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Kilburn Engineering Ltd.

BSE: 522101 Sector: Engineering
NSE: KILBUNENGG ISIN Code: INE338F01015
BSE 00:00 | 18 Aug 50.35 4.55
(9.93%)
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NSE 05:30 | 01 Jan Kilburn Engineering Ltd
OPEN 49.50
PREVIOUS CLOSE 45.80
VOLUME 1865921
52-Week high 57.55
52-Week low 22.55
P/E 33.79
Mkt Cap.(Rs cr) 173
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 49.50
CLOSE 45.80
VOLUME 1865921
52-Week high 57.55
52-Week low 22.55
P/E 33.79
Mkt Cap.(Rs cr) 173
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Kilburn Engineering Ltd. (KILBUNENGG) - Auditors Report

Company auditors report

TO ThE MEMbERS Of KILbURN ENGINEERING LIMITED

Report on the Audit of the Ind AS Financial Statements

Opinion

We have audited the accompanying Ind AS Financial Statements of Kilburn EngineeringLimited. ("the Company") which comprise the Balance Sheet as at 31stMarch 2021 the Statement of Profit and Loss (including Other Comprehensive Income) theCash Flow Statement and the Statement of Changes in Equity for the year then ended andnotes to the Financial Statements including a summary of significant accounting policiesand other explanatory information (hereinafter referred to as "Ind AS FinancialStatements").

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS Financial Statements give the information required bythe Companies Act 2013 as amended ("the Act") in the manner so required andgive a true and fair view in conformity with the Indian Accounting Standards prescribedunder section 133 of the Act read with the Companies (Indian Accounting Standards) Rules2015 as amended and other accounting principles generally accepted in India of the stateof affairs of the Company as at 31st March 2021 and its loss (including othercomprehensive income) the changes in Equity and its cash flows for the year ended on thatdate.

We conducted our audit of Ind AS financial statements in accordance with the Standardson Auditing (SAs) as specified under Section 143(10) of the Act. Our responsibilitiesunder those Standards are further described in the Auditor's Responsibilities for theAudit of the Ind AS financial statements section of our report. We are independent of theCompany in accordance with the Code of Ethics issued by the Institute of CharteredAccountants of India "(the ICAI)" together with the ethical requirements thatare relevant to our audit of the financial statements under the provisions of the Act andthe Rules made thereunder and we have fulfilledour other ethical responsibilities inaccordance with these requirements and the ICAI's Code of Ethics. We believe that theaudit evidence we have obtained is sufficient and appropriate to provide a basis for ouraudit opinion on the Ind AS Financial Statements.

Emphasis of Matter

Management's assessment of impact of COVID-19

We draw attention to Note 45 to the Ind AS Financial Statements which describes themanagement's assessment of impact of COVID-19 a global pandemic on the financial Companposition/matters of the y. Our opinion is not modified in respect of the above matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Ind AS financial statements for the financial yearended31st March 2021. These matters were addressed in the context of our audit of theInd AS financial statements as a whole and in forming our opinion thereon and we do notprovide a separate opinion on these matters. We have determined the matter described belowto be the key audit matters to be communicated in our report. For the matter below ourdescription of how our audit addressed the matter is provided in that context.

We have fulfilled the responsibilities described in the Auditor's responsibilities forthe audit of the Ind AS financial statements section of our report including in relationto these matters. Accordingly our audit included the performance of procedures designedto respond to our assessment of the risks of material misstatement of the Ind AS financialstatements. The results of our audit procedures including the procedures performed toaddress the matter below provide the basis for our audit opinion on the accompanying IndAS financial statements.

