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Consolidated Finvest & Holdings Ltd.

BSE: 500226 Sector: Financials
NSE: CONSOFINVT ISIN Code: INE025A01027
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Consolidated Finvest & Holdings Ltd. (CONSOFINVT) - Auditors Report

Company auditors report

To the Members of Consolidated Finvest & Holdings Limited Report on the StandaloneFinancial Statements

We have audited the accompanying Standalone financial statements of ConsolidatedFinvest & Holdings Limited ("the Company") which comprise the Balance Sheetas at March 31 2018 the Statement of Profit and Loss Cash Flow Statement for the yearthen ended and a summary of significant accounting policies and other explanatoryinformation.

Management's Responsibility for the (Standalone) 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 ofthese Standalone financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting 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 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 these Standalone financial statementsbased on our audit. We have taken into account the provisions of the Act the accountingand auditing standards and matters which are required to be included in the audit reportunder the provisions of the Act and the Rules made thereunder and the order under Section143(11) of the Act.

We conducted our audit of Standalone 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 financial statements are free from materialmisstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditor's 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. We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our audit opinion on the (Standalone)financial statements

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid (Standalone) financial statements give the information requiredby the Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the Company as at March 31 2018and its loss and its Cash Flow for the year ended on that date.

Emphasis of Matter

We draw attention to Note 30 in the financial statements. In earlier year company hasinvested Rs 2772 Lacs in Zero % Redeemable Preference Shares in Jindal India PowertechLimited (JIPL) Subsidiary of the JPIFCL and which was the holding company of Jindal IndiaThermal Power Limited (JITPL). JITPL operates thermal power plant (1200 MW) located inAngul Orissa. In June 2017 the lenders of JITPL have invoked the pledged shares to theextent of 51% holding consequent thereof JITPL ceased to be a subsidiary of JIPL.Lenders have further invoked 15% pledged equity shares in the month of February 2018.Inview of this development CFHL will make necessary adjustment in the value of theinvestment if any after final outcome. However company has provided diminution in thevalue of investment in equity shares of Jindal India Thermal Power Limited which areshown under exceptional item.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")as amended issued by the Central Government of India in terms of subsection (11) ofsection 143 of the Act we give in the "Annexure A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order.

2. 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 purpose of our audit; b. in our opinion proper books ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books; c. the Balance Sheet the Statement of Profit and Loss and theCash Flow Statement dealt with by this Report are in agreement with the books of accountd. in our opinion the aforesaid (Standalone) financial statements comply with theAccounting Standards specified under section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014. e. on the basis of written representations received fromthe directors as on March 31 2018 taken on record by the Board of Directors none of thedirectors is disqualified as on March 31 2018 from being appointed as a director in termsof Section 164 (2) of the Act. f. with respect to the adequacy of the internal financialcontrols over financial reporting of the Company and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure B". g. with respect to theother matters to be included in the Auditor's Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in our opinion and to the best of ourinformation and according to the explanations given to us: i. The Company does not haveany pending litigation which would impact its financial position; ii. The Company did nothave any long term Contracts including derivative contracts for which there were anymaterial foreseeable losses; iii. There has been no delay in transferring amountsrequired to be transferred to the Investor Education and Protection Fund by the Company.

For P. L. Gupta & Co.
Chartered Accountants
FRN: 011575 C
(Ravindra Kumar Newatia)
Place: New Delhi Partner
Date: 30thMay 2018 Membership no.: 074193

"ANNEXURE A" TO THE INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements' of our report of even date to the financial statements of the Company forthe year ended March 31 2018:

1) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets; (b) Fixed Assets have been physicallyverified by the management in a phased manner designed to cover all the items over aperiod of three years which in our opinion is reasonable having regard to the size ofthe company and nature of its business. In accordance with this programme certain fixedassets were physically verified during the year and no material discrepancies were noticedon such verification.

(c) The title deeds of immovable properties are held in the name of the company.

2) The nature of the company's operations does not require it to hold inventories andas such the provisions of the Order are not applicable.

3) In respect of loans secured or unsecured granted by the Company to the partiescovered in the register maintained under section 189 of the Companies Act 2013:

The company has not granted any loans to any company/parties during the year theProvisions of the Order are not applicable.

4) 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 Companies Act 2013in respect of grant of loans making investments providing guarantees and security.

5) The Company has not accepted any deposits from the public and hence the directivesissued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any otherrelevant provisions of the Act and the Companies (Acceptance of Deposit) Rules 2015 withregard to the deposits are not applicable to the Company.

6) The maintenance of Cost records has not been prescribed by the Central Governmentu/s 148 (1) of the Companies Act 2013 in respect of the Company's products.

7) According to information and explanations given to us and on the basis of ourexamination of the books of accounts and records the Company has been generally regularin depositing on undisputed statutory dues including provident fund Income-Tax ServiceTax GST Cess and any other statutory dues with the appropriate authorities. According tothe information and explanations given to us no undisputed amounts payable in respect ofthe above were in arrears as at March 31 2018 for a period of more than six months fromthe date on when they become payable.

8) In our opinion and according to the information and explanations given to us theCompany has not defaulted in the repayment of dues to banks. The Company has not taken anyloan either from financial institutions or from the government and has not issued anydebentures.

9) Based upon the audit procedures performed and the information and explanations givenby the management the company has not raised moneys by way of initial public offer orfurther public offer including debt instruments and term Loans. Accordingly theprovisions of clause 3 (ix) of the Order are not applicable to the Company.

10) Based upon the audit procedures performed and the information and explanationsgiven by the management we report that no fraud by the Company or on the company by itsofficers or employees has been noticed or reported during the year. 11) Based upon theaudit procedures performed and the information and explanations given by the managementthe managerial remuneration has been paid or provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct;

12) The Company is not a Nidhi Company. Therefore the provisions of clause 4 (xii) ofthe Order are not applicable to the Company. 13) In our opinion all transactions with therelated parties are in compliance with section 177 and 188 of Companies Act 2013 and thedetails have been disclosed in the Standalone Financial Statements as required by theapplicable accounting standards. 14) In our opinion and according to information andexplanations available to us the company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the year.Accordingly the provisions of clause 3 (xiv) of the Order are not applicable to theCompany.

15) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not entered into any non-cash transactions withdirectors or directors of its holding subsidiary or associates company or personsconnected with them. Accordingly the provisions of clause 3 (xv) of the Order are notapplicable to the Company.

16) The Company is registered under section 45-1A of the Reserve Bank of the India Act1934.

For P. L. Gupta & Co.
Chartered Accountants
FRN: 011575 C
(Ravindra Kumar Newatia)
Place: New Delhi Partner
Date: 30th May 2018 Membership no.: 074193

"ANNEXURE B" TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS OF CONSOLIDATED FINVEST & HOLDINGS LIMITED

Referred to in paragraph 2(f) under ‘Report on Other Legal and RegulatoryRequirements' of our report of even date:

Wehaveauditedtheinternalfinancialcontrolsoverfinancial reporting of ConsolidatedFinvest & Holdings Limited ("the Company") as of March 31 2018 inconjunction with our audit of the standalone financial statements of the Company for theyear 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). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required 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 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 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.

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 authorisations ofmanagement 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 March 31 2018 based 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 P. L. Gupta & Co.
Chartered Accountants
FRN: 011575 C
(Ravindra Kumar Newatia)
Place: New Delhi Partner
Date: 30thMay 2018 Membership no.: 074193