To the Members of Manjeera Constructions Limited
Report on the Audit of the Standalone Ind AS Financial Statements
We have audited the accompanying standalone Ind AS financial statements of ManjeeraConstructions Limited ("the Company") which comprise the Balance Sheet as atMarch 31 2018 the Statement of Profit and Loss the Statement of Changes in Equity andthe Statement of Cash Flows for the year then ended and summary of the significantaccounting policies and other explanatory information (hereinafter referred to asstandalone Ind AS financial statements).
Management's Responsibility for the Standalone Ind AS Financial Statements
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 standalone Ind AS financial statements that give a true and fair view of the stateof affairs profit (including other comprehensive income) changes in equity and cashflows of the Company in accordance with the accounting principles generally accepted inIndia including the Indian Accounting Standards (Ind AS) prescribed under section 133 ofthe Act.
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 of theaccounting records relevant to the preparation and presentation of the standalone Ind ASfinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit.
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.
We conducted our audit of the standalone Ind AS financial statements in accordance withthe Standards on Auditing specified under Section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone Ind AS financial statements are freefrom material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the standalone Ind AS financial statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the standalone Ind ASfinancial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone Ind AS financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of affairs of theCompany as at March 31 2018 its profit (including other comprehensive income) changesin equity and its cash flows for the year ended on that date.
The comparative financial information of the Company for the year ended March 31 2017and the transition date opening balance sheet as at April 1 2016 included in thesestandalone Ind AS financial statements are based on the previously issued statutoryfinancial statements prepared in accordance with the Companies (Accounting Standards)Rules 2006 audited by the predecessor auditor whose report for the year ended March 312017 and March 31 2016 dated May 30 2017 and May 30 2016 respectively expressed anunmodified opinion on those standalone financial statements as adjusted for thedifferences in the accounting principles adopted by the Company on transition to the IndAS which have been audited by us.
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 in terms of Section 143(11) of the Act we give in"Annexure A" a statement on the matters specified in paragraphs 3 and 4 of theOrder.
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 it appears from our examination of those books;
c) The Balance Sheet the Statement of Profit and Loss (including other comprehensiveincome) the Cash Flow Statement and Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account;
d) In our opinion the aforesaid standalone Ind AS financial statements comply with theIndian Accounting Standards specified under section 133 of the Act read with relevantrules issued thereunder;
e) On the basis of the written representations received from the directors as on March31 2018 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2018 from being appointed as a director in terms of Section 164(2) of theAct;
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" to this report; and
g) With respect to the other matters to be included in the Auditors' 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 Ind AS financial statements - Refer Note 33 to the standaloneInd AS financial statements;
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were material foreseeable losses;
iii. There were no amounts which were required to be transferred to Investor Educationand Protection Fund by the Company; and iv. The disclosures in the standalone Ind ASfinancial statements regarding holdings as well as dealings in specified bank notes duringthe period from November 8 2016 to December 30 2016 have not been made since they do notpertain to the financial year ended March 31 2018. Hence reporting under this clause isnot applicable.
Annexure A to the Independent Auditors' Report on the Standalone Ind AS FinancialStatements
With reference to Annexure A referred to in the Independent Auditors' Report of evendate to the members of Manjeera Constructions Limited (the Company') on theStandalone Ind AS financial statements for the year ended March 31 2018 we report that:
i. (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) All fixed assets have not been physically verified by the management during theyear but there is a regular programme of verification which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. Discrepancies notedon such verification were not material and have been properly dealt with in the books ofaccount.
(c) Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to information and explanations givenby the management the title deeds of immovable properties included in fixed assets areheld in the name of the Company.
ii. The management has conducted physical verification of inventories at reasonableintervals during the year. Discrepancies noted on physical verification of inventorieswere not material and have been properly dealt with in the books of account.
iii. The Company has granted unsecured loans to its subsidiary company. According tothe information and explanations given to us in respect of such loans:
a. The terms and conditions of the grant of such loans is not prejudicial to theinterests of the Company.
b. The schedule of repayment of principal and payment of interest has been stipulatedand the repayments and receipts are as stipulated.
c. The loan amount has no over dues.
iv. In our opinion and according to the information and explanations given to us inrespect of loans investments guarantees and securities offered by the Companyprovisions of Section 185 and Section 186 of the Companies Act 2013 are complied with. v.The Company has not accepted any deposits from the public.
vi. We have broadly reviewed the books of account maintained by the Company pursuant tothe rules made by the Central Government for the maintenance of cost records under section148(1) of the Companies Act 2013 and are of the opinion that prima facie the specifiedaccounts and records have been made and maintained. We have not however made a detailedexamination of the same.
vii. (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted/accrued in the books ofaccount in respect of undisputed statutory dues including Provident fund Employees' stateinsurance Income-tax Sales tax Service tax Duty of custom Duty of excise Value addedtax Goods and Service tax Cess and other material statutory dues have generally beenregularly deposited during the year by the Company with the appropriate authorities. (b)According to the information and explanations given to us and according to the records ofthe Company there were no dues of Income tax Sales tax Service tax Duty of customDuty of excise Value added tax and Cess where applicable which have not been depositedas on March 31 2018 on account of any dispute.
viii. According to the information and explanations given by the management theCompany has not defaulted in repayment of loans or borrowings to financial institutionsand banks. The Company did not have any dues to Government nor has it issued anydebentures as at the balance sheet date.
ix. According to information and explanations given by the management and on an overallexamination of the balance sheet we report that monies raised by the Company by way ofterm loans were applied for the purposes for which those were raised.
x. Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the Company or no fraud by theofficers and employees of the Company has been noticed or reported during the year.
xi. According to the information and explanations given by the management the Companyhas paid / provided managerial remuneration in accordance with the requisite approvalsmandated by the provisions of section 197 read with Schedule V to the Companies Act 2013.
xii. In our opinion the Company is not a Nidhi Company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.
xiii. According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe Standalone Ind AS financial statements as required by the applicable accountingstandards.
xiv. During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures. Therefore the provisionsof clause 3(xiv) of the order are not applicable to the Company and hence not commentedupon.
xv. According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in section 192 of Companies Act 2013. xvi. According to theinformation and explanations given to us the provisions of section 45-IA of the ReserveBank of India Act 1934 are not applicable to the Company.
Annexure B referred to in paragraph 2(h) of our Report of even date to the members ofManjeera Constructions Limited on the standalone Ind AS financial statements for the yearended March 31 2018.
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 ManjeeraConstructions Limited(the Company') as of March 31 2018 in conjunction with ouraudit of the Standalone Ind AS financial statements of the Company for the year ended onthat 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 (ICAI'). 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 safeguarding ofits 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 Act.
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') and the Standards on Auditing issued by ICAI and deemed to beprescribed under Section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the ICAI. Those Standards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.
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 Standalone Ind AS financial statements whether due to fraudor error. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion on the Company's internal financialcontrols system over 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 Standalone Ind AS 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 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 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.
According to the information and explanations given to us and based on our audit theCompany has in all material respects maintained adequate internal financial controlsover financial reporting as of March 31 2018 based on the internal control overfinancial 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.
| ||For M. Bhaskara Rao & Co. |
| ||Chartered Accountants |
| ||ICAI Firm Registration Number: 000459S |
| ||V K Muralidhar |
|Date : May 28 2018 ||Partner |
|Place : Hyderabad ||Membership Number: 201570 |