Maxgrow India Ltd.
|BSE: 521167||Sector: Others|
|NSE: N.A.||ISIN Code: INE485D01035|
|BSE 00:00 | 28 Jun||Maxgrow India Ltd|
|NSE 05:30 | 01 Jan||Maxgrow India Ltd|
|BSE: 521167||Sector: Others|
|NSE: N.A.||ISIN Code: INE485D01035|
|BSE 00:00 | 28 Jun||Maxgrow India Ltd|
|NSE 05:30 | 01 Jan||Maxgrow India Ltd|
To the Members of MAXGROW INDIA LIMITED
(Formally known as M/s. FRONTLINE BUSINESS SOLUTIONS LIMITED)
Report on the Audit of the Financial Statements
We have audited the accompanying financial statements of MAXGROW INDIA LIMITED("the Company") (Formally known as M/s. FRONTLINE BUSINESS SOLUTIONSLIMITED) which comprise the Balance Sheet as at 31st March 2020 theStatement of Profit & Loss Account and Statement of Cash Flows for the year then endedand notes to the financial statements including a summary of significant accountingpolicies and other explanatory 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 theCompanies Act 2013 (Act') in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at 31st March 2020 its Loss and cash flows for theyear ended on that date.
2. Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing specified undersection 143(10) of the Companies Act 2013. Our responsibilities under those Standards arefurther described in the Auditor's Responsibilities for the Audit of the FinancialStatements section of our report. We are independent of the Company in accordance with theCode of Ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules thereunder 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.
3. Key Matters
Key Audit Matters are those matters that in our professional judgement were of mostsignificance in our audit of the financial statements of the current year. These matterswere addressed in the context of our audit of the financial statements as a whole and inframing our opinion thereon and we do not provide a separate opinion on these matters.
We have determined that there are no key audit matters to communicate in our report.
4. Information other than the financial statements and auditors' report thereon
The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the Board'sReport Business Responsibility Report but does not include the financial statement andour report thereon.
Our opinion on the financial statement does not cover the other information and we donot express any form of assurance conclusion thereon.
In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.
5. Management's responsibility for the 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 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 specified undersection 133 of the Act. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding of theassets of the Company and for preventing and detecting frauds and other irregularities;selection and application of appropriate implementation and maintenance of accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation 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 statement that givea true and fair view and are free from material misstatement whether due to fraud orerror.
In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.
Those Board of Directors are also responsible for overseeing the company's financialreporting process.
6. Auditor's Responsibility for the Audit of the Financial Statements
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 to issue 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 with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.
As part of an audit in accordance with Standards on Auditing we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:
6.1 Identify and assess the risks of material misstatement of the financial statementswhether due to fraud or error design and perform audit procedures 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 omissions misrepresentations or the override of internal control.
6.2 Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Companies Act 2013 we are also responsible for expressing our opinion on whetherthe company has adequate internal financial controls system in place and the operatingeffectiveness of such controls.
6.3 Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
6.4 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 auditor's report to the related disclosures inthe financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the company to cease to continue asa going concern.
6.5 Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and communicate with them allrelationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.
From the matters communicated with those charged with governance determine thosematters that were of most significance in the audit of the financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.
7. Report on Other Legal and Regulatory Requirements
As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the "Annexure A" a statement on thematters specified in paragraphs 3 and 4 of the Order to the extent applicable.
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 purposes of our audit and have foundthem to be satisfactory;
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 account and Cash Flow Statementdealt with in this report are in agreement with the books of account;
d) In our opinion the aforesaid financial statements comply with the AccountingStandards specified under Section 133 of the Companies Act read with Rule 7 of theCompanies (Accounts) Rules 2014;
e) On the basis of the written representations received from the directors as on 31stMarch 2020 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2020 from being appointed as a director in terms of Section164 (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".
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 has disclosed the impact of pending litigations on its financialposition in its financial statements;
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses;
iii. An amount of Rs. 80873/- being unpaid dividend account which is outstanding sincefor more than 7 years are required to be transferred to the Investor Education andProtection Fund by the Company.
Annexure-A to Independent Auditor's Report
(Referred to in paragraph 9 under Report on Other Legal and RegulatoryRequirements' section of our report of even date)
i. In respect of its fixed assets :
a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
b) The Company has a program of physical verification of all its fixed assets in aphased manner which in our opinion is reasonable having regard to the size of theCompany and the nature of its assets. In accordance with such a program certain fixedassets were physically verified by the management during the year. According to theinformation and explanation given to us no material discrepancies were noticed on suchverification.
c) According to information and explanation given to us and on the basis of ourexamination of records of the Company the title deeds of the immovable properties areheld in the name of the Company.
ii. In respect of its inventories :
As explained to us the inventories were physically verified during the year by theManagement at reasonable intervals and no material discrepancy was noticed on physicalverification.
iii. The Company has granted interest free unsecured loans to a party covered in theregister maintained under Section 189 of the Companies Act 2013. The maximum amountoutstanding during the year and year-end balance of such loan aggregate to Rs26400000/- and Rs. 25540000/- respectively.
a. In respect of the aforesaid loans the terms and conditions under which such loanswere granted are not prejudicial to the Company's interest.
b. The said loans are repayable on demand and therefore the question of its overdue and/ or amount of overdue and / or steps taken by the Company for recovery of principal andinterest does not arise.