Key Audit Matters

Key audit matters Auditor's Response
Revenue recognition from design construction and commissioning contracts with customer Our audit procedures included the following among others:
(as described in Note 43 of the accompanying Ind AS financial statements) We tested the effectiveness of controls relating to (1) recording of costs incurred and estimation of costs required to complete the remaining contract performance obligations and (2) evaluated the design and operative effectiveness of the financial controls;
The Company's significant portion of business is from design construction and commissioning contracts with customer. Revenue from these contracts is recognized over a period of time in accordance with the requirements of Ind AS 115 Revenue from Contracts with Customers. We selected a sample of fixed price contracts with customers accounted using percentage of completion method and performed the following:
Due to the nature of the contracts revenue is accounted over a period of time (using input method) which involves significant judgments and estimates including: a) Compared costs incurred with Company's estimate of costs incurred to date to identify significant variations and evaluate whether those variations have been considered appropriately in estimating the remaining costs to complete the contract.
Identification of contractual obligations and the Company's rights to receive payments for performance completed till date Changes in scope and consequential revised contract price including provision of liquidated damages and recognition of the liability for loss making contracts/ onerous obligations b) Tested the estimate for consistency with the status of delivery of milestones and customer acceptances and sign off from customers to identify possible delays in achieving milestones which require changes in estimated costs to complete the remaining performance obligations.
Estimation of total contract costs to be incurred. c) We evaluated the revenue recognized over a period of time status of the project and of contractual obligation total cost estimates and re-calculated the arithmetic accuracy of the same.
Revenue and profits may deviate significantly on account of change in judgements and estimates. Accordingly revenue recognition for contracts is considered as a key audit matter.

Information Other than the financial Statements and Auditor's Report thereon

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Management Discussion and AnalysisBoard's Report including Annexures to Board's Report and Shareholder's information butdoes not include the Ind AS Financial Statements and our Auditor's Report thereon. Theannual report is expected to be made available to us after the date of this auditor'sreport. Our opinion on the Ind AS financialstatements does not cover the other informationand we do not express any form of assurance conclusion thereon.

In connection with our audit of the Ind AS financial statements our responsibility isto read the other information and in doing so consider whether such other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated.

Responsibilities of Management and Those Charged with Governance for the Ind ASfinancial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Act with respect to the preparation of these Ind AS financial statementsthat give a true and fair view of the financial position and financial performanceincluding other comprehensive income changes in equity and cash flows of the Company inaccordance with the Ind AS and other accounting principles generally accepted in India.This responsibility also includes maintenance of adequate accounting records in accordancewith the provisions of the Act for safeguarding the assets of the Company and forpreventing 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 financial controlsthat were operating effectively for ensuring the accuracy and completeness of theaccounting records relevant to the preparation and presentation of the Ind AS financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the Ind AS Financial Statements the management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

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

Auditor's Responsibilities for the Audit of the Ind AS financial Statements

Our objectives are to obtain reasonable assurance about whether the Ind AS 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 scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the Ind AS 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 misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theAct 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 reasonableness ofaccounting estimates and related disclosures made by management.

Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may doubt on the Company's ability to continueas a going concern. If we conclude that a material castsignificant uncertainty exists weare required to draw attention in our Auditor's Report to the related disclosures in thefinancial statements or if such disclosures are inadequate to modify our opinion. Ourconclusions 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 Ind AS financialstatements including the disclosures and whether the Ind AS financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

Materiality is the magnitude of misstatements in the financial statements thatindividually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be quantitative materialityand qualitative factors in

(i) planning the scope of our audit work influenced. and in evaluating the results ofour work; and

(ii) to evaluate the effect of any identified misstatements in the financialstatements.

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 Ind AS financial statements forthe financial year ended March 31 2021 and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.

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 1" a statement on the matters specified inparagraphs 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 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 the Statement ofOther Comprehensive Income the Cash Flow Statement and Statement of Changes in Equitydealt with by this Report are in agreement with the books of account;

(d) in our opinion the aforesaid Ind AS financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended;

(e) on the basis of the written representations received from the directors as on 31stMarch 2021 and taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2021 from being appointed as a director in termsof Section 164 (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 2" to this report.

(g) in our opinion the managerial remuneration for the year ended 31stMarch 2021 has been paid/ provided by the Company to the directors in accordance with theprovisions of section 197 read with Schedule V to the Act;

(h) 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 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on the financialposition in the Ind AS financial statements Refer Note 35 to the Ind AS financialstatements;

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts;

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

For V. Singhi & Associates
Chartered Accountants
Firm Registration No.: 311017E
(Tarun Jain)
Place: Kolkata Partner
Date: 29th June 2021 Membership No.: 130109
UDIN: 21130109AAAAEC1443

ANNEXURE 1 REfERRED TO IN PARAGRAPh 1 Of ThE SECTION ON "REPORT ON OThER LEGAL ANDREGULATORY REQUIREMENTS" Of OUR REPORT Of EVEN DATE TO ThE MEMbERS Of KILbURNENGINEERING LIMITED ON ThE fINANCIAL STATEMENTS Of ThE COMPANY fOR ThE YEAR ENDED 31STMARCh 2021

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and ed assets. fix situation of

(b) Fixed assets have been physically verified by the management during the year and nomaterial discrepancies were identified on such physical verification.

