Maheshwari Logistics Limited Opinion
1. We have audited the accompanying financial statements of Maheshwari Logistics
Limited("the Company") which comprise of the Balance Sheet as at 31st March2018 the Statement of Profit and Loss and Cash Flow for theyear ended and notes tofinancial statements and a summary of significant accounting policies and otherexplanatory information.
In our opinion and to 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 of the state of affairs of the Company as at 31stMarch 2018 and its profit and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the SAs specified under section 143(10) ofthe Companies Act2013. Our responsibilities under those Standards are further describedin the Auditor's Responsibilities for the Audit of the Financial Statements section of ourreport. We are independent of the company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of the financial statements under the provisions of theCompanies Act 2013 and the Rules there under and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our opinion
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 preparation ofthese financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards prescribedunder Section 133 of the Act as applicable. This responsibility also includes maintenanceof adequate accounting records in accordance with the provisions of the Act forsafeguarding the assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.
In preparing financial statements management is responsible for assessing thecompanies' ability to continue as going concern disclosing as applicable mattersrelated to going concern and using the going concern accounting basis accounting unlessManagement either intends to liquidate the company or to cease operations or has norealistic Alternative but to do so. That Board of directors are also responsible foroverseeing the companies' financial Reporting process.
Auditors Responsibility for the audit of the Financial Statements
3. Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are Free from material misstatement whether due to fraud or errorand tolssue 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 withSA's will always detect a material misstatement when it exists. Misstatement misstatementcan arise from fraud or error and are considered material if individually or inaggregate they could reasonably be expected to influence economic decisions of the userstaken on the basis of these financial statements. Generally accepted in India of thestate of affairs of the Company as at 31st March 2018 and its profit and its cash flowsfor the year ended on that date.
4. Identify and assess the risk of material misstatement of the financial statementwhether due to fraud or error design and perform audit procedure responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omission misrepresentations or the override of internal control.
5. Obtain an understanding of internal control relevant to the audit in order to designaudit procedure that are appropriate in the circumstances. Under section 143 (3) (i) ofthe Companies Act 2013 we are also responsible for expressing our opinion on whether thecompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.
6. Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosure made by management.
7. 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 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 audit report to the related disclosures in thefinancial statements or if such disclosure are inadequate to modify our opinion. Ourconclusions are based on the audit evidence obtained up to the date of auditor's report.However future events or conditions may cause the Company to cease to continue as a goingconcern.
8. Evaluate the overall presentation structure and content of the financial statementincluding the disclosure and whether the financial statements represent the underlyingtransactions and events in the manner that achieves fair presentation. We communicate withthose charged with governance regarding among other matters planned scope and timing ofthe audit and significant audit findings including any significant deficiency in theinternal control that we identify during our audit
Report on other Legal and Regulatory Requirements
9. As required by the Companies (Auditor's Report) Order 2016 ("theOrder")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 specified inparagraphs 3 and 4 of the Order.
As required by section 143(3) of the Act we report that:
a. We have sought and obtainedall the information and explanations which to the best ofour 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 it appears from our examination of those books.
c. The Balance Sheet Statement of Profit and Loss and Cash Flow Statement dealt withby this Report are in agreement with the books of account.
d. In our opinion the aforesaid financial statements comply with the AccountingStandards specified underSection 133 of the Act as applicable.
e. On the basis of the written representations received from the directors as on31stMarch 2018 and taken on record by the Board of Directors none of the directors isdisqualified as on 31stMarch 2018 from being appointed as a director in terms ofSectionl64(2) of the 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 reports express an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.
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
i. Inour opinion and to the best of our information and according to the explanationsgiven to us: in our opinion the Company has disclosed the impact of pending litigation onits financial statements - Refer Notice No. 33 to financial statements
ii. The Company did not have any long term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred to the InvestorsEducation and Protection Fund by the Company.
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ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT
(Referred to in paragraph9 under Report on Other Legal and RegulatoryRequirements' section of our report of even date)
i) (a) The company has maintained proper records showing full particularsincludingQuantitative details and situation of Fixed Assets.
(b) It is explained to us that the fixed assets were physically verified during theyear by the Management in accordance with a regular programme of verification which inour opinion provides for physical verification of all the fixed assets at reasonableintervals. According to the information and explanations given to us no materialdiscrepancies were noticed on such verification.
