Genera Agri Corp Ltd.
|BSE: 541999||Sector: Others|
|NSE: N.A.||ISIN Code: INE993L01015|
|BSE 00:00 | 09 Mar||Genera Agri Corp Ltd|
|NSE 05:30 | 01 Jan||Genera Agri Corp Ltd|
|BSE: 541999||Sector: Others|
|NSE: N.A.||ISIN Code: INE993L01015|
|BSE 00:00 | 09 Mar||Genera Agri Corp Ltd|
|NSE 05:30 | 01 Jan||Genera Agri Corp Ltd|
The Members of the Genera Agri Corp Ltd.
Report on the Audit of the Standalone Financial Statements
We have audited the accompanying standalone financial statements of Genera Agri CorpLimited ("the Company") which comprise the Balance sheet as at March 312019 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Changes in Equity and the Statement of Cash Flows for the year ended on thatdate and a summary of the significant accounting policies and other explanatoryinformation ( herein after referred to as "the stand alone financialstatements").
In our Opinion and to the best of our information and according to the explanationsgiven to us except for the effects of the matter described in the Basis for Qualifiedopinion section of our report the aforesaid standalone financial statements give theinformation required by the Companies Act 2013 ("the Act") in the manner sorequired and give a true and fair view in conformity with the Indian Accounting Standardsprescribed under section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended ("Ind AS") and other accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 31 2019the profit and total comprehensive income changes in equity and its cash flows for theyear ended on that date.
Basis for Qualified Opinion
Facts of the case:
(i)The company had advanced certain amounts as Inter-Corporate loans totaling Rs.1037.35 lakhs which are outstanding since long time. In our opinion Company's effortsin recovering the same are not fully yielding desired results. The management is yet toassess the change in risk of default and resultant expected credit loss allowance on suchloans and advances. Had the aforesaid assets been provided for impairment loss after taxfor the year ended on March 31 2019 would have been higher by Rs.1037.35 lakhs otherequity would have been lower by Rs. 1037.35 lakhs.
(ii)The company had given advances for land totaling Rs.641.11 lakhs which areoutstanding since long time. Considering the fact that these are outstanding since longtime and Company's efforts in recovering the same are not fully yielding desired results.The possible loss on account of this has not been recognized in the financial statements.
According to the management it is not possible to estimate the losses and consequentlyquantify the amount of provision required in the above cases.
Had the company estimated and provided for the losses as mentioned (i) to (ii) abovethe profit stated in the statement of Profit and Loss would have been lower by suchamount; the amount of other non- current assets in the Balance Sheet would have been lowerby the amount of provision with respect to item mentioned in paragraph (1) above ; theamount of Long-term loans and advances in the Balance Sheet would have been lower by theamount of provision with respect to item mentioned in paragraph (ii) above.
We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing specified under section 143(10) of the Act (SAs). Ourresponsibilities under those standards are further described in the Auditorsresponsibility for the Audit of the Standalone Financial Statements section of our report.We are independent of the Company in accordance with the Code of Ethics issued by theInstitute of Chartered Accountants of India (ICAI) together with the independencerequirements that are relevant to our audit of the standalone financial statements underthe provisions of the Act and the rules made thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the standalone financial statements.
Key Audit Matters:
Key audit matters are those matters that in our opinion professional judgement wereof most significance in our audit of the standalone financial statements of the currentperiod. These matters were addressed in the context of our audit of the standalonefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. except for the matters mentioned in Basis ofQualification there are no other Key Audit matters to communicate in our report.
Information other than the Standalone Financial Statements and Auditor's Report Thereon
The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis. Board's report including Annexures to the Board's Report BusinessResponsibility Report Corporate Governance and Shareholder's information but does notinclude the standalone financial statements and our auditor's report thereon.
Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationmaterially inconsistent with the standalone financial statements or our knowledge obtainedduring the course of our audit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.
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 Act with respect to the preparation of these standalone financial statementsthat give a true and fair view of the financial position financial performance totalcomprehensive income changes in equity and cash flows of the Company in accordance withthe Ind AS and other accounting principles generally accepted in India. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies ; making judgements 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 standalone financialstatements that give a true and Fairview and are free from material misstatement whetherdue to fraud or error.
