To the members of
Blue circle services limited report on the Financial Statements
1. We have audited the accompanying financial statements of M/s. Blue Circle ServicesLimited which comprise the Balance Sheet as at 31st March 2017 the Statementof Profit and Loss and the Cash Flow Statement for the year then ended and a summary ofthe significant accounting policies and other explanatory information.
Management's Responsibility For The Financial Statements
2. The Company's Board of Directors is responsible for the matters in section 134(5) ofthe Companies Act 2013 ("the Act") with respect to the preparation of thesefinancial statements that give a true and fair view of the financial position financialperformance and cash flows of the Company in accordance with the accounting principlesgenerally accepted in India including the Accounting Standards specified under Section133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes the maintenance of adequate accounting records in accordancewith the provision of the Act for safeguarding of the assets of the Company and forpreventing and detecting the frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of internal financial control thatwere operating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.
3. Our responsibility is to express an opinion on these financial statements based onour audit. We have taken into account the provisions of the Act the accounting andauditing standards and matters which are required to be included in the audit report underthe provisions of the Act and the Rules made there under.
4. We have taken into account the provisions of the Act and the Rules made thereunderincluding the accounting standards and matters which are required to be included in theaudit report.
5. We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act and other applicable authoritative pronouncements issued by theInstitute of Chartered Accountants of India. Those Standards and pronouncements requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the financial statements are free from materialmisstatement.
6. An audit involves performing procedures to obtain audit evidence about the amountsand the disclosures in the financial statements. The procedures selected depend on theauditors' 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.
7. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the financial statements.
8. In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2017 and its Losses and its cash flows for the year ended on that date.
Emphasis Of Matters
We draw attention to the following matters in the Notes to the financial statements: a)Note 2 ii) to the financial statements which describes the uncertainty related to theoutcome of the SEBI Order No. WTM/RKA/ ISD/ 162 /2014 dated December 19 2014 and anotherconformity Order No. WTM/ RKA/ISD/31/2015 dated 20th April 2015 against the Company. b)Note 2 iii) in the financial statement which indicates that the Company has accumulatedlosses and its Net worth has been substantially eroded the Company has incurred netlosses/net cash losses during the current year. The condition along with other mattersset forth in Note 2 ii) indicate the existence of a material uncertainty that castsignificant doubt about the Company's ability to continue as a going concern. However thefinancial statements of the Company have been prepared on a going concern basis for thereasons stated in the said Note. Our opinion is not modified in respect of these matters.
Report On Other Legal And Regulatory Requirements
9. As required by "the Companies (Auditor's Report) Order 2016 ("theOrder")" issued by the Central Government of India in terms of sub-section (11)of section 143 of the Act (hereinafter referred to as the "Order") and on thebasis of such checks of the books and records of the Company as we consider appropriateand according to the information and explanation given to us we give in the Annexure"A" a statement on the matters specified in the paragraph 3 and 4 of the Order.
10. As required by section 143(3) of the Act we report that: a) We have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purposes of our audit. b) In our opinion proper books ofaccount as required by law have been kept by the Company so far as appears from ourexamination of those books. c) The Balance Sheet the Statement of Profit and Loss andCash Flow Statement dealt with by this Report are in agreement with the books of account.d) In our opinion the aforesaid financial statements comply with the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. e) The going concern matter described in sub-paragraph (b) under the Emphasisof Matters paragraph above in our opinion may have an adverse effect on the functioningof the Company. f) On the basis of written representations received from the directors ason 31 March 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2017 from being appointed as a director in terms of Section164(2) of the Act. g) With respect to the adequacy of the internal financial controls overfinancial reporting of the Company and the operating effectiveness of such controls referto our separate Report in Annexure "B" and; h) With respect to the other mattersto be included in the Auditor's Report in accordance with Rule 11 of the Companies (Auditand Auditors) Rules 2014 in our opinion and to the best of our knowledge and belief andaccording to the information and explanations given to us we report that : i The Companyhas disclosed the impact of pending litigations if any on its financial position in itsfinancial statements; however there isn't any litigations pending against the name of thecompany so far as appeared from the records and has been told to us by the management. iiThe Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts; however no such losses are been foreseeable in near future by thecompany's management. iii There has been no requirement in transferring amounts to theInvestor Education and Protection Fund by the Company. iv The Company has providedrequisite disclosures in its financial statements as to holdings as well as dealings inSpecified Bank Notes during the period from 8 November 2016 to 30 December 2016 andthese are in accordance with the books of accounts maintained by the Company. Refer Note2.20 to the standalone Ind AS financial statements.
