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International Constructions Ltd.

BSE: 535096 Sector: Infrastructure
NSE: SUBCAPCITY ISIN Code: INE845C01016
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International Constructions Ltd. (SUBCAPCITY) - Auditors Report

Company auditors report

To the Members of INTERNATIONAL CONSTRUCTIONS LIMITED Report on the Audit of theStandalone Financial Statements Opinion

We have audited the accompanying Standalone Financial Statements of InternationalConstructions Limited {"the Company") which includes joint operations whichcomprise the Balance sheet as at March 31 2021 the Statement of Profit and Lossincluding the statement of Other Comprehensive Income the Cash Flow Statement and theStatement of Changes in Equity for the year then ended and notes to the StandaloneFinancial 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 Financial Statements give the information requiredby the Companies Act 2013 as amended ("the Act") in the manner so required andgive a true and fair view in conformity with the accounting principles generally acceptedin India of the state of affairs of the Company as at March 31 2021 its profitincluding other comprehensive income its cash flows and the changes in equity for theyear ended on that date.

BASIS FOR OPINION

We conducted our audit of the Standalone Financial Statements in accordance with theStandards on Auditing (SAs) as specified under Section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the 'Auditors'Responsibilities for the Audit of the Standalone Financial Statements' section of ourreport. We are independent of the Company in accordance with the 'Code of Ethics' issuedby the Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of the financial statements under the provisions of the Actand the Rules thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the Code of Ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for our auditopinion on the Standalone Financial Statements.

KEY AUDIT MATTERS

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

Key Audit Matter How our audit addressed the key audit matter
Assessment of impairment of non- current investments (reported by us as auditor of the Company) Our audit approach was a combination of test of internal controls and substantive procedures which included the following:
The Company as at 31st March 2021 had non-current investments of Rs. 1686.51 lakhs (prior to impairment provision). • Obtained an understanding of the management process for identification of possible impairment indicators and process followed by the management for impairment testing of non-current investments;
Due to the significance of the carrying amounts of the non-current investments and the significant management judgement involved in carrying out the impairment assessment this was considered to be a key audit matter.
• Discussed extensively with management regarding impairment indicators and evaluated the design and testing operating effectiveness of controls;
• Assessed the methodology used by the management to estimate the recoverability of investment and ensured that it is consistent with applicable accounting standards;
• Verified the appropriateness of the key assumptions considered by the management/independent valuer as part of the impairment assessment.
• Evaluated the management's assessment of the ultimate outcome of the ongoing legal proceedings if any impacting a particular investment including analysis of the latest judgment pronounced relating to such proceedings or any legal opinion obtained by The- management;
• Compared the carrying value of the non-current investment with the realizable value determined by the independent valuer to ensure there is no impairment/ provision required to be recognized.

Other Information

The Company's management and Board of Directors are responsible for the otherinformation. The other information comprises the information included in the Company'sannual report but does not include the financial statements and our auditors' reportthereon.

Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated. If based on thework we have performed we conclude that there is a material misstatement of this otherinformation we are required to report that fact. We have nothing to report in thisregard.

Management's Responsibility for the Standalone Financial Statements76

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 preparationand presentation of these standalone financial statements that give a true and fair viewof the financial position financial performance and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe 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 statements that give a true and fair viewand are free from material misstatements whether due to fraud or error.

In preparing the standalone financial statements the Management and Board of Directorsare responsible for assessing the Company's ability to continue as going concerndisclosing as applicable matters related to going concern and using the^gqjng concernbasis of accounting unless the Board of Directors either intends to liquidate the Companyor to cease operations or has no realistic alternative but to do so.

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

Auditor's Responsibility

Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone financial statements.

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

• Identify and assess the risks of material misstatement of the standalonefinancial 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 companyhas adequate internal financial controls with reference to financial statements in placeand the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures in the standalone financial statementsmade by the Management and Board of Directors.

• Conclude on the appropriateness of the Management and Board of Directors use ofthe going concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the Company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor's report tothe related disclosures in the standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of the standalonefinancial statements including the Annual Report 2020-2021 disclosures and whether thestandalone financial statements represent the underlying transactions and events in amanner that achieves fair presentation.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditors' report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of 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 to the extent applicable.

