The Members of D.P.ABHUSHAN LIMITED
We have audited the accompanying financial statement of DPABHUSHAN LIMITED (TheCompany) which comprises Balance Sheet as at 31 st March 2019 the statement of theProfit and Loss and the Cash Flow Statement for the period ended on that date and asummary of significant accounting policiesand other explanatory information.
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 state of affairs of the Companyas at March 312019andprofit/lossaccountand its cash flows fortheyearended on that date.
We conducted our Audit of the standalone Financial Statements in accordance with theStandards on Auditing. Our responsibilities under those Standards are further described inthe Auditors Responsibilities for the Audit of the Standalone Financial Statementssection of our report. We are independent of the Company in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India (ICAI) together with theindependence requirements that are relevant to our audit of the standalone financialstatements under the provisions of the Act and the Rules made there under and we havefulfilled our other ethical responsibilities in accordance with these requirements and theICAIs Code of Ethics. We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our audit opinion on the standalonefinancial statements.
KEY AUDIT MATTERS
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone financial statements of the current period.These matters were addressed in the context of our audit of the standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report.
Refer note 2.7 to the Significant Accounting Policies
|THE KEY AUDIT MATTERS ||HOW THE MATTER WAS ADDRESSED IN OUR AUDIT |
|Revenue from sale of goods is recognized when control of the products being sold is transferred to the customer and when there are no other unfulfilled obligations. The performance obligations in the contracts are fulfilled at the time of dispatch delivery or upon formal customer acceptance depending on customerterms. We identified revenue recognition as a key audit matter because the Company and its external stakeholders focus on revenue as a key performance indicator. This could create an incentive for revenue to be overstated or recognized before control has been transferred. ||In view of the significance of the matter we applied the following audit procedures in this area among other procedures to obtain sufficient appropriate audit evidence: |
| ||1. We assessed the appropriateness of the revenue recognition accounting policies and its compliances with applicable accounting standards. We read the contracts with customer distributors franchisees etc. to determine appropriateness of revenue recognition. |
| ||2. We evaluated the design of key internal financial controls and operating effectiveness of the relevant key controls with respect to revenue recognition on selected transactions. |
| ||3. We evaluated the design implementation and operating effectiveness of management's general IT controls and key application controls over the Company's IT systems which govern revenue recognition including access controls controls over program changes and interfaces between different systems. |
MANAGEMENTS RESPONSIBILITYFORTHE FINANCIAL STATEMENT
The Companys Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 ("the Act") with respect to preparation ofthese financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the Accountingprinciples generally accepted in India including the companies accounting standards Rules2006 (as amended) specified under section 133 of the act read with companies (Accounts)Rules 2014. This responsibility also includes the maintenance of adequate accountingrecords in accordance with the provisions of the act for safeguarding the assets of thecompany and for preventing and detecting the frauds and other irregularities; selectionand application of appropriate accounting policies; making judgment and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalcontrol that were operating effectively for ensuring the accuracy and completeness ofaccounting records relevant to preparation of financial statements that give a true andfair view and are free from material misstatement whetherdue to fraud orerror.
In preparing the financial statements management is responsible for assessing theCompanys ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.
Those Board of Directors are also responsible for overseeing the Companysfinancial reporting process.
Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditors report that includes our opinion. Reasonable assurance is ahigh level of assurance but is not a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when it exists. Misstatements can arisefrom fraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.
As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughoutthe audit. We also: -
Identify and assess the risks of material misstatement of the standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higherthan forone resulting from error as fraud may involvecollusionforgery intentionalomissions misrepresentations or the override of internalcontrol.
Obtain an understanding of internalfinancialcontrols relevantto the audit inorderto design audit procedures that are appropriate in the circumstances. Under section143(3)0) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls. (Annexure B is our Report on Internal Financial Control).
Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.
Conclude on the appropriateness of managements use of the going concernbasis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompanys ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditors report to therelated disclosures in the financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditors report. However future events or conditions may cause theCompany to cease to continue as a going concern.
Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought tobearonourindependence and where applicable related safeguards.
