To the Members of GSB Finance Limited
Report on the Audit of the Standalone Financial Statements
We have audited the standalone financial statements of GSB Finance Limited ("theCompany") which comprise the balance sheet as at 31st March 2019 and the statementof Pro t and Loss statement of changes in equityand statement of cash flows for the yearthen ended and notes to the financial statements including a summary of significantaccounting policies and other explanatory information.
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 31st March 2019 and pro t/loss changes in equityand its cash flows for the yearended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rulesthereunder and we have ful lled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsigni cance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.
|Key Audit Matters ||Auditor's Response |
|Accuracy of recognition measurement presentation and disclosures of revenue and other related balances presented in the financial statements in view of adoption of Ind AS. ||Principal Audit Procedures |
| ||We assessed the company's process to identify the impact of adoption of the new Indian Accounting Standard (Ind AS). |
| ||Our audit approach consisted testing of the design and operating effectiveness of the internal controls. |
The Company's Board of Directors is responsible for the other information. The otherinformation comprises the [information included in the Management report but does notinclude the 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 the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the nancial statements or our knowledge obtained in the auditor 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 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 withtheaccounting principles generally accepted in India including the accounting Standardsspecified under section 133 of the Act. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingof the assets of the Company and for preventing and detecting frauds and otherirregularities; 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 financial statement that give a true and fair view andare free from material misstatement whether due to fraud or error.
In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.
The 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 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 control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(Ifthe Companies 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 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 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 financialstatements including the disclosures and whether the financial statements represent theunderlying transactions 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 signi cance 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.
The comparative financial information of the company for the year ended 31st March2018and the transition date opening balance sheet as at 1st April2017 included in this IndASfinancial statements are based on previously issued statutory financial statementsprepared in accordance with the Companies ( Accounting Standard ) Rules 2006 audited byus for the year ended 31st March2017 and 31st March2018 dated 29th May 2017 and 12thMay 2018 respectively expressed an unmodi ed opinion on those financial statements asadjusted for the differences in the accounting principles adopted by the Company on thetransition to Ind AS which have been audited by us.
Our opinion is not modi ed in respect of this matter.
Report on Other Legal and Regulatory Requirements
As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the Annexure "B" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extentapplicable.
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 Pro t and Loss ( including other compressiveincome statement of Changes in Equity and statement of the Cash Flow dealt with by thisReport are in agreement with the books of account.
(d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules2014.
(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 is disqualied as on 31st March 2019 from being appointed as a director in terms of Section 164 (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 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. The Company has disclosed the impact of pending litigations on its financialposition in its 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 H. P. Jadeja & Associates. |
| ||Firm Registration Number: 135374W |
| ||Chartered Accountants |
| ||Hemantsinh P. Jadeja |
|Place : Mumbai ||Proprietor |
|Dat : 30th May 2019 ||Membership Number: 152374 |
ANNEXURE A- TO THE INDEPENDENT AUDITORS' REPORT
The Annexure referred to in paragraph 1 under the 'Report on Other Legal and RegulatoryRequirements' our report in the members of GSB Finance Limited ("The Company")for the year ended on 31st March 2019 We report that:-
(I) (a) The company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets;
(b) Fixed assets have been physically verified by the management at reasonableintervals; and no material discrepancies were noticed on such verification
(c) The company does not hold any immovable property. Hence clause 3(i)(c) about titledeeds of immovable properties is not applicable in the present case.
(ii) Company has inventory in electronic mode hence verification of inventory has beendone through demat statement at reasonable intervals by the management and no materialdiscrepancies were noticed.
(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.
(a) as the company has not granted any loans to parties covered under section 189clause
3(iii)(a) which deals with terms and conditions of the grant of such loans is notapplicable;
(b) as the company has not granted any loans to parties covered under section 189clause
3(iii)(b) which deals with schedule of repayment of principal and payment of interestis not applicable;
(c) as the company has not granted any loans to parties covered under section 189 thequestion of amount being overdue does not arise;
(iv) In our opinion and according to the information and explanations given to us theCompany has not granted any loans or provided any guarantee or security to the partiescovered under Section 185 and hence provisions of Clause 3(iv) of the aforesaid Order inthis regard are not applicable to the Company. Further the Company has complied withprovision of Section 186 of the Act in respect of the investments made by it.
