M/s Millitoons Entertainment Limited Report on the Financial Statements
We have audited the accompanying financial statements of M/s. Millitoons EntertainmentLimited which comprise the Balance Sheet as at March 31 2017 the Statement of Profitand Loss and the Cash flow statement for the year then ended and a summary of significantaccounting policies and other explanatory information.
Management's Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters in Section 134(5] ofthe Companies Act 2013 (''the Act"] with respect to the preparation of thesefinancial statements that give a true and fair view of the financial position financialperformance and Cash Flows of the Company in accordance with the Accounting Principlesgenerally accepted in India including the Accounting Standards specified under Section133of the Act 2013 read with Rule 7 of the Companies (Accounts] Rules 2014. Thisresponsibility also includes the maintenance of adequate accounting records in accordancewith the provisions of the Act for safeguarding of the assets of the Company and forpreventing and detecting of the frauds and other irregularities; selection and applicationof appropriate accounting policies; making judgements and estimates that are reasonableand prudent; and design implementation and maintenance of internal control relevant tothe preparation and presentation of the financial statements that give a true and fairview and are free from material misstatement whether due to fraud or error.
Our responsibility is to express an opinion on these financial statements based on ouraudit. We have taken into account the provision 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 in accordancewith the Standards on Auditing under section 143(10] of the Act. Those Standards requirethat 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 anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal control relevant to the Company's preparation of the financialstatements that give true and fair presentation of the financial statements in order todesign audit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of accounting policies used and reasonableness of theaccounting estimates made by Company's Directors as well as evaluating the overallpresentation of 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.
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 the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India:
(a] in the case of the Balance Sheet of the state of affairs of the Company as atMarch 31 2017;
(b] in the case of the Profit and Loss Account of the Profit for the period ended onthat date; and
(c] in the case of the Cash Flow Statement of the cash flows for the year ended onthat date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report] Order 2016 issued by the CentralGovernment of India in terms of Section 143 of the Act we give in the Annexure A astatement on the matters specified in paragraph 3 and 4 of the order.
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 accounts 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 & Loss and Cash Flow Statementdealt with by this Report are in agreement with the books of account ;
(d] In our opinion the aforesaid financial statements comply with the AccountingStandards specified undersection 133 of the Act read with Rule 7 of the Companies(Accounts] Rules 2014.
(e] On the basis of the written representations received from the directors as on March31 2017 and taken on record by the Board of Directors none of the directors isdisqualified as on March 31 2017 from being appointed as a director in terms ofsub-section (2] of section 164 of the Companies Act2013;
(f] With respect to adequacy of internal financial controls over financial reporting ofthe company and the operating effectiveness of such controls refer to our separate reportin " Annexure B" and
(g) With respect to the other matters included in the Auditor's Report and to our bestof our information and according to the explanations given to us :
(i) The Company does not have any pending litigations which would impact its financialposition.
(ii) The Company did not have any long-term contracts including derivative contractsfor which they were any material foreseeable losses.
(iii) There were no amounts which required to be transferred to the Investor Educationand Protection Fund by the Company.
(iv) Company had provided requisites disclosure in financial statement as to holding aswell as dealing in specified Bank Notes during the period from 8th November 2016 to 30thDecember 2016. These are in accordance with the books of accounts maintained by thecompany.
| ||For S N Murthy & Co |
| ||Chartered Accountants |
| ||FRN No. 002217S |
| ||Sd/- |
|Place: Hyderabad ||P V S N Murthy |
|Date: 29.05.2017 ||( Proprietor) |
| ||M. No. 21862 |
Annexure - A to the Auditors' Report
(Referred to in Paragraph 1 under"Report on Other Legal and RegulatoryRequirements" section of our report of even date to the members of MillitoonsEntertainