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Mahindra EPC Irrigation Ltd.

BSE: 523754 Sector: Industrials
NSE: MAHEPC ISIN Code: INE215D01010
BSE 00:00 | 12 May 142.40 -12.10
(-7.83%)
OPEN

144.75

HIGH

147.80

LOW

141.10

NSE 00:00 | 12 May 142.25 -12.30
(-7.96%)
OPEN

142.10

HIGH

148.00

LOW

140.85

OPEN 144.75
PREVIOUS CLOSE 154.50
VOLUME 43459
52-Week high 194.65
52-Week low 99.95
P/E 20.67
Mkt Cap.(Rs cr) 396
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 144.75
CLOSE 154.50
VOLUME 43459
52-Week high 194.65
52-Week low 99.95
P/E 20.67
Mkt Cap.(Rs cr) 396
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Mahindra EPC Irrigation Ltd. (MAHEPC) - Auditors Report

Company auditors report

To The Members of Mahindra EPC irrigation Limited

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the accompanying standalone financial statements ofMahindra EPC irrigation Limited ("the Company") which comprise the BalanceSheet as at 31 March 2020 and the Statement of Profit and Loss (including OtherComprehensive Income) the Statement of Cash Flows/ the Cash Flow Statement and theStatement of Changes in Equity for the year then ended and a summary of significantaccounting policies and other explanatory information. In our opinion and to the best ofour information and according to the explanations given to us the aforesaid standalonefinancial statements give the information required by the Companies Act 2013 ("theAct") in the manner so required and give a true and fair view in conformity with theIndian Accounting Standards prescribed under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended ("Ind AS") andother accounting principles generally accepted in India of the state of affairs of theCompany as at 31 March 2020 and its profit total comprehensive income its cash flows andthe changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements inaccordance with the Standards on Auditing specified under section 143(10) of the Act(SAs). Our responsibilities under those Standards are further described in theAuditor's Responsibility for the Audit of the Standalone Financial Statements sectionof our report. We are independent of the Company in accordance with the Code of Ethicsissued by the Institute of Chartered Accountants of India (ICAI) together with the ethicalrequirements that are relevant to our audit of the standalone financial statements underthe provisions of the Act and the Rules made thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our audit opinion on the standalone financial statements.

Key Audit Matter

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. We have determined that there are no key audit matters to communicate inour report.

Information Other than the Financial Statements and Auditor'sReport Thereon

The Company's Board of Directors is responsible for the otherinformation. The other information comprises the financial highlights managementdiscussion & analysis Board Report and related annexure there to corporategovernance but does not include the standalone financial statements and ourauditor's report thereon.

Our opinion on the standalone financial statements doesnot cover the other information and we do not express any form of assurance conclusionthereon

In connection with our audit of the standalone financialstatements our responsibility is to read the other information and in doing so considerwhether the other information is materially inconsistent with the standalone financialstatements or our knowledge obtained during the course of our audit or otherwise appearsto be materially misstated.

If based on the work we have performed we conclude thatthere is a material misstatement of this other information we are required to report thatfact. We have nothing to report in this regard.

Management's Responsibility for the Standalone FinancialStatements

The Company's Board of Directors is responsible for the mattersstated in section 134(5) of the Act with respect to the preparation of these standalonefinancial statements that give a true and fair view of the financial position financialperformance including other comprehensive income cash flows and changes in equity of theCompany in accordance with the Ind AS and other accounting principles generally acceptedin India. This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing 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 financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalonefinancial statement that give a true and fair view and are free from materialmisstatement whether due 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.

Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibility for the Audit of the Standalone FinancialStatements

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 statements.

As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement ofthe standalone financial statements whether due to fraud or error design and performaudit procedures responsive to those risks and obtain audit evidence that is sufficientand appropriate 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 financial controlrelevant to the audit in order to design audit procedures that are appropriate in thecircumstances. Under section 143(3)(i) of the Act we are also responsible for expressingour opinion on whether the Company has adequate internal financial controls system inplace and the operating effectiveness of such controls.

Evaluate the appropriateness of accounting policies usedand the reasonableness of accounting estimates and related disclosures made by themanagement.

Conclude on the appropriateness of management's useof the going concern basis of accounting and based on the audit evidence obtainedwhether a material uncertainty exists related to events or conditions that may castsignificant doubt on the Company's ability to continue as a going concern. If weconclude that a material uncertainty exists we are required to draw attention in ourauditor's report to the related disclosures in the standalone financial statementsor if such disclosures are inadequate to modify our opinion. Our conclusions are basedon the audit evidence obtained up to the date of our auditor's report. Howeverfuture events or conditions may cause the Company to cease to continue as a going concern.

