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Hathway Cable & Datacom Ltd.

BSE: 533162 Sector: Media
NSE: HATHWAY ISIN Code: INE982F01036
BSE 00:00 | 25 Jun 28.20 -1.20
(-4.08%)
OPEN

29.05

HIGH

29.40

LOW

27.85

NSE 00:00 | 25 Jun 28.15 -1.10
(-3.76%)
OPEN

29.20

HIGH

29.40

LOW

27.90

OPEN 29.05
PREVIOUS CLOSE 29.40
VOLUME 48696
52-Week high 48.50
52-Week low 23.80
P/E 38.11
Mkt Cap.(Rs cr) 2,342
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 29.05
CLOSE 29.40
VOLUME 48696
52-Week high 48.50
52-Week low 23.80
P/E 38.11
Mkt Cap.(Rs cr) 2,342
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Hathway Cable & Datacom Ltd. (HATHWAY) - Auditors Report

Company auditors report

INDEPENDENT AUDITOR'S REPORT

To the Members of Hathway Cable and Datacom Limited

REPORT ON THE STANDALONE FINANCIAL STATEMENTS

We have audited the accompanying standalone financial statements of Hathway Cableand Datacom Limited ('the Company') which comprise the Balance Sheet as at March 312017 the Statement of Profit and Loss (including Other Comprehensive Income) the CashFlow Statement and the Statement of Changes in Equity for the year then ended and asummary of the significant accounting policies and other explanatory information (hereinafter referred to as "standalone financial statements").

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 including other comprehensive income cash flows andchanges in equity of the Company in accordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards ("Ind AS")specified under Section 133 of the Act read with the relevant rules issued thereunder.

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 standalonefinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

AUDITOR'S RESPONSIBILITY

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 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 the standalone financial statements in accordance with theStandards on Auditing specified under Section 143(10) of the Act. Those Standards requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone financial statements are free frommaterial misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the standalone financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thestandalone financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to the Company'spreparation of the standalone financial statements that give a true and fair view in orderto design audit procedures that are appropriate in the circumstances. An audit alsoincludes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the standalone financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone financial statements.

OPINION

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 including the Ind AS of the state ofaffairs of the Company as at March 31 2017 and its losses including (other comprehensiveincome) its cash flows and the changes in equity for the year ended on that date.

EMPHASIS OF MATTER

We draw attention to note no. 4.20 to the accounts relating to manner and basis ofrecognition of subscription income in respect of Cable Television business.

Our opinion is not qualified 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 the paragraph 3 and4 of the Order.

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 the Cash Flow Statement and theStatement of Changes in Equity dealt with by this Report are in agreement with the booksof account;

d) In our opinion the aforesaid standalone financial statements comply with the IndianAccounting Standards specified under Section 133 of the Act read with relevant rulesissued thereunder;

e) On the basis of the written representations received from the directors as on March31 2017 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of Section 164(2) of theAct;

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 bythe Companies (Audit and Auditors) Rules 2017 in our opinion and to the best of ourinformation and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements. Refer Note 4.02 to the standalonefinancial statements;

ii. The Company did not have any material foreseeable losses on long term contractsincluding derivative contracts;

iii. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund except for delay in transferring an amount of Rs.29375 (Amount in ') in respect of unclaimed share application money as explained in Note4.24 to the standalone financial statements; and

iv. The Company has provided requisite disclosures in its standalone financialstatements as to holdings as well as dealings in Specified Bank Notes during the periodfrom November 8 2016 to December 30 2016 and these are in accordance with the books ofaccounts maintained by the Company. Refer Note 2.11 to the standalone financialstatements.

For G. M. Kapadia & Co.
Chartered Accountants
Firm's Registration No: 104767W
Viren Thakkar
Mumbai Partner
Dated: May 30 2017 Membership No: 49417

ANNEXURE A TO THE INDEPENDENT AUDITOR'S REPORT

Referred to in paragraph 1 under the heading "Report on Other Legal &Regulatory Requirements" of our report on even date to the financial statements ofthe Company for the year ended March 31 2017

(i) (a) The Company has maintained records of Property

Plant and Equipment showing particulars of assets including quantitative details andlocation except in case of certain types of distribution equipments like cabling lineequipments access devices with end users. In view of the management nature of suchassets and business is such that maintaining location-wise particulars is impractical;

(b) Distribution equipments like cabling and other line equipments of selected networkswere verified. The management plans to verify balance networks in a phased manner.Property Plant and Equipment other than distribution equipments and access devices withthe end users were physically verified during the year based on verification programmeadopted by the management. As per this programme all assets will be verified at leastonce in a period of three years. The management has represented that physical verificationof access devices with the end users is impractical; however the same can be tracked incase of most of the networks through subscribers management system;

The Company is in the process of reconciling book records with outcome of physicalverification wherever physical verification was carried out and have accounted for thediscrepancies observed on such verification;

In our opinion frequency and procedure for verification of distribution equipments andsubsequent reconciliation with book records need to be strengthened;

(c) The Company does not hold any immovable properties. Accordingly the paragraph3(i)(c) of the Order regarding title deeds of immovable properties is not applicable;

(ii) (a) Inventories have been physically verified during

the year by the management. In our opinion the frequency of verification isreasonable;

(b) The discrepancies noticed on physical verification as compared to the book recordswere not material having regards to size and nature of operations and have been properlydealt with in the books of account;

(iii) (a) The Company has granted unsecured loan to

parties covered in the register maintained under Section 189 of the Act;

(b) I n our opinion the terms and conditions on which the loans had been granted tothe companies listed in the register maintained under Section 189 of the Act were notprima facie prejudicial to the interest of the Company

(c) According to the information and explanations given to us no repayment scheduleshave been specified in respect of such loans granted and accordingly the question ofregularity in repayment of principal amount does not arise;

(d) There is no amount which is overdue for more than ninety days in respect of suchloans.