(c) With respect to immovable properties of acquired land and buildings that arefreehold according to the information and explanations given to us and the recordsexamined by us and based on the examination of the registered sale deed / transfer deed /conveyance deed provided to us we report that the title deeds of such immovableproperties are held in the name of the Company as at the balance sheet date.
ii) (a) Physical verification of inventory has been conducted at reasonable intervalsby the management;
(b) In our opinion and according to the information and explanation given to us theprocedures of physical verification of inventory followed by the management are reasonableand adequate in relation to the size of the company and the nature of its business.
(c) The company is maintaining proper records of inventory. As per information andexplanation given to us no material discrepancies were noticed on physical verification.
iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms or other parties covered inthe register maintained U/s. 189 of the Companies Act 2013. Hence the provisions ofclause 3 (iii) of the Order are not applicable.
iv) According to the information and explanation given to us the Company has notgranted any loans made investments or provided guarantees and securities and hence theprovisions of clause (iv) of the Order is not applicable.
v) According to the information and explanations given to us the Company has notaccepted any deposit during the year and accordingly the question of complying withSections 73 and 76 of the Companies Act 2013 does not arise.
vi) As per information and explanation given by management maintenance of cost recordshas not been specified by the Central Government under clause (d) of sub section (1) ofsection 148 of the Companies Act.
vii) In respect of statutory dues according to the information and explanations givento us:
(a) On the basis of our examination of the records of the Company amount deducted /collected/ accrued in the books of accounts in respect of undisputed statutory duesincluding Provided Fund Employees' state insurance Income Tax Sales Tax Value AddedTax Service Tax Excise Duty Wealth Tax Custom duty Goods and Service Tax etc. areregularly deposited by the company with the appropriate authorities.
(b) Details of dues of Tax which have not been deposited as on 31/03/2018 on account ofdisputes are as follows:
|Name of the Statute ||Nature of the dues ||Amount (in Rs.) ||Period to which the amount relates ||Forum where dispute is pending |
|Income Tax Act 1961 ||Tax including interest ||* 410590/- ||F.Y. 2011-12 ||Income Tax Appellate Tribunal |
*The Company has not deposited the tax since the company has filed an appeal atTribunal level against the original order of section 263 of the Income Tax Act 1961 onthe basis of which the assessment was conducted.
viii) In our opinion and according to the information and explanations given to us theCompany has not defaulted in the repayment of loans or borrowings to financialinstitutions and banks.
ix) In our opinion and according to the information and explanation given to us theCompany has utilized the monies raised by way of Initial Public Offering and the termloans for the purpose for which they were raised.
x) To the best of our knowledge and according to the information and explanations givento us no fraud by the Company and no material fraud on the Company by its officers oremployees has been noticed or reported during the year.
xi) In our opinion and according to the information and explanations given to us theCompany has paid/provided for managerial remuneration in accordance with the provision ofSection 197 read with Schedule V to the Companies Act 2013.
xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of theOrder is not applicable.
xiii) In our opinion and according to the information and explanations given to us theCompany is in compliance with Sections 177 and 188 of the Companies Act 2013 whereapplicable for all transactions with the related parties and the details of related partytransactions have been disclosed in the financial statements etc. as required by theapplicable accounting standards.
xiv) According to the information and explanations given to usthe Company has not madeany preferentialallotment or private placement of shares during the year and hencereporting under this clause of the Order is not applicable.
xv) In our opinion and according to the information and explanations given to usduring theyear the Company has not entered into any non-cash transactions with itsdirectors or person connected with them and hence provisions of Section 192 of theCompanies Act 2013 are not applicable.
xvi) The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.
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ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT
(Referred to in paragraph 9 (Rs. ) under 'Report on Other Legal andRegulatoryRequirements' of our report of even date)
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of MaheshwariLogistics Ltd.("the Company") as of March 31 2018 in conjunction with our auditof 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 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.
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 Financial Reporting(the "Guidance Note") issued by the Institute of Chartered Accountants of Indiaand the Standards on Auditing prescribed under Section 143(10) of the Companies Act 2013to the extent applicable to an audit of internal financial controls. 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 authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised 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.
In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2018 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.
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DATE:3 0/05/2 018