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Gillanders Arbuthnot & Company Ltd.

BSE: 532716 Sector: Others
NSE: GILLANDERS ISIN Code: INE047B01011
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OPEN 17.80
CLOSE 19.00
VOLUME 929
52-Week high 55.00
52-Week low 15.15
P/E
Mkt Cap.(Rs cr) 38
Buy Price 18.00
Buy Qty 100.00
Sell Price 19.00
Sell Qty 4.00

Gillanders Arbuthnot & Company Ltd. (GILLANDERS) - Auditors Report

Company auditors report

TO THE MEMBERS OF GILLANDERS ARBUTHNOT AND COMPANY LIMITED

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of GILLANDERSARBUTHNOT AND COMPANY LIMITED ("the Company") which comprise the BalanceSheet as at March 31 2019 the Statement of Profit and Loss (including OtherComprehensive Income) the Statement of Change in Equity and the Cash Flows Statement forthe year ended on that date and a summary of the significant accounting policies andother explanatory Information in which are included the financial statements for the yearended on that date audited by the branch auditors of the Company's "EngineeringDivision" (hereinafter referred to as "the standalone financialstatements").

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 Companies Act 2013 ("the Act") in the manner so required and give a trueand fair view in conformity with the Indian Accounting Standards prescribed under section133 of the Act read with the Companies (Indian accounting Standards) Rules 2015 asamended ("Ind AS") and other accounting principles generally accepted in Indiaof the state of a airs of the Company as at March 31 2019 the loss and totalcomprehensive income changes in equity and its cash flows for the year ended on thatdate.

Basis for Opinion

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 "Auditor'sResponsibilities for the Audit of the Standalone Financial Statements" section of ourreport. We are independent of the Company in accordance with the Code of Ethicsissued 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 thereunder and we havefulfilled our other ethical responsibilities in accordance with these requirements and theICAI's Code of Ethics. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion on the standalone financialstatements.

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.

Key Audit Matter How our audit addressed the key audit Matter
1. Revenue recognition (See note 27 to the Standalone Financial Statements)
Revenue recognition is significant audit risk within the Company. Our audit consisted testing of the design and operating effectiveness of the internal controls and substanvetesting as follows:
The revenue standard establishes a comprehensive framework for determining whether how much and when revenue is recognized. This involves certain key judgments relating to identification of distinct performance obligations determination of transaction price of identified performance obligation the appropriateness of the basis used to measure revenue recognized over a period. additionally the standard mandates robust disclosures in respect of revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. • Evaluated the design and tested the opera five effectiveness of the internal controls relating to revenue recognition discounts and rebates.
• Tested sample of sale transactions to their respective customer contracts underlying invoices and related documents.
• Obtained confirmations from customers on sample basis to support existence assertion of trade receivables and assessed the relevant disclosures made in the financial statements; to ensure revenue from contracts with customers are in accordance with the requirements of relevant accounting standards.
Risk exists that revenue is recognized without substantial transfer of control and is not in accordance with Ind AS- 115 "Revenue from Contracts with Customers". • In case of construction contracts reviewed the Company's estimation process (including the approval of project budget monitoring of project costs and Activities and management's review and customer's approval of project's stage of completion and milestones achieved) used in determining the amounts of revenue and costs recognised in Company's financial statements.
2. Impairment of Assets (See note 4 to the Standalone Financial Statements)
Significant judgement is involved in assessing property plant and equipment for impairment. At the end of every Reporting period the Company assesses whether there is any indication that an asset or cash Generating unit (CGU) may be impaired. If any such indication exists the Company estimates the recoverable amount of the asset or CGU. Our audit procedures included considering the Company's accounting policies with respect to impairment in accordance with Ind AS 36 "Impairment of Assets".
The determination of recoverable amount being the higher of fair value less costs to sell and value-in- use involves significant estimates assumptions and judgements of the long-term financial projections. Impairment of assets is a key audit matter considering the significance of the carrying value long term estimation and the significant judgements involved in the impairment assessment. We performed test of controls over impairment process through inspection of evidence of performance of these controls. We performed the following tests of details:
• We obtained the management's impairment assessment.
• We evaluated the key assumptions including projected cash flows. In determining future cash flows management is required to make assumptions relating to future Profitability including revenue growth and operating margins and the determination of an appropriate discount rate all of which are subject to management override as the outcome of the impairment assessments could vary significantly if different judgements are applied.
• We have tested the workings of management for ascertaining fair value and costs of disposal of CGU for ascertaining recoverable amount.
3. Expected Credit Loss (See note 50 (A) to the Standalone Financial Statements)
The Company assesses at each date of balance sheet whether a financial asset or a group of financial assets is impaired. Ind AS 109 requires expected credit losses (ECL) to be measured through a loss allowance. The company recognizes impairment loss for trade receivables that do not constitute a financing transaction using expected credit loss model which involves use of a provision matrix constructed on the basis of historical credit loss experience. For all other financial assets expected credit losses are measured at an amount equal to the 12 month expected credit losses or at an amount equal to the life me expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition. Our Audit procedure on Evaluation of Expected credit loss model include:
• Obtained an understanding of the Company's process for estimating the ECL of various eligible assets included in the Standalone Financial Statements.
• Evaluated the detailed analysis performed by management on revenue by selecting samples for the existing contracts with customers.
• Evaluated the calculation of historical loss rate on the basis of historical trends industry practices business environment in which company operates and forward looking Information.

