The Members of Ladderup Finance Limited
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements ofLadderup Finance Limited ("the Company") which comprise the balance sheet as at31st March 2019 and the statement of Profit and Loss and Cash flowsstatements for the year then ended including a summary of significant accounting policiesand other explanatory information (hereinafter referred to as the " Standalonefinancial statements").
In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone financial statements give theinformation required by the Companies Act 2013 ("the Act") in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the state of affairs of the Company as at 31 stMarch 2019 the profit 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) specified under section 143(10) of the Act (SAs). Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit ofthe Standalone 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 (ICAI) together with the independence requirements that are relevantto our audit of the financial statements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethical responsibilities in accordancewith these requirements and
Ethics. We believe that the audit evidence we have obtained issufficient basis for our audit opinion.
Key Audit Matters
Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the standalone financial statements of thecurrent period. These matters were addressed in the context of our audit of the standalonefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters.
|Key audit matters ||How our audit addressed the key audit matter |
|Investment in Subsidiary ||Our procedures in relation to verification of investment made in subsidiary include: |
|Company have acquired equity Shares and optionally convertible preference shares of Godland Enterprises Private Limited. ||Evaluating the independent professional valuer's competence capabilities and objectivity; |
|Godland Enterprises Pvt. Ltd. holds 100% Equity Shares of M/s. Waterproof Corporation Private Limited. ||Assessing the valuation methodology used by the independent professional valuer to estimate the fair value of the investment. |
|Whether the proper compliance was made with regards to Accounting Standard & Valuation of investment. ||Recording of investment made in the books and compliance with accounting standard. |
Information Other than the Standalone Financial Statements andAuditor's Report Thereon
The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included not include thestandalone financial statements and our auditor's report thereon. The Board'sReport including Annexures to Board's Report is expected to be made available to usafter the date of this auditor's report. Our opinion on the financial statements doesnot cover the other information and we do not express any form of assurance conclusionthereon. In connection with our audit of the financial statements our responsibility isto read the 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 have performed we conclude that there is amaterial misstatement of this other information; we are required to report that fact. Wehave nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance forthe Standalone Financial Statements:
The Company's Board of Directors is responsible for the mattersstated in section 134(5) of the Companies Act 2013 ("the Act") with respect tothe preparation of these standalone financial statements that give a true and fair view ofthe financial position financial performance and cash flows of the Company in accordancewith the accounting principles generally accepted in India including the AccountingStandards specified under section 133 of the Act. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; appropriate accounting policies; making judgments and estimates thatare reasonable and prudent; and design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.
In preparing the standalone financial statements the Board ofDirectors is responsible for assessing the Company's ability to continue as a goingconcern disclosing as applicable matters related to going concern and using the goingconcern basis of accounting unless the Board of Directors either intends to liquidate theCompany or to cease operations or has no realistic alternative but to do so. Those Boardof Directors are also responsible for overseeing the Company's financial reportingprocess.
Auditor's Responsibilities for the Audit of the StandaloneFinancial Statements:
Our objectives are to obtain reasonable assurance about whether thestandalone financial statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these standalone financial As part of anaudit in accordance with SAs we exercise professional judgment and maintain professionalskepticismthroughout the audit. We also:
Identify and assess the risks of material misstatement of thestandalone financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control.
Obtain an understanding of internal control relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Companies Act 2013 we are also responsible for expressing our opinionon whether the company has adequate internal financial controls system in place and theoperating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditionsmay cause the Company to cease to continue as a going concern.
Evaluate the overall presentation structure and content of thefinancial statements including the disclosures and whether the standalone financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation. We communicate with those charged with governance regarding among othermatters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit. We also provide those charged with governance with a statement that we havecomplied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may reasonably be thought to bear onour independence and where applicable related safeguards. From the matters communicatedwith those charged with governance we determine those matters that were of mostsignificance in the audit of the financial statements of the current period and aretherefore the key audit matters. We describe these matters in our auditor's reportunless law or regulation precludes public disclosure about the matter or when inextremely rare circumstances we determine that a matter should not be communicated in ourreport because the adverse consequences of doing so would reasonably be expected tooutweigh the public interest benefits of such communication.
