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Global Offshore Services Ltd.

BSE: 501848 Sector: Infrastructure
NSE: GLOBOFFS ISIN Code: INE446C01013
BSE 11:37 | 21 Nov 5.82 -0.13
(-2.18%)
OPEN

5.96

HIGH

5.96

LOW

5.80

NSE 11:29 | 21 Nov 5.90 -0.30
(-4.84%)
OPEN

6.05

HIGH

6.10

LOW

5.90

OPEN 5.96
PREVIOUS CLOSE 5.95
VOLUME 7560
52-Week high 17.50
52-Week low 5.55
P/E
Mkt Cap.(Rs cr) 14
Buy Price 5.84
Buy Qty 100.00
Sell Price 6.09
Sell Qty 100.00
OPEN 5.96
CLOSE 5.95
VOLUME 7560
52-Week high 17.50
52-Week low 5.55
P/E
Mkt Cap.(Rs cr) 14
Buy Price 5.84
Buy Qty 100.00
Sell Price 6.09
Sell Qty 100.00

Global Offshore Services Ltd. (GLOBOFFS) - Auditors Report

Company auditors report

To the Members of

Global Offshore Services Limited Report on the Audit of the Financial StatementsOpinion

We have audited the accompanying financial statements of Global Offshore ServicesLimited ("the Company") which comprise the Balance Sheet as at 31st March2019 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Changes in Equity and the Statement of Cash Flow for the year then endedand notes to the financial statements including a summary of significant accountingpolicies and other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by theCompanies Act 2013 ("the Act") in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at 31st March 2019 the loss and other comprehensiveincome changes in equity and its cash flows and for the year ended on that date.

Basis of Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs)specifiedunder section 143 (10) of the Act. Our responsibilities under those Standards arefurther described in the Auditor's Responsibilities for the Audit of the FinancialStatements section of our report. We are independent of the Company in accordance with theCode of Ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the financial statements under theprovisions of the Companies Act 2013 and the Rules thereunder and we have fulfilled ourother ethical responsibilities in accordance with these requirements and the Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our opinion.

Emphasis of Matter

We draw attention to the following: -

Out of the Foreign Currency Term Loans (FCTL) for Acquisition / Modification ofvessels an amount of Rs. 35643.31 lakhs are due to State Bank of India (SBI). On accountof the default in repayment of installment due and interest SBI has treated the same as aNon Performing Assets. Subsequently the bank has converted FCTL into rupee loans andproposes to charge higher interest rate. The Company has not accepted the switchover ofthe loans into rupees and is continuing to provide interest as per the original terms theamount of interest on rupee loan is not quantifiable.

Our report is not modified in respect of the above matter.

Key Audit Matters

Key audit matters are those matters that in ourprofessionaljudgmentwereofmostsignificancein our audit of the financial statements of thecurrent period. These matters were addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters.

Information Other than the Financial Statements and Auditor's Report thereon

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Annual Report but does not includethe financial statements and our auditor's report thereon.

Our opinion on the financial statements does not cover the other information and we donot express any form of assurance conclusion thereon. In connection with our audit of thefinancial statements our responsibility is to read the other information and in doingso consider whether the other information is materially inconsistent with the financialstatements or our knowledge obtained in the audit or otherwise appears to be materiallymisstated. 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.

Responsibilities of Management and Those Charged with Governance for the StandaloneFinancial 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 cash flows and changes in equity of the Company in accordancewith the accounting principles generally accepted in India including under Section 133 ofthe Act read with theIndianAccountingStandards(IndAS)specified Rule 7 of theCompanies(Accounts) Rules 2014. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding of theassets of the Company and for preventing and detecting frauds and other irregularities;selection and application of appropriate accounting policies; making judgments andestimates that are reasonable and prudent; and design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

In preparing the financial statements the Board of Directors 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 unlessthe Board of Directors either intends to liquidate the Company or to cease operations orhas no realistic alternative but to do so.

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

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theCompanies Act 2013 we are also responsible for expressing our opinion on whether thecompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

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 financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

Evaluate the overall presentation structure and content of the financial statementsincluding the disclosures and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding among other matters theplanned scope and timing 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 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 financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen 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 the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of subsection (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 to the extent applicable.

