The Members of KEMP & COMPANY LIMITED
Report on the Indian Accounting Standards (Ind AS) Financial Statements
We have audited the accompanying Ind AS financial statements of KEMP& COMPANY LIMITED ("the Company") which comprise the Balance Sheet asat March 31 2018 and the Statement of Profit and Loss (including other comprehensiveincome) and the Cash Flow Statement and the Statement of Changes in Equity for the yearthen ended and a summary of significant explanatory information (hereinafter referred toas "Ind AS financial statements'').
Management's Responsibility for the Ind AS Financial Statements
The Company's Board of Directors is responsible for the matters statedin Section 134(5) of Companies Act 2013 ("the Act") with respect to thepreparation and presentation of these Ind AS financial statements that give a true andfair view of the financial position financial performance including other comprehensiveincome cash flows and changes in equity of the Company in accordance with the accountingprinciples generally accepted in India including the Indian Accounting Standards (Ind AS)specified under Section 133 of the Act read with relevant rules issued thereunder.
This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
Our responsibility is to express financial statements based onour audit. We have taken into account the provisions opinion on these IndAS of the Actthe accounting 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. statements inaccordance We conducted our audit of the Ind AS financial with the Standards on Auditingspecified under Section 143(10) of the Act and other applicable authoritativepronouncements issued by the Institute of Chartered Accountants of India. Those Standardsand pronouncements require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether the Ind AS financial statements arefree from material misstatement.
An audit involves performing procedures to obtain audit evidence aboutthe amounts and the disclosures in the Ind AS financial The procedures selected depend onthe auditor's judgment including the assessment of the risks of material misstatement ofthe Ind AS financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial 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 we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Ind AS financial statements.
In our opinion and to the best of our information and according to theexplanations given to us the aforesaid Ind AS financial give the information required bythe Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India including the Ind AS of the state ofaffairs (financial position) as at March 31 2018 and its total comprehensive income(comprising of profit and other comprehensive income) its cash flows and the changes inequity for the year ended on that date.
The comparative financial information of the Company for the year endedMarch 31 2017 and the transition date opening balance sheet as at April 01 2016 includedin these Ind AS financial statements are based on the previously issued statutoryfinancial statements prepared in accordance with the Companies (Accounting Standards)Rules 2006 for the year ended March 31 2017 and March 31 2016 on which opinion onthose financial the predecessor auditor expressed an unmodified statements vide theiraudit report dated May 30 2017 and
May 30 2016 respectively as adjusted for the differences in theaccounting principles adopted by the Company on transition to Ind AS which have beenaudited by us. Our opinion is not modifiedinrespect matter ofthis .
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 subsection(11) of section 143 of the Act we give in the Annexure A a statement on the mattersspecified in paragraphs 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 havesought and obtained all the information and explanations which to the best of ourknowledge and belief were necessary for the purpose of our audit of the aforesaid Ind ASfinancial statements. b) In our opinion proper books of account as required by lawrelating to preparation of the aforesaid Ind AS financial statements have been kept by theCompany so far as it appears from our examination of those books. c) The Balance Sheetthe Statement of Profit and Loss (including other comprehensive income) the Cash FlowStatement and the Statement of Changes in Equity dealt with by this report are inagreement with the books of account maintained for the purpose of preparation of the IndAS financial statements. d) In our opinion the aforesaid Ind AS financial statementscomply with the Accounting Standards specified under Section 133 of Companies Act 2013read with rule 7 of the Companies (Accounts) Rules 2014. e) On the basis of the writtenrepresentations received from the directors as on March 31 2018 and taken on record bythe Board of Directors we report that none of the directors is disqualified as on March31 2018 from being appointed as a director in terms of Section 164(2) of the CompaniesAct 2013. f) With respect to the adequacy of the internal financial controls overfinancial reporting of the of such controls refer to our separate report inAnnexure B' and; g) With respect to the other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules2014 in our opinion and to the best of our information and according to the explanationsgiven to us: i. The Company has disclosed the impact of pending litigations on itsfinancial position in its Ind AS financial statements - Refer Note 28 (a) to the Ind ASfinancial statements; ii. The Company did not have any material foreseeable losses on longterm contracts including derivatives contracts. iii. There were no amounts which wererequired to be transferred to the Investor Education and Protection Fund by the Companyduring the year ended March 31 2018. iv. The reporting on disclosures relating toSpecified Bank Notes is not applicable to the Company for the year ended March 31 2018.
For M L BHUWANIA AND CO LLP
Membership No. 109931
Date: May 28 2018
ANNEXURE A TO THE INDEPENDENT AUDITOR'S REPORT
Referred to in paragraph 1 of Report on other Legal andRegulatory Requirements' in our Report of even date on the accounts of KEMP &COMPANY LIMITED for the year ended 31st March 2018.
On the basis of the records produced to us for our verification/perusal such checks as we considered appropriate and in terms of information andexplanation given to us on our enquiries we state that:
(i) (a) The company is maintaining proper records showing fullparticulars including quantitative details and situation of fixed assets. (b) The fixedassets of the Company are physically verified by the Management according to a phasedprogramme all the items over a period of three years which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. Pursuant to theprogramme a portion of the fixed assets has been physically verified by the Managementduring the year and discrepancies noticed between the book records and the physicalinventories were not material and have been properly dealt with in the accounts.