Chartered Accountants Place : Mumbai Date : May 29 2017 Proprietor Membership Number048979
ANNEXURE "A" TO INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 9 of the Independent Auditors' Report of even date to themembers of M/s. Blue Circle Services Limited on the standalone financial statements forthe year ended March 31 2017 1)
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; no material discrepancies were noticed on such verification the same have beenproperly dealt with in the books of account;
2) a) The management has conducted physical verification of inventory at reasonableintervals during the year.
b) The procedures of physical verification of inventory followed by the management arereasonable and adequate in relation to the size of the Company and the nature of itsbusiness.
c) The company is maintaining proper records of inventory and no material discrepancieswere noticed on physical verification.
3) The Company has not granted any loan to any body corporate covered in the registermaintained under section 189 of the Companies Act 2013 (the Act'). Thus paragraph3(iii) of the Order is not applicable to the Company.
4) In our opinion and according to the information and explanations given to us theprovisions of section 185 and 186 of the Companies Act 2013 does not apply to thecompany as the company is primarily engaged in the acquisition of securities and engagedin the business of financing of companies.
5) The Company has not accepted any deposits from the public within the meaning ofSections 73 74 75 and 76 of the Act and the Rules framed there under to the extentnotified.
6) The Central Government has not prescribed the maintenance of cost records undersection 148(1) of the Act for any of the services rendered by the Company.
7) a) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company amounts deducted/ accrued in the booksof account in respect of undisputed statutory dues have been regularly depositedduring the year by the Company with the appropriate authorities.
b) According to the information and explanations given to us no disputed amountspayable in respect of provident fund income tax sales tax value added tax duty ofcustoms service tax cess and other material statutory dues were in arrears as at 31March 2017 for a period of more than six months from the date they became payable.
c) According to the information and explanations given to us the dues outstanding ofincome tax sales-tax service tax duty of customs duty of excise or value added taxwhich have not been deposited on account of any dispute are as follows:
|name of the nature of disputed FinancialYear for Forum where dispute is |
|Statue dues Amount which it relates pending |
|IncomeTax Act 1961 ||IncomeTax ||142763400 ||2011-12 ||IncomeTax Appellate CIT |
|IncomeTax Act 1961 ||IncomeTax ||3557240 ||2013-14 ||IncomeTax Appellate C IT |
|IncomeTax Act 1961 ||IncomeTax ||21997591 ||2014-15 ||IncomeTax Appellate C.I.T |
|IncomeTax Act 1961 ||IncomeTax ||30450363 ||2015-16 ||IncomeTax Appellate CIT |
d) The Company is not required to transfer any funds to the Investor Education andProtection Fund in accordance with the relevant provisions of the Companies Act.
8) The Company does not have any loans or borrowings from any financial institutionbanks government or debenture holders during the year. Accordingly paragraph 3(viii) ofthe Order is not applicable.
9) The Company did not raise any money by way of initial public offer or further publicoffer (including debt instruments) and term loans during the year. Accordingly paragraph3 (ix) of the Order is not applicable.
10) 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.
11) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not paid/provided for anymanagerial remuneration during the year.
12) In our opinion and according to the information and explanations given to us theCompany is not a nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable.
13) According to the information and explanations given to us and based on ourexamination of the records of the Company there is been no transactions with the relatedparties during the said period. Therefore this paragraph is not applicable in case of thecompany.
14) According to the information and explanations give 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. 15) 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.
16) According to the information and explanations given to us we report that theCompany is not required to be registered itself under section 45-IA of the Reserve Bank ofIndia Act 1934.
Place : Mumbai
Date : May 29 2017
Proprietor Membership Number 048979
ANNEXURE "B" TO INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 10(g) of the Independent Auditors' Report of even date to themembers of M/s. Blue Circle Services Limited on the standalone financial statements forthe year ended March 31 2017 Report on the Internal Financial Controls under Clause (i)of Sub-section 3 of Section 143 of the Act
1. We have audited the internal financial controls over financial reporting of M/s.Blue Circle Services Limited ("the Company") as of March 31 2017 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
2. 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 Act.
3. 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 deemed to be prescribedunder section 143(10) of the Act to the extent applicable to an audit of internalfinancial controls both applicable to an audit of internal financial controls and bothissued by the ICAI. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the 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 judgement including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.
5. 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
6. A company's internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that a) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; b) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and c) provides reasonable assurance regardingprevention or timely detection of unauthorised 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
7. 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.
8. 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.
Chartered Accountants Place : Mumbai Date : May 29 2017 Proprietor Membership Number048979