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Macpower CNC Machines Ltd.

BSE: 535057 Sector: Engineering
NSE: MACPOWER ISIN Code: INE155Z01011
BSE 05:30 | 01 Jan Macpower CNC Machines Ltd
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Macpower CNC Machines Ltd. (MACPOWER) - Auditors Report

Company auditors report

To

The Members

Macpower CNC Machines Limited

Rajkot.

-Report on the Financial Statements:

1 We have audited the accompanying Financial Statements of Macpower CNC MachinesLimited which comprise the Balance Sheet as at 31st March 2019 and the Statement ofProfit & Loss the Cash Flow Statement for the year ended and a summary ofsignificant accounting policies and other explanatory information.

-Management's Responsibility for the Financial Statements:

2 The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 (the Act) with respect to the preperation of thesefinancial statements that give a true and fair view of the financial position financialperformance and cash flows of the company in accordance with the accounting principlesgenerally accepted in India including the Accounting Standards specified under section133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

-Auditor's Responsibility

3 Our responsibility is to express an opinion on these financial statements based onour audit.

4 We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder.

5 We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.

6 An audit involves performing procedures to obtain audit evidence about the amountsand the disclosures in the financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances. An audit also includes evaluating theappropriateness of the accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof the financial statements.

7 We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the financial stafements.

-Opinion

8 In our opinion and fo the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India:

i. in the case of the Balance Sheet of the state of affairs of the Company as at 31st March 2019; and

ii. in the case of the Profit & Loss Account of fhe Profit for fhe period ended onfhat date.

-Report on Other Legal and Regulatory Requirements:

9 As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of India in terms of powers conferred by Section 143(11) of the Companies Act2013 (18 of 2013) We give in the Annexure "A" statement on the mattersspecified in paragraphs 3 and 4 of the order

10 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 accounts as required by law have been kept by theCompany so far as it appears from our examination of the books.

C. The Balance Sheet and the Profit & Loss A/c. dealt with by this report are inagreement with the books of account.

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

E. On the basis of written representations received from the Directors of the Companyas on 31st March 2019 taken on record by the Board of Directors none of the directorsis disqualified as on 31st March 2019 from being appointed as a director in terms ofSection 164(2) of the Act.

F With respect to the adequacy of internal financial controls over financial reportingof the company and operative effectiveness of such controls refer to our separate reportin Annexure B to this report; and

G With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us;

i. The Company does not have any pending litigations which would impact its financialposition.

ii. The Company did not have any long term contracts including derivative contracts forwhich there were any foreseeable losses.

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

For S. C. Makhecha & Associates

Chartered Accountants Firm Regn. No. 120184W

Sanat C. Makhecha

Partner M.No. 107192 Date: 20/05/2019 Place: Rajkot

ANNEXURE - A

Annexure referred to in and forming part of Auditor's Report of even date to themembers of

MACPOWER CNC MACHINES LIMITED.

As required by the Companies (Auditor's Report) Order 2016 and in the terms of theinformation given to us and on the basis of such checks as we considered appropriate wefurther state that:-

i(a) As informed to us the company is maintaining proper records showing fullparticulars including quantitative details and situation of fixed assets;

i(b) As informed to us the title deeds of immovable properties are held in the name ofthe company.

i(c) As explained to us the fixed assets have been physically verified by themanagement at reasonable intervals and there were no material discrepancies noticed onsuch verification and if so the same have been properly dealt with in the books ofaccount;

ii As explained to us the physical verification of inventory has been conducted atreasonable intervals by the management and there were no material discrepancies noticedand if so they have been dealt with in the books of account;

iii As informed to us the company has not granted loans secured or unsecured tocompanies firms or other parties covered by clause (76) of Section 2 of the CompaniesAct 2013. If so iii(a) Reporting to this Clause is not Applicable. iii(b) Reporting tothis Clause is not Applicable. iii(c) Reporting to this Clause is not Applicable.

iv As informed to us in respect of loans investments and guarantees the provisionsof Section 185 and 186 of the Companies Act 2013 have been complied with.

v As informed to us the company has not accepted deposits so the reporting to thisClause is not Applicable.

vi As informed to us the company has maintained records pursuant to rules prescribedby the

Central Government for maintenance of cost records under sub section 1 of section 148of the

Act and are of the opinion that prima facie the prescribed records have beenmaintained.