2. As required by Section 143 (3) of the Act 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 Balance Sheet the Statement of Profit and Loss including Other ComprehensiveIncome the Cash Flow Statement and Statement of Changes in Equity dealt with by thisreport are in agreement with the books of account.

(d) In our opinion the aforesaid standalone financial statements comply with theIndian Accounting Standards specified under Section 133 of the Act read with Rule 7 ofthe Companies (Accounts) Rules 2014.

(e) On the basis of the written representations received from the directors as on 31stMarch 2019 taken on record by the Board of Directors none of the directors aredisqualified 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 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 in our opinionand to the best of our information and according to the explanations given to us: i. TheCompany has disclosed the impact of pending litigations on its financial position in itsfinancial statements. ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses. iii. There hasbeen no delay in transferring amounts to the Investor Education and Protection Fund by theCompany during the year ended 31st March 2019.

For D. Kothary & Co.
Chartered Accountants
(Firm Registration No. 105335W)
Mehul N. Patel
Partner
Membership No. 132650
Place: Mumbai
Date: 30th May 2019

Annexure A

To Independent Auditors' Report

(Referred to in Paragraph 1 under the heading of "Report on Other Legal andRegulatory Requirements" section of our report to the members of the Company of evendate) i. In respect of its fixed assets: a) The Company has maintained proper recordsshowing full particulars including quantitative details and situation of fixed assets onthe basis of available information. b) As explained to us all the fixed assetsverifiedbythe management in a phased periodical manner which have been physically in our opinion isreasonable having regard to the size of the Company and nature of its assets. Accordingto the information and explanations given to us no material discrepancies were noticed onsuch verification. c) According to the information and explanations given to us and on thebasis of our examination of the records of the Company the title deeds of immovableproperties are held in the name of the Company. ii. In respect of its inventories a) Weare unable to attend the physical inventory count at the year end to determine the actualquantity of the inventory included in the financial statement due to the impracticality toattend the physical inventory count at the end of the financial year. In our opinion andaccording to the information and explanations given to us the procedures of physicalverification management are reasonable and adequate in relation to the size of the companyand the nature of its business. b) The Company has maintained proper records ofinventories. As explained to us there was no material discrepancies noticed on physicalverification of inventory as compared to the book records. iii. The Company has notgranted any loans secured or unsecured to companies firms Limited Liability Partnershipsor other parties covered in the register maintained under section 189 of the CompaniesAct 2013. iv. In our opinion and according to the information and explanations given tous the Company has complied with the provisions of section 185 and 186 of the Act withrespect to the loans and investments made. v. According to the information andexplanations given to us the Company has not accepted any deposits during the year andtherefore the clause (v) of paragraph 3 of the Order is not applicable to the Company.vi. The maintenance of cost records has not been specifiedby the Central Government undersection 148(1) of the Companies Act 2013 for the business activities carried out by thecompany and hence clause (vi) of paragraph 3 of the Order is not applicable to theCompany. vii. According to the information and explanations given to us in respect ofstatutory dues: a) The Company has generally been regular in depositing undisputedstatutory dues including Goods and Service Tax Withholding Taxes Provident Fund andEmployees' State Insurance Cess as applicable and other material statutory duesapplicable to it with the appropriate authorities. b) There were no undisputed amountspayable in respect of Income-Tax Goods and Service Tax Withholding Taxes ProvidentFund and Employees' State Insurance Cess and other material statutory dues in arrears asat 31st March 2019 for a period of more than six months from the date they becamepayable.

c) According to the information and explanations given to us there are no statutorydues of Sales Tax Value Added Tax Service Tax Goods and Service Tax Withholding TaxesProvident Fund and Employees' State Insurance Cess pending to be deposited on account ofany disputes pending with various forums. However according to the information andexplanations given to us the following dues of income tax have not been deposited by theCompany on account of Disputes.

