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IVP Ltd.

BSE: 507580 Sector: Industrials
NSE: IVP ISIN Code: INE043C01018
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OPEN 40.05
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VOLUME 3129
52-Week high 142.45
52-Week low 40.05
P/E
Mkt Cap.(Rs cr) 46
Buy Price 37.00
Buy Qty 2000.00
Sell Price 44.25
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OPEN 40.05
CLOSE 44.00
VOLUME 3129
52-Week high 142.45
52-Week low 40.05
P/E
Mkt Cap.(Rs cr) 46
Buy Price 37.00
Buy Qty 2000.00
Sell Price 44.25
Sell Qty 1.00

IVP Ltd. (IVP) - Auditors Report

Company auditors report

To

The Members of

IVP Limited

Report on the Audit of the Ind AS Financial Statements Opinion

We have audited the financial statements of IVP Limited ("the Company")which comprise the balance sheet as at 31 March 2019 and the statement of profit and loss(including other comprehensive income) statement of changes in equity and statement ofcash flows for the year then ended and notes to the financial statements including asummary of the significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by theCompanies Act 2013 ("Act") in the manner so required and give a true and fairview in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at 31 March 2019 and profit and other comprehensiveincome changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act. Our responsibilities under those SAs are furtherdescribed in the Auditor's Responsibilities for the Audit of the Financial Statementssection of our report. We are independent of the Company in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules thereunder 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 opinion.

Key Audit Matters

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

Description of Key Audit Matter

Trade receivable and provisioning
Key audit matter How the matter was addressed in our audit
As at 31 March 2019 the carrying amount of trade receivables was र12255 lakhs which accounted for 44% of the Company's total assets. Our audit procedures to assess the recoverability of trade debtors included the following:
Management determines at each balance sheet date the existence of any objective evidence that trade receivables are impaired. - assessing the design and implementation of the Company's internal control in relation to the revenue and collection cycle particularly the controls over receivables collection;
Basis this evaluation management provides for impairment allowance which comprises of a specific element based on individual debtors and a collective element based on historical experience adjusted for certain current factors. - obtaining an understanding of the basis of management's judgment about recoverability of individual trade debtor balances and evaluating the provisions for doubtful debts made by management for these individual balances with reference to the debtors' financial condition the industry in which the debtors are operating the ageing of balances historical and post year-end payment records;
In computing the allowance management considers factors such as type of products sold credit terms ageing of receivables current creditworthiness past collection history insurance cover as also historical loss experience. - assessing on a sample basis whether items in the trade receivable's ageing report were classified within the appropriate ageing bracket by comparing individual items in the report with underlying documentation;
We identified assessing the recoverability of trade debtors as a key audit matter because trade receivables and loss allowance are material to the Company and the recognition of expected credit losses is inherently subjective and requires the exercise of significant management judgment. - comparing on a sample basis cash receipts from customers subsequent to the financial year end relating to trade receivable balances as at 31 March 2019 with bank statements and relevant remittance documentation; and
- assessing the reasonableness of management's loss allowance estimates by examining the information used by the management such as ageing of overdue balances extent of insurance coverage historical and post year-end collection trend from debtors correspondence including legal notices issued to overdue debtors and the historical and estimated loss rate.

