TO THE MEMBERS OF KABRA COMMERCIAL LTD.
Report on the Financial Statements
We have audited the standalone financial statements of KABRA COMMERCIALLTD. ("the Company") which comprise the Balance Sheet as at 31st March 2017and the Statement of Profit and Loss the Cash Flow Statement for the year then ended anda summary of significant accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters statedin section 134(5) of the Companies Act 2013 ("the Act") with respect to thepreparation of these financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified under section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes maintenance of adequate accounting recordsin accordance with 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 financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.
Our responsibility is to express an opinion on these financialstatements based on 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.
We conducted our audit in accordance with the Standard on Auditingspecified under section 143(10) of the Companies Act 2013. Those Standards require thatwe comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence abountthe amount and the disclosures in the financial statements. The procedures selected dependon the auditor's judgment including the assessment of the risks of material misstatementof the financial statements whether due to fraud and error. In making those riskassessments the auditor considers internal financial control relevant to the Company'spreparation of the financial statements that give a true and fair view in order to designaudit 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 financial statement.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the financial statements.
In our opinion and to the best of our information and according to theexplanations given to us the aforesaid financial statements give the information requiredby the Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at 31st March 2017 and Profit and its cash flows for the year ended on that date.
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 of the Act we give in the Annexure - "A" a statement on thematters specified in paragraph 3 and 4 of the order to the extent applicable.
2. As required by Section 143 (3) of the Act we report that:
(a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purpose of our audit;
(b) In our opinion proper books of account as required by law havebeen kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet the Statement of Profit and Loss and the CashFlow Statement dealt with by this Report are in agreement with the books of account.
(d) In our opinion the aforesaid standalone financial statementscomply with the Accounting Standards specified under Section 133 of the Act read withRule 7 of the Companies (Accounts) Rules 2014.
(e) On the basis of the written representations received from thedirectors as on 31st March 2017 taken on record by the Board of Directors none of thedirectors is disqualified as on 31st March 2017 from being appointed as a director interms of Section 164 (2) of the Act.
(f) With respect to the adequacy of the internal financial controlsover financial reporting of the company and the operating effectiveness of such controlsreferred to our separate Report in "Annexure - "B".
(g) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 inour opinion and to the best of our information and according to the explanations given tous:
(i) The Company does not have any pending litigations which wouldimpact its financial position.
(ii) The Company does not have any long - term contracts includingderivative contracts for which there were any material foreseeable losses.
(iii) There were no amounts which were required to be transferred tothe Investor Education and Protection Fund by the Company.
(iv) The Company has provided requisite disclosures in the financialstatements as to holding as well as dealings in Specified Bank Notes during the periodfrom November 8 2016 to December 30 2016. Based on audit procedures and relying on themanagement representation we report that the disclosures are in accordance with the booksof account maintained by the Company and as produced to us by the management - Refer NoteB(i) in Schedule - 1.
For S. C. Soni & Co.
(S. C. Soni)
29th May 2017
ANNEXURE - "A" TO THE INDEPENDENT AUDITORS' REPORT
With reference to the Annexure referred to in paragraph 1 in Report onother legal and regulatory requirements of the Independent Auditor' Report to the Membersof the Company on the financial statements for the year ended 31st March 2017 we reportthat :
(i) (a) The company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets.
b) Fixed Assets have been physically verified by the management duringthe year at reasonable intervals and according to the information and explanations givento us no material discrepancies were noticed on such verification.
(c) The title deeds of the immovable properties are held in the name ofthe Company.
(ii) The Company has no Stock in Trade as on 31.3.2017.
iii) In our opinion and according to the information and explanationsgiven to us the Company has not granted any loan to parties covered in the registermaintained under section 189 of the Companies Act 2013. Thus paragraph 3(iii) of theOrder is not applicable.
(iv) In our opinion and according to the information and explanationsgiven to us the Company has complied with provision of Section 185 and 186 of the Actwith respect of loans and investments made. The Company has neither issued any guaranteenor has provided any security on behalf of any party.
(v) The Company has not accepted any deposits from the Public duringthe year.
(vi) The Company is not required to maintain cost records under theCompanies (cost Records and
Audit) Rules 2014.
(vii) (a) The Company is regular in depositing undisputed statutorydues including provident fund employees' state insurance income-tax sales-tax servicetax duty of customs duty of excise value added tax cess and other statutory dues tothe appropriate authorities. There is no dues as on the last day of the financial yearoutstanding for a period of more than six months from the date they become payable.
(b) There is no income tax or sales tax or service tax or duty ofcustoms or duty of excise or value added tax or cess which have not been deposited withappropriate authorities on account of any dispute.
(viii) The Company has not defaulted in repayment of loans or borrowingto a financial institution bank government or dues to debenture holders.
(ix) The Company has not raised any money by way of initial publicoffer or further public offer (including debt instrument) and term loans during the year.Therefore this clause is not applicable.
(x) According to the information and explanations given to us no fraudby the Company and on the Company by its officers or employees has been noticed orreported during the course of our audit .
(xi) According to the information and explanations given to us andbased on our examination of the records of the Company the Company has paid managerialremuneration in accordance with the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Act.
(xii) The Company is not a Nidhi Company.
(xiii) According to the information and explanations given to us andbased on our examination of the records of the Company transactions with the relatedparties are in compliance with section 177 and 188 of the Act where applicable and detailsof such transactions have been disclosed in the financial statements as required by theapplicable accounting standards.
(xiv) The Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debenture during the year under reviewtherefore this clause is not applicable.
(xv) The Company has not entered into any non cash transactions withdirectors or persons connected with them. Therefore this clause is not applicable.
(xvi) On the basis of Assets and Income pattern of the Company and asper the information and explanations given to us the Company is not required to beregistered under section 45 - IA of the Reserve Bank of India Act 1934.
For S. C. Soni & Co.
(S. C. Soni)
29th May 2017
ANNEXURE "B" TO THE AUDITOR'S REPORT
Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financialreporting of Kabra CommercialLtd. ("the Company") as of 31st March 2017 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 andmaintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India ('ICAI').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 the 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 Internalfinancial controls over financial reporting based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls over FinancialReporting (the "Guidance Note") and the Standards on Auditing as specified undersection 143(10) of the Companies Act 2013 to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the Institute of Chartered Accountants of India. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting were established and maintained and if such controlsoperated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditors' judgement including the assessment of therisks of material misstatement of the financial statements whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A company's internal financial control over financial reporting 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 control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorizations ofthe management and directors of the company; and (3) provide reasonable assuranceregarding prevention or timely detection of unauthorized acquisition use or dispositionof the company's assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over FinancialReporting
Because of the inherent limitations of internal financial controls overfinancial reporting 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 overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31 March 2017 based onthe internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.
For S. C. Soni & Co.
(S. C. Soni)
29th May 2017