In preparing the standalone 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.
The Board of Directors are responsible for overseeing the Company's financial reportingprocess.
Auditor's Responsibilities for the Audit of the Standalone Financial Statements.
Our objectives are to obtain reasonable assurance about whether the standalonefinancial 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. Reasonable assuranceis a high level of assurancebutis not a guarantee that an audit conducted in accordancewith SA's will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in the aggregatethey could reasonably be expected to influence the economic decisions of users taken onthe basis of these standalone financial statements.
As part of an audit in accordance with SA's w exercise professional judgement andmaintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the standalone financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a Material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.
Obtain an understanding of internal financial controls relevant to the audit in orderto design audit procedures that are appropriate in the circumstances. Under section143(3)(1) 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 control
Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe standalone financial statement or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained upto the date of ourauditor's report. However future events or conditions may cause the company to cease tocontinue as a going concern.
Evaluate the overall presentation structure and content of the standalone financialstatements that individually or in aggregate makes it probable that the economicdecisions of a reasonably knowledgeable user of the financial statements may beinfluenced. We consider quantitative materiality and qualitative factors in (i) planningthe scope of our audit work and in evaluating the results of our work; and (ii) toevaluate the effect of any identified misstatements in the financial statements.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of 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 to bear on ourindependence 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 auditor's report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements.
1.As required by section 143 (3) of the Act based on our audit 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 accounts as required by law have been kept by theCompany so far as it appears from our examination of the books.
c) The Balance Sheet the Statement of Profit & Loss including other ComprehensiveIncome Statement of Changes in Equity and the Statement of Cash Flow dealt with by thusReport are in agreement with the relevant books of accounts.
d) In our opinion the afore said Ind AS financial statements comply with the IndASspecified under section 133 of the Act read with rule 7 of the Companies (Accounts)Rules 2014.
e) On the basis of the written representative received from the directors as on 31stMarch 2019 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2019 from being appointed as a director in terms of section164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financialreporting of the company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure A"
g) With respect to other matters to be included in the Auditors report in accordancewith the requirements of section 197(16) of the Act as amended In our opinion and to thebest of our information and according tothe explanations given to us the remunerationpaid by the company to its directors during the year is in accordance with the provisionsof section 197 of the Act.
h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:
i. The Company has disclosed the pending litigations on its financial position in itsstandalone financial statements in Note no 2.1
ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on log-term contracts.
iii. There were no amounts which were required to be transferred to the investorEducation and Protections Fund by the company
2.As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143 (11) of the Act we give in"Annexure B" a statement on the matters specified in paragraphs 3 and 4 of theOrder.
For N G Rao & Associates
Firm Registration No.:009399S
(N Nageswara Rao)
Membership No: 207300
Annexure - A to the Independent Auditors' report on the Internal Financial Controlsunder Clause (i) of Subsection 3 of Section 143 of the Companies Act 2013 ("theAct")
We have audited the internal financial controls over financial reporting of M/s GeneraAgri Corp Limited ("the company") as of 31 March 2019 in conjunction with ouraudit of the financial statements of the company for the year ended on that date.
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". 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 Act.
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 aspects.
An 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. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the company's internal financial controls system overfinancial 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 standalone Ind AS financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of standaloneInd AS financial statements in accordance with generally accepted accounting principlesand that receipts and expenditures of the company are being made only in accordance withauthorizations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition use ordisposition of the company's assets that could have a material effect on the standaloneInd AS 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 misstatement due to error or fraud may occur and not be detected. Alsoprojections of any evaluation of the internal financial control over financial reportingmay become inadequate because of changes in conditions or that the degree of compliancewith the policies or procedures may deteriorate.
According to the information and explanation given to us and based on our audit thefollowing material weakness have been identified as at March 31 2019.
a. The company did not have internal auditor's as required by the company's act2013which is one of the essential components of internal control with regards to thepotential for fraud when performing risk assessment.
b. The company's internal control system for statutory dues and returns were notoperating effectively which could potentially result in the company goes to the variouslegal cases for the above mentioned liability.