Information Other than the Standalone Financial Statements and Auditor's Report Thereon

The Company's Board of Directors is responsible for the presentation of the otherInformation. The other Information comprises the Information included in the AnnualReport but does not include the standalone financial statements and our auditor's reportthereon.

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 such other Informationis materially inconsistent with the standalone financial statements or our knowledgeobtained during 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 includingother comprehensive income changes in equity and cash flows of the Company in accordancewith the accounting principles generally accepted in India including the accountingstandards specified under section 133 of the Act. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the standalone financial statements that give a true andfair view and are free from material misstatement whether due to fraud or error.

In preparing the standalone financial statements the Board of Directors is responsiblefor assessing 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 the Board of Directors either intends to liquidate the Company or tocease Operations or has no realise alternative but to do so.

Those Board of Directors are also responsible for overseeing the Company's financialReporting process.

Auditor's Responsibility 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 assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepcism throughout the 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 higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal controls relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Act we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls system in place and the operating effectiveness ofsuch controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basisof accounting 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 a enon in our auditor's report to the related disclosures in thestandalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to 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 standalonefinancial statements including the disclosures and whether the standalone financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.

Materiality is the magnitude of misstatements in the standalone financial statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquanta five materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the standalone financial statements.

We communicate with those charged with governance regarding among other Matters theplanned scope and mining 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 relatoonships 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.

Other Matter

We did not audit the financial statements/information of Engineering Division includedin the standalone financial statements of the Company whose financial statements reflecttotal assets of र 17441.42 lacs as at March 31 2019 and total revenue of र7736.68 lacs for the year ended on that date as considered in the standalonefinancial statements. The financial statements/information of these units have beenaudited by the branch auditor whose report have been furnished to us and our opinion inso far as it relates to the amounts and disclosures included in respect of the said unitis based solely on the report of such branch auditor.

Our opinion is not modified in respect of this Matter.

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 4of the Order.

2. 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 account as required by law have been kept by theCompany so far as it appears from our examination of those books.

c) The report on the financial statements of Engineering Division of the Companyaudited under section 143(8) of the Act by branch auditors has been sent to us and havebeen properly dealt with us in preparing this report.

d) The Balance Sheet the Statement of Profit and Loss including Other ComprehensiveIncome Statement of Changes in Equity and the Cash Flow Statement dealt with by thisReport are in agreement with the books of account.

e) In our opinion the aforesaid standalone financial statements comply with the Indianaccounting Standards specified under section 133 of the Act read with the relevant Rulesthereon.

f) On the basis of the written representations received from the directors as on March31 2019 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2019 from being appointed as a director in terms of section 164 (2) of theAct.

g) With respect to the adequacy of the internal financial controls over financialReporting of the Company with reference to these standalone financial statements and theoperating effectiveness of such controls refer to our separate Report in Annexure"B" to this report. Our report expresses an unmodified opinion on the adequacyand operating effectiveness of the Company's internal financial controls over financialReporting with reference to these standalone financial statements.

h) With respect to the other Matters to be included in the Auditor's Report inaccordance with the requirements of Section 197(16) of the Act as amended:

In our opinion and to the best of our Information and according to the explanationsgiven to us the Remuneration paid by the Company to its directors during the year is inaccordance with the provisions of section 197 of the Act.

i) 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 as at March 31 2019 onits financial position in its Standalone financial statements - Refer Note No. 38 to theStandalone financial statements;

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 tothe Investor Education and Protection Fund by the Company.