From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditors report unless law or regulation precludes public disclosure aboutthe matter or when in extremely rare circumstances we determine that a matter should notbe communicated in our report because the adverse consequences of doing so wouldreasonably be expected to outweigh the public interest benefits of such communication.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
As required by the Companies (Auditors Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Companies Act 2013 we give in the "Annexure A" a statementon the mattersspecifiedinparagraphs3and4of the Order to the extent applicable.
AS REQUIRED BYSECTION 143(3) OF THE ACT WE FURTHER REPORTTHAT:
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;
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 Statement of Profit and Loss and Cash Flow Statement dealt withby this Report are in agreement with the books of account;
d) In our opinion the aforesaid Financial Statements comply with the CompaniesAccounting Standards referred to in section 133 of the Companies Act 2013 read with rule7 of the Companies (Accounts) Rules 2014.
e) On the basis of written representations received from other directors as on March312019 and taken on record by the Board of Directors none of the directors isdisqualified as on March 312019 from being appointed as a director in terms ofsub-section (2) of section 164 of the Companies Act 2013.
f) We have also audited the internal financial controls over financial reporting of theCompany as on 31 March 2019 in conjunction with our audit of the standalone financialstatements of the Company for the year ended on that date and our report dated 31 stMarch 2019 as per Annexure B expressed unmodified opinion;
g) In our opinion and to the best of our information and according to the explanationsgiven to us we report as under with respect to other matters to be included in theAuditors Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014:
i) The Company has disclosed the impact of pending litigations on its financialpositions in itsfinancial statements- Refer Note27.1 to the financial statement;
ii) The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable loss thereon does arise.
iii) There was no amount which was required to be transferred to the Investor Educationand Protection Fund by the Company.
| ||For Jeevan Jagetiya & Co |
| ||Chartered Accountants |
| ||FRN: - 121335W |
| ||Sd/- |
| ||CA Jeevan Jagetiya |
|Date: May 302019 ||(Partner) |
|Place :Ratlam (M.P.) - 457001 ||M. No. 046553 |
ANNEXURE-ATO THE AUDITORS REPORT
With reference to the Annexure A referred to in our report to the members of theCompany "D. P. Abhushan Limited" for the year ended 31st March 2019 we reportthe following:
i. (a) The company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets.
(b) The Company has a program of verification to cover all the items of fixed assets ina proper manner which in our opinion is reasonable with regard to size of company andnature of assets of company. According to information and explanation given to us nomaterial discrepancies were noticed during such verification.
(c) According to the information and explanations given to us the records examined byus and based on the conveyance/sale deed provided to us we report that the title deedscomprising all the immovable property of freehold land and buildings are held in the nameof company as on balance sheet date.
ii. In our opinion the management has conducted physical verification of inventory atreasonable intervals during the year including inventory given to third parties/goldsmithon job work basis. As per the information and explanation given to us nomaterialdiscrepancieswere noticed on the aforesaid physicalverification.
iii. According to the information and explanation given to us the company has notgranted any loan secured or unsecured loans to companies firm LLP or other partiescovered in the register maintained under section 189 of the Companies Act 2013.Accordingly Paragraph 3(iii) (a) and (b) of the order is not applicable to the company.
iv. According to the information and explanation given to us the company has notgranted any loans or provides any guarantee orsecurity to the parties covered underSection 185 of the Act The company has complied with the provisions of the section 186 ofthe Act with respect to investment made.
v. In our opinion and according to information given to us the Entity/Firm (NowCompany) has taken unsecured loan which is covered as Deposit u/s 73 of the Companies Act2013 when it was Partnership Firm and the Provisions of the Companies Act were notapplicable to it. However after conversions of partnership firm into company no new loanor deposit prohibited u/s 73 have been accepted by the company. The old monies/depositshave been repaid during the period.
vi. Maintenance of cost records has not been specified by the Central Government undersub-section (1) of section 148 of the Companies Act 2013. Therefore the provisions ofclause 3 (vi) of the Companies (Auditors Report) Order 2016 are not applicable tothe Company.
vii. (a) The company is regular in depositing undisputed statutory dues includingprovident fund Employees state insurance income-tax sales-tax service tax dutyof customs duty of excise value added tax GST cess and any other statutory dues to theappropriate authorities.
