The Members of Hipolin Limited
Report on the Audit of Standalone Ind AS Financial Statements Opinion
We have audited the accompanying standalone Ind AS financial statements of The HIPOLINLIMITED (the Company) which comprises of Balance Sheet as at March 31 2019the Statement of Profit and Loss including Other Comprehensive Income the Statement ofChanges in Equity the Statement of Cash Flow for the year ended and notes to thefinancial statements including a summary of significant accounting policies and otherexplanatory information.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by 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 Companies (Indian Accounting Standards) Rules 2015 as amended(Ind AS) and other accounting principles generally accepted in India of thestate of affairs of the Company as at March 312019 its profits including othercomprehensive income changes in equity and its cash flows for the year ended on thatdate.
Basis for Opinion
We conducted our audit of the Standalone Ind AS financial statements in accordance withthe Standards on Auditing (SAs) as specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the audit of the Financial Statements section of our report. We areindependent of the Company in accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India (ICAI) together with the ethical requirements that arerelevant to our audit of the standalone Ind AS financial statements under the provisionsof the Act and the Rules made there under and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our audit opinion on the standalone Ind AS financial statements.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificant in our audit of the standalone Ind AS financial statements for the year endedMarch 312019 .These matters were addressed in the context of our audit of the standaloneInd AS financial statements as a whole and in forming our opinion thereon and we do notprovide a separate opinion on these matters for each matter below our description of howour audit addressed the matter is provided in that context.
We have determined the matters described below to be the key audit matters to becommunicated in our report. We have fulfilled the responsibilities described in theAuditor's responsibilities for the audit of the standalone Ind AS financial statementssection of our report including in relation to these matters. Accordingly our auditincluded the performance of procedures designed to respond to our assessment of the risksof material misstatement of the standalone Ind AS financial statements. The results of ouraudit procedures including the procedures performed to address the matters below providethe basis for our audit opinion on the accompanying standalone Ind AS financialstatements.
|Key audit matters ||How our audit addressed the key audit matter |
|Revenue Recognition ||Principal Audit Procedures |
|Revenue from contracts with customers is recognized on transfer of control of promised goods or services to a customer at an amount that reflects the consideration to which the Company is expected to be entitled to in exchange for those goods or services. The Re ve n u e sta n d a rd e sta b l i s h e s a comprehensive framework for determining whether how much and when revenue should be recognized. This involves certain key judgments relating to identification of distinct performance obligations determination of the transaction price allocation of the transaction price to identified performance obligations and the appropriateness of the revenue recognition methodology. ||Our audit procedures on adoption of Ind AS 115 Revenue from contracts with Customers ('Ind AS 115') the new standard on revenue recognition includes the following - |
| || Evaluated the design and implementation of the processes and internal controls relating to implementation of the new revenue recognition standard. |
| || Evaluated the detailed analysis performed by the management across revenue streams by selecting samples for the existing contracts with customers and verified the appropriateness of identification of distinct performance obligations determination of the transaction price allocation of the transaction price to identified performance obligations and the appropriateness of the revenue recognition methodology and |
|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 appropriateness of the accounting policy and disclosures provided under the new revenue standard and assessed the completeness and mathematical accuracy of the relevant disclosures. |
|Revenue is one of the key profit drivers and is therefore susceptible to misstatement. Cut-off is the key assertion in so far as revenue recognition is concerned since an inappropriate cut-off can result in material misstatement of results for the year. || |
Information Other than the Standalone Ind AS Financial Statements and Auditor's reportthereon
The Company's Board of Directors is responsible for the preparation of otherinformation. The Other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexure to the Board report CorporateGovernance report and Shareholder's information but does not include the standalone IndAS financial statements and our auditor's report thereon.
Our opinion on the standalone Ind AS financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone Ind AS financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone Ind AS financialstatements or our knowledge obtained during the course of our audit or otherwise appearsto be materially misstated. If based on the work we have performed we conclude thatthere is a material misstatement of this other information we are required to report thatfact. We have nothing to report in this regard.