Evaluate the overall presentation structure and contentof the standalone financial statements including the disclosures and whether thestandalone financial statements represent the underlying transactions and events in amanner that achieves fair presentation.

Materiality is the magnitude of misstatements in the standalonefinancial statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the standalone financialstatements may be influenced. We consider quantitative materiality and qualitative factorsin (i) planning the scope of our audit work and in evaluating the results of our work; and(ii) to evaluate the effect of any identified misstatements in the standalone financialstatements.

We communicate with those charged with governance regarding amongother matters 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 wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the standalonefinancial statements of the current period and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludespublic disclosure about the matter or when in extremely rare circumstances we determinethat a matter should not be communicated in our report because the adverse consequences ofdoing so would reasonably be expected to outweigh the public interest benefits of suchcommunication.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act based on our auditwe report that: a) We have sought and obtained all the information and explanations whichto the best of 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 the Company.

c) The Balance Sheet the Statement of Profit and Loss including OtherComprehensive Income the Statement of Cash Flows and Statement of Changes in Equity dealtwith by this Report are in agreement with the relevant books of account. d) In ouropinion the aforesaid standalone financial statements comply with the Ind AS specifiedunder Section 133 of the Act. e) On the basis of the written representations received fromthe directors as on 31 March 2020 taken on record by the Board of Directors none of thedirectors is disqualified as on 31 March 2020 from being appointed as a director in termsof Section 164(2) of the Act. f) With respect to the adequacy of the internal financialcontrols over financial reporting of the Company and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure A". Our report expresses anunmodified opinion on the adequacy and operating effectiveness of the Company'sinternal financial controls over financial reporting. g) With respect to the other mattersto be included in the Auditor's Report in accordance with the requirements of section197(16) of the Act as amended In our opinion and to the best of our information andaccording 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 theAuditor's 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 us: i. The Company has disclosed the impact of pendinglitigations on its financial position in its standalone financial statements in accordancewith generally accepted accounting principles; ii. The Company did not have any long-termcontracts including derivative contracts for which there were any material foreseeablelosses. iii. There has been no delay in transferring amounts required to be transferredto the Investor Education and Protection Fund by the Company.

2. As required by the Companies (Auditor's Report) Order2016 ("the Order") issued by the Central Government in terms of Section 143(11)of the Act we give in "Annexure B" a statement on the matters specified inparagraphs 3 and 4 of the Order.

For Deloitte Haskins & Sells
Chartered Accountants
(Firm's Registration No. 117364W)
Kedar Raje
Partner
(Membership Number: 102637)
Date: 14 May 2020
Place:- Mumbai

ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1(f) under ‘Report on Other Legal andRegulatory Requirements' section of our report of even date)

Report on the Internal Financial Controls Over Financial Reportingunder Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("theAct")

We have audited the internal financial controls over financialreporting of Mahindra EPC Irrigation Limited ("the Company") as of 31 March2020 in conjunction with our audit of the standalone Ind AS financial statements of theCompany for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting 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 controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguardingof its assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company'sinternal financial controls over financial reporting of the Company based on our audit. Weconducted our audit in accordance with the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting (the "Guidance Note") issued by the Instituteof Chartered Accountants of India 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 audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures 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 andappropriate to provide a basis for our audit opinion on the Company's internalfinancial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company's internal financial control over financial reporting isa process 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 controlover financial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of 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 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 FinancialReporting

Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion to the best of our information and according to theexplanations given to us 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 31 March 2020 based on thecriteria for internal financial control over financial reporting established by therespective Company considering the essential components of internal control stated in theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting issued bythe Institute of Chartered Accountants of India.

For Deloitte Haskins & Sells
Chartered Accountants
(Firm's Registration No. 117364W)
Kedar Raje
Partner
(Membership Number: 102637)
Date: 14 May 2020
Place: Mumbai

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2 under ‘Report on other legal andregulatory requirements' section of our report to the members of Mahindra EPCIrrigation Limited of even date.) i. (a) The Company has maintained proper records showingfull particulars including quantitative details and situation of property plant andequipment. (b) The Company has a programme of verification of property plant andequipment to cover all the items in a phased manner over a period of three years which inour opinion is reasonable having regard to the size of the Company and the nature of itsassets. Pursuant to the programme certain fixed assets were physically verified by theManagement during the year. According to the information and explanations given to us nomaterial discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and therecords examined by us and based on the examination of the registered sale deed / transferdeed / conveyance deed provided to us we report that the title deeds comprising all theimmovable properties of buildings which are freehold are held in the name of the Companyas at the balance sheet date. Immovable properties of buildings whose title deeds havebeen pledged as security for loans availed from banks are held in the name of the Companybased on the confirmation directly received by us from the bank. In respect of immovableproperties of land that have been taken on lease and disclosed as prepaid asset in the IndAS financial statements the lease agreements are in the name of the Company where theCompany is the lessee in the agreement. ii. As explained to us the inventories werephysically verified during the year by the Management at reasonable intervals except stocklying with third parties for which confirmations have been obtained and no materialdiscrepancies were noticed on physical verification. iii. The Company has not granted anyloans secured or unsecured to companies firms limited liability partnerships or otherparties covered in the register maintained under Section 189 of the Act. iv. The Companyhas not granted any loans made investments or provided guarantees to which the provisionsof Sections 185 and 186 of the Act apply and hence reporting under clause (iv) of theOrder is not applicable. v. According to the information and explanations given to us theCompany has not accepted any deposit during the year. In respect of unclaimed depositsthe Company has complied with the provisions of Sections 73 to 76 or any other relevantprovisions of the Act and the Companies (Acceptance of Deposits) Rules 2014 as amended.According to the information and explanations given to us no order has been passed by theCompany

