You are here » Home » Companies » Company Overview » Karnavati Finance Ltd

Karnavati Finance Ltd.

BSE: 538928 Sector: Financials
NSE: N.A. ISIN Code: INE554R01012
BSE 16:01 | 24 Sep 28.40 0
(0.00%)
OPEN

28.40

HIGH

28.40

LOW

28.40

NSE 05:30 | 01 Jan Karnavati Finance Ltd
OPEN 28.40
PREVIOUS CLOSE 28.40
VOLUME 35
52-Week high 32.00
52-Week low 20.75
P/E 44.38
Mkt Cap.(Rs cr) 29
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 28.40
CLOSE 28.40
VOLUME 35
52-Week high 32.00
52-Week low 20.75
P/E 44.38
Mkt Cap.(Rs cr) 29
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Karnavati Finance Ltd. (KARNAVATIFIN) - Auditors Report

Company auditors report

To

The Members of

Karnavati Finance Limited

Report on the Financial Statements

We have audited the accompanying financial statements of Karnavati Finance Limited("the Company") which comprise the Balance Sheet as at March 31 2017 theStatement of Profit and Loss and the Cash Flow Statement for the year then ended and asummary 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 stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls andensuring their operating effectiveness and the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

Auditor s Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit.

We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made there under. We conducted our audit in accordancewith the Standards on Auditing specified under Section 143(10) of the Act. Those Standardsrequire that we comply with eth ical requirements and plan and perform the audit to obtainreasonable assurance about whether the financial statements are free from materialmisstatement. An audit involves performing procedures to obtain audit evidence about theamounts and disclosures i n the financial statements. The procedures selected depend onthe auditors judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal financial control relevant to the Company s preparation ofthe financial statements that give a true and fair view in order to design auditprocedures that are appropriate in the circumstances but not for the purpose ofexpressing an opi nion on whether the Company has in place an adequate internal financialcontrols system over financial reporting and the operating effectiveness of such controls.An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by the Company s Directors as well asevaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion/qualified audit opinion/adverse audit opinion on thefinancial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information req uired by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2017 and its 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 (Auditors Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of Section 143 ofthe Act we give in the "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the Order.

(2) As required by Section 143(3) of the Act we report that:

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

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

c. The Balance Sheet and the Statement of Profit and Loss dealt with by this Report arein agreement with the books of account;

d. In our opinion the aforesaid financial statements comply with the AccountingStandards specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014;

e. On the basis of written representations received from the directors as on March 312017 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of clause (g) ofsub-section (1) 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 B" and

g. With respect to the other matters to be included in the Auditor s 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 does not have any pending litigations which would impact its financialposition;

ii. The Company did not have any long-term contracts including derivative contractshence the question of any material foreseeable losses does not arise;

iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.

iv. Adequate disclosures have been made in the financial statements with respect toholdings as well as dealings in Specified Bank Notes during the period of November 8 2016 to December 30 2016. Refer Note 22 to financial statements.

For Maharishi & Co.

Chartered Accountants

ICA I Firm Registration No. 124872W

Ankit Gokani

Partner

Membership No. 133391

Signed at Jamnagar on May 30 2017

"ANNEXURE A" TO INDEPENDENT AUDITOR S REPORT

[Referred to in paragraph 1 under "Report on Other Legal and RegulatoryRequirements" in the Independent Auditor s Report of even date to the members ofKarnavati Finance Limited on the financial statements for the year ended March 31 2017]i. (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets. (b) During the year fixed assets havenot been physically verified by the management. However there is a regular programme ofverification which in our opinion is reasonable having regard to the size of the Companyand the nature of its assets. (c) According to the information and explanations given tous and on the basis of our examination of the records of the company company does nothave any immovable properties. ii. The Company is a Non Banking Finance Company and itdoes not hold any physical inventories.

