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Mastek Ltd.

BSE: 523704 Sector: IT
NSE: MASTEK ISIN Code: INE759A01021
BSE 11:50 | 20 Feb 421.20 -5.40
(-1.27%)
OPEN

420.00

HIGH

430.00

LOW

420.00

NSE 11:44 | 20 Feb 422.00 -4.40
(-1.03%)
OPEN

428.00

HIGH

429.95

LOW

420.00

OPEN 420.00
PREVIOUS CLOSE 426.60
VOLUME 874
52-Week high 508.50
52-Week low 295.00
P/E 47.22
Mkt Cap.(Rs cr) 1,022
Buy Price 421.20
Buy Qty 189.00
Sell Price 422.55
Sell Qty 9.00
OPEN 420.00
CLOSE 426.60
VOLUME 874
52-Week high 508.50
52-Week low 295.00
P/E 47.22
Mkt Cap.(Rs cr) 1,022
Buy Price 421.20
Buy Qty 189.00
Sell Price 422.55
Sell Qty 9.00

Mastek Ltd. (MASTEK) - Auditors Report

Company auditors report

 

To

The Members of

Mastek Limited

Report on the Standalone Financial Statements

1. We have audited the accompanying standalone financial statements of Mastek Limited(‘the Company') which comprise the Balance Sheet as at 31 March 2018 the Statementof Profit and Loss (including Other Comprehensive loss) the Cash Flow Statement and theStatement of Changes in Equity for the year then ended and a summary of the significantaccounting policies and other explanatory information.

Management's Responsibility for the Standalone 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 standalone financial statements that give a true and fair view of the state ofaffairs (financial position) profit or loss (financial performance including othercomprehensive loss) cash flows and changes in equity of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (‘Ind AS') specified under Section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding the assets of the Company and for preventing and detecting fraudsand other irregularities; selection and application of appropriate accounting policies;making judgments and estimates that are reasonable and prudent; and design implementationand maintenance of adequate internal financial controls that were operating effectivelyfor ensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the standalone financial statements that give a true andfair view and are free from material misstatement whether due to fraud or error.

Auditor's Responsibility

3. Our responsibility is to express an opinion on these standalone financial statementsbased on our 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 whetherthese standalone 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 controls 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 these standalone financial statements.

Opinion

8. 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 Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India including Ind AS specified underSection 133 of the Act of the state of affairs (financial position) of the Company as at31 March 2018 and its profit (financial performance including other comprehensive loss)its cash flows and the changes in equity for the year ended on that date.

Other Matter

9. The comparative financial information for the year ended 31 March 2017 and thetransition date opening balance sheet as at 1 April 2016 prepared in accordance with IndAS included in these standalone financial statements are based on the previously issuedstatutory financial statements for the year ended 31 March 2017 and 31 March 2016respectively prepared in accordance with Accounting Standards prescribed under Section 133of the Act read with Rule 7 of the Companies (Accounts) Rules 2014 (as amended) whichwere audited by the predecessor auditor whose reports dated 20 April 2017 and 19 April2016 respectively expressed unmodified opinion on those standalone financial statementsand have been adjusted for the differences in the accounting principles adopted by theCompany on transition to Ind AS which have been audited by us. Our opinion is notmodified in respect of this matter.

Report on Other Legal and Regulatory Requirements

10. As required by the Companies (Auditor's Report) Order 2016 (‘the Order')issued by the Central Government of India in terms of Section 143(11) of the Act we givein the Annexure A a statement on the matters specified in paragraphs 3 and 4 of theOrder.

