Mid East Portfolio Management Ltd.
|BSE: 526251||Sector: Financials|
|NSE: N.A.||ISIN Code: INE033E01015|
|BSE 00:00 | 15 Nov||Mid East Portfolio Management Ltd|
|NSE 05:30 | 01 Jan||Mid East Portfolio Management Ltd|
|BSE: 526251||Sector: Financials|
|NSE: N.A.||ISIN Code: INE033E01015|
|BSE 00:00 | 15 Nov||Mid East Portfolio Management Ltd|
|NSE 05:30 | 01 Jan||Mid East Portfolio Management Ltd|
To the Members of MIDEAST PORTFOLIO MANAGEMENT LIMITED
1. Report on the Financial Statements
We have audited the accompanying financial statements of MIDEAST PORTFOLIOMANAGEMENT LIMITED ("the Company") which comprise the Balance Sheet as atMarch 31 2017 the Statement of Profit and Loss Statement of Cash Flows for the yearthen ended and a summary of the significant accounting policies and other explanatoryinformation.
2. Management's Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act 2013 ("the Act") with respect to the preparation andpresentation of these financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
3. Auditors' Responsibility
Our responsibility is to express an opinion on these financial statements based on ouraudit. 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 there under. We conducted our audit in accordancewith the 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 financial statements are free from materialmisstatement.
An audit involves performing procedures to obtain audit evidence about the amounts andthe 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 control 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.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the financial statements.
4. Basis for Qualified Opinion
(a) As per para 120 (c) of AS 15 Employee Benefits the company should disclose areconciliation of opening and closing balances of the present value of the defined benefitobligation showing separately the effects during the period attributable to currentservice cost interest cost actuarial gain/loss benefits paid past service costs etc.However in reconciliation of opening and closing defined benefits disclosed by thecompany in Note 22 it has not disclosed separately the effects attributable to each ofthe above applicable factors. (b) Further as per para 120 (g) of AS 15 Employee Benefitsthe company should disclose bifurcation of total employee benefit expenditure incurredduring the year into current service cost interest cost actuarial gain/loss benefitspaid past service costs etc. However the company has not made such disclosure ofexpenses recognised during the year.
However on account of the above non disclosure there is no impact on loss for theyear and net assets of the company.
5. Qualified Opinion
Except for the effects of the matter described in the "Basis for QualifiedOpinion" para 4 above in our opinion and to the best of our information andaccording to the explanations given to us the aforesaid financial statements give theinformation required by the 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 2017 its loss and its cash flows for the yearended on that date.
6. Emphasis of Matter
As mentioned in note 11 of the Financial Statements regarding the Company's loanaggregating to Rs. 10298338/- to two parties ("the borrowers") for which noprovisions for bad and doubtful loan have been made even though the borrowers haveincurred losses and has negative net worth as per latest audited financial statements forthe year ended as at March 31 2016. As explained in said note the company considersabove loan as good for recovery based on balance confirmation received from the borrowers.Accordingly the said loan is considered good and recoverable by the management. Ouropinion is not qualified in respect of the above matter.
7. Report on Other Legal and Regulatory Requirements
(i) 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 Act we give in the "Annexure A" a statement on the matters specified in theparagraph 3 and 4 of the Order.
(ii) 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.
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.
The Balance Sheet the Statement of Profit and Loss and the cash flow statement dealtc) with by this Report are in agreement with the books of account. d) Except for thematter prescribed in para 4 above in our opinion the aforesaid financial statementscomply with the Accounting Standards specified under Section 133 of the Act read withRule 7 of the Companies (Accounts) Rules 2014.
e) On the basis of the written representations received from the directors as on 31stMarch 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2017 from being appointed as a director in terms of Section164 (2) of the Act; and
In our opinion the company has in all material respects an adequate internal With f)respect to the adequacy of the internal financial controls over financial reporting of theCompany and the operative effectiveness of such controls refer to our separate report in"Annexure B". Our report expresses an unmodified opinion on the adequacy andoperating effectiveness of the Company's internal financial controls over financialreporting; and
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-Refer Note No.19 (a).