Deferred tax on the indexation benefit of land

Key audit matter How the matter was addressed in our audit
As stated in Note 3 (C) to the financial statements the Company does not intend to pursue any business undertaking on leasehold land at Aurangabad and has accordingly reclassified the land from property plant and equipment to investment property in accordance with the requirements of Ind AS 40- Investment Property. Our audit procedures to assess the recoverability of the deferred credit towards indexation benefit on leasehold land recognized during the year included the following:
- verifying the terms and conditions of the lease agreement to evaluate whether there are any covenants or conditions which restrict or impede the Company's ability to sell the land.
Pursuant to such reclassification the Company has in accordance with the requirements of Ind AS 12 - Income Taxes recognized deferred tax credit of र331 lakhs towards indexation benefit that would be available under tax laws on sale of the said - verifying the draft board minutes for resolution passed by the board evidencing the intent to sell the land. The board has sought approval from the shareholders at the ensuing annual general meeting to sell the land.
land. - perused fair valuation report for land obtained by the Company from an independent valuer for determining:
We identified the recognition of deferred tax credit on leasehold land as a key audit matter as the recognition is subject to considerable estimation and is inter-alia dependent upon factors such as - (i) fair value as on 1 April 2001 being the cost of acquisition to be considered for tax purposes for computing indexation benefit
(ii) fair value as at 31 March 2019 to assess whether fair value as at
- exercise of significant management judgment to the effect that there is no intent to pursue any business undertaking on the land the balance sheet date is higher than the fair value determined in (i) above (tax base of land post indexation)
- the carrying value of the land to be recovered only through its outright sale and not on a slump sale basis - for evaluating the probability of whether taxable profits from sale of land will be available to offset the deferred tax credit recognized during the year we challenged the management's assessment on recoverability of the deferred tax credit by assessing the fair value of land being higher than its tax base (due to indexation).
- availability of future taxable profits for utilization of deferred tax credit - testing the computation of deferred tax credit by involving our tax specialists to assist us in verifying the tax principles applied in the calculations
- verifying the disclosures in the financial statements using the results from our testing and against the requirements of the accounting standard.

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 financial statements does not cover the other information and we donot express any form of assurance conclusion thereon.

In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact. We have nothing to report in this regard.

Management's Responsibility for the Financial Statements

The Company's management and Board of Directors are responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these financial statementsthat give a true and fair view of the state of affairs profit/loss and othercomprehensive income changes in equity and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring the accuracy and completeness of the accounting records relevantto the preparation and presentation of the financial statements that give a true and fairview and are free from material misstatement whether due to fraud or error.

In preparing the financial statements management and Board of Directors areresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

Board of Directors is also responsible for overseeing the Company's financial reportingprocess.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.

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

• Identify and assess the risks of material misstatement of the financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Act we are also responsible for expressing our opinion on whether the company hasadequate internal financial controls with reference to financial statements in place andthe operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

• Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit. We alsoprovide those charged with governance with a statement that we have complied with relevantethical requirements regarding independence and to communicate with them allrelationships 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 financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditors' report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

Other Matter

The comparative financial information of the Company for the year ended 31 March 2018included in these Ind AS financial statements had been audited by the predecessor auditorwhose report dated 24 May 2018 expressed an unmodified opinion on those Ind AS financialstatement for the year ended 31 March 2018. Our opinion is not modified in respect of theabove matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors' Report) Order 2016 ("the Order")issued by the Central Government in terms of section 143 (11) of the Act we give in the‘Annexure A" a statement on the matters specified in paragraphs 3 and 4 of theOrder to the extent applicable.

(A) 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 (including other comprehensiveincome) the statement of changes in equity and the statement of cash flows dealt with bythis Report are in agreement with the books of account

d) In our opinion the aforesaid financial statements comply with the Ind AS specifiedunder section 133 of the Act.

e) On the basis of the written representations received from the directors as on 31March 2019 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2019 from being appointed as a director in terms of Section164(2) of the Act.

f) With respect to the adequacy of the internal financial controls with reference tofinancial statements of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure B" .

(B) 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 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations as at 31 March 2019 onits financial position in its financial statements - Refer Note 35 to the financialstatements;

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;

iv. The disclosures in the financial statements regarding holdings as well as dealingsin specified bank notes during the period from 8 November 2016 to 30 December 2016 havenot been made in these financial statements since they do not pertain to the financialyear ended 31 March 2019

(C) With respect to the matter to be included in the Auditors' Report under section197(16):

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 B S R & Associates LLP
Chartered Accountants
Firm's Registration No: 116231W/W-100024
Shabbir Readymadewala
Place : Mumbai Partner
Date : 29 May 2019 Membership No. 100060

