Dolat Investments Ltd.
|BSE: 505526||Sector: Financials|
|NSE: DOLAT||ISIN Code: INE966A01022|
|BSE 00:00 | 09 Jul||47.05||
|NSE 09:07 | 10 Jul||47.55||
|Mkt Cap.(Rs cr)||828|
|Mkt Cap.(Rs cr)||828.08|
Dolat Investments Ltd. (DOLAT) - Auditors Report
Company auditors report
TO THE MEMBERS OF DOLAT INVESTMENTS LTD.
REPORT ON THE IND AS FINANCIAL STATEMENTS OPINION
We have audited the accompanying standalone financial statements of DolatInvestments Limited ('the company') which comprise the balance sheet as at 31 March2019 and the Statement of Profit and Loss (including Other Comprehensive Income) thecash flow statement and the Statement of changes in Equity for the year then ended and asummary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone financial statements give theinformation required by the Act in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at 31st March 2019 and its profit totalcomprehensive income the changes in equity and its cash flows for the year ended on thatdate.
BASIS FOR OPINION
We conducted our audit of the financial statements in accordance withthe Standards on Auditing (SAs) specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Financial Statements section of our report. We areindependent of the company in accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India (ICAI) together with the independence requirements thatare relevant to our audit of the financial statements under the provisions of the Act andthe Rules made there under and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the ICAI's Code of Ethics. We believe that theaudit evidence we have obtained is sufficient and appropriate to provide a basis for ouraudit opinion on the financial statements.
KEY AUDIT MATTERS
Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the financial statements of the current period.These matters were addressed in the context of our audit of the financial statements as awhole and in forming our opinion thereon and we do not provide a separate opinion onthese matters. We have determined the matters described below to be the key audit mattersto be communicated in our report.
Key audit Matter -
Accounting and Valuation of Investments
The Company's investments as on 31/03/2019 amount to Rs. 8420.04Lakh which in primarily invested in liquid mutual funds. This comprises 52.22% of totalassets of the Company. Considering the high value of this item of asset it has beenconsidered as a key audit matter.
How our audit addressed the key audit matter
We obtained an understanding of the internal controls designedby the management for investment accounting and valuation and tested the operatingeffectiveness these controls.
We undertook substantive audit procedures like inspectionrecalculation and reperformance.
We performed procedures to identify encumbrances on theseinvestments and verified sufficiency and appropriateness of disclosures regarding thesame.
We performed procedures to verify adherence to IND-AS.
Key audit Matter - Valuation of Financial Instruments
The derivative financial assets amount to Rs. 1608.81 lakhs andderivative financial liabilities amount to Rs. 415.53 lakhs. We focused on this because ofthe number of contracts their measurement and the complexity related to fair valueestimation.
How our audit addressed the key audit matter
We obtained an understanding of management's process andevaluated design and tested operating effectiveness of controls around existence andmeasurement of derivative financial instruments.
Reconciling derivative financial instruments data with datareceived from independent third parties.
Considering the appropriateness of disclosures in relation tofinancial risk management and derivative financial instruments.
INFORMATION OTHER THAN THE FINANCIAL STATEMENTS AND AUDITORS REPORTTHEREON
The Company's Board of Directors is responsible for the preparation ofthe other information. The other information comprises the information included in theManagement Discussion and Analysis Board's Report including Annexures toBoard's Report Business Responsibility Report Corporate Governance andShareholder's Information but does not include the financial statements and ourauditor's report thereon
Our opinion on the financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the financial statements or ourknowledge obtained during the course of our audit or otherwise appears to be materiallymisstated.
If based on the work we have performed we conclude that there is amaterial misstatement of this other information we are required to report that fact. Wehave nothing to report in this regard.
MANAGEMENT'S RESPONSIBILITY FOR THE IND AS FINANCIAL STATEMENTS
The Company's Board of Directors is responsible for the mattersstated in Section 134(5) of the Companies Act 2013 ("the Act") with respect tothe preparation and presentation of these standalone financial statements that give a trueand fair view of the financial position financial performance including othercomprehensive income cash flows and changes in the equity of the Company in accordancewith the accounting principles generally accepted in India including the IndianAccounting Standards(Ind AS) prescribed under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the company and for preventing and detecting frauds andother irregularities; selection and applications of appropriate accounting policies;making judgments and estimates that are reasonable and prudent; and the designimplementation 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 standalone financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.
In preparing the financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so. Those Board of Directors arealso responsible for overseeing the Company's financial reporting process.
Our objectives are to obtain reasonable assurance about whether thefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonableassurance is a high level of assurance but is not a guarantee that an audit conducted inaccordance with SAs will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of theconsolidated financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal controls.
Obtain an understanding of internal financial controls relevantto the audit in order to design audit procedures that are appropriate in thecircumstances. Under section 143(3)(i) of the Act we are also responsible for expressingour opinion on whether the Company has adequate internal financial controls system inplace and the operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of thegoing concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the ability of the company to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor'sreport to the related disclosures in the financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditionsmay cause the company to cease to continue as a going concern.
Evaluate the overall presentation structure and content of thefinancial statements including the disclosures and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.
Obtain sufficient appropriate audit evidence regarding thefinancial information of business activities within the company to express an opinion onthe financial statements. We are responsible for the direction supervision andperformance of the audit of the financial statements of such entities.
We believe that the audit evidence obtained by us is sufficient andappropriate to provide a basis for our audit opinion on the financial statements.
We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.
We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.
From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the financialstatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the Companies (Auditor's Report) Order 2016("the Order") issued by the Central Government of India in terms of sub-section(11) of section 143 of the Act we give in the Annexure A a statement on the mattersspecified in the paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act we report that:
a. we have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit.
b. in our opinion proper books of account as required by law have beenkept by the company so far as it appears from our examination of those books;
c. the balance sheet statement of profit and loss including othercomprehensive income statement of changes in equity and the cash flow statement dealtwith by this Report are in agreement with the books of account;
d. in our opinion the aforesaid standalone financial statements complywith the Indian Accounting Standards specified under section 133 of the Act.
e. on the basis of the written representations received from thedirectors as on 31 March 2019 taken on record by the Board of Directors none of thedirectors is disqualified as on 31 March 2019 from being appointed as a director in termsof section 164(2) of the Act;
f. 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
g. with respect to the other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 in our opinion and to the best of our information and according to theexplanations given to us:
i. the Company does not have any pending litigations which would impactits financial position for other litigations refer point no 29 of the standalonefinancial statements;
ii. the Company did not have any long term contract includingderivative contract; as such the question of commenting on any material foreseeable lossesthereon does not arise;
iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.