To the Members of
Capfin India Limited.
Report on the Indian Accounting Standards (Ind AS) Financial Statements
1. We have audited the financial statements of Capfin India Limited("theCompany") which comprise the balance sheet as at March 312019 and thestatement of profit and loss (including other comprehensive income) statement of changesin equity and statement of cash flows for the year ended March 31 2019 and notes to thefinancial statements including a summary of the significant accounting policies and otherexplanatory information.
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 theCompanies Act 2013 ("Act") in the manner so required and give a true and fairview in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2019 and its loss and other comprehensiveincome the changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
2. We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143 (10) of the Companies Act 2013 ("Act"). Our responsibilitiesunder those SAs are further described in the Auditor's Responsibilities for the Audit ofthe Annual Financial statement section of our report. We are independent of the Company inaccordance with the code of ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of the annualfinancial statements and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the code of ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for ouropinion.
Key Audit Matters
3. Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.
Management's Responsibility for the Ind AS Financial Statements
4. 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 ofthese Ind AS financial statements to give a true and fair view of the financial positionfinancial performance (including other comprehensive income) cash flows and changes inequity of the Company in accordance with the accounting principles generally accepted inIndia including the Indian Accounting Standards specified in the Companies (IndianAccounting Standards) Rules 2015 (as amended) under Section 133 of the Act. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the Ind AS financial statementsthat give a true and fair view and are free from material misstatement whether due tofraud or error. In preparing the financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.
5. Our responsibility is to express an opinion on these Ind AS financial statementsbased on our audit.
6. We have taken into account the provisions of the Act and the Rules made thereunderincluding the accounting and auditing standards and matters which are required to beincluded in the audit report under the provisions of the Act and the Rules madethereunder.
7. We conducted our audit of the Ind AS financial statements in accordance with theStandards on Auditing specified under Section 143(10) of the Act and other applicableauthoritative pronouncements issued by the Institute of Chartered Accountants of India.Those Standards and pronouncements require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether the Ind ASfinancial statements are free from material misstatement.
8. An audit involves performing procedures to obtain audit evidence about the amountsand the disclosures in the Ind AS financial statements. The procedures selected depend onthe auditors' judgment including the assessment of the risks of material misstatement ofthe Ind 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 the accounting policies used and the reasonableness ofthe accounting estimates made by the Company's Directors as well as evaluating theoverall presentation of the Ind AS financial statements.
9. 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.
Report on Other Legal and Regulatory Requirements
10. As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of India in terms of sub-section (11) of section 143 of the Act ("theOrder") and on the basis of such checks of the books and records of the Company aswe considered appropriate and according to the information and explanations given to uswe give in the Annexure A a statement on the matters specified in paragraphs 3 and 4 ofthe Order.
11. As required by Section 143 (3) ofthe 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 (including other comprehensiveincome) the Cash Flow Statement and the Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account.
d) In our opinion the aforesaid Ind AS financial statements comply with the IndianAccounting Standards specified underSection 133 of the Act.
e) On the basis of the written representations received from the directors as on March31 2019 taken on record by the Board ofDirectors none of the directors is disqualifiedas on March 31 2019 from being appointed as a director in terms of Section 164 (2) of theAct.
f) With respect to the adequacy oftheinternal financial controls over financialreporting of the Company and the operating effectiveness of such controls of the Companyrefer to our separate report in "Annexure-B".
g) With respect to the other matters to be included in the Auditors' Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our knowledge and belief and according to the information andexplanations given to us:
(I) The Company has disclosed no pending litigations as at March 31 2019 on itsfinancial position in its Ind AS financial statements.
(ii) The Company did not have any long-term contracts including derivative contractsas at March 31 2019 for which there were material foreseeable losses.
(iii) There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company during the year ended March 31 2019.
For Adarsh Kumar & Co
Chartered Accountants ICAI
Firm Registration number: 013300N
Adarsh Kumar Agarwal
Membership No: 087559
Place: New Delhi
Date: 30th May 2019
ANNEXURE TO INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 9 of the Independent Auditors' Report of even date to themembers of Capfin India Limited on the financial statements as of and for the year endedMarch 31 2019.