Annexure A to the Independent Auditor's Report - 31 March 2019

With reference to the Annexure A referred to in the Independent Auditor's Report to themembers of the Company on the financial statements for the year ended 31 March 2019 wereport the following:

(i) (a) The company has maintained its fixed asset showing quantitative details andlocation of its fixed assets. The costs incurred on purchase or construction of individualcomponents/constituents of fixed assets have been recorded in the register on a line-itembasis. The management is in the process of updating the fixed asset register to reflect ona consolidated basis the aggregate cost incurred for purchase or construction ofindividual items of fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets bywhich all fixed assets are verified in a phased manner over a period of 2 years. In ouropinion this periodicity of physical verification is reasonable having regard to the sizeof the Company and the nature of its assets. Pursuant to the programme certain fixedassets were physically verified during the year. No material discrepancies were noticed onsuch verification.

(c) In our opinion and according to the information and explanations given to us and onthe basis of our examination of the records of the Company the title deeds of immovableproperties included in property plant and equipment are held in the name of the Company.

(ii) The inventory except goods-in-transit and stocks lying with third parties hasbeen physically verified by the management during the year. In our opinion the frequencyof such verification is reasonable. The discrepancies noticed on verification between thephysical stock and the book records were not material and have been appropriately dealtwith in the books of accounts. For stocks lying with third parties at the year-endwritten confirmations have been obtained by the Management.

(iii) According to the information and explanations given 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 of theCompanies Act 2013 ("the Act"). Accordingly the provisions of clause 3(iii)(a) (b) and (c) of the Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us theCompany has not given any loan made any investment provided any guarantee and securitiesas per the provisions of Section 185 and 186 of the Act. Accordingly paragraph 3 (iv) ofthe Order is not applicable to the Company.

(v) In our opinion and according to information and explanations given to us theCompany has not accepted deposits from the public as per the directives issued by theReserve Bank of India under the provisions of Section 73 to 76 of the Act or any otherrelevant provisions of the Act and the relevant rules framed thereunder. Accordinglyparagraph 3(v) of the Order is not applicable to the Company.

(vi) The maintenance of cost records has been specified by the Central Government underSection 148(1) of the Companies Act 2013 in respect of the products manufactured by theCompany. We have broadly reviewed the books of account maintained by the Company pursuantto the rules prescribed by the Central Government for maintenance of cost records undersection 148(1) of the Companies Act 2013 in respect of manufacture of products and are ofthe opinion that prima facie the prescribed accounts and records have been made andmaintained. However we have not made a detailed examination of the cost records with aview to determine whether they are accurate or complete.

(vii) (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted/accrued in the books ofaccount in respect of undisputed statutory dues including Provident fund Employees StateInsurance Income-tax Goods and Service tax Duty of customs cess and any other materialstatutory dues have been regularly deposited during the year by the Company with theappropriate authorities.

According to the information and explanations given to us no undisputed amountspayable in respect of Provident fund Employee State Insurance Income-tax Goods andService tax Duty of customs cess and any other material statutory dues were in arrearsas at 31 March 2019 for a period of more than six months from the date they becamepayable.

(b) According to the information and explanations given to us there are no dues ofincome tax sales tax service tax goods and services tax duty of customs duty ofexcise and value added tax which have not been deposited by the Company with appropriateauthorities on account of disputes except for the following:

Name of Statute Nature of the dues Amount (Rupees) Period to which the amount relates Forum where dispute is pending
The Bihar Sales Tax Act 1944 Sales Tax 12668 F.Y. 1992-93 Deputy Commissioner (Appeals) Jamshedpur
The Central Sales Tax Act 1956 Sales Tax 91700 F.Y. 1992-93 Deputy Commissioner (Appeals) Jamshedpur
Sales Tax @ 313384 F.Y.2015-16 Joint Commissioner (Appeals) Bangalore
The Integrated Goods And Services Tax Act 2017 Goods & Service Tax # 416056 F.Y.2018-19 Joint Commissioner Bhopal
The Central Excise Act 1944 Duty of excise $ 651639* FY 1996-99 Commissioner (Appeals)
The Income Tax Act 1961 Income Tax 304770 F.Y. 2010-11 ITAT
Income Tax 434050 F.Y 2012-13 CIT (Appeals)
Income Tax 498131 F.Y 2013-14 CIT (Appeals)
Income Tax 418480 F.Y 2014-15 CIT (Appeals)

@ net of deposit र134308;

# net of deposit र21900;

$ Net of deposit of र288872

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of loans or borrowings to banks. The Companydid not have any outstanding loans or borrowings from financial institutions or governmentand there are no dues to debenture holders during the year.