Sr. Name of the Statute No. Nature of Dues Forum where dispute is pending Period to which the amount relates Demand Amount (in Rs.) Amount Adjusted against Refunds Amount Outstanding after Adjustment
1. Income Tax Act 1961 Income Tax ITAT Mumbai FY 2010-11 2691230 2691230 (Against Refund of AY 2016-17) Nil
2. Income Tax Act 1961 Income Tax ITAT Mumbai FY 2011-12 20634358 11544220 (Against Refund of AY 2014-15) 9090138
3. Income Tax Act 1961 Income Tax CIT Appeals FY 2012-13 273390 273390 (Against Refund of AY 2016-17) Nil

viii. According to the information and explanation given to us the Company hasdefaulted in repayment of dues to a bank during the year. Following are the details of thedefault days for the financial year 2018-2019 in repayment of dues:

Name of the Bank Default of Principal Default of Interest
Less than 365 Days More than 365 Days Less than 365 Days More than 365 Days
State Bank of India 5226.65 Lakhs 6959.63 Lakhs 2243.80 Lakhs 2492.66 Lakhs
Axis Bank - 1199.17 Lakhs 85.78 Lakhs 32.78 Lakhs

ix. The Company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loans during the year and hence clause(ix) of paragraph 3 of the Order is not applicable. x. To the best of our knowledge andaccording to the information and explanations given to us no fraud by the Company and nomaterial fraud on the Company by its officers or employees has been noticed or reportedduring the year. xi. In our opinion and according to the information and explanationsgiven to us the Company has paid/provided for managerial remuneration in accordance withthe requisite approvals mandated by the provisions of section 197 read with Schedule V tothe Act. xii. In our opinion the Company is not a Nidhi company and hence clause (xii) ofparagraph 3 of the Order is not applicable to the Company. xiii. According to theinformation and explanations given to us and based on our examination of the records ofthe Company transactions with the related parties are in compliance with sections 177 and188 of the Act where applicable and details of such transactions have been disclosed inthe financial statements as required by the applicable accounting standards. xiv. In ouropinion and according to the information and explanations given to us the Company has notmade any preferential allotment or private placement of shares or fully or partlyconvertible debentures during the year and hence clause (xiv) of paragraph 3 of the Orderis not applicable to the company. xv. In our opinion and according to the information andexplanations given to us the Company has not entered into non-cash transactions with itsdirectors or persons connected with them and covered under section 192 of the Act andhence clause (xv) of paragraph 3 of the Order is not applicable to the Company. xvi. TheCompany is not required to be registered under section 45-IA of the Reserve Bank of IndiaAct 1934.

For D. Kothary & Co.
Chartered Accountants
(Firm Registration No. 105335W)
Mehul N. Patel
Partner
Membership No. 132650
Place: Mumbai
Date: 30th May 2019

Annexure - B

To the Independent Auditor's Report on the Standalone Financial Statements of GlobalOffshore Services Limited Report on the Internal Financial Controls 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 Global OffshoreServices Limited reportingof ("the Company") as of 31st March 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 (‘ICAI'). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention detection of frauds and errors the accuracy and completenessof the accounting records and the timely preparation of reliable financial informationas required under the Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols our audit in accordance with the Guidance Note on Audit of Internal FinancialControls over Financial Reporting (the "Guidance Note") and the Standards onAuditing issued by ICAI and deemed to be prescribed under section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controlsboth applicable to an audit of Internal Financial Controls and both issued by theInstitute of Chartered Accountants of India. Those Standards and the Guidance Note requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls overfinancialreporting was established and maintained and if such controls operatedeffectively 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 evaluating the design and internalfinancial operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error.

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 financialstatements for external purposes in accordance with generallyaccepted accounting principles. reporting includes those policies and procedures that (1)pertain to the maintenance of Acompany'sinternalfinancialcontrolover financial 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 authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized 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 financialcontrols over financialreporting to future periods are subject to the risk that the internal financial controlover reporting may become inadequate because of changes in conditions or that the degreeof compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31st March 2019 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For D. Kothary & Co.
Chartered Accountants
(Firm Registration No. 105335W)
Mehul N. Patel
Partner
Membership No. 132650
Place: Mumbai
Date: 30th May 2019