i) Note no. 9.01 to the accompanying statement of audited financial results whereinthe management of the company has considered trade receivables outstanding for more than 6months amounting to Rs. 1092.69 Lacs as good and fully recoverable. As per management thereceivables are fully due from the Government Departments as per Express Contractsprovisions of the agreement and hence the same are considered good and recoverable and noprovision is required. We are unable to comment the exact extent to which these balancesshall be recoverable.

ii) Note No. 20.01 to the accompanying statement of audited financial resultsregarding non-provision of service tax demand as per Order of Commissioner (Appeals) ofRs. 188.89 Lacs and penalty of Rs.188.89 Lacs thereon. The company had contested thedemand in appeal before Appellate Tribunal and as per Order of Tribunal dated 27.03.2018No. ST/86888/2014-ST/DB the Service Tax demand of Rs 31.16 lacs and penalty of Rs 170.93Lacs is waived. Further amount of Rs 129.39 Lacs was paid against outstanding demand. Forbalance demand and penalty ofRs 17.96 Lacs the matter has been remanded to Commissioner(Appeals) for the Company to submit the other relevant evidences. The company does notenvisage any liability thereon.

iii) Note no.20.02 to the financial statements regarding the payments due of servicetax amounting to Rs.119.72 Lacs (net of CENVAT credit) as on March 2018 and non-filingofService Tax Returns from April 2017 to June 2017. Provision for the interest on latepayments ofservice has been made in the books. Any other impact on the financialstatements cannot be quantified at this stage and will be accounted for as and whendetermined.

iv) Note no.20.02 to the financial statements regarding the payments due of GSTofRs.272.58 Lacs (Net of Input Credit) and non-filing of GST Returns since August 2017.Interest for delay in payment of GST and Late fees for non-filing of GST Returns has beenprovided for in the books. Any other impact on the financial statements which cannot bequantified at this stage and will be accounted for as and when determined.

v) Note no.20.03 to the financial statements regarding the payments due of TDS ofRs.133.22 Lacs and non filing of TDS Returns since April 2017. Interest for delay inpayment of TDS and late fees for non-filing of TDS returns has been provided for in thebooks. Any other impact of non-filing of these returns which cannot be quantified at thisstage shall be provided for as and when determined.

vi) Note no.12.03 to the financial statements wherein the Management of the Company hasconsidered the receivable amounting to Rs. 72.72 Lacs given as sponsorship for highereducation in earlier years as good and recoverable even though he has not fulfilled hisstipulated commitments and obligations till date. As explained to us the said loan isconsidered good and recoverable based on management's assessment.

vii) Note no.9.02 20.04 21.01 to the financial statements as regards tradereceivables amounting to Rs. 223.01 Lacs of earlier years outstanding in the books ofaccounts credited to parties by reducing consultancy receipts of the current year andconsequently unrealized service tax liability of Rs. 33.45 Lacs thereon outstanding in thebooks of accounts also reversed during the year.

viii) Note no.20.04 to the financial statements as regards unrealized service taxliability of Rs. 120.72 Lacs outstanding in the books of accounts for earlier yearswritten off during the year. Consequently sundry debtors have also been reduced by thesaid amount.

ix) As stated in Note no 6.01 the Company has not evaluated whether any impairmentprovision is required for expected Losses in accordance with Ind-AS-109- "FinancialInstruments" for investments in equity shares and fully compulsory convertibledebentures amounting to Rs. 12.90 crores on 31sMarch 2018 to Companies whichhave incurred losses and have negative net worth.

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 matters described in the basis forqualified opinion paragraph above the aforesaid financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of affairs of theCompany as at March 31 2018 and its profit and its cash flows for the year ended on thatdate.

Other Matters

a) The Financial Statements and other financial information includes the Company'sproportionate share in jointly controlled total assets of Rs 44069702 as at March 312018 total revenue of Rs. 10648587 and total expenditure of Rs. 10551533 for theyear ended on that date and the elements making up the cash flow statements and relateddisclosures in respect of unincorporated Joint Ventures which is based on auditedfinancial statements of the respective Joint Ventures audited by us. Our Opinion is notmodified in respect of this matter.

b) The comparative financial information of the Company for the quarter and year ended31st March 2017 and the transition date opening balance sheet as on 1stApril2016 included in the statements are based on the previously issued statutoryfinancial statements for the year ended 31st March 2016 and 31stMarch 2017 prepared in accordance with the Companies (Accounting Standards) Rules 2006(as amended) which were audited by the predecessor auditor whose report expressed anmodified opinion on those financial statements as adjusted for the differences in theaccounting principles adopted by the Company on transition to the Ind AS which have beenaudited by us. Our opinion is not qualified in respect of this matter.

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 purpose of our audit except for thematters described in the 'Basis for Qualified Opinion' paragraph above.

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. Except for the matters described in the 'Basis for Qualified Opinion' paragraphabove in our opinion the aforesaid Ind AS financial statements comply with the IndianAccounting Standards specified under Section 133 of the Act as applicable read with Rule7 of the Companies (Accounts) Rules 2015.;

e. The matter described in the 'Basis for Qualified Opinion' paragraph above in ouropinion may have an adverse effect on the functioning of the company.

f. On the basis of the written representations received from the directors as on March31 2018 and taken on record by the Board of Directors none of the directors isdisqualified as on March 31 2018 from being appointed as a director in terms of Section164 (2) ofthe Act.

g. 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”.

h. 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 2016 in our opinionand to the best of 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 Ind AS financial statements as referred to in Note no. 32 to the financialstatements.

ii. The Company does not have any long-term contracts including derivative contractsfor which there were any material foreseeable losses.

iii. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company.

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 “Annexure B” a statement on the matters specified inparagraphs 3 and 4 ofthe Order.

For Banthia Damani & Associates
Chartered Accountants
Firm Registration Number- 126132W
Sudesh Banthia
Membership No. - 041344
Place: Nagpur
Date : June 01 2018