(c) According to information and explanations gives to us and on thebasis of our examination of the records of the Company the title deeds of immovableproperties are held in the name of the Company.
(ii) During the year the inventories have been physically verified bythe management. In our opinion the frequency of verification is reasonable. Thediscrepancies noticed verification of inventories as compared to the book recordswere not material and physical have been properly dealt with in the books of account.
(iii) The Company has not granted any loans secured or unsecured tocompanies firms limited liability partnerships or other parties covered in the registermaintained under Section 189 of the Companies Act 2013 during the year. Accordinglyclause 3 (iii) of the Order is not applicable to the Company.
(iv) The company has complied with provisions of sections 186 of theCompanies Act 2013 in respect of investments made and loan given. Section 185 of theCompanies Act 2013 is not applicable as there were no loans securities and guaranteesgiven during the year. (v) The Company has not accepted any deposits from the publicwithin the meaning of Sections 73 74 75 and 76 of the Act and the rules framed thereunder to the extent notified and therefore. clause 3(v)is not applicable (vi) The CentralGovernment has not prescribed maintenance of cost records for the company under subsection (1) of section 148 of the Companies Act 2013. Accordingly clause 3 (vi) of theOrder is not applicable to the Company.
(vii) (a) According to the records of the Company the Company isgenerally regular in depositing undisputed statutory dues including Provident FundEmployees' State Insurance Income Tax Sales Tax Service Tax Excise Duty Customs DutyValue Added Tax Cess Goods and Services Tax (GST) w.e.f. July 01 2017 and otherstatutory dues applicable to it. Further no undisputed amounts were outstanding as on 31stMarch 2018 for a period of more than six months from the date they became payable. (b)According to the records of the Company there are no dues of Income Tax Service TaxCustoms Duty Cess and Sales Tax / Value Added Tax which have not been deposited onaccount of any dispute.
The disputed amount that have not been deposited in respect of ExciseDuty is as under:
|Name of Statute || |
Nature of Dues
|Forum where dispute is pending |
| || || || |
(Rs in thousand)
|The Central Excise Act 1944 || |
01/03/1986 to 14/12/1986
|Customs Excise and Service Tax Appellate Tribunal |
| || || || || |
(viii) The Company has not taken any loan or borrowing from bankgovernment financial institutions and has not issued debentures during the year.Accordingly clause 3 (viii) of the Order is not applicable to the Company.
(ix) The company has not taken any term loans and does not raisedmoneys by way of Initial Public Offer or further public offer (including debt instruments)during the year. Accordingly clause 3 (ix) of the Order is not applicable to the Company.
(x) Based upon the audit procedures performed and information andexplanations given by the management we report that no fraud by the Company or no fraudon the Company by its officers or employees has been noticed or reported during the .
(xi) In our opinion and according to the information and explanationsgiven to us the managerial remuneration has been paid or provided in accordance with therequisite approvals mandated by the provisions of Sec 197 read with Schedule V to theCompanies Act 2013.
(xii) In our opinion and according to the information and explanationsgiven to us the nature of activities of the Company does not attract any special statuteapplicable to Nidhi Company. Accordingly clause 3 (xii) of the Order is not applicable tothe Company.
(xiii) According to the information and explanation given to us andbased on our examination of the records of the Company transactions with the relatedparties are in compliance with Sec 177 and 188 of Companies Act 2013 where applicable anddetails of such transactions have been disclosed in the financial statements as requiredby the applicable accounting standards.
(xiv) In our opinion and according to the information and explanationsgiven to us and based on our examination of the records of the Company the company hasnot made any preferential allotment or private placement of shares or fully or partlyconvertible debentures during the year. Accordingly clause 3 (xiv) of the Order is notapplicable to the Company.
(xv) In our opinion and according to the information and explanationsgiven to us and based on our examination of the records of the Company the company hasnot entered into any non-cash transactions with directors or persons connected with him.Accordingly clause 3 (xv) of the Order is not applicable to the Company.
(xvi) The company is not required to be registered under Sec 45-IA ofthe Reserve Bank of India Act 1934. Accordingly clause 3(xvi) of the Order is notapplicable to the Company.
For M L BHUWANIA AND CO LLP
Membership No. 109931
Date: May 28 2018
ANNEXURE B TO THE INDEPENDENT AUDITORS' 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 financial KEMP& COMPANY LIMITED ("the Company") as of March 31 2018 reportingof inconjunction with our audit of the Ind AS financial statements of the Company for the yearended on that date.
Management's Responsibility for Internal Financial Controls
The Company's Board of Directors are 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 maintenanceof adequate 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.
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 issued by ICAIand deemed to be prescribed under Section 143(10) of the Companies Act 2013 to theextent applicable to an audit of internal financial controls both applicable to an auditof Internal Financial Controls and both issued by the ICAI. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain controls over financial reporting was established and maintained and ifsuch reasonable assurance about whether adequate internal financial controls operatedeffectively 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 controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design of internalfinancial and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgment including the assessment of therisks of material misstatement of the Ind AS financial statements whether due to fraud orerror. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the Company's internal financial controlssystem 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 ofmanagement and directors of the Company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized 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 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 financial reporting may become inadequate because of changes in conditions orthat the degree of compliance with the policies or procedures may deteriorate.
In our opinion to the best of our information and according to theexplanations given to us the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 2018 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 M L BHUWANIA AND CO LLP
Membership No. 109931
Date: May 28 2018