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Honeywell Automation India Ltd.

BSE: 517174 Sector: Engineering
NSE: HONAUT ISIN Code: INE671A01010
BSE 09:58 | 16 Oct 28805.60 -19.65
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28909.90

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NSE 09:49 | 16 Oct 28851.25 57.45
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OPEN 28909.90
PREVIOUS CLOSE 28825.25
VOLUME 13
52-Week high 29499.00
52-Week low 18255.00
P/E 66.79
Mkt Cap.(Rs cr) 25,464
Buy Price 28780.00
Buy Qty 2.00
Sell Price 28939.00
Sell Qty 5.00
OPEN 28909.90
CLOSE 28825.25
VOLUME 13
52-Week high 29499.00
52-Week low 18255.00
P/E 66.79
Mkt Cap.(Rs cr) 25,464
Buy Price 28780.00
Buy Qty 2.00
Sell Price 28939.00
Sell Qty 5.00

Honeywell Automation India Ltd. (HONAUT) - Auditors Report

Company auditors report

To

The Members of

Honeywell Automation India Limited

Report on the Ind AS Financial Statements

We have audited the accompanying Ind AS financial statements of Honeywell AutomationIndia Limited ("the Company") which comprise the Balance Sheet as at 31stMarch 2018 and the Statement of Profit and Loss (including Other Comprehensive Income)the Cash Flow Statement and the Statement of Changes in Equity for the year then endedand a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Ind AS 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 Ind AS 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 Indian Accounting Standards (IndAS) prescribed under Section 133 of the Act with the Companies (Indian AccountingStandards) Rules 2015 as amended and other accounting principles generally accepted inIndia.

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

Auditors' Responsibility

Our responsibility is to express an opinion on these Ind AS financial statements basedon our audit.

In conducting our audit we have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder and the Orderissued under section 143(11) of the Act.

We conducted our audit of the Ind AS 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 Ind AS financial statements are free from materialmisstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the Ind AS financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of theInd AS 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 Ind AS financial statements that give a true and fair view in order todesign audit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of the accounting policies used and the reasonableness ofthe accounting estimates made by the Company's Directors as well as evaluating theoverall presentation of the Ind AS financial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our audit opinion on the Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS financial statements give the information required bythe Act in the manner so required and give a true and fair view in conformity with the IndAS and other accounting principles generally accepted in India of the state of affairs ofthe Company as at 31st March 2018 and its profit total comprehensive income its cashflows and the changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act based on our audit we report that :

a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.

c) The 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 relevant books of account.

d) In our opinion the aforesaid Ind AS financial statements comply with the IndianAccounting Standards prescribed under Section 133 of the Act.

e) On the basis of the written representations received from the directors of theCompany as on 31st March 2018 taken on record by the Board of Directors none of thedirectors is disqualified as on 31st March 2018 from being appointed as a director interms 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". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.

g) With respect to the other matters to be included in the Auditors' Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its Ind AS financial statements - Refer Note 34 to the Ind AS financialstatements;

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts - Refer Note 37 to the Ind AS financial statements;

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

2. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"Annexure B" a statement on the matters specified in paragraphs 3 and 4 of theOrder.

For DELOITTE HASKINS & SELLS LLP
Chartered Accountants
(Firm's Registration No. 117366W/W-100018)
Sunil S. Kothari
Partner
Pune 14th May 2018 (Membership No. 208238)

Annexure ‘A' to Independent

Auditors' Report

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

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of HoneywellAutomation India Limited ("the Company") as of 31st March 2018 in conjunctionwith our audit of the Ind AS financial statements of the Company for the year ended onthat date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on "the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India". These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting of the Company based on our audit. We conducted ouraudit in accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") issued by the Institute of CharteredAccountants of India and the Standards on Auditing prescribed under Section 143(10) of theAct to the extent applicable to an audit of internal financial controls. Those Standardsand the Guidance Note require that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgement including the assessment of the risks ofmaterial misstatement of the 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 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 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 2018 based on the criteria forinternal financial control over financial reporting 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 DELOITTE HASKINS & SELLS LLP
Chartered Accountants
(Firm's Registration No. 117366W/W-100018)
Sunil S. Kothari
Partner
Pune 14th May 2018 (Membership No. 208238)

