To The Members of
DREDGING CORPORATION OF INDIA LIMITED
Report on the Standalone Ind AS Financial Statements
We have audited the accompanying standalone Ind AS financial statements of DREDGINGCORPORATION OF INDIA LIMITED ("the Company") which comprise the BalanceSheet as at March 31 2018 and the Statement of Profit and Loss (including othercomprehensive income) statement of cash flows and statement of changes in equity for theyear then ended and a summary of significant accounting policies and other explanatoryinformation (herein after referred to as "Standalone Ind AS financialstatements").
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 preparationand presentation of these standalone Ind AS financial statements that give a true and fairview of the financial position financial performance including other comprehensiveincome cash flows and changes in equity of the Company in accordance with the accountingprinciples generally accepted in India including the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the Act read with relevant rules thereunder.
This responsibility also includes the maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit.
We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe standalone Ind AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the standalone Ind AS financial statements. The procedures selected dependon the auditor's judgment including the assessment of the risks of material misstatementof the standalone Ind AS financial statements whether due to fraud or error. In makingthose risk assessments the auditor considers internal financial control relevant to theCompany's preparation of the standalone Ind AS financial statements that give a true andfair view in order to design audit procedures that are appropriate in the circumstances.An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by the Company's directors as well asevaluating the overall presentation of the standalone Ind AS financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone Ind AS financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India including the Ind AS of thefinancial position of the Company as at March 31 2018 its financial performanceincluding other comprehensive income its cash flows and changes in equity for the yearended on that date.
Emphasis of Matters:
We draw attention to the following matters in the Notes to the financial statements.Our opinion is not qualified in respect of this matter. a) Trade Receivables includes`11433.18 lakhs receivable from M/s Sethusamudram Corporation Ltd (SCL) which is pendingfor more than 4 years. Out of the above Company has provided for doubtful debts to theextent of `3019.27 lakhs. The company is of the view that this will be reimbursed by GOI(at whose behest the contract with SCL was entered)to DCI to compensate the actualexpenditure incurred on this project. In view of this a provision for doubtful debts isnot made in respect of receivables in this regard amounting to `8413.91 lakhs. b) Thebalances of sundry debtors creditors loans and advances other receivable and otherpayables being subject to confirmation and reconciliation resulting in the balances as perbooks of account not verified by us.
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 ofthe Act we give in the Annexure A a statement on the matters specified inparagraphs 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 CashFlow Statement and the statement of changes in equity dealt with by this Report are inagreement with the books of account. d) In our opinion the aforesaid standalone Ind ASfinancial statements comply with the Accounting Standards specified under section 133 ofthe Act read with relevant rule issued thereunder. e) On the basis of writtenrepresentations received from the directors as on March 31 2018 taken on record by theBoard of Directors none of the directors is disqualified as on March 31 2018 from beingappointed as a director in terms of Section 164(2) of the Act. f ) With respect to theadequacy of the internal financial controls over financial reporting of the Company andthe operating effectiveness of such controls refer to our separate report in "AnnexureB"; and g) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 inour opinion and to the best of our information and according to the explanations given tous: i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements Refer Note 27 the standaloneInd AS financial statements. ii. The company has made provision as required under theapplicable law or accounting standards for material foreseeable losses if any on longterm contracts including derivative contracts. iii. There are no delays in transferringamounts required to be transferred to the Investor Education and Protection fund by thecompany during the year and
3. Directions under section 143(5) of the Companies Act. 2013 are form part of thisreport.
For Tukaram & Co Chartered Accountants [Firm Regn No. 004436S]
Place : New Delhi (P.MURALI)
Date : 28-05-2018 Partner : Membership No. 221625
ANNEXURE A TO AUDITOR'S REPORT
The Annexure referred to in Independent Auditor's Report to the members of the Companyon the standalone Ind AS financial statements for the year ended 31 March 2018 we reportthat: (i) (a) The Company has generally maintained proper records showing full particularsincluding quantitative details and situation of its fixed assets.
(b) Fixed assets have been physically verified by the management during the year and nomaterial discrepancies were identified on such verification.
(c ) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.
(ii ) According to the explanation and information provided by the company that theCompany has carried out physical verification of spares on board dredgers. It was informedthat the company is in the process of reconciling the excess/ deficit stock. Hence we areunable to comment on this at the moment.
(iii) According to the information and explanations given to us and based on ourexamination of the records of the company that the Company has not granted any loanssecured or unsecured to companies firms limited liability partnerships or other partiescovered in the Register maintained under Section 189 of the Companies Act 2013.
(iv) The Company has not granted any loans made investments or provide guarantees andaccordingly the clause 3 (iv) of the Companies (Auditors Report) Order is not applicableto the Company.
(v ) According to the information and explanations given to us that the company has notaccepted any deposit from the public pursuant to sections 73 to 76 or any other relevantprovisions of the Companies Act 2013 and rules framed thereunder.
(vi) To the best of our knowledge the Central Government has not prescribedmaintenance of cost records under Section 148(1) of the Act in respect of the nature ofbusiness carried on by the Company.
(vii) According to the information and explanations given to us in respect of statutorydues:
(a) The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Income-tax sales tax Service Tax Customs Duty Value AddedTax Cess and other material statutory dues applicable to it with the appropriateauthorities.
(b) There were no undisputed amounts payable in respect of Provident Fund Income TaxGST Service Tax Customs Duty Value Added Tax Cess and other material statutory dues inarrears as at 31 March 2018 for a period of more than six months from the date theybecame payable.
(c ) There are no dues in respect of Income Tax GST Service Tax Customs Duty andValue Added Tax as on 31 March 2018 on account of disputes.
(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of loans or borrowings to banks financialinstitutions and government.
(ix) During the period the Company has not raised moneys by way of initial public offeror further public offer (including debt instruments) or term loans and hence reportingunder clause (ix) of the CARO 2016 Order is not applicable.
(x ) According to the information and explanations given to us and to the best of ourknowledge and belief no material fraud by the Company or on the Company by its officers oremployees has been noticed or reported during the course of the audit.
(xi) According to the information and explanations given to us and based on ourexamination of the records of the company the company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Act.
(xii) The Company is not a Nidhi Company hence clause 3(xii) of Companies (AuditorsReport) Order 2016 is not applicable to the company. (xiii) According to the informationand explanations given to us and based on our examination of the records of the companytransactions with the related parties are in compliance with Section 177 and 188 of theCompanies Act 2013 where applicable and details of such transactions have been disclosedin the standalone Ind AS financial statements as required by the applicable accountingstandards. (xiv)According to the information and explanations given to us and based on ourexamination of the records of the company the Company has not made any preferentialallotment / private placement of shares or fully or partly convertible debentures duringthe year.
Accordingly the clause 3 (xiv) of Companies (Auditors Report) Order 2016 is notapplicable to the Company.
(xv ) 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 any non-cashtransactions with directors or persons connected with him. Accordingly the clause 3 ( xv)of the Companies (Auditors Report) Order is not applicable to the Company.
(xvi)The nature of business and the activities of the Company are such that the Companyis not required to obtain registration under section 45-IA of the Reserve Bank of IndiaAct 1934.
For Tukaram & Co Chartered Accountants [Firm Regn No. 004436S]
Place : New Delhi (P.MURALI)
Date : 28-05-2018 Partner Membership No. 221625