The Members of LORDS ISHWAR HOTELS LIMITED
Report on the Audit of the Standalone Financial Statements
We have audited the accompanying standalone financial statements of Lords IshwarHotels Limited ("the Company") which comprise the Balance Sheet as at 31"March2019 the Statement of Profit and Loss (including other Comprehensive Income) theStatement of Changes in Equity and the Statement of Cash Flow for the year ended on thatdate and a summary of the significant accounting policies and other explanatoryinformation.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 ("the Act") in the manner so required and give a trueand fair view in conformity with the accounting principles generally accepted in India ofthe state of affairs of the Company as at 31 "March 2019 the profit and totalcomprehensive income changes inequity and its Cash Flows for the year ended on that date.
Basis of Opinion
We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing specified under Section 143(10) of the Act. Our responsibilitiesunder those Standards are further described in the Auditor's Responsibilities for theAudit of the Standalone Financial Statements section of our report. We are independent ofthe Company 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 standalone financial statements under the provisions of the Act andthe Rules made there under and we have fulfilled our 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 standalone financial statements.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone financial statements of the current period.These matters were addressed in the context of our audit of the standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report.
|S.No. ||Key Audit matter ||Auditor's Response |
|1. ||Revenue Recognition ||Principal Audit Procedure |
| ||To ensure accuracy of recognition measurement presentation and disclosures of revenues and related accounts || We have assessed the Company's internal controls surrounding its revenue transactions; |
| || || We tested the key controls identified |
| || || We performed substantive detail testing by selecting a sample of revenue transactions that we considered appropriate to test the evidence of effectiveness of the internal controls and adherence to accounting policies in recognising the revenue and the rebates and discounts there against. |
|2. ||Tax liabilities including MAT Credit ||Principal Audit Procedures |
| ||Evaluation of uncertain tax positions: The Company has material uncertain tax positions including matters under dispute which involves significant judgment to determine the possible outcome ofthese disputes. || Obtained details of completed tax assessments demands and appeals there against as at March 312019. |
| || || Review the management's underlying assumptions in estimating the tax provision and the possible outcome of the disputes based on legal and other precedents in evaluating management's position on these uncertain tax positions. |
Information Other than the Standalone Financial Statements and Auditor's Report Thereon
The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexures to Board's Report CorporateGovernance and Shareholder's Information but does not include the standalone financialstatements and our auditor's report thereon.
Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained during the course of our audit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude that there is a materialmisstatement of this other information; we are required to report that fact. We havenothing to report in this regard.
Management's Responsibility for the Standalone Financial 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 standalone financial statementsthat give a true and fair view of the financial position financial performance totalcomprehensive income changes in equity and cash flows of the Company in accordance withthe Ind AS and other accounting principles generally accepted in India. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding 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 that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error. In preparing the standalone financial statements management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so. The Board of Directors areresponsible for overseeing the Company's financial reporting process.
Auditor's Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.
Obtain an understanding of internal financial controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has an adequate internal financial controls system in place and the operatingeffectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe standalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.
Evaluate the overall presentation structure and content of the standalonefinancial statements including the disclosures and whether the standalone financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.
Materiality is the magnitude of misstatements in the standalone financial statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our 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 standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh 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 ofthe Act we give in the "Annexure A" a statement on the matters specifiedin paragraphs 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 purpose of our audit;
b) in our opinion proper books of account as required by law have been kept by theCompany so far as appears from our examination of those books;
c) the Balance Sheet the Statement of Profit and Loss including other comprehensiveIncome Statement of Changes in Equity and the Statement of Cash Flow dealt with by thisReport are in agreement with the relevant books of account;
d) in our opinion the aforesaid Standalone financial Statements comply with the Ind ASspecified under Section 133 of the Act read with the Rules made there under and in forcefor the time being;
e) on the basis of written representations received from the Directors as on 31"March 2019and taken on record by the Board of Directors none of the Directors isdisqualified as on 31 "March 2019 from being appointed as a director in terms ofSection 164(2) ofthe 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". Our report expresses an unmodifiedopinion on the adequacy and operating effectiveness of the company's internal financialcontrols over financial reporting.
g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) ofthe Act as amended:
In our opinion and to the best of our information and according to the explanationgiven to us Company is not paying any remuneration to its Directors including ManagingDirector.
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 in our opinionand to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financialposition in its Standalone financial statements.
ii. The Company didn't have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. There were no amounts which required to be transferred to the investor Educationand Protection Fund by the Company.
| ||For K. K. Haryani & Co. |
| ||Chartered Accountants |
| ||FRN: 121950W |
|Place: Mumbai ||(CA. Kishor Haryani) |
|Date: 30'h May 2019 ||(proprietor) |
| ||Membership No. 110780 |
Annexure "A" to the Independent Auditors' Report
Report on the matters specified in paragraph 3 of the Companies (Auditor's Report)Order 2016 ("the order") issued by the Central Government of India in terms ofSection 143(11) of the Companies Act 2013 ("the Act") as referred to inParagraph 1 of 'Report on Other Legal and Regulatory Requirements' section.
i. (a) The company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets.
(b) The fixed assets have been physically verified by the management during the yearthe frequency of which in our opinion is reasonable having regard to the size of theCompany and the nature of its assets. No material discrepancies were noticed on suchverification.
(c) According to the information and explanation given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.
ii. As explained to us inventories have been physically verified during the year bythe management at reasonable intervals and no material discrepancy was noticed on suchverification.
iii. According to the information and explanations given to us and on the basis of ourexamination of the books of account the Company has not granted any loans secured orunsecured to companies firms or other parties covered in the register maintained underSection 189 of the Companies Act 2013.
iv. In our opinion and according to the information and explanations given to us theCompany has not given loan to Directors or provided guarantee or security in connectionwith any loan to Directors including entities in which they are interested under theprovisions of Section 185. Provisions of Section 186 in respect of loans and advancesgiven investments made and guarantee and securities given have been complied with bycompany.
v. The Company has not accepted any deposits from the public. Accordingly paragraph3(v) of the Order is not applicable to the Company.
vi. The Central Government has not prescribed maintenance of Cost records under Section148(1) of the Companies Act 2013for the Company's activities. Hence the provisions ofClause 3(vi) of the Order are not applicable to the Company.
vii. (a) According to the records of the company undisputed statutory dues includingProvident Fund Employees' State Insurance Income-tax Sales-tax Service Tax LuxuryTax Duty of Custom Excise Duty Value added tax Good and Service Tax Cess to theextent applicable and any other statutory dues have generally been regularly depositedwith the appropriate authorities. According to the information and explanations given tous there were no outstanding statutory dues as at 31st of March 2019 for aperiod of more than six months from the date they became payable.
(b) According to the information and explanations given to us the amounts payable inrespect of Income Tax Service Tax Sales Tax Luxury Tax Goods and Service tax CustomsDuty and Excise Duty which have not been deposited on account of disputes and the forumwhere dispute is pending are given below:-
|Name of the statute ||Nature of Dispute ||Amount (Rs.) ||Period ||Forum where dispute is pending ||Progress and Remarks |
|Central Excise & Customs Act ||Service Tax & Penalty ||407758 ||2004- 05 & 2005- 06 ||Commissioner (Appeals) Central Excise & Customs Baroda ||Out of total demand of Rs. 815516 raised Rs. 407758 is paid. Rest Rs. 407758 is under dispute & pending at appeal level. |
|Luxury Tax ||Luxury Tax Interest & Penalty ||662000 ||1999-2000 ||District Collector office Entertainment Tax & Luxury Tax Baroda. ||Amount is under dispute. |
viii. In our opinion and according to the information and explanation given to us theCompany has not taken any loans or borrowing from the financial institution bankGovernment and there is no debenture holder in the Company so the provisions of Clause3(viii) of the Order are not applicable to the Company.