According to information & explanations given to us no undisputed amounts payablein respect of aforesaid dues were in arrear as at 31 -Mar-2019 for period of more thansix months from the date they become payable.
(b) According to information and explanations given to us the following dues of SalesTax/VAT have not been deposited by thecompany on account of any dispute.
|Name of Statue ||Nature of Dues ||Amt in (Lakhs) ||Amt paid under protest ||Period to which the amount relates ||Forum where dispute is pending |
|Rajasthan VAT Act ||VatTax&Int. ||19.55 ||1.50 (Paid in Month of April 2018) ||F.Y.15-16 ||Rajasthan Tax Board Ajmer |
viii. The Company has not made any default in repayment of loans or borrowing tofinancial institution bank Government or dues to debenture holders.
ix. The Company has not raised moneys byway of initial public offer or further publicoffer (including debt instruments) orterm loansand hence reporting under clause3 (ix) ofthe Order is notapplicable to the Company
x. To the best of our knowledge and belief and according to the information andexplanations given to us no material fraud on or by the company by its officers oremployees during the period was noticed or reported nor have we been informed of suchcase by the management.
xi. In our opinion the managerial remuneration has been paid or provided in accordancewith the requisite approvals mandated by the provisions of Section 197 read with ScheduleVtotheCompanies Act 2013.
xii. In our opinion the company is not a Nidhi Company. Therefore the provisions ofclause 3(xii) of the Companies Auditors Report) Order 2016 are not applicable tothe company.
xiii. In our opinion all transactions with the related parties are in compliance withsection 177 and 188 of the Companies act 2013 where applicable and the details have beendisclosed in the financial statements as required by applicable Accounting Standards (AS)18.
xiv. According to the information and explanations given to us the Company has notmade any preferential allotment or private placement of shares or fully or partlyconvertible debentures during the period under review and therefore the provisions ofclause 3(xiv) of the Companies (Auditors Report) Order 2016 are not applicable tothe company.
xv. In our opinion and according to the information and explanations given to us thecompany has not entered any transaction that require compliance of provision of Section192 of Companies Act 2013 with respect to non-cash transaction so the provisions ofclause 3(xv) of the Companies (Auditors Report) Order 2016 are not applicable tothecompany.
xvi. In our opinion and according to information and explanations given to us companyis not required to be registered under section 45-IAof the Reserve Bankof India Act 1934.
| ||For Jeevan Jagetiya & Co |
| ||Chartered Accountants |
| ||FRN: - 121335W |
| ||Sd/- |
|Date: May 302019 ||CA Jeevan Jagetiya |
|Place: Ratlam (M.P.)-457001 ||M. No. 046553 |
ANNEXURE - B TO THE AUDITORS REPORT
Annexure-B to the Audit Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of D.P.ABHUSHAN LIMITED ('The Company") as of 31 March 2019 in conjunction with ouraudit of the financial statements of the Company for the period ended on that date.
MANAGEMENTS RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
The Companys 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 CICAI). 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 companys policies the safeguardingof its 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.
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 internalfinancialcontrols 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 auditors judgment including the assessment of therisksofmaterialmisstatementof thefinancialstatementswhetherduetofraudorerror.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on theCompanys internalfinancialcontrolssystem over 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 internalfinancial control overfinancialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect thetransactionsanddispositions of theassets of thecompany;
(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) providereasonable assurance regarding prevention ortimely detection of unauthorized acquisitionuse or disposition of the company's assets that could have a material effect on thefinancial 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 internalfinancial controls overfinancialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions orthatthedegree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material respects an adequateinternalfinancial controls system overfinancial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31 March 2019 based onthe 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 Jeevan Jagetiya & Co |
| ||Chartered Accountants |
| ||FRN: - 121335W |
| ||Sd/- |
| ||CA Jeevan Jagetiya |
|Date: May 302019 ||(Partner) |
|Place: Ratlam (M.P.)- 457001 ||M. No. 046553 |