(c) According to the information and explanations given by the management the titledeeds of immovable properties included in property plant and equipment are held in thename of the Company. In respect of immovable properties of land and building that havebeen taken on lease and disclosed under Right of Use asset under the Note 3 to theFinancial Statements the lease agreements are in the name of the Company.

(ii) The management has conducted physical verification of inventory at reasonableintervals during the year and no material discrepancies were noticed on such physicalverification.

(iii) Except unsecured loans that are re-payable on demand having outstanding balanceof Rs. 4669.80 Lakhs (excluding the provision of Rs. 4669.80 Lakhs recognised during theyear under review) as on 31st March 2021 granted to two Companies in earlieryears covered in the Register maintained under Section 189 of the Act the Company hasnot granted 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.

(a) Considering the perceived uncertainties of recovery the terms and conditions ofthe grant of such loans are prejudicial to the Company's interest.

(b) The loans granted are re-payable on demand and schedule of payment of interest ofthese loans has not been stipulated. The repayment of principal and payment of interestare not regular in respect of the aforesaid loans and hence during the year the Companyhas recognised the provision for outstanding loans and written off the accrued interest asdescribed in Note 5b to the Ind AS Financial Statements.

(c) According to the information and explanations given to us the Company is puttingin best efforts to recover the outstanding amounts however considering the currentfinancial position of these group companies and the perceived uncertainties of recoverythe management has considered it prudent to recognise a provision for the entireoutstanding amount of ICDs and to write-off the entire amount of interest accrued on suchICDs without prejudice to any of the legal rights and remedies available to recover theoutstanding amounts. (Refer Note 5b to the Ind AS Financial Statements)

(iv) In our opinion and according to the information and explanations given to us theprovisions of Section 185 and 186 of the Act in respect of loans given and investmentsmade have been complied with wherever applicable.

The Company has not provided any guarantees and securities.

(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76of the Act and the Companies (Acceptance of Deposits) Rules 2014 (as amended).Accordingly the provisions of clause 3(v) of the Order are not applicable.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148 (1) of the Companies Act 2013 related to the manufacture or service ofProcess Equipment and Tea Dryer and are of the opinion that prima facie the specifiedaccounts and records have been made and maintained. We have not however made a detailedexamination of the cost records with a view to determine whether the same are accurate orcomplete.

(vii) (a) Undisputed statutory dues including provident fund employees' stateinsurance income-tax duty of custom goods and services tax cess and other statutorydues have generally been regularly deposited with the appropriate authorities though therehas been a slight delay in few cases. There are no arrears in undisputed statutory duesoutstanding at the year end for a period of more than six months from the date theybecame payable except the dues tabulated below.

Name of the Statute Nature of Dues Amount (in Rs. lakhs) Period to which the amount relates Due Date
Maharashtra State Tax on Professions Trades Callings and Employments Act 1975 Profession Tax 0.57 January 2020 29th February 2020
0.56 March 2020 30th April 2020
0.48 July 2020 31st August 2020
0.48 August 2020 30th September 2020
West Bengal State Tax on Professions Trades Callings and Employments Act 1979 Profession Tax 0.03 January 2020 21st February 2020

(b) According to the information and explanations given to us there are no dues ofprovident fund employees' state insurance income-tax goods and service tax duty ofcustoms duty of excise and cess which have not been deposited on account of any dispute.The particulars of dues of sales tax on account of any dispute is as follows:

Name of the Statute Nature of Dues Amount (in Rs. lakhs)* Period to which the amount relates forum where dispute is pending
Sales Tax Non Production of declaration forms 13.86 FY 2008 -09 Jt. Comm. of Sales Tax (Appeals)

* Net of amount paid under protest.

(viii) In our opinion and according to the information and explanations given by themanagement the Company had defaulted in repayment of loans or borrowing during the yearwhich has been restructured under the Guidelines of the Reserve Bank of India (PrudentialFramework for Resolution of Stressed Assets) Directions 2019 dated 7th June 2019.Accordingly there is no continuing default as on the balance sheet date. The Company doesnot have any loan or borrowing fromfinancialinstitution or Government. Further theCompany has not issued any debenture.