Responsibilities of Management for the Standalone Ind AS 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 Ind AS financialstatements that give a true and fair view of the financial position financial performanceincluding other comprehensive income changes in equity and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theIndian accounting Standards specified under section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 as amended. 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 Ind AS financial statements that give atrue and fair view and are free from material misstatement whether due to fraud or error.
In preparing the standalone Ind AS financial statements the Management 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 management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative 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 Standalone Ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone Ind ASfinancial statements 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 standalone Ind AS 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 standalone Ind ASfinancial 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 control 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 control 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 the 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 entity'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 standalone Ind AS financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.
Evaluate the overall presentation structure and content of the standalone IndAS financial statements including the disclosures and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.
Materiality is the magnitude of misstatements in the standalone Ind AS financialstatements that individually or in aggregate makes it probable that the economic decisionsof a reasonably knowledgeable user of the standalone Ind AS financial statements may beinfluenced. We consider quantitative materiality and qualitative factors in
(i) Planning the scope of our audit work and in evaluating the results of our work and
(ii) To evaluate the effect of an identified misstatements in the standalone Ind ASfinancial statements.
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 standalone Ind AS financialstatements for the financial year ended March 312019 and are therefore the key auditmatters. We describe these matters in our auditor's report unless law or regulationprecludes public disclosure about the matter or when in extremely rare circumstances wedetermine that a matter should not be communicated in our report because the adverseconsequences of doing so would reasonably be expected to outweigh the public interestbenefits of such communication.
Report on Other Legal and Regulatory Requirements
1. Pursuant to 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 Act we give in the Annexure A a statement on the matters specified inparagraphs 3 and 4 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 and records.
c) The Balance sheet the Statement of Profit & 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.
d) In our opinion the aforesaid standalone Ind AS financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended;
e) On the basis of the written representation received from the directors as on March312019 taken on records by the Board of Directors none of the directors is disqualifiedas on March 312019 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 with reference to these standalone Ind AS Financial Statementsand the operating effectiveness of such controls refer to our separate Report in AnnexureB.
g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of Sec 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 read with Schedule V to the Act.
h) With respect to the matters to be included in the Auditor's report in accordancewith the rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and tothe 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 standalone Ind AS financial statements. [Refer note no 40 to standaloneInd AS financial statements]
(ii) The Company did not have any long-term contracts including derivative contractsfor which 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 BORKAR & MUZUMDAR
Firm Registration No.: 101569W
CA GUNVANT K KOTADIA
Membership No.: 033190
Date : May 29 2019
ANNEXURE A TO THE INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 2 (f) under 'Report on Other Legal and RegulatoryRequirements' of our report of even date)
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSubsection 3 of Section 143 of the Companies Act 2013 (the Act)
We have audited the internal financial controls over financial reporting of HipolinLimited (the Company) as of March 312019 in conjunction with our audit ofthe standalone Ind AS 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 (theGuidance Note) issued by the Institute of Chartered Accountants of India.These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to Company's policies thesafeguarding 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 prescribed under Section 143(10) ofthe Companies Act 2013 to the extent applicable to an audit of internal financialcontrols. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting were established andmaintained and if such controls 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 judgement including the assessment of the risks ofmaterial misstatement of the standalone Ind AS Financial Statements whether due to fraudor 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 standalone Ind AS Financial Statements for external purposes in accordancewith generally accepted accounting principles. A Company's internal financial control overfinancial reporting includes those policies and procedures that:
1. Pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the Company;
2. Provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the Company are being made only inaccordance with the authorization of the management and the directors of the Company and;
3. Provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the Company's assets that could have amaterial effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.
In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at 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.
FOR BORKAR & MUZUMDAR
Firm Registration No.: 101569W
CA GUNVANT K KOTADIA
Membership No.: 033190
Date : May 29 2019
ANNEXURE B TO THE INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements'of our report of even date)
1. In respect of Fixed Assets:
The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets on the basis of available information
As explained to us all the fixed assets have been physically verified by themanagement in a phased manner which in our opinion is reasonable having regard to thesize of the Company and the nature of its assets. No material discrepancies were noticedon such verification.