ix. In our opinion and according to information and explanation given to us theCompany has not raised any money by way of initial public offer/further public offer(including debt instruments).
x. In our opinion and according to information and explanations given to us we reportthat no fraud by the Company or on the Company by its officers or employees has beennoticed or reported during the year.
xi. In my opinion and according to the information and explanations given to us theCompany is not paying any managerial remuneration to its Managing Director and otherDirectors. Hence the provisions of Clause 3(xi) of the Order are not applicable to theCompany.
xii. The Company is not a Nidhi Company. Hence the provisions of Clause 3(xii) of theOrder are not applicable to the Company.
xiii. In our opinion and according to the information and explanation given to usduring the audit transactions with the related parties are in accordance with Section 177and Section 188 of the Act and the details have been disclosed in the notes to thefinancial statements as required by the applicable Accounting Standards.
xiv. According to the information and explanations given to us and on an overallexamination of the books of account the Company has not made any preferential allotmentor private placement of shares or fully or partly convertible debentures during the yearunder review and hence reporting requirement under Clause 3 (xiv) are not applicable tothe Company and not commented upon.
xv. In our opinion and according to the information and explanation given to us theCompany has not entered into any noncash transactions with directors or persons connectedwith him as referred to in section 192 of the Companies Act 2013.
xvi. According to the information and explanation given to us the provisions ofSection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.
| ||For K. K. Haryani & Co. |
| ||Chartered Accountants |
| ||FRN: 121950W |
| ||(CA. Kishor Haryani) |
|Place: Mumbai ||(proprietor) |
|Date: 30'h May 2019 ||Membership No. 110780 |
Annexure "B" to the Independent Auditors' Report
Report on the Internal Financial Controls under clause (i) of Sub-Section 3 of Section143 of the Companies Act 2013 ("the Act") as referred to in paragraph 2(f) of'Report on Other Legal and Regulatory Requirements' section.
We have audited the internal financial controls over financial reporting of LordsIshwar Hotels Limited ("the Company") as of 31s' March 2019 inconjunction with our audit of the Standalone financial statements of the company for theyear ended on that date.
Management's Responsibility for Internal Financial Controls
The Company's Management is responsible for establishing 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 Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to the company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparations of reliable financial information asrequired under the Companies Act 2013.
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 accordance with the Guidance Note on audit of InternalFinancial Controls over Financial Reporting (the "Guidance Note") and thestandards on Auditing issued by ICAI and deemed to be prescribed under section 143(10) ofthe Act to the extent applicable to an audit of Internal Financial Controls bothapplicable to an audit of Internal Financial Controls and both issued by the Institute ofChartered Accountants of India. Those Standards and the Guidance Note require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.
Our audit involves performing procedure to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness.
Our audit of internal financial controls over financial reporting included obtainingunderstanding 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 auditor's judgments including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.
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 financial reporting includes those policies& procedures that:
(a) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transaction & disposition of the assets of company;
(b) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditure of the company are being made only inaccordance with authorizations of management and directors of company; and
(c) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of company's assets that could have amaterial effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of inherent limitation of internal financial controls over financial reportingincluding the possibility of collusion or improper management override of controlsmaterial misstatements due to error or fraud may occur and not be detected. Alsoprojections of any evaluation of the internal financial controls over financial reportingto future periods are subject to the risk that the internal financial control overfinancial reporting may become inadequate because of changes in conditions or that thedegree of compliance with the policies or procedures may deteriorate.
In our opinion 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 31st March 2019based 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 ofChartered Accountants of India.
| ||For K. K. Haryani & Co. |
| ||Chartered Accountants |
| ||FRN: 121950W |
| ||(CA. Kishor Haryani) |
|Place: Mumbai ||(proprietor) |
|Date: 30th May 2019 ||Membership No. 110780 |