TO THE MEMBERSGENESYS INTERNATIONAL CORPORATION LIMITED
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of GENESYSINTERNATIONAL CORPORATION LIMITED ("the Company") which comprise theBalance Sheet as at 31 March 2017 the Statement of Profit and Loss and the Cash FlowStatement for the year then ended and a summary of the significant accounting policiesand other explanatory information.
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.
This responsibility also includes 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 financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.
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 equired to be included in the auditreport under the provisions of the Act and the Rules made thereunder. In conducting ouraudit 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 the Rules made thereunder. We conducted our audit of thestandalone financial statements in accordance with the Standards on Auditing specifiedunder Section 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 financial statements are free from material misstatement. An audit involves performingprocedures to obtain audit evidence about the amounts and the disclosures in thestandalone financial statements. The procedures selected depend on the auditor's judgmentincluding the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal financial control relevant to the Company's preparation of thestandalone financial statements that give a true and fair view in order to design auditprocedures that are appropriate in the circumstances. An audit also includes evaluatingthe appropriateness of the accounting policies used and the reasonableness of theaccounting estimates made by the Company's Directors as well as evaluating the overallpresentation of the standalone financial statements. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide a basis for our audit opinion onthe standalone financial statements.
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 31 March 2017 and its profit and its cash flows for the year ended on that date.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 Section 143(11) of the Act we givein the Annexure A a statement on the matters specified in paragraphs 3 and 4 of theOrder.
2. As required by Section 143 (3) of the Act based on our audit we report to theextent applicable 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 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 the Statement of Profit and Loss and the Cash Flow Statementdealt with by this Report are in agreement with the relevant books of account.
(d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards prescribed under Section 133 of the Act.
(e) On the basis of the written representations received from the directors as on 31March 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2017 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 B"; and
(g) 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 impact of pending litigations on its financialposition on its financial position in its standalone financial statements in accordancewith the generally accepted accounting practice Refer Note 28 to the financialstatements.
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company.
iv. The company has provided requisite disclosures in its standalone financialstatements as regards its holding and dealings in Specified Bank Notes as defined in theNotification S.O. 3407(E) dated the 8th November 2016 of the Ministry of Finance duringthe period from 8th November 2016 to 30th December 2016.Based on audit proceduresperformed and the representations provided to us by the management we report that thedisclosures are in accordance with the books of account maintained by the company.
ANNEXURE - A TO THE AUDITORS' REPORT
(Referred to in paragraph 2 under Report on Other Legal and RegulatoryRequirements' section of our report of even date): (i)(a)The Company has maintained properrecords showing full particulars including quantitative details and situation of fixedassets. (b) The fixed assets have been physically verified by the management as per aphased program of verification. In our opinion the frequency of verification isreasonable having regard to the size of the Company and the nature of its assets. Thediscrepancies reported on verification were not material and have been properly dealt within the books of accounts.
(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) The Company is a service company primarily rendering computer based services inthe area of Geospatial Information System (GIS). Accordingly it does not hold anyphysical inventories. Thus paragraph 3(ii) of the Order is not applicable to the Company.
(iii) The Company has not granted any loans secured or unsecured to companies firmslimited liability partnerships or other parties covered in the register maintained undersection 189 of the Companies Act 2013 (the Act').Accordingly paragraph3(iii)(a)(b) and (c) of the Order is not applicable to the Company.
(iv) 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 Act with respectto the loans and investments made.
(v) In our opinion and according to the information and explanations given to us theCompany has not accepted deposits as per the directives issued by the Reserve Bank ofIndia under the provisions of Section 73 to 76 or any other relevant provisions of the Actand the Rules framed there under .Accordingly the provisions of paragraph 3(v) of theOrder are not applicable to the Company.
(vi) The Central Government has not prescribed the maintenance of cost records undersection 148(1) of the Act for any of the services rendered by the Company. Therefore theprovisions of paragraph 3(vi) of the Order are not applicable to the company.
(vii) In respect of statutory dues:
(a) According to the records of the Company undisputed statutory dues includingprovident fund employees' state insurance income-tax sales-tax wealth tax servicetax duty of customs duty of excise value added tax cess and any other statutory dueshave been generally regularly deposited with appropriate authorities. There has been delayin payment of undisputed statutory dues during the year however based on the informationand explanations given to us and records of the company examined by us no undisputedamounts payable in respect of the aforesaid dues were outstanding as at 31st March 2017for a period of more than six months from the date of it becoming payable.
(b) According to the information and explanation given to us there are no dues CustomsDuty Excise Duty which have not been deposited with the appropriate authorities onaccount of any dispute. However according to the information and explanation given to usthe following dues of income tax sales tax service tax and Value Added Tax which havenot been deposited as on 31st March 2017 on account of disputes are given below:
|Name of the Statute ||Nature of Dues ||Forum where Dispute is Pending ||Period to which the Amount Relates ||Amount Unpaid |
|Income Tax Act 1961 ||Income Tax Penalty ||Commission- er of Income Tax Appeals- 22 ||A.Y. 2009-10 ||160690/- |
|Income Tax Act 1961 ||Income Tax ||Income Tax Appellate Tribunal Mumbai ||A.Y. 2009-10 ||179890/- |
|Service Tax ||Service Tax and Penalty ||Commission- er (Appeals) Mumbai ||April 2010 to March 2015 ||7473186/- |
|Maha- rashtra Value Added Act 2002 ||Sales tax inter- est and penalty ||Deputy Com- missioner of Sales Tax ||April 2012 to March 2013 ||316206/- |
(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 financialinstitutions banks and government. Further the Company has not issued any debentures.
(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) during the year under consideration. Accordingto the information and explanation given to us and based on our examination of therecords the term loans obtained during the year by the company were applied for thepurpose for which they were raised and there was no delay or default in repayment of thesame. (x) According to the information and explanations given to us and based on ouraudit we have not come across any material 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 and according to the information and explanations given to us theCompany is not a nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable.
(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.
(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 and according to information and explanations given to us theCompany is not required to be registered under section 45-IA of the Reserve Bank of IndiaAct 1934.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of GenesysInternational Corporation Limited ("the Company") as of 31 March 2017 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. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe 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") issued by the Institute of Chartered Accountants of Indiaand the Standards on Auditing prescribed under Section 143(10) of the Companies Act 2013to the extent applicable to an audit of internal financial controls. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated 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 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'sinternal financial control over financial reporting is a process designed to providereasonable assurance regarding the reliability of financial reporting and the preparationof financial statements for external purposes in accordance with generally acceptedaccounting principles. A company's internal financial control over financial reportingincludes those policies and procedures that (1) pertain to the maintenance of recordsthat 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 unauthorised 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.
In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at 31st March 2017 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.
| ||For G.K. Choksi & Co. |
| ||Chartered Accountants |
| ||(Firm's Registration No: 125442W) |
| ||(Sandip A. Parikh) |
| ||(Partner) |
|Mumbai 30 May 2017 ||(Membership No.40727) |