A material weakness' is a deficiency or a combination of deficiencies in internalfinancial control over financial reporting such that there is a reasonable possibilitythat a material misstatement of the company's annual financial statements will not beprevented or detected on a timely basis.
In our opinion except for the effects/possible effects of the material weaknessesdescribed above on the achievement of the objective of control criteria the company hasmaintained adequate and effective internal financial control system over financialreporting as at 31st March 2019 based on the internal control over financial reportingcriteria established by the company considering the essential components of internalfinancial control stated in the Guidance Note on Audit of Internal Financial Controls overFinancial Reporting issued by the Institute of Chartered Accountants of India.
We have considered the material weaknesses identified and reported above in determiningthe nature timing and extent of audit tests applied in our audit of the standalonefinancial statements of the Company and these material weaknesses do not affect ouropinion on the standalone financial statements of the Company.
For N G Rao & Associates
G Nageswara Rao
Annexure (B) to the Independent Auditor's Report
Referred to in paragraph 2 under the heading "Report on other legal and regulatoryrequirements" of our report of even date to the financial statements of the companyfor the year ended March 31 2018:
(i) In respect of Fixed Assets
(a) The Company has not maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) As informed to us the Company had carried out the physical verification of FixedAssets during the yearunder review.
(c) According to the information and explanations given to us and on the basis of ourexamination of therecords of the company the title deeds of immovable properties are heldin the name of the company.
(ii)The management has conducted physical verification of inventory at reasonableintervals during the year. The discrepancies noticed on physical verification of theinventory is compared to books records which has been properly dealt with in the books ofaccount were not material.
(iii)According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms LLPs or other parties coveredin the register maintained under Section 189 of the Companies Act 2013.
Accordingly the provisions of clause 3(iii)(a)(b) and (c) of the Order are notapplicable to the Company and hence not commented upon.
(iv)In our opinion and according to the information and explanations given to us thecompany has complied with the provisions of section 185 and I86 of the Companies Act 2013In respect of loans investments guarantees and security.
(v) According to the information and explanations given to us the Company has notaccepted any deposits from the public and hence the directives issued by the Reserve Bankof India and the provisions of Sections 73 to 76or any other relevant provisions of theAct and the Companies (Acceptance of Deposit) Rules 2015 with regard to the depositsaccepted from the public are not applicable.
(vi) As informed to us the maintenance of Cost Records has not been specified by theCentral Government under sub-section (1) of Section 148 of the Act in respect of theactivities carried on by the company.
(vii)According to information and explanations given to us and on the basis of ourexamination of the books of account and records the Company have not been regular indepositing undisputed statutory dues including Provident Fund Employees State InsuranceIncome-Tax Sales tax Service Tax Duty of Customs Duty of Excise Value added Tax Cessand any other statutory dues with the appropriate authorities.
According to the information and explanation given to us following are the due amountspertaining to the Income Tax which have not been deposited on account of dispute for whichappeals are pending before the Hon'ble Income Tax Appellate Tribunal.
(viii) The Company does not have any loans or borrowings from any financialinstitution banks government or debenture holders during the year. Accordinglyparagraph 3(viii) of the Order is not applicable.
ix) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not raised moneys by way of initial public offeror further public offer including debt instruments and term Loans. Accordingly theprovisions of clause 3 (ix) of the Order are not applicable to the Company and hence notcommented upon.
(x) 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.
(xi) According to the information and explanations give 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) In our opinion the Company is not a Nidhi Company. Therefore the provisions ofclause 4 (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 standalone Ind AS financial statements as requiredunder Indian Accounting Standard (Ind AS) 24 Related Party Disclosures specified underSection 133 of the Act.
(xiv) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year.
(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 non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.
(xvi) In our opinion the company is not required to be registered under section 45 IAof the Reserve Bank of India Act 1934 and accordingly the provisions of clause 3 (xvi)of the Order are not applicable to the Company and hence not commented upon.
For N G Rao & Associates
G Nageswara Rao