ii) The Company does not have any long-term contracts including derivative contractsfor which there were any material foreseeable losses.
iii) There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
iv) The Company has provided requisite disclosures in the financial statements asregards its holding and dealings in Specified Bank Notes as defined in the NotificationS.O. 3407(E) dated November 8 2016 of the Ministry of Finance during the period fromNovember 8 2016 to December 30 2016. Based on audit procedures performed and therepresentations provided to us by the management we report that the disclosures are inaccordance with the books of account maintained by the Company and as produced to us bythe Management.
Annexure A to the Independent Auditors' Report
[Referred to in paragraph 7 (i) of our report of even date]
i. (a) The Company is maintaining proper record showing full particulars includingquantitative details and situation of fixed assets.
(b) The fixed assets have been physically verified by the management at reasonableintervals; no material discrepancies found.
(c) The company does not have any immovable property and hence paragraph 3(i)(c) of theOrder is not applicable.
ii. The Company does not have any inventory and hence paragraph 3(ii) of the order isnot applicable.
iii. The Company has not granted any loans secured or unsecured to companies firms orother parties covered in the register maintained under section 189 of the Act andtherefore paragraph 3 (iii) of the order is not applicable.
iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 185 and 186 of the Act with respectto the loans given and investments made.
v. According to the information and explanations given to us the Company has notaccepted any deposits. Hence paragraph 3 (v) of the order is not applicable.
vi. The company does not qualify the prescribed criteria as specified in Companies(Cost Records and Audit) Rules 2014 and therefore is not required to maintain the costrecords as prescribed under Section 148 (1) of the Act. Hence paragraph 3 (vi) of theorder is not applicable.
vii. (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company the Company is regular in depositingundisputed statutory dues including Income tax and other Statutory dues with theappropriate dues. (b) According to the information and explanations given to us thedetails of disputed dues of Income tax is as follows
viii. According to the information and explanations given to us there are no loans orborrowings from any financial institution banks government or debenture holders andtherefore paragraph 3(viii) of the Order is not applicable. ix. According to theinformation and explanations given to us the Company did not raise any money by way ofinitial public offer or further public offer (including debt instruments) or by way termloan and hence paragraph 3(ix) of the order is not applicable.
x. According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe year.
xi. According to the information and explanation given to us and based on ourexamination of the records of the company the company has not paid any managerialremuneration during the year and hence paragraph 3(xi) of the order is not applicable.
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.
xiii. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.
xiv. According to the information and explanations give to us and based on ourexamination of the records during the year the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures.Accordingly paragraph 3 (xiv) of the order is not applicable.
xv. According to the information and explanations given to us and based on ourexamination of the records during the year the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.
xvi. According to the information and explanations given to us and based on ourexamination of the records the Company is not required to be registered under section45-IA of the Reserve Bank of India Act 1934.
Annexure - B to the Independent Auditors' Report [Referred to in paragraph 7 (ii) (f)of our report of even date]
Report on the Internal Financial Controls Over Financials Reporting under Clause (i) ofSubsection 3 of Section 143 of the Companies Act 2013 ("the Act") of MideastPortfolio Management Limited
We have audited the internal financial controls over financial reporting of MIDEASTPORTFOLIO MANAGEMENT LIMITED ("the Company") as of March 31 2017 inconjunction with our audit of the financial statements of the Company for the year endedand as at on that 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 (the Guidance Note').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 ofreliable financial information as required under the Companies Act 2013.
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 and the Standards on Auditing prescribed under section 143(10) ofthe Companies Act 2013 to the extent applicable to an audit of internal financialcontrols. The Guidance Note and those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate 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 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 authorizations of management and directors of the company; and
(3) Provide reasonable assurance regarding prevention or timely detection ofunauthorized 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.
In our opinion 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 March 31 2017 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note.