Annexure ‘B' to Independent Auditors' Report

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

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) The Company has a program of verification of fixed assets to cover all the items ina phased manner over a period of five years which in our opinion is reasonable havingregard to the size of the Company and the nature of its assets. Pursuant to the programcertain fixed assets were physically verified by the Management during the year. 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 the records examinedby us and based on the examination of the copy of the registered sale deed title searchreport and tax paid receipts provided to us we report that the title deeds comprisingall the immovable properties of land and buildings which are freehold are held in thename of the Company as at the balance sheet date. The Company does not have any immovableproperties of leasehold land and building.

(ii) As explained to us the inventories were physically verified during the year bythe Management at reasonable intervals and no material discrepancies were noticed onphysical verification.

(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 Act.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Act in respect ofinvestments made by the Company. According to the information and explanations given tous the Company has not granted loans or provided guarantees and securities.

(v) According to the information and explanations given to us the Company has notaccepted any deposit and hence reporting under clause 3 (v) of the Order is not applicableto the Company.

(vi) The maintenance of cost records has been specified by the Central Government undersection 148(1) of Act. We have broadly reviewed the cost records maintained by the Companypursuant to the Companies (Cost Records and Audit) Rules 2014 as amended prescribed bythe Central Government under sub-section (1) of Section 148 of the Act and are of theopinion that prima facie the prescribed cost records have been made and maintained. Wehave however not made a detailed examination of the cost records with a view todetermine whether they are accurate or complete.

(vii) According to the information and explanations given to us in respect ofstatutory dues:

(a) The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income-tax Sales Tax Service TaxCustoms Duty Excise Duty Value Added Tax Goods and Service Tax (GST) Cess and othermaterial statutory dues applicable to it to the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income-tax Sales Tax Service Tax Customs Duty Excise Duty ValueAdded Tax Goods and Service Tax (GST) Cess and other material statutory dues in arrearsas at 31st March 2018 for a period of more than six months from the date they becamepayable.

(c) Details of dues of Income-tax Sales Tax Service Tax Customs Duty Excise DutyValue Added Tax and Goods and Service Tax (GST) which have not been deposited as on 31stMarch 2018 on account of disputes are given below:

Income Tax Act 1961
Nature of Due Forum where Pending Period to which it pertains Amount unpaid Amount Paid
(Rs. in Lakhs) (Rs. in Lakhs)
Income Tax Bombay High Court 1999-00 22.75 211.68
Income Tax Commissioner of Income Tax 2001-02 2002-03 2004-05 & 2014-15 1731.46 373.75
Income Tax Income Tax Appellate Tribunal 2003-04 2005-06 2006-07 2007-08 2009-10 2010-11 2011-12 & 2012-13 3404.59 8540.94
Respective sales tax laws- Sales tax Value added tax (VAT) Central Sales Tax (CST) Works Contract Tax Entry Tax
Nature of Dues Forum where dispute is pending Period to which amount relates Amount unpaid (Rs. in Lakhs) Amount Paid (Rs. in Lakhs)
VAT Additional Commissioner (Appeal) Uttar Pradesh 2011-122012-13 378.68
CST Assistant commissioner Himachal Pradesh 2012-13 0.40
CST/VAT Assistant Commissioner Jharkhand 2007-08 18.69
CST/VAT Assistant Commissioner Karnataka 2011-12 2012-13 59.02 90.00
VAT/CST Assistant commissioner West Bengal 2014-15 25.55 2.68
VAT/CST Assistant Commissioner Rajasthan 2006-07 2007-08 2008-09 2013-14 2014-15 79.74
VAT/CST Assistant Commissioner Telangana 2014-15 2015-16 79.02 11.29
VAT Delhi AVATO 2012-13 5.99
CST Commerical tax officer Andhra Pradesh 2010-11 0.34
VAT Commerical tax officer Kerala 2008-09 2011-12 144.67 15.59
CST Commerical tax officer Telegana 2014-15 52.41
VAT Deputy Commissioner (Commercial Tax) Kerala 2013-14 46.46 20.39
VAT Deputy Commissioner (CT) Andhra Pradesh 2010-11 7.66
VAT Deputy Commissioner (CT) Uttar Pradesh 2008-09 65.35
VAT Deputy Commissioner Jharkhand 1997-98 1998-99 1999-2000 39.73
VAT Deputy Commissioner Kerala 2009-10 0.74 0.19
CST Deputy commissioner Maharashtra 2012-13 519.87 40.00
Entry Tax Deputy Commissioner Uttar Pradesh 2005-06 2006-07 26.00
VAT/CST Deputy Commissioner Uttar Pradesh 2006-07 2013-14 2014-15 306.57 0.19
VAT/CST Deputy Commissoner (A) Gujrat 2001-02 2008-09 48.44 10.00
VAT Deputy Commissoner (A) Kerala 2011-12 2012-13 119.16 9.63
VAT/CST Deputy Commissoner (A) Rajasthan 2009-10 to 2012-13 92.05
CST Joint Commissioner (A) Karnataka 2009-10 0.23 17.80
VAT/CST Joint Commissioner (A) West Bengal 2010-11 to 2013-14 289.34 40.71
CST Joint Commissioner (A) Maharashtra 2001-02 212.98
MWCT Joint Commissioner (A) Maharashtra 2001-02 13.19
VAT/CST Joint Commissioner (A) Maharashtra 2007-08 2009-10 219.75 71.64
VAT/CST Joint commissioner Delhi 2012-13 2014-15 2015-16 1338.62
VAT Joint commmissioner Karnataka 2010-112011-12 28.92 65.00
VAT/CST Joint commmissioner Maharshtra 2010-112011-12 253.61 51.96
CST Sales tax officer Uttar Pradesh 2010-11 13.69 16.50
VAT/CST Special Commissioner Delhi 2007-08 341.48
VAT Senior joint Commissioner West Bengal 2007-08 19.25
The Customs Act 1962
Nature of Dues Forum where dispute is pending Period to which amount relates Amount unpaid Amount Paid
(Rs. in Lakhs) (Rs. in Lakhs)
Customs Deputy Commissioner (Customs) Mumbai 1994-95 2007-08 81.35
The Central Excise Act 1944
Nature of Dues Forum where dispute is pending Period to which amount relates Amount unpaid Amount Paid
(Rs. in Lakhs) (Rs. in Lakhs)
Excise Deputy/Assistant Commissioner Excise Pune 2000-01 2.40

(viii) The Company has not taken any loans or borrowings from financial institutionsbanks and government or has not issued any debentures. Hence reporting under clause 3(viii) of the Order is not applicable to the Company.

(ix) The Company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments) or term loans and hence reporting under clause 3 (ix)of the Order is not applicable to the Company.

(x) To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company and no material fraud on the Company by its officersor employees has been noticed or reported during the year.

(xi) In our opinion and according to the information and explanations given to us theCompany has paid / provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of Section 197 read with Schedule V to the Act.

(xii) The Company is not a Nidhi Company and hence reporting under clause 3 (xii) ofthe Order is not applicable to the Company.

(xiii) In our opinion and according to the information and explanations given to us theCompany is in compliance with Section 188 and 177 of the Act where applicable for alltransactions with the related parties and the details of related party transactions havebeen disclosed in the financial statements etc. as required by the applicable accountingstandards.

(xiv) During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures and hence reporting underclause 3 (xiv) of the Order is not applicable to the Company.

(xv) In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any non-cash transactions with itsdirectors or persons connected with them and hence provisions of Section 192 of the Actare not applicable to the Company.

(xvi) The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.

For DELOITTE HASKINS & SELLS LLP
Chartered Accountants
(Firm's Registration No. 117366W/W-100018)
Sunil S. Kothari
Partner
Pune 14th May 2018 (Membership No. 208238)