The Members of
Bhaskar Agrochemicals Limited
Report on the Ind AS Financial Statements
We have audited the accompanying Ind AS financial statements of BhaskarAgrochemicals Limited ("theCompany") which comprise the Balance Sheet as at31stMarch 2018 and the Statement of Profit and Loss includingOther ComprehensiveIncome the Cash Flow Statementand the Statement of Changes in Equity for the year thenended and a summary of the significant accounting policies and other explanatoryinformation.
Management's Responsibility for the StandaloneFinancial Statements
The Company's Board of Directors is responsible for thematters stated in Section 134(5)of the Companies Act 2013("the Act") with respect to the preparation of theseInd AS financial statements that give a true and fair view of the state ofaffairs(financial position) profit or loss (financial performance including othercomprehensiveincome) cash flows and changes in equity of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) prescribed under section 133 of the Act.
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.
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.
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 theamounts and the disclosures in the Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the Ind AS financial statements that give a trueand fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors aswell as evaluating the overall presentation of the Ind AS financialstatements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Ind AS financial statements.
Basis for Qualified Opinion
The company has not provided depreciation on building and Plant & Machineryrelating to Unit-II in the books of account of the company as the Unit-II is closed andhence our opinion is qualified in respect of this matter.
In our opinion and to the best of our information andaccording to the explanationsgiven to us except for the matter described in the basis for qualified opinion paragraphthe aforesaid Ind AS financial statements give the information required by the Act in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India including the Ind AS of the state of affairs(financial position) of the Company as at 31stMarch 2018 and its profit (financialperformance including other comprehensive income) its cash flows and the changes inequity for the year ended on that date.
The comparative financial information of the Company for the year ended 31stMarch 2017 and transition date opening Balance Sheet as at 1st April 2016 isincluded in these Ind AS financial statements are based on previously issued statutoryfinancial statements prepared in accordance with the Companies (Accounting Standards)Rules 2006 audited by predecessor auditor whose report dated 15-05-2017 and30-05-2016respectively expressed an unmodified opinion on those financial statements asadjusted for the difference in accounting principles adopted by the Company on transitionto the Ind AS which have been audited by us. Our opinion is not modified in respect ofthis matter.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"Annexure A"a statement on the matters specified in paragraphs 3 and 4of theOrder.
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 purposes of our audit.
b) In our opinion proper books of account as requiredby 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 the Cash Flow Statement andStatement of Changes in Equity dealt with by this Report are in agreement with the booksof account.
d) In our opinion the aforesaid Ind AS financial statements comply with the IndianAccounting Standards prescribed under section 133 of the Act.
e) On the basis of the written representations received from the directors as on 31stMarch 2018 taken onrecord by the Board of Directors none of thedirectors is disqualifiedas on 31st March 2018 from being appointed as a director in terms of Section164(2) of theAct.
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".
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 disclosed the impact of pending litigations on its financialposition in its Ind AS financial statements;
ii. The Company did not have any long term contracts including derivativecontracts forwhich there were any materialforeseeable losses.
iii. There were no amount as at 31stMarch 2018 which are required to betransferred to the Investor Education and Protection Fund by theCompany.
ANNEXURE "A" TO THE AUDITOR'S REPORT
Referred to in paragraph 1 under the head "Report on other legal & regulatoryrequirements" of our report of even date.
i) a. The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
b. All the Fixed assets have been physically verified by the management during the yearaccording to the information and explanations given to us no material discrepancies werenoticed on such verification. c. As per the documents verified by us and explanation givento us the Title Deeds of immovable properties are held in the name of the company.
ii). The inventory has been physically verified during the year by the management.Inour opinion the frequency of verification is reasonable. No material discrepancies havebeen noticed on physical verification of stocks as compared to book records.
iii). The company has not granted any loans secured or unsecured to companies firmsLimited Liability Partnership or other parties who are covered in the register maintainedunder section 189 of Companies Act 2013 accordingly Clause (iii a)(iii b) and (iii c)of Paragraph 3 of the Order are not applicable.
iv) According to the information and explanations given to us the Company has notgranted any loans guarantees and security and made investments as per section 185 &186 of the Companies Act 2013 v) According to the information and explanations given tous the Company has not accepted any deposits from the public as per the directives issuedby the Reserve Bank of India and as per the provisions of section 73 to 76 or any otherrelevant provisions of the Companies Act 2013 and the rules framed there under. vi) TheCentral Government has not prescribed the maintenance of cost records under section 148(1)of the Companies Act 2013 for the Company.
vii) a. According tothe information & explanations given to us none of theundisputed statutory dues including Provident Fund Employees State Insurance Income TaxSales Tax Service Tax Custom Duty Excise Duty Value Added Tax Goods & ServiceTax Cess and any other Statutory Dues were outstanding as at last day of the financialyear concerned for a period of more than six months. b. According to the information &explanations given to us there is no dues in respect of disputed amount to be depositedin respect of Sales Tax Service Tax Custom Duty Excise Duty Value Added Tax and Goodsand Services Tax as on 31st March2018.
viii) According to the information and explanations given to us the company has notdefaulted in repayment of loans or borrowing to the financial institutions bankgovernment or dues to debenture holders.
ix) In our opinion and according to the information and explanations given to us thecompany has raised money by way of term loans and has applied for the purpose for which itwas raised company has not raised money by way of initial public offer or further publicoffer (including debt instruments) during the year.
x) According to the information and explanations given to us no fraud by the Companyor any fraud on the company by its officers/employees has been noticed or reported duringthe course of our audit.
xi) According to the information and explanations given to us the Company has paid andprovided managerial remuneration during the yearas per the provisions of Section 197 readwith Schedule V to the Companies Act.
xii) In our opinion the Company is not a Nidhi Company. Accordingly Clause (xii) ofParagraph 3 of the Order is not applicable.
xiii) According to the information and explanations given to us all transactions withthe related party are in compliance with section 177 & 188 of Companies Act 2013 andthe same has been disclosed in financial statements as required by the AccountingStandards.
xiv) According to the information and explanations given to us the company has notmade preferential allotment of shares or private placement of shares or fully or partlyconvertible debentures during the year.
xv) According to the information and explanations given to us the company has notentered into Non Cash Transactions with directors or persons connected with him during theyear.
xvi) According to the information and explanations given to us company is not requiredto be registered under section 45-IA of Reserve Bank of India.
Annexure "B" to the Independent Auditor's Report of even date on theFinancial Statements of Bhaskar Agrochemicals 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 BhaskarAgrochemicals Limited ("the Company") as of March 31 2018 in conjunction withour audit 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". 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 included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement 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) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorizations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized 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 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.