(iv) Based on the audit procedures applied by us during the year under audit theCompany has not granted loans guarantee and security or made investments which requirecompliance in terms of the provisions contained in the section 185 or section 186 of theAct. The Management has based on legal opinion represented that overdue book debts arenot in the nature of loan and hence do not fall within the scope of section 185 of theAct. In such circumstances para 3(iv) of the Order is not applicable;

(v) In our opinion and according to the information and explanation given to us theCompany has not accepted deposits from the public and therefore the provisions sections73 to 76 or any other relevant provisions of the Act and the rules framed thereunder arenot applicable to the Company. We have been informed by the management that no order hasbeen passed by the Company Law Board or National Company Law Tribunal or Reserve Bank ofIndia or any Court or any other Tribunal in this regard;

(vi) The Central Government has prescribed maintenance of cost records under Section148(1) of the Act for the products manufactured by the Company. We have broadly reviewedthe books of account maintained and in our opinion; prima facie the prescribed accountsand records have been made and maintained by the Company. We have not however made adetailed examination of the records with a view to determine whether they are accurate orcomplete;

(vii) (a) The Company has generally been regular in

depositing with appropriate authorities undisputed statutory dues such as providentfund employees' state insurance income tax sales tax service tax duty of customsduty of excise value added

tax cess and other applicable statutory dues. According to information andexplanations given to us no undisputed statutory dues payable were in arrears as at March31 2017 for a period of more than six months from the date they became payable;

(b) The details of dues of income tax sales tax service tax duty of customs duty ofexcise or value added tax or cess which have not been deposited with the concernedauthorities on account of dispute are given below:

Sr No Name of the Statute Nature of the Dues Amount involved (in crores) Period to which the amount relates Forum where dispute is pending
1 Finance Act 1994 Service Tax 0.04 April 2003 to March 2004 Service Tax Department
2 Central Sales Tax Act 1958 Central Sales Tax 0.02 2011-12 Deputy Commissioner Appeals
3 Finance Act 1994 Service Tax 3.70 2003-04 to 2006-07 Additional Commissioner Service Tax

(viii) Based on our audit procedure and according to the information and explanationsgiven to us the Company has not defaulted in repayment of dues to the financialinstitutions bank and government. The Company has not issued any debentures;

(ix) In our opinion and according to the information and explanations given to us andbased on overall examination of records the term loans have been applied for the purposefor which the loans were obtained; The Company did not raise any money by way of initialpublic offer or further public offer including debt instruments;

(x) During the course of our examination of the books and records of the Companycarried out in accordance with generally accepted auditing practices in India andaccording to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe year;

(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) In our opinion and according to information and explanation given to us theCompany is not a Nidhi Company. Accordingly paragraph 3 (xii) of the Order is notapplicable to the Company;

(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 such transactions have been disclosed in the standalonefinancial statements as required by the applicable accounting standards;

(xiv) Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to information and explanations givenby the management the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year.Accordingly paragraph 3(xvi) of the Order is not applicable to the Company;

(xv) Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements the Company has not entered into any noncashtransactions with directors. We have been informed that no such transactions have beenentered into with person connected with directors. Accordingly paragraph 3(xv) of theOrder is not applicable to the Company; and

(xvi) In our opinion the Company is not required to be registered under section 45 IAof the Reserve Bank of India Act 1934 and accordingly the provision of clause 3(xvi) ofthe Order are not applicable to the Company.

For G. M. Kapadia & co.
Chartered Accountants
Firm's Registration No: 104767W
Viren Thakkar
Mumbai Partner
Dated: May 30 2017 Membership No: 49417

ANNEXURE B TO THE INDEPENDENT AUDITOR'S REPORT

Referred to in paragraph 2(f) under the heading ‘Report on Other Legal andRegulatory Requirements' of our report on even date to the financial statements of theCompany for the year ended March 31 2017:

REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER SECTION 143(3)(I) OF THE ACT

We have audited the internal financial controls over financial reporting of HathwayCable and Datacom Limited ('the Company') as of March 31 2017 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

MANAGEMENT'S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS

The Company's Board of Directors are responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting (the 'Guidance Note') issued by the Institute of Chartered Accountants of India('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 Act.

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 and the Standards on Auditing issued by ICAI and deemed to beprescribed under Section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the Institute of Chartered Accountants of India. 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 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 system over 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 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.

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 March 31 2017 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on issued by theInstitute of Chartered Accountants of India.

For G. M. Kapadia & Co.
Chartered Accountants
Firm's Registration No: 104767W
Viren Thakkar
Mumbai Partner
Dated: May 30 2017 Membership No: 49417