For Singhi & Co.
Chartered Accountants
Firm‘s Registration No. 302049E
Anurag Singhi
Place: Kolkata Partner
Date : 28th May 2019 Membership No. 066274

Annexure 'A' to the Independent Auditors' Report

(Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date)

i. (a) The Company has maintained proper records showing full Particulars includingquanta five details and situation of property plant and equipment.

(b) As per the Information and explanations given to us physical verification ofproperty plant and equipment have been carried out in terms of the phased program of itsverification adopted by the Company and no material discrepancies were noticed on suchverification. In our opinion the frequency of verification is reasonable having regard tosize of the Company and nature of its business.

(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. As per the Information and explanations given to us the inventories have beenphysically verified at reasonable intervals during the year by the management or by affirmof Chartered Accountants on behalf of the Management and no material discrepancies betweenbook stock and physical stock have been found.

iii. The Company has not granted any loans secured or unsecured to companies firmslimited liability partnership or other pares listed in the register maintained undersection 189 of the Act. Accordingly the provisions of paragraph 3(iii)(a) to 3(iii)(c) ofthe said Order are not applicable.

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 in respect ofgrant of loans making investments and providing guarantees and Securities as applicable.

v. According to Information and explanations given to us the company has complied withthe directives issued by Reserve Bank Of India and the provisions of section 73 to 76 orany other relevant provisions of the Act and the rules framed there under with respect todeposits (from public). According to the Information and explanation's given to us noorder has been passed by the Company Law Board or National Company Law Tribunal or ReserveBank of India or any Court or any other Tribunal on the Company in respect of theaforesaid deposits.

vi. We have broadly reviewed the cost records maintained by the Company in respect ofits products (Tea and Textile) pursuant to the rules prescribed by the Central Governmentof India under section 148 (1) of the Act and are of the opinion that prima facie theprescribed records have been so made and maintained. We have however not made a detailedexamination of the cost records with a view to determine whether they are accurate orcomplete.

vii. (a) According to the Information and explanations given to us and on the basis ofour examination of the records of the Company the Company is generally regular indeposing undisputed statutory dues including provident fund employees' state insuranceincome tax duty of customs Goods & Service Tax cess and other material statutorydues during the year by the Company with the appropriate authorities. According to theInformation and explanations given to us no undisputed amounts payable in respect ofprovident fund employees' state insurance income tax duty of customs Goods &Service Tax cess and other material statutory dues were in arrears as at March 31 2019for a period of more than six months from the date they became payable.

(b) According to the Information and explanations given to us the dues outstanding inrespect of income tax or sales tax or wealth tax or duty of customs or duty of excise orvalue added tax or goods and service tax on account of disputes are as follows:

Name of the Statute Nature of Dues Amount Involved र Period to which the amount relates Forum where Dispute is Pending
(in Lakhs)
The Central Sales Tax Act 1956 Sales Tax 1.62 2011-12 West Bengal Commercial Taxes Appellate and Revisitional Board Kolkata
194.45 2004-05 Joint Commissioner Commercial Taxes Kolkata
104.61 (pre-deposit amount 6.41) 2014-15 Joint Commissioner (Appeal) Kolkata
254.12 (pre-deposit amount 29.99) 2015-16 Sales tax Commissioner (Appeal) Kolkata
The West Bengal Value Added Tax Act 2003 Sales Tax 28.68 (Net of amount paid under protest 3.28) 2013-14 WBCT Appellate and Revisional Board Kolkata
83.33 (Pre-deposit amount 8.18) 2014-15 Joint Commissioner (Appeal) Kolkata
79.20 (Pre-deposit amount 12.58) 2015-16 Sales tax Commissioner (Appeal) Kolkata
80.12 2004-05 Joint Commissioner Commercial Taxes
Orissa Sales Tax Act 1947 Sales Tax 11.91 1998-99 Additional Commissioner of Sales Tax Cuack
Central Sales Tax (Orissa) Rules 1957 Sales Tax 1998-99 & 1999-2000 Additional Commissioner of Sales Tax Cuack
Assam Sales Tax Sales Tax 5.08(Pre-deposit amount 1.68) 2011-12 to 2014-15 Deputy Commissioner of Commercial Taxes Assam
Chennai Sales Tax Sales Tax 5.13 2006-07 Sales Tax Tribunal Chennai
Jharkhand VAT Act 2005 VAT 1.16 2015-16 Sales Tax Tribunal Ranchi
51.38 2009-10 Sales Tax Tribunal Ranchi
The Central Excise Act 1944 Excise Duty 34.32 Upto 1987-88 Office of the Commissioner - Central Excise Kolkata
0.92 Various periods from 1994-95 to 2007-08 Office of the Additional / Deputy Commissioner of Central Excise
Finance Act 1994 Service Tax 274.24 (Net of amount paid under Protest 81.66) 2003-04 to 2011-12 CESTAT Kolkata
35.00 (Net of amount paid under Protest 4.00) June 2005 to September 2010 CESTAT Chennai
27.69 (Net of amount paid under Protest 2.24) October 2010 to June 2012 Commissioner of Central excise (Appeals) Kolkata
2.04 (Net of amount paid under Protest 0.26) 2012-13 to 2015-16 Assistant Commissioner of CGST and CX
Income Tax Act 1961 Income 8.36 2007-08 to 2017-18 Asst. commissioner of I.T -CPC (TDS)
Tax 5.86 1987-88 Hon'ble High Court at Calcua
1.31 2007-08 - 2017-18 Income Tax Department Siliguri

viii. According to the records of the Company examined by us and the Information andexplanation given to us the company has not defaulted in repayment of loans or borrowingto any financial institution or banks or Government. The company neither had anyoutstanding debentures at the beginning of the year nor has it issued any debenture duringthe year.

ix. The Company has not raised any money by way of initial public offer or furtherpublic offer including debt instruments during the year. According to the Information andexplanations given to us by the management term loans were applied for the purpose forwhich the loans were obtained.

x. According to the Information and explanations given to us no fraud by the Companyor on the Company by its Officers or employees has been noticed or reported during thecourse of our 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. Accordingly paragraph 3(xii) of the Order isnot applicable.

xiii. According to the Information and explanations given to us and based on ourexamination of the records of the Company transactions with the related pares are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the standalone financial statements as required by theapplicable accounting 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. Accordingly paragraph 3(xiv) of the Order is not applicable 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 non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

xvi. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934. Accordingly paragraph 3(xvi) of the Order is not applicable tothe Company.

For Singhi & Co.
Chartered Accountants
Firm‘s Registration No. 302049E
Anurag Singhi
Place: Kolkata Partner
Date : 28th May 2019 Membership No. 066274

Annexure 'B' to the Independent Auditors' Report

(Referred to in paragraph 2(g) under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date)

Report on the Internal Financial Controls over Financial Reporting 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 GILLANDERSARBUTHNOT AND COMPANY LIMITED ("the Company") as of March 31 2019 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.

Auditor's Responsibility

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 judgement including the assessment of the risks ofmaterial misstatement of the standalone financial statements whether due to fraud orerror.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover 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 standalone financial statements for external purposes in accordance withgenerally 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 standalonefinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations 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 standalonefinancial 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.

Opinion

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 March 31 2019 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.

Other Matter

Our aforesaid reports u/s 143(3)(i) of the Act on the adequacy and operatingeffectiveness of the internal financial controls over financial reporting in so far as itrelates to one unit of the Company ‘Engineering Division' is based on thecorresponding report of the branch auditor of such unit.

Our opinion is not modified in respect of this matter.

For Singhi & Co.
Chartered Accountants
Firm‘s Registration No. 302049E
Anurag Singhi
Place: Kolkata Partner
Date : 28th May 2019 Membership No. 066274