According to the information and explanations provided to us and the title deedsof all the immovable properties are held in the Company's name.
2. In respect of Inventories:
The physical verification of the Inventories has been conducted at reasonableintervals by the Management.
The procedure of physical verification of Inventories followed by the managementis reasonable and adequate in relation to the size of the Company and nature of itsbusiness.
The Company has maintained proper records of Inventories and no materialdiscrepancies were noticed on physical verification.
3. According to the information and explanations provided to us the Company has notgranted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under Section 189 (2) ofthe Companies Act 2013 (Act). Accordingly the provisions of clause (iii)(a)/ (b) and (c) of Paragraph 3 of the said Order are not applicable to the Company.
4. In our opinion and according to the information and explanations provided to us theCompany has complied with the provisions of Section 185 and 186 of the Act with respectto grant of loans making investments and providing guarantees and securities.
5. According to the information and explanation provided to us the Company has notaccepted any deposits from the public. Accordingly the provisions of clause (v) ofParagraph 3 of the said Order are not applicable to the Company.
6. The company is registered under MSME Act 2006. As per the Company's (Cost Recordsand Audit) Rules 2014 as amended by Companies (Cost Records and Audit) Amendment Rules2014 issued by the Central Government the company is not required to maintain the costrecords hence the provisions of (vi) is not applicable to the company.
7. In respect of statutory dues:
According to the information and explanation provided to us undisputed amountspayable in respect of Provident Fund Income Tax Goods and Service Tax Cess and othermaterial statutory dues have been generally regularly deposited with the appropriateauthorities. According to the records of the Company and information and explanationsprovided to us no undisputed amounts payable in respect of the aforesaid dues wereoutstanding as at March 312019 for a period of more than six months from the date theybecome payable.
According to the records of the Company and information and explanationsprovided to us particulars of disputed amounts payable in respect of Provident FundIncome Tax Goods and Service Tax Sales Tax Value Added Tax Customs Duty Service TaxCess and other material statutory dues as on the last day of the period ending March312019 are as follows:
|Name of the Statute ||Name of the dispute ||Amount (In Rs) ||Period to which the amount relates ||Forum where the dispute is pending |
|Income Tax Act 1961 ||Income Tax & Interest ||2092950/- ||2011-12 ||Income Tax Appellate tribunal |
8. Based on our audit procedures and on the basis of information and explanationprovided to us we are of the opinion that the Company has not defaulted in the repaymentof dues to financial institutions banks or government. The Company did not have anyoutstanding dues to debenture holders during the year.
9. The Company has neither applied for any Term Loan nor it has raised any money by wayof Initial public offer / further public offer (including debt instruments) during theyear. Accordingly the provisions of clause (ix) of Paragraph 3 of the said Order are notapplicable to the Company.
10. Based upon the audit procedures performed and as per the information andexplanations provided to us we have neither come across any instance of fraud on or bythe Company its officers or employees noticed or reported during the period nor have webeen informed of any such case by the management.
11. According to the information and explanation provided 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.
12. In our opinion Company is not a Nidhi Company. Accordingly the provisions ofclause (xii) of Paragraph 3 of the said Order are not applicable to the Company
13. According to the information and explanation provided to us and based on ourexamination of the records of the Company all transactions with the related parties arein compliance with section 177 and 188 of the Act where applicable and the details havebeen disclosed in the standalone Ind AS Financial Statements etc; as required by theapplicable accounting standards.
14. According to the information and explanation provided 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 period under review.
15. According to the information and explanation provided to us and based on ourexamination of the records of the Company the Company has not entered into any non-cashtransactions during the period with directors or persons connected with as referred insection 192 of Companies Act 2013. Accordingly the provisions of clause (xv) ofParagraph 3 of the said Order are not applicable to the Company
16. According to the information and explanation provided to us and based on ourexamination of the records of the Company the Company is not required to be registeredunder section 45-IA of the Reserve Bank of India Act 1934.
FOR BORKAR & MUZUMDAR
Firm Registration No.: 101569W
CA GUNVANT K KOTADIA
Membership No.: 033190
Date : May 29 2019