iv. In our opinion and according to the information given to us the Company hascomplied with the provisions of section 185 and 186 of the Act with respect to the loansand investments made. The company has not provided any guarantee or security in terms ofsection 185 and 186 of the Act
v. According to the information and explanations given to us the Company has notaccepted any deposit from the public during the year in terms of the provision of Section73 to 76 or any other relevant provision of the Act and the rules framed their under. Asinformed to us no Order has been passed by the Company Law Board or National Company LawTribunal or Reserve Bank of India for this matter.
vi. The Central Government has not prescribed the maintenance of cost records undersection 148(1) of the Act in respect of the product manufactured and / or the servicesrendered by the Company.
vii. According to the information and explanations given to us in respect of statutorydues ;
a. The Company has generally been regular in depositing undisputed statutory duesincluding provident fund employees' state insurance income-tax sales tax service taxcustoms duty excise duty value added tax cess and any other statutory dues with theappropriate authorities. There were no undisputed amount payable in respect of Providentfund Employees' State Insurance Income tax Sales tax Service tax and any othermaterial statutory dues in arrears as at March 31 2020 for a period of more than sixmonths from the date they become payable.
b. Details of Sales tax dues which have not been deposited as on March 312020 onaccount of dispute are given below:
viii. An amount of Rs. 80873/- being unpaid dividend account which is outstandingsince for more than 7 years are required to be transferred to the Investor Education andProtection Fund by the Company.
ix. In our opinion and according to information and explanation given to us no moneywas raised by way of term loan or by way of initial public offer or further public offer(including debt instruments) during the year.
x. During the course of our examination of the books of account and records of theCompany carried out in accordance with the generally accepted auditing practices inIndia and according to the information and explanations given to us we have neither comeacross any instance of material fraud by the Company or on the Company by its officers oremployees noticed or reported during the year nor have we been informed of any such caseby the Management.
xi. In our opinion and according to the information and explanations given by themanagement the Company has paid/provided managerial remuneration in accordance with theprovisions of section 197 read with Schedule V of the Act
xii. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly paragraph 3 (xii) of the order is notapplicable to the Company.
xiii. According to the information and explanation given to us all the transactionswith related parties are in compliance with the provisions of Sections 177 and 188 of theAct where applicable. The details of related party transactions have been disclosed inthe financial statements as required under Accounting Standard (AS) 18 Related PartyDisclosures specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014.
xiv. According to the information and explanations given to us and based on ourexamination of the records of the company the company has not made any preferentialallotment or private placement of fully or partly convertible debentures nor preferentialallotment of equity shares and hence reporting under clause (xiv) of CARO 2016 is notapplicable to the Company
xv. In our opinion and according to the information and explanations given to us andbased on our examination of the records of the Company the Company has not entered intoany non cash transactions with directors or persons connected with him during the year.Accordingly paragraph 3 (xv) of the order is not applicable to the Company.
xvi. According to the information and explanations given to us the Company is notrequired to be registered under section 45-IA of the Reserve Bank of India Act 1934.Accordingly paragraph 3 (xvi) of the order is not applicable to the Company.
Annexure B' to Independent Auditor's Report
(Referred to in paragraph 10 (f) under Report on the Standalone FinancialStatement Other Legal and Regulatory Requirements' section of our report of even date)
Report on the internal financial controls with reference to the financial reportingunder Clause (i) of Subsection 3 of Section 143 of the Act.
We have audited the internal financial controls with reference to the financialreporting of M/s MAXGROW INDIA LIMITED ("the Company") (Formallyknown as M/s. FRONTLINE BUSINESS SOLUTIONS LIMITED) as of March 31 2020 in conjunctionwith our audit of the standalone financial statements of the Company for the year ended onthat date.
Management's Responsibility for Internal Financial Controls
1. The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal financial controls with reference to thefinancial reporting 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 (ICAI).These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation of reliablefinancial information as required under the Act.
2. Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to the financial reporting based on our audit. We conducted ouraudit in accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") and the Standards on Auditing issuedby ICAI and deemed to be prescribed under section 143(10) of the Act to the extentapplicable to an audit of internal financial controls both applicable to an audit ofinternal financial controls and both issued by the ICAI. Those Standards and the GuidanceNote require that we comply with ethical requirements and plan and perform the audit toobtain reasonable assurance about internal financial controls with reference to thefinancial reporting was established and maintained and if such controls operatedeffectively in all material respects.
3. Our audit involves performing procedures to obtain audit evidence about the adequacyof the internal financial controls with reference to the financial reporting and theiroperating effectiveness. Our audit of internal financial controls with reference to thefinancial reporting included obtaining and understanding of internal financial controlswith reference to the financial reporting assessing the risk that a material weaknessexists and testing and evaluating the design and operating effectiveness of internalcontrol based on the assessed risk. The procedures selected depend on the auditor'sjudgement including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error.
4. 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 withreference to the financial reporting.
Meaning of internal financial controls with reference to the financial reporting
5. A company's internal financial controls with reference to the 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 controlswith reference to the financial reporting includes those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and disposition of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.
Inherent Limitations of internal financial controls with reference to the financialreporting
6. Because of the inherent limitations of internal financial controls with reference tothe financial 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 withreference to the financial reporting to future periods are subject to the risk that theinternal financial controls with reference to the financial reporting may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.
7. In our opinion the Company has in all material respects an adequate internalfinancial controls with reference to the financial reporting and such internal financialcontrols with reference to the financial reporting were operating effectively as at March31 2020 based on the internal financial controls with reference to the 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.