(v) In our opinion and according to the information and explanations given to us TheCompany has not accepted any deposits. Hence clause 3(v) which deals with directivesissued by the Reserve Bank of India and the provisions of sections 73 to 76 or any otherrelevant provisions of the Companies Act 2013 and the rules framed there under are notapplicable
(vi) In our opinion and according to the information and explanations given to us TheCompany is not required to maintain cost records pursuant to the Rules made by the CentralGovernment for the maintenance of cost records under sub-section (l) of section 148 of theCompanies Act.
(vii) According to the records of the Company the Company is generally regular indepositing with appropriate authorities undisputed statutory dues including providentfund employees' state insurance income-tax sales tax wealth tax duty of customs dutyof excise value added tax or cess and other statutory dues applicable to it. Noundisputed amounts payable in respect of provident fund employees' state insuranceincome-tax sales tax wealth tax duty of customs duty of excise value added tax orcess and other statutory dues were outstanding as at 31-03- 2018 for a period of morethan six months from the date they became payable.
a) According to the records of the Company and information and explanations given to usno dues of income tax sales tax wealth tax service tax duty of customs duty ofexcise value added tax or cess that have not been deposited on account of any disputesexcept as follows:
|Name of the Statue ||Nature of Dispute ||Amount paid under Protest ||Period to which the amount relates ||Forum where dispute is pending |
| || ||(Rs in lakhs) || || |
|Income Tax Act 1961 ||Income Tax ||0.07 ||AY 2011-12 ||Under Re-assessment Proceedings raised on 26.12.2018 |
(viii) Based on our audit procedures and according to the information and explanationsgiven to us by the management we are of the opinion that the Company has not defaulted inrepayment of dues to financial institutions and bank.
(ix) Based on our audit procedures and according to the information and explanationsgiven to us by the management the Company has not raised any money during the year underreview.
(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor we have been informed of any such case by themanagement.
(xi) Managerial remuneration has been paid or provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct;
(xii) The company is not a Nidhi Company. Hence clause 3(xii) will not be applicable
(xiii) The Company has entered into the transaction with the related parties incompliance with the provisions of the Section 177 and 188 of the Act. The details of suchrelated party transactions have been disclosed in the standalone financial statements asrequired under Indian Accounting Standard (Ind AS) 24 Related Party Disclosures specifiedunder Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.
|Name of Related Party ||Designation ||Remuneration |
|1. Shri Girdhari S. Biyani ||Chairman& Director ||600000/- |
|2. Shri Ramakant S. Biyani ||Mg. Director ||600000/- |
|3. Shri Suyash Ramakant Biyani ||Whole Time Director ||400000/- |
(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review and henceprovisions of Clause 3(xiv) of the aforesaid Order are not applicable to the Company.
(xv) The Company has not entered into any non-cash transactions with its directors orthe persons connected with him and hence provisions of Clause 3(xv) of the aforesaid Orderare not applicable to the Company.
(xvi) The company is registered under section 45-IA of the Reserve Bank of India Act1934 and the registration is enforced for the same.
| ||For H. P. Jadeja & Associates |
| ||Chartered Accountants |
| ||Firm Registration No. 135374W |
| ||Hemantsinh P. Jadeja |
|Date : 30th May2019 ||Proprietor |
|Place : Mumbai ||Membership No: 152374 |
ANNEXURE B- TO THE INDEPENDENT AUDITOR'S REPORT
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 GSB FinanceLimited ("the Company") as of March 31 2019 in conjunction with our audit ofthe standalone financial statements of the Company for the year 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 Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants ofIndia(ICAI). These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company's policiesthe safeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the 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 and the Standards on Auditing issued by ICAI and deemed to beprescribed under section 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated 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.
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 financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that 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 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 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 March 31 2019 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note issued by theInstitute of Chartered Accountants of India
| ||For H. P. Jadeja & Associates |
| ||Chartered Accountants |
| ||Firm Registration No. 135374W |
| ||Hemantsinh P. Jadeja |
|Date : 30th May 2019 ||Proprietor |
|Place : Mumbai ||Membership No: 152374 |