(I) (a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) As explained to us these fixed assets have been physically verified by themanagement at reasonable intervals; no any material discrepancies were noticed on suchverification.
(c) The title deed of the immovable property is held in the name of the Company
(ii) According to the information and explanation given to us the company is engagedin trading of shares. Further the company had no closing inventory whatsoever.
(iii) The Company has not granted any loans secured or unsecured to companies firmsLimited Liability Partnerships or other parties covered in the register maintained underSection 189 of the Act. Therefore the provisions of Clause 3(iii) (iii)(a) (iii)(b) and(iii)(c) of the Order are not applicable to the Company.
(iv) According to the information and explanations given to us the said clause isinapplicable to the Company being a non-banking financial company registered underChapter IIIB of the Reserve Bank of India Act1934
(v) 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.
(vi) The Central Government of India has not specified maintenance of cost recordsunder Section 148(1) of the Act in respect of Company's services. Accordingly theprovisions of clause 3(vi) of the order are not applicable to the Company.
(vii) (a) According to the information and explanations given to us and the records ofthe Company examined by us in our opinion the Company is generally regular in depositingundisputed statutory dues in respect of provident fund employee's state insuranceservice tax and duty of excise though there has been a slight delay in a few cases and isregular in depositing undisputed statutory dues including sales tax income tax duty ofcustoms value added tax cess and other material statutory dues as applicable with theappropriate authorities.
(b) According to the information and explanations given to us and the records of theCompany examined by us there are no dues of service tax duty of customs income taxsales tax duty of excise and value added tax which have not been deposited on account ofany dispute.
(viii) The Company has not availed any loan from any financial institution bankGovernment and there are no dues to debenture holders. Therefore the provisions of clause(viii) of paragraph 3 of the order are not applicable to the Company.
(ix) The Company has not raised any moneys by way of initial public offer furtherpublic offer (including debt instruments) and term loans. Accordingly the provisions ofClause 3(ix) of the Order are not applicable to the Company.
(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.
(xi) The Company has paid remuneration to managerial personnel as per the provisions ofSection 197 read with schedule V to the Companies Act 2013.
(xii As the Company is not a Nidhi Company and the Nidhi Rules 2014 are not applicableto it the provisions of Clause 3(xii) of the Order are not applicable to the Company.
(xiii) The Company has entered into transactions with related parties in compliancewith the provisions of Sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the Ind AS financial statements as required underIndian Accounting Standard (Ind AS) 24 Related Party Disclosures specified under Section133 of the Act read with Companies (Indian Accounting Standard) Rules 2015.
(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review.Accordingly the provisions of Clause 3(xiv) of the Order are not applicable to theCompany.
(xv) According to information and explanation given to us the Company has not enteredinto any non-cash transactions with its directors or persons connected with him.Accordingly the provisions of Clause 3(xv) of the Order are not applicable to theCompany.
(xvi) The Company is registered under section 45-IA of the Reserve Bank Of India Act1934 vide registration no. 14.00643 dated 06/04/1998. Therefore the provisions of clause(xvi) or paragraph 3 of the Order are applicable and have been complied with.
For Adarsh Kumar & Co
ICAI Firm Registration number: 013300N
Adarsh Kumar Agarwal
Place: New Delhi
Date: 30th May 2019
"Annexure - B" to the Auditors' Report
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 ofthe Companies Act 2013.
We have audited the internal financial controls over financial reporting of CapfinIndia Limited as of 31 March 2019 in conjunction with our audit of the financialstatements 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 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 Reportingand the Standards on Auditing issued by ICAI and deemed to be prescribed under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls both applicable to an audit of Internal Financial Controls and bothissued by the Institute of Chartered Accountants of India. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively 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 control 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) 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 authorizations 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 31st March 2019based on the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India
For Adarsh Kumar & Co
ICAI Firm Registration number: 013300N
CA Adarsh Kumar Aggarwal
Membership No. 087559
Place: New Delhi
Date: 30th May 2019.