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MFL India Ltd.

BSE: 526622 Sector: Services
NSE: N.A. ISIN Code: INE244C01020
BSE 00:00 | 17 Sep 0.36 -0.01
(-2.70%)
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0.38

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0.38

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NSE 05:30 | 01 Jan MFL India Ltd
OPEN 0.38
PREVIOUS CLOSE 0.37
VOLUME 5818704
52-Week high 0.50
52-Week low 0.15
P/E 4.50
Mkt Cap.(Rs cr) 13
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 0.38
CLOSE 0.37
VOLUME 5818704
52-Week high 0.50
52-Week low 0.15
P/E 4.50
Mkt Cap.(Rs cr) 13
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

MFL India Ltd. (MFLINDIA) - Auditors Report

Company auditors report

To

The Members of M/s MFL INDIA LIMITED

Qualified Audit Report on the Financial Statements

We have audited the accompanying financial statements of M/s MFL INDIA LIMITED("the Company") which comprise the Balance Sheet as at March 31 2020 and theStatement of Profit and Loss (including Other Comprehensive Income) the Statement ofChanges in Equity and the Statement of Cash Flows for the year then ended and a summary ofthe significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors are 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 including other comprehensive income cash flows and changes inequity of the Company in accordance with the Indian Accounting Standards (Ind AS)prescribed under section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended and other accounting principles generally accepted inIndia. 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 statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit. In conducting our audit we have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made there under and the Orderissued under section 143(11) of the Act. We conducted our audit of the standalonefinancial statements in accordance with the Standards on Auditing specified under Section143(10) of the Act. Those Standards require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether the financialstatements are free from material misstatement. An audit involves performing procedures toobtain audit evidence about the amounts and the disclosures in the financial statements.The procedures selected depend on the auditor's judgment including the assessment of therisks of material misstatement of the 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 financial statements that give a true andfair view in order to design audit procedures that are appropriate in the circumstances.An audit also includes evaluating the appropriateness of the accounting policies used andthe reasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the financial statements. We believe that the auditevidence obtained by us is sufficient and appropriate to provide a basis for our auditopinion on the financial statements.

Opinion

Our opinion on the Statement is qualified in respect of the matters described below.

Attention is drawn to the following matters:

1. The Bankers of the company have termed the Credit facilities of the company as a NonPerforming Asset (NPA) and has recalled their facilities.

2. They have taken symbolic possession of the assets of the company mortgaged with themand have communicated their stand to the debtors of the company.

3. The business of the company has been discontinued/disrupted because of the abovesaid affects. As a result there is no turnover of the company in the last quarter of FY2018-19.

4. After the closure of the financial year the major moveable assets of the companywhich generated revenue were repossessed by the financers.

5. The company has generated cash losses during the financial year the net worth ofthe company has been fully eroded and current liabilities are substantially higher thancurrent assets.

Qualification

The facts mentioned above indicate a material uncertainty and cast significant doubt onthe company's ability to continue as a going concern. However in absence of adequateinformation we cannot quantify the net realizable amount of assets and liabilities of thecompany to be stated in the financial statements.

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 based on our audit 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.

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 Statement of Changes in Equity and the Statement of Cash Flow dealt with by thisReport are in agreement with the books of account.

d) In our opinion the aforesaid financial statements comply with the Indian AccountingStandards prescribed under section 133 of the Act.

e) on the basis of the written representations received from the directors of theCompany as on March 31 2020 taken on record by the Board of Directors none of thedirectors is disqualified as on March 31 2020 from being appointed as a director in termsof Section 164(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 our separate Reportin "Annexure B". Our report expresses an unmodified opinion on the adequacy andoperating effectiveness of the Company's internal financial controls over financialreporting.

g) with respect to the other matters to be included in the Auditor's Report inaccordance with Rule11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements. ii. The Company has made provision as requiredunder the applicable law or accounting standards for material foreseeable losses if anyon long-term contracts including derivative contracts. iii. There has been no delay intransferring amounts required to be transferred to the Investor Education and ProtectionFund by the Company.