Thus paragraph 3(ii) of the Order is not applicable to the company. iii. As informedthe Company has not granted any loans secured or unsecured to companies firms or otherparties covered in the register maintained under Section 189 of the Act. Accordingly theprovisions stated in paragraph 3 (iii)(a) and 3 (iii)(b) of the Order are not applicable.iv. In our opinion and according to the information and explanations given to us thecompany has neither granted any loans or guarantees to parties covered under section 185nor have any investment hence provisions of Section 185 and section 186 of act shall notapply to the company. v. In our opinion and according to the information and explanationsgiven to us the company has not accepted any deposits from the public within theprovisions of section 73 to 76 of the Act and rules framed there under. vi. The CentralGovernment has not prescribed the maintenance of cost records under section 148(1) of theact for any of the services rendered by the company. vii. (a) According to informationand explanations given to us and on the basis of our examination of the books of accountand records the Company has been generally regular in depositing undisputed statutorydues with the appropriate authorities. According to the information and explanations givento us no undisputed amounts payable in respect of the above were in arrears as at March31 2017 for a period of more than six months from the date on when they become payable.(b) According to the information and explanation given to us there are no dues of incometax sales tax service tax duty of customs duty of e xcise value added tax outstandingon account of any dispute. viii. In our opinion and according to the information andexplanations given to us the Company has not obtained any loan from banks or financialinstitutions. ix. The company did not raise any money by way of initial public offer orfurther public offer

(including debt instruments) and term loans during the year. Accordingly paragraph3(ix) of the Order is not applicable. x. Based upon the audit procedures performed and theinformation and explanations given by the management we report that no fraud by thecompany or on the company by its officers or employees has been noticed or reported duringthe year. xi. Based upon the audit procedures performed and the information andexplanations given by the management the managerial remuneration has been paid orprovided in accordance with the requisite approvals mandated by the provisions of section197 read with Schedule V to the Companies Act; xii. In our opinion the Company is not aNidhi Company. Therefore the provisions of clause 4 (xii) of the Order are not applicableto the Company. xiii. In our opinion all transactions with the related parties are incompliance with section 177 and 188 of Companies Act 2013 and the details have beendisclosed in the Financial Statements as required by the applicable accounting standards.

xiv. Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year underreview. Accordingly the provisions of clause 3 (xiv) of the Order are not applicable tothe Company and hence not commented upon. xv. Based upon the audit procedures performedand the information and explanations given by the management the company has not enteredinto any non-cash transactions with directors or persons connected with him. Accordinglythe provisions of clause 3 (xv) of the Order are not applicable to the Company and hencenot commented upon. xvi. In our opinion the company is Non Banking Finance Companyregistered under section 45IA of the Reserve Bank of India Act 1934 vide certificate ofregistration no. 13.00064 dated February 24 1998.

For Maharishi & Co.

Chartered Accountants

ICA I Firm Registration No. 124872W

Ankit Gokani

Partner

Membership No. 133391

Signed at Jamnagar on May 30 2017

"ANNEXURE B" TO INDEPENDENT AUDITOR S REPORT OF EVEN DATE OF KA RNAVATI FINANCE

LIMITED

[ Report on the Internal Financial Controls under Clause (i) of Sub-section 3 ofsection 143 of the Companies Act 2013 ("the Act")]

We have audited the internal financial controls over financial reporting of KarnavatiFinance Limited ("the Company") as of March 31 2017 in conjunction with ouraudit of the financial statements of the Company for the year ended on that date.

Management s Responsibility for Internal Financial Controls

The Company s management is responsi ble for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the company considering the essential components of internal control statedin the Guidance Note on Audit of internal Financial Controls over

Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI"). These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company s policiesthe safeguarding 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.

Auditors 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 deemed to be prescribed under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls both applicable to an audit of Internal Financial Controls and bothissued by the Institute of Chartered Accountants of India. Because of the matter describedin Disclaimer of Opinion paragraph below we were not able to obtain sufficientappropriate audit evidence to provide a basis for an audit opinion on internal financialcontrols system over financial reporting of the Company.

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 detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

2. provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and

3. provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

According to the information and explanation given to us the company is in process ofestablishment of its internal financial control over financial reporting o n criteriabased on or considering the essential components of internal control stated in theGuidance Note on Audit of Internal Financial Controls over Financial Reporting issued bythe Institute of Chartered Accountants of India. Because of this reason we are unable toobtain sufficient appropriate audit evidence to provide a basis for our opinion whetherthe Company had adequate internal financial controls were operating effectively as atMarch 31 2017.

We have considered the disclaimer reported above in determining the nature timing andextent of audit tests applied in our audit of the financial statements of the Company andthe disclaimer does not affect our opinion on the financial statements of the Company.

For Maharishi & Co.

Chartered Accountants

ICA I Firm Registration No. 124872W

Ankit Gokani

Partner

Membership No. 133391

Signed at Jamnagar on May 30 2017