11. Further to our comments in Annexure A as required by Section 143(3) of the Act wereport 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 standalone financial statements dealt with by this report are in agreement withthe books of account;

d) in our opinion the aforesaid standalone financial statements comply with Ind ASspecified under Section 133 of the Act;

e) on the basis of the written representations received from the directors and taken onrecord by the Board of Directors none of the directors is disqualified as on 31 March2018 from being appointed as a director in terms of Section 164(2) of the Act;

f) we have also audited the internal financial controls over financial reporting(IFCoFR) of the Company as on 31 March 2018 in conjunction with our audit of thestandalone financial statements of the Company for the year ended on that date and ourreport dated 31 March 2018 as per Annexure B expressed an unmodified opinion.; g) withrespect to the other matters to be included in the Auditor's Report in accordance withRule 11 of the Companies (Audit and Auditors) Rules 2014 (as amended) in our opinion andto the best of our information and according to the explanations given to us: (i) theCompany as detailed in Note 37 to the standalone financial statements has disclosed theimpact of pending litigations on its financial position;

(ii) the Company as detailed in Note 29 to the standalone financial statements hasmade provision as required under the applicable law or Ind AS for material foreseeablelosses if any on long-term contracts including derivative contracts;

(iii) there has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company;

(iv) the disclosure requirements relating to holdings as well as dealings in specifiedbank notes were applicable for the period from 8 November 2016 to 30 December 2016 whichare not relevant to these standalone financial statements. Hence reporting under thisclause is not applicable.

For Walker Chandiok & Co LLP

Chartered Accountants Firm's Registration No.: 001076N/N500013

per Khushroo B. Panthaky
Place: Mumbai Partner
Date: 18 April 2018 Membership No.: 42423

Annexure A to the Independent Auditor's Report of even date to the members of MastekLimited on the standalone financial statements for the year ended 31 March 2018

Based on the audit procedures performed for the purpose of reporting a true and fairview on the financial statements of the Company and taking into consideration theinformation and explanations given to us and the books of account and other recordsexamined by us in the normal course of audit and to the best of our knowledge and beliefwe report that:

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) The fixed assets have been physically verified by the management during the yearand no material discrepancies were noticed on such verification. In our opinion thefrequency of verification of the fixed assets is reasonable having regard to the size ofthe Company and the nature of its assets.

(c) The title deeds of all the immovable properties are held in the name of theCompany.

(ii) The Company does not have any inventory. Accordingly the provisions of clause3(ii) of the Order are not applicable.

(iii) The Company has not granted any loan secured or unsecured to companies firmsLimited Liability Partnerships (LLPs) or other parties covered in the register maintainedunder Section 189 of the Act. Accordingly the provisions of clauses 3(iii)(a) 3(iii)(b)and 3(iii)(c) of the Order are not applicable.

(iv) In our opinion the Company has complied with the provisions of Sections 185 and186 of the Act in respect of loans investments guarantees and security.

(v) In our opinion the Company has not accepted any deposits within the meaning ofSections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules 2014 (asamended). Accordingly the provisions of clause 3(v) of the Order are not applicable.

(vi) The Central Government has not specified maintenance of cost records undersub-section (1) of Section 148 of the Act in respect of Company's services. Accordinglythe provisions of clause 3(vi) of the Order are not applicable.

(vii) (a) The Company is regular in depositing undisputed statutory dues includingprovident fund employees' state insurance income-tax sales-tax service tax goods andservice tax value added tax cess and other material statutory dues as applicable tothe appropriate authorities. Further no undisputed amounts payable in respect thereofwere outstanding at the year-end for a period of more than six months from the date theybecome payable.

(b) The dues outstanding in respect of income-tax sales-tax service-tax goods andservice tax and value added tax on account of any dispute are as follows:

Statement of Disputed Dues

Name of the statute Nature of dues Amount (Rs. ) Lakhs Amount paid under Protest (Rs. ) Lakhs Period to which the amount relates Forum where dispute is pending Remarks if any
The Gujrat Stamp Act 1958 Demand of Stamp Duty on Demerger 350 350 FY 2014-2015 Chief Controlling Revenue Authority Gujrat _
The Maharashtra Value Added Tax Act 2002 VAT liability including Interest 840 28 FY 2006-07 FY 2009-10 FY 2012-13 FY 2013-14 Joint Commissioner of Sales Tax (Appeals) Mumbai _
The Central Sales Tax Act 1956 CST liability including interest 77 11 FY 2006-07 FY 2009-10 FY 2012-13 & FY 2013-14 Joint Commissioner of Sales Tax (Appeals) Mumbai _
The Bombay Sales Tax Act 1959 BST liability including interest 66 5 FY 2001-02 Joint Commissioner of Sales Tax (Appeals) Mumbai _
The Income Tax Act 1961 Income tax and interest demanded 651 - AY 2011 - 12 AY 2013 - 14 ITAT
The Income Tax Act 1961 Income tax and interest demanded 282 - AY 2014 – 15 CIT (Appeals) _
The Income Tax Act 1961 Income tax and interest demanded 854 - AY 2015 - 16 Assessing officer _

(viii) The Company has not defaulted in repayment of loans or borrowings to any bank orfinancial institution or government during the year. The Company did not have anyoutstanding debentures during the year.