For V.K. Sehgal & Associates Chartered Accountants

(Firm's Registration No. 011519N)

Sd/-

Anuj Maheshwari

Partner

(Membership No. 096530)

Date: September 05 2020

Place: New Delhi

ANNEXURE ‘A' TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements' section of Auditor's report to the Members of M/s MFL INDIA LIMITED of evendate) i. In respect of the Company's 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 verification to cover all the items of fixed assets ina phased manner which in our opinion is reasonable having regard to the size of theCompany and the nature of its assets. Pursuant to the program certain fixed assets werephysically verified by the management during the year. According to the information andexplanations given to us no material discrepancies were noticed on such verification.

c) According to the information and explanations given to us the records examined byus we report that no material discrepancies were noticed. However after the end offinancial year majors movable assets of the company were repossessed by the financierswhich has affected the company has a going concern.

ii. The Company is in the business of providing services and does not have any physicalinventories. Accordingly reporting under clause 3 (ii) of the Order is not applicable tothe Company.

iii. According to the information and explanations given to us the Company has notgranted secured and unsecured loans to companies firms Limited Liability Partnerships orother parties covered under the register maintained under section 189 of the CompaniesAct 2013 in respect of which:

(a) In view of (iii) above this reporting is not applicable.

(b) In view of (iii) above this reporting is not applicable.

..(c) In view of (iii) above this reporting is not applicable.

iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Act in respect ofgrant of loans making investments and providing guarantees and securities as applicable.

v. The Company has not accepted deposits during the year and does not have anyunclaimed deposits as at March 31 2020 and therefore the provisions of the clause 3 (v)of the Order are not applicable to the Company.

vi. The maintenance of cost records has not been specified by the Central Governmentunder section 148(1) of the Companies Act 2013 for the business activities carried out bythe Company. Thus reporting under clause 3(vi) of the order is not applicable to theCompany.

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 Tax Goods and Service Tax Value Added Tax Customs Duty Excise Duty Cessand other material statutory dues applicable to it with the appropriate authorities.

b) There were no undisputed amounts payables in respect of Provident Fund

Employees' State Insurance Income Tax Sales Tax Service Tax Value Added Tax Goodsand Service Tax Customs Duty Excise Duty Cess and other material statutory dues inarrears as at March 31 2020 for a period of more than six months from the date theybecame payable.

c) According to the information and explanations given to us and on the basis of ourexamination of the records the company has not defaulted in repayment of loans andborrowing to a financial institution bank Government or dues to debenture holders.

viii. The Company has defaulted in repayment of loans and borrowings from the financialinstitutions/Banks. The Bank has termed the credit facilities of the company as NPA witheffect from October 2018. The term Loan treated as NPA by the bank is Rs. 6.94 crores andthe working capital limits termed as NPA by the bank amounts to Rs. 30.36 Crores.

ix. The Company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments). The term loans raised during the year have beenapplied for the purposes 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 or 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 the

Company has paid/provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the Act.

xii. The Company is not a Nidhi Company and hence reporting under clause 3 (xii) of the

Order is not applicable to the Company.

xiii. In our opinion and according to the information and explanations given to us the

Company is in compliance with Section 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 standalone financial statements as required by theapplicable accounting standards.

xiv. During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly paid convertible debentures and hence reportingunder clause 3 (xiv) of the Order is not applicable to the Company.

xv. In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any non-cash transactions with itsDirectors or persons connected to its directors and hence provisions of section 192 of theCompanies Act 2013 are not applicable to the Company.

xvi. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

For V.K. Sehgal & Associates Chartered Accountants

(Firm's Registration No. 011519N)

Sd/-

Anuj Maheshwari

Partner

(Membership No. 096530)

Date: September 05 2020

Place: New Delhi

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2 (f) under ‘Report on Other Legal and RegulatoryRequirements' section of Auditor's report to the Members of M/s MFL INDIA LIMITED of evendate):

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of

Subsection3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of M/s MFLINDIA LIMITED ("the Company") as of March 31 2020 in conjunction with our auditof the standalone financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting 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 the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the internal financial controls overfinancial reporting of the Company based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") issued by the Institute of Chartered Accountantsof India and the Standards on Auditing prescribed under Section143(10) of the CompaniesAct 2013 to the extent applicable to an audit of internal financial controls. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated 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 Judgment 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 of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and

(3) Provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial 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.

Opinion

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 2019 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.

For V.K. Sehgal & Associates Chartered Accountants

(Firm's Registration No. 011519N)

Sd/-

Anuj Maheshwari

Partner

(Membership No. 096530)

Date: September 05 2020

Place: New Delhi

.