Law Board or the National Company Law Tribunal or the Reserve Bank ofIndia or any Court or any other Tribunal. vi. The maintenance of cost records has beenprescribed by the Central Government under Section 148(1) of the Act. We have broadlyreviewed the cost records maintained by the Company pursuant to the Companies (CostRecords and Audit) Rules 2014 as amended prescribed by the Central Government underSection 148(1) of the Act and are of the opinion that prima facie the prescribed costrecords have been made and maintained. We have however not made a detailed examinationof the cost records with a view to determine whether they are accurate or complete. vii.According to the information and explanations given to us in respect of statutory dues:(a) The Company has generally been regular in depositing undisputed statutory duesincluding provident fund employees' state insurance income-tax goods and servicestax customs duty cess and other material statutory dues applicable to it with theappropriate authorities.

(b) There were no undisputed amounts payable in respect of providentfund employees' state insurance income-tax goods and services tax customs dutycess and other material statutory dues in arrears as at 31 March 2020 for a period of morethan six months from the date they became payable.

(c) Details of dues of income-tax goods and services tax sales-taxservice tax customs duty excise duty and value added tax which have not been depositedas on 31 March 2020 on account of disputes are given below:

Name of statute Nature of dues Forum where dispute is pending Period to which the amount relates Amount unpaid
(Rs. in lakhs)
Central Excise Duty Commissioner of Central Excise FY 1996- 97 35.76
Excise Act 1944
(Appeals)
Commissioner of Central Excise FY 1997- 98 8.12
Madhya Pradesh Vat Sales Tax Addtl CCT/APP FY 2014- 15 286.81
DC/DCAPP DC
Act 2002 Bhopal
Chhattisgarh Sales Tax Deputy Commissioner of Commercial Tax Raipur FY 2014- 15 8.39
VAT Act2003
Income Tax Act1961 Income Tax Commissioner of Income Tax FY 2016- 17 113.31
(Appeals)
Commissioner of Income Tax FY 2011- 12 172.58
(Appeals)

viii. In our opinion and according to the information and explanationsgiven to us the Company has not defaulted in repayment of loans or borrowings to banksand government. The Company has not borrowed from financial institutions and has notissued any debentures.

ix. In our opinion and according to the information and explanationsgiven to us money raised by way of further public offer (rights offer) in the earlieryears have been applied by the Company during the year for the purposes as revised withappropriate approvals other than temporary deployment pending application of proceeds.The Company has not raised moneys by way of public offer of debt instruments or termloans.

x. To the best of our knowledge and according to the information andexplanations given to us no fraud by the Company and no material fraud on the Company byits officers or employees has been noticed or reported during the year.

xi. In our opinion and according to the information and explanationsgiven to us the Company has paid / provided managerial remuneration in accordance withthe requisite approvals mandated by the provisions of Section 197 read with Schedule V tothe Act.

xii. The Company is not a Nidhi Company and hence reporting underclause (xii) of the Order is not applicable.

xiii. In our opinion and according to the information and explanationsgiven to us the Company is in compliance with Sections 177 and 188 of the Act whereapplicable for all transactions with the related parties and the details of related partytransactions have been disclosed in the Ind AS financial statements etc. as required bythe applicable accounting standards.

xiv. During the year the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures andhence reporting under clause (xiv) of the Order is not applicable to the Company.

. In our opinion and according to the information and explanationsgiven to us during the year the Company has not entered into any non-cash transactionswith its directors or directors of its holding company or persons connected with them andhence provisions of Section 192 of the Act are not applicable.

xvi. The Company is not required to be registered under Section 45-IAof the Reserve Bank of India Act 1934.

For Deloitte Haskins & Sells
Chartered Accountants
(Firm's Registration No. 117364W)
Kedar Raje
Partner
(Membership Number: 102637)
Date: 14 May 2020
Place:- Mumbai

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