2. (A) As required by section 143(3) of the Act we report that:

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

ii. 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;

iii. the balance sheet statement of profit and loss and cash flow statement dealt withby this Report are in agreement with the books of account;

iv. in our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under section 133 of the Act.

v. on the basis of the written representations received from the directors as on 31March 2021 taken on record by the Board of Directors none.of th&

directors is disqualified as on 31 March 2021 from being appointed as a director interms of section 164(2) of the Act.

vi. 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

(B) with respect to the other to be included in the Auditor's Report in accordance withRule 11 of the Companies ( Audit and Auditors) Rules2014 in our opinion and to the bestof 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.

(C) In our opinion and according to the information and explanations given to us theremuneration paid by the company to its directors during the current year is in accordancewith the provisions of Section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under Section 197(16) which arerequired to be commented upon by us.

For G. L. KOTHARI & Co.
CHARTERED ACCOUNTANTS
(Firm Registration No. 001445 S)
CA G.L.KOTHARI
PROPRIETOR
M. No. 025481
PLACE : Bangalore
DATE : 29/06/2021
UDIN Nio. 21025481AAAABN8732

Annexure - "A" to the Independent Auditors' Report

1. The Annexure referred to in our independent Auditors' report to the members ofthe company on the standalone financial statements for the year ended 31 March 2021 wereport that:

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

b) A substantial portion of the fixed assets has been physically verified by themanagement during the year and in our opinion frequency of verification is reasonablehaving regard to the size of the Company and the nature of its assets. No materialdiscrepancies were noticed on such physical verification.

c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.

2. There is no inventory during the year hence the said disclosure is not applicable.

3. According to the information and explanations given to us the company has discloseddetails required to be disclosed for the grant of loans secured or unsecured tocompanies firms and other parties covered in the register maintained under section 189 ofthe Companies Act.

4. In Our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Act with respectto the loans and investments made.

5. The Company has not accepted any deposits from the public during the year underconsideration.

6. The Central Government has not prescribed the maintenance of cost records undersection 148(1) of the Act for any of the activities rendered by the Company.

7. According to the records of the Company and information and explanations given tous the Company has been regular in depositing undisputed statutory dues includingProvident Fund Employee's State Insurance Income tax Sales Tax Wealth Tax ServiceTax Customs Duty Excise Duty Value Added Tax Cess and other statutory dues with theappropriate

8. authorities during the year. According to the information and explanations given tous no undisputed amounts payable in respect of above were in arrears as at March 31 2021for a period of more than six months from the date.

9. The company has not defaulted in payment of any loan installment or interest inrespect of term loans from bank. The company has not issued any debentures and taken theloan from financial institution.

10. The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loan during the year. Accordinglyparagraph 3 (ix) of the Order is not applicable.

11. To the best of our knowledge and belief and according to the information andexplanations given to us no fraud on or by the Company has been noticed or reportedduring the course of our audit.

12. According to the information and explanations give 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.

13. In Our opinion and according to the information and explanations given to us theCompany is not a Nidhi company. Accordingly paragraph 3(xii) of the order is notapplicable.

14. 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 sectionsl77 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

15. According to the information and explanations give 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 year.

16. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered in to non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

17. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

For G. L. KOTHARI & Co.
CHARTERED ACCOUNTANTS
{Firm Registration No. 001445 S)
CA G.L.KOTHARI
PROPRIETOR
M. No. 025481
PLACE : Bangalore
DATE : 29/06/2021
UDIN Nio. 21025481AAAABN8732

Annexure - "B" to the Independent Auditors' Report

Report on the Internal Financial Controls under (i) Of Sub-section 143 of the CompaniesAct 2013 ("the Act")

We have audited the internal financial controls over financial reporting ofINTERNATIONAL CONSTRUCTIONS LIMITED ("the Company") as of 31 March 2021 inconjunction with our audit of the standalone financial statements of the Company for theyear ended on that date.

Management's Responsibility for Internal Financial controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountant of India. (TCAT).

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 polices 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.

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 on Audit of Internal Financial Controls over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143 (10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofinternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. 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 was 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 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 of records that in reasonable details accurately andfairly reflect the transactions and dispositions of the assets of the company

2. provide reasonable assurance that truncations 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 authorizations of management and 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 polices 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 controls

over financial reporting were operating effectively as at 31 March 2021 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting Issued by the Institute of CharteredAccountants of India.

For G. L. KOTHARI & Co.
CHARTERED ACCOUNTANTS
(Firm Registration No. 001445 S)
CA G.L.KOTHARI
PROPRIETOR
M. No. 025481
PLACE : Bangalore
DATE : 29/06/2021
UDIN Nio. 21025481AAAABN8732

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