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 statementon the matters specified in paragraphs 3 and 4 of the Order to the extent applicable.
2. As required by Section143 (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 purposes of ouraudit; (b) In our opinion proper books of account as required by law have been kept bythe Company so far as it appears from our examination of those books;
(c) The Balance Sheet Statement of Profit this Report are in agreementwith the books of account; (d) In our opinion the aforesaid standalone financialstatements comply with the Accounting Standards specified under Section 133 of the Actread with Rule 7 of the Companies (Accounts) Rules 2014; (e) On thebasisofthewrittenrepresentations received from the directors as on 31st March 2019 takenon record by the Board of Directors none of the directors is disqualified as on 31stMarch 2019 from being appointed as a director in terms of Section 164(2) of the Act; (f)With respect to the adequacy of the Internal financial controls over financial reportingthe Company and operative effectiveness of such controls refer to our separate report in "AnnexureB". Our report expresses an unmodified opinion on the adequacy and operatingeffectiveness of the Company's internal financial controls over financial reporting(g) With respect to the other matters to be included in the Auditor's report in accordancewith the requirements of the sub-section In our opinion and to the best of our informationand according to the explanations given to us the remuneration paid by the Company to itsdirectors during the year is in accordance with the provisions of Section 197 of the Act.
(h) With respect to the other matters to be included in theAuditors' Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 as amended in our opinion and to the best of our information and according tothe explanations given to i. The Company has disclosed the impact of pending litigationson its financial position in its financial statements; ii. The Company did not have anylong-term contracts including derivative contracts as at 31st March 2019 for which therewere any material foreseeable losses; and iii. There has been delay in transferringamounts of र 201471/- required to be transferred to the Investor Education andProtection Fund by the Company during the year ended 31st March 2019. The amount has beentransferred on 22nd May 2019.
For SHAH GUPTA & CO.
Chartered Accountants Firm Registration No.: 109574W Sd/-
Membership No. 135823
Date: 23rd May 2019
ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT
The Annexure referred to in paragraph 1 under Report on OtherLegal and Regulatory Requirements' section of our report of even date to thefinancial statements of the Company for the year ended 31st March 2019: i. a) The Companyhas maintained proper records showing full particulars including quantitative details andsituations of fixed assets. b) The Company has a regular programme of physicalverification of its fixed assets by which fixed assets are verified in a phased mannerover a period of three years. In our opinion this periodicity of physical verification isreasonable having regard to the size of the Company and the nature of its assets. Inaccordance with this programme certain fixed assets were during the year by theManagement. According to the information and explanations given to us no materialdiscrepancies were noticed on such c) According to the information and explanations givento us and on the basis of our examination of the records of the Company the title deedsof immovable properties are held in the name of the Company as at the balance sheet date.ii. Since the Company does not have inventory the Clause 3(ii) of the Order is notapplicable to the Company. iii. According to the information and explanations given by theManagement the company has granted unsecured loans to companies covered in the registermaintained under section 189 of the Companies Act 2013. a) In our opinion the rate ofinterest and the other terms and conditions of the grant of such loans were not primafacie prejudicial to the company's interest; b) The borrowers have been regular inthe payment of the interest as stipulated. The terms of arrangements do not stipulate anyrepayment schedule and the loans are repayable on demand. Accordingly paragraph 3(iii)(b)of the Order is not applicable to the Company in respect of repayment of the principalamount; c) There are no overdue amounts in respect of such loans. iv. Based on informationand explanation given to us the Company has complied with provisions of Section 185 and186 of the Act in respect of grant of loans making investments and providing guaranteesand securities the Company has not accepted any deposit v. Accordingtothe from the publicwith the meaning of the directives issued by the Reserve Bank of India and the provisionsof Sections 73 to 76 or any other relevant provisions of the Act and the rules framedthere under. Accordingly clause 3(v) of the order is not applicable to the company. vi.To the best of our knowledge and as explained the Central Government has not prescribedmaintenance of cost records under sub-section (1) of Section 148 of the not applicable tothe Company. vii. According to the information and explanations given to us in respect ofstatutory dues: (a) The Company has generally been regular in depositing undisputedstatutory dues including provident fund Income-Tax Cess Goods and Service Tax and othermaterial statutory dues applicable to it to the appropriate authorities. (b) There were noundisputed amount payable in respect of provident fund Income-Tax Cess Goods andService Tax and other material statutory dues in arrears as at 31st March 2019 for aperiod of more than six months from the date they became payable. (c) According to therecords of the Company there are no dues of provident fund Income-Tax Cess Goods andService Tax and other material statutory dues which have not been deposited on account ofany disputes other than as follows:
|Name of the status ||Nature of Dues ||Amount (र In Lakh) ||Period to which the amount relates ||Forum where dispute is pending |
|Income Tax Act 1961 ||Tax ||154860 ||A.Y. 2012-2013 ||CIT (Appeals) |
|Income Tax Act 1961 ||Tax ||302050 ||A.Y. 2013-2014 ||CIT (Appeals) |
|Income Tax Act 1961 ||Tax ||1257380 ||A.Y. 2015-2016 ||CIT (Appeals) |
viii. According to the information and explanations given year inrepayment of dues to its bankers non-banking financial company and government. TheCompany did not have any outstanding debenture during the year. ix. The Company did notraise any money by way of initial public offer or further public offer (including debtinstruments) and term loans during the year. Accordingly clause 3 (ix) of the Order isnot applicable to the Company. x. According to the information and explanations given tous no material fraud by the Company or on the Company by its officers or employee hasbeen noticed or reported during the year. xi. According to the information andexplanations given to us and based on our examination of the records of the Company theCompany has paid/provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the Act. xii.According to the information and explanations given to us the Company is not a NidhiCompany. Accordingly the provision of clause 3 (xii) of the Order is not applicable tothe Company. xiii. According to the information and explanations given to us and based onour examination of the records of the Company transactions with the related parties arein compliance with sections 177 and 188 of the Act where applicable and details of suchtransactionshave been disclosed in the standalone financial statements as required by theapplicable accounting standards. xiv. According to the information and explanations giveto us and based on our examination of the records of the Company the Company has not madeany preferential allotment or private placement of shares or fully or partly convertibledebentures during the year. Accordingly clause 3(xiv) of the Order is not applicable tothe Company. xv. According to the information and explanations given to us and based onour examination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with them and hence provisions of section192 of the Act are not applicable. Accordingly clause 3(xv) of the Order is notapplicable to the Company. xvi. According to the information and explanations given to usand based on our examination of the records of the Company the Company is registeredunder Section 45-IA of the Reserve Bank of India Act 1934.
For SHAH GUPTA & CO.
Firm Registration No.: 109574W
Membership No. 135823
Date: 23rd May 2019
ANNEXURE TO THE INDEPENDENT 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 haveaudited the internal financial controls over financial reporting of Ladderup FinanceLimited ("the Company") as of 31st March 2019 in conjunction with our auditof the Standalone financial statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Company's management is responsible for establishing andmaintaining internal financialcontrols based on the internal control overfinancialreportingcriteria established by the Company considering the essential componentsof internal control stated in the Guidance Note on Audit of Internal Financial Controlsover Financial Reporting issued by the Institute of Chartered Accountants of India (The"Guidance Note"). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence toCompany's policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013("the Act").
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 and the Standards on Auditing prescribed under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects. Our auditinvolves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system over financial reporting and their operating effectiveness. Ouraudit of internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditors' judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the Company's internal financial controls system over financialreporting.
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 dispositionsof 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 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 controls over financial reporting tofuture periods are subject to the risk that the internal financial control overfinancialreporting may become inadequate because of changesinconditions or that thedegree of compliance with the policies or procedures may deteriorate.
In our opinion to the best our information and according to theexplanation given to us the Company has in all material respects an adequate internalfinancial controls system over financial reporting such internal financial controls overfinancial reporting were operating effectively as at 31st March 2019 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 SHAH GUPTA & CO.
Firm Registration No.: 109574W
Membership No. 135823
Date: 23rd May 2019