However we have not conducted detailed examination of the records. vii(a) As informedto us the company is regular in depositing undisputed statutory dues including

Provident Fund Employees' State Insurance Income-tax Goods & Service TaxService tax duty of Customs duty of Excise Value Added Tax and any other statutorydues with the appropriate authorities.

ANNEXURE - A

Annexure referred to in and forming part of Auditor's Report of even date to themembers of

MACPOWER CNC MACHINES LIMITED.

As required by the Companies (Auditor's Report) Order 2016 and in the terms of theinformation given to us and on the basis of such checks as we considered appropriate wefurther state that:-

vii(b) As informed and explained to us there are disputed amount outstanding todeposit in respect of Value Added Tax & Service Tax as on 31/03/2019 as under:

Sr. No. Name of the Statute Nature of Dues Amount Involved Year Forum Agaist which the dispute is pending
1 Value Added Tax Act 2003 Order of Commercial Tax Officer dated 31.03.2016 Rs. 1607840/- + Interest Rs. 1157660/- F.Y.2011-12 Deputy Commissioner of Commercial tax(Appeals)
2 Value Added Tax Act 2003 Order of Commercial Tax Officer dated 31.03.2017 Rs. 833966/- F.Y. 2012-13 Commissioner of Commercial tax(Appeals)
3 Service Tax Act(Finance Act 1994) Letter of Superintendent of Service Tax AR-III dated 08/10/2013 Rs. 198378/- F.Y. 2013-14 Superintendent of Service Tax AR III S. Tax Devision Rajkot

viii As informed to us the company has not defaulted in repayment of loans orborrowing to a financial institution bank government.

ix As informed to us the money raised by way of Initial Public Offer & utlisedtill date of this Audit Report were for business purposes for which it was raised.

x No fraud on or by the company has been noticed or reported during the year.

xi As explained to us the managerial remuneration has been paid / provided inaccordance with the requisite approvals mandated by the provisions of section 197 of theCompanies Act 2013.

xii As the company is not a Nidhi Company reporting to this clause is not applicable.

ANNEXURE - A

Annexure referred to in and forming part of Auditor's Report of even date to themembers of

MACPOWER CNC MACHINES LIMITED.

As required by the Companies (Auditor's Report) Order 2016 and in the terms of theinformation given to us and on the basis of such checks as we considered appropriate wefurther state that:-

xiii All transactions with the related parties are in compliance with Section 188 and177 of Companies Act 2013 where applicable and the details have been disclosed in theFinancial Statements etc. as required by the accounting standards and Companies Act 2013.

xiv As informed to us the company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year soreporting to this Clause is not Applicable.

xv As informed to us the company has not entered into any non-cash transactions withdirectors or persons connected with him.

xvi As the company is not required to be registered u/s 45-IA of the Reserve Bank ofIndia Act 1934; reporting to this clause is not applicable.

For S. C. Makhecha & Associates

Chartered Accountants Firm Regn. No. 120184W

Sanat C. Makhecha

Partner M.No. 107192 Date: 20/05/2019 Place: Rajkot

ANNEXURE-B

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the

Companies Act 2013 (“the Act”)

We have audited the internal financial controls over financial reporting of MacpowerCNC Machines Limited as of 31st March 2019 in conjunction with our audit ofthe 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 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 company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

Auditors' Responsibility:

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on “Audit of Internal Financial Controls Over FinancialReporting" and the Standards on Auditing issued by ICAI and deemed to be prescribedunder section 143(10) of the Companies Act 2013 to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the Institute of Chartered Accountants of India. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated effectively in all material respects.

Our audit involves performing procedures 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 includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgement including the assessment of the risks ofmaterial misstatement 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 financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures 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 Financial Reporting:

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

Opinion:

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 S.C.Makhecha & Associates
Chartered Accountants
FRN:120194W
Sanat Makhecha
Place: Rajkot Partner
-Date: 20/05/2019 Membership No. 107192