(ix) In our opinion and according to the information and explanations given to us theCompany did not raise any money by way of initial public offer or further public offer(including debt instruments) and term loans during the year. Accordingly paragraph 3(ix)of the Order is not applicable to the Company

(x) According to the information and explanations given to us no material fraud on theCompany by its officers and employees or fraud by the Company has been noticed or reportedduring the course of our audit. Accordingly paragraph 3(x) of the Order is notapplicable.

(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 of the Act for the year ended 31 March 2019.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company as per the Act. Accordingly paragraph 3(xii) of the Orderis not applicable to the Company.

(xiii) In our opinion and according to the information and explanations given to usall transactions with related parties are in compliance with section 177 and 188 of theAct and the details as required by the applicable accounting standards have beendisclosed in the financial statements.

(xiv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not made preferential allotmentor private placement of shares or fully or partly convertible debentures during the year.Accordingly paragraph 3(xiv) of the Order is not applicable to the Company.

(xv) According to the information and explanations given to us the Company has notentered into non-cash transactions with directors or persons connected with them duringthe year. Accordingly paragraph 3(xv) of the Order is not applicable to the Company.

(xvi) In our opinion and according to the information and explanations given to us andin our opinion the Company is not required to be registered under Section 45-IA of theReserve Bank of India Act 1934.

For B S R & Associates LLP
Chartered Accountants
Firm's Registration No: 116231W/W-100024
Shabbir Readymadewala
Place : Mumbai Partner
Date : 29 May 2019 Membership No. 100060

Annexure B to the Independent Auditor's report on the financial statements of IVPLimited for the period ended 31 March 2019.

Report on the internal financial controls with reference to the aforesaid financialstatements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013

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

Opinion

We have audited the internal financial controls with reference to financial statementsof IVP Limited ("the Company") as of 31 March 2019 in conjunction with our auditof the Ind AS financial statements of the Company for the year ended on that date.

In our opinion the Company has in all material respects adequate internal financialcontrols with reference to financial statements and such internal financial controls wereoperating effectively as at 31 March 2019 based on the internal financial controls withreference to financial statements criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India (the "Guidance Note").

Management's Responsibility for Internal Financial Controls

The Company's management and the Board of Directors are responsible for establishingand maintaining internal financial controls based on the internal financial controls withreference to financial statements criteria established by the Company considering theessential components of internal control stated in the Guidance Note. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013 (hereinafter referred to as"the Act").

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to financial statements based on our audit. We conducted our auditin accordance with the Guidance Note and the Standards on Auditing prescribed undersection 143(10) of the Act to the extent applicable to an audit of internal financialcontrols with reference to financial statements. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls with reference tofinancial statements were established and maintained and whether such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to financial statements and their operatingeffectiveness. Our audit of internal financial controls with reference to financialstatements included obtaining an understanding of such internal financial controlsassessing 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 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 withreference to financial statements.

Meaning of Internal Financial controls with Reference to Financial Statements

A company's internal financial controls with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial controlswith reference to financial statements include those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.

Inherent Limitations of Internal Financial controls with Reference to FinancialStatements

Because of the inherent limitations of internal financial controls with reference tofinancial statements including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls withreference to financial statements to future periods are subject to the risk that theinternal financial controls with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.

For B S R & Associates LLP
Chartered Accountants
Firm's Registration No: 116231W/W-100024
Shabbir Readymadewala
Place : Mumbai Partner
Date : 29 May 2019 Membership No. 100060