(ix) The Company did not raise moneys by way of initial public offer or further publicoffer (including debt instruments) and did not have any term loans outstanding during theyear. Accordingly the provisions of clause 3(ix) of the Order are not applicable.

(x) In our opinion no fraud by the Company or on the Company by its officers oremployees has been noticed or reported during the period covered by our audit.

(xi) Managerial remuneration has been paid (and)/ provided by the company in accordancewith the requisite approvals mandated by the provisions of Section 197 of the Act readwith Schedule V to the Act.

(xii) The Company is not a Nidhi Company. Accordingly provisions of clause 3(xii) ofthe Order are not applicable.

(xiii) In our opinion all transactions with the related parties are in compliance withSections 177 and 188 of Act where applicable and the requisite details have beendisclosed in the financial statements etc as required by the applicable Ind AS.

(xiv) During the year the company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures.

(xv) In our opinion the company has not entered into any non-cash transactions withthe directors or persons connected with them covered under Section 192 of the Act.

(xvi) The company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.

For Walker Chandiok & Co LLP
Chartered Accountants
Firm's Registration No.: 001076N/N500013
per Khushroo B. Panthaky
Place: Mumbai Partner
Date: 18 April 2018 Membership No.: 42423

Independent Auditor's Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 (‘the Act')

1. In conjunction with our audit of the standalone financial statements of MastekLimited (‘the Company') as at and for the year ended 31 March 2018 we have auditedthe internal financial controls over financial reporting (‘IFCoFR') of the Company asat that date.

Management's Responsibility for Internal Financial Controls

2. The Company's Board of Directors is responsible for establishing and maintaininginternal financial controls based on criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Control over Financial Reporting ("Guidance Note") issued by theInstitute of Chartered Accountants of India (ICAI). These responsibilities include thedesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the orderly and efficient conduct of the Company'sbusiness including adherence to the Company's policies the safeguarding of its assetsthe prevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Act.

Auditor's Responsibility

3. Our responsibility is to express an opinion on the Company's IFCoFR based on ouraudit. We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India (‘ICAI') and deemed to be prescribedunder Section 143(10) of the Act to the extent applicable to an audit of IFCoFR and theGuidance Note issued by the ICAI. Those Standards and the Guidance Note require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate IFCoFR were established and maintained and if suchcontrols operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the IFCoFR and their operating effectiveness. Our audit of IFCoFR includes obtaining anunderstanding of IFCoFR assessing the risk that a material weakness exists and testingand evaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgement including theassessment of the risks of material misstatement of the financial statements whether dueto fraud or error.

5. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's IFCoFR.

Meaning of Internal Financial Controls over Financial Reporting

6. A company's IFCoFR is a process designed to provide reasonable assurance regardingthe reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles. A company'sIFCoFR include those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly refiect 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

7. Because of the inherent limitations of IFCoFR including the possibility ofcollusion or improper management override of controls material misstatements due to erroror fraud may occur and not be detected. Also projections of any evaluation of the IFCoFRto future periods are subject to the risk that the IFCoFR may become inadequate because ofchanges in conditions or that the degree of compliance with the policies or proceduresmay deteriorate.

Opinion

8. In our opinion the Company has in all material respects adequate internalfinancial controls over financial reporting and such internal financial controls overfinancial reporting were operating effectively as at 31 March 2018 based on the internalcontrol over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Notes issued by the ICAI.

For Walker Chandiok & Co LLP
Chartered Accountants
Firm's Registration No.: 001076N/N500013
per Khushroo B. Panthaky
Place: Mumbai Partner
Date: 18 April 2018 Membership No.: 42423