(ix) In our opinion and according to the information and explanations given to us theCompany has not raised monies by way of initial public offer or further public offer(including debt instruments) and term loans during the year. The term loans raised andutilised in earlier years has been restructured by the lender during the year underreview. (Refer Note 16 to the Ind AS Financial Statements)

(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the company or no fraud on the companyby the officers and employees of the Company noticed or reported during the year.

(xi) According to the information and explanations given by the management themanagerial remuneration has been paid / provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) In our opinion the Company is not a Nidhi Company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe Financial Statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and on an overallexamination of the balance sheet the Company has made preferential allotment on privateplacement basis of Equity Shares and Compulsorily Redeemable Preference Shares during theyear under review under the Guidelines of the Reserve Bank of India (Prudential Frameworkfor Resolution of Stressed Assets) Directions 2019 dated 7th June 2019. We report thatthe applicable requirements of Section 42 of the Companies Act 2013 have been compliedwith and the amount raised have been used for the purposes for which the funds wereraised.

The Company has not made any preferential allotment or private allotment of fully orpartly convertible debentures during the year under review.

(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in section 192 of Companies Act 2013.

(xvi) According to the information and explanations given to us the Company is notrequired to be registered under section 45-IA of the Reserve Bank of India Act 1934.

For V. Singhi & Associates
Chartered Accountants
Firm Registration No.: 311017E
(Tarun Jain)
Place: Kolkata Partner
Date: 29th June 2021 Membership No.: 130109
UDIN: 20130109AAAABY1440

ANNEXURE 2 TO ThE INDEPENDENT AUDITOR'S REPORT Of EVEN DATE ON ThE IND AS fINANCIALSTATEMENTS Of KILbURN ENGINEERING LIMITED

Report on the Internal financial Controls with reference to the accompanying Ind ASfinancial Statements under Clause (i) of Sub-section 3 of Section 143 of the CompaniesAct 2013 ("the Act")

We have audited the internal financial controls with reference to financial statementsof Kilburn Engineering Limited ("the Company") as of 31st March2021 in conjunction with our audit of the Ind AS financial statements of the Company forthe year 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 financial controls with reference to financialstatements 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. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial for ensuring the orderly and efficient conduct of its business includingadherence to the Company's policies the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial information as required under the Act.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to these Ind AS financial statements based on our audit. Weconducted our audit in accordance with the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting (the " Guidance Note" ) and the Standards onAuditing as specified under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls with reference to financialstatements. 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 with reference to these Ind AS financial statementswere established and maintained and whether such controls operated effectively in allmaterial respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to these Ind AS financial statements andtheir operating effectiveness. Our audit of internal financial controls with reference tofinancial statements included obtaining an understanding controls with reference to theseInd AS financial statements assessing the risk that a material weakness exists andtesting and evaluating the design and operating effectiveness of internal control based onthe assessed risk.

The procedures selected depend on the auditor's judgement including the assessment ofthe risks of material misstatement of the 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 internal financial controls with reference tothese Ind AS financial statements.

Meaning of Internal financial Controls Over financial Reporting With Reference to theseInd AS financial Statements

A company's internal financial control with reference to these Ind AS financialstatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposesin accordance with generally accepted accounting principles. A company's internalfinancial control with reference to these Ind AS financial statements includes thosepolicies and procedures that

(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the 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 and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement 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 with Reference to these Ind ASfinancial Statements

Because of the inherent limitations of internal financial controls over financialreporting with reference to these Ind AS financial statements including the possibilityof collusion or improper management override of controls material misstatements due toerror or fraud may occur and not be detected. Also projections of any evaluation of theinternal financial controls over financial reporting with reference to these Ind ASfinancial statements to future control over financial periods aresubject to the risk thatthe internal financial AS financial statements may become inadequate because of changes inconditions or that the degree of compliance with the policies or procedures maydeteriorate.

Opinion

In our opinion the Company has maintained in all material respects adequate internalfinancial controls over financial reporting with reference to these Ind AS financialstatements and such internal financial controls over financial reporting with reference toInd AS financial statements were operating effectively as of31 st March 2021based on the 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 of Chartered Accountants of India.

For V. Singhi & Associates
Chartered Accountants
Firm Registration No.: 311017E
(Tarun Jain)
Place: Kolkata Partner
Date: 29th June 2021 Membership No.: 130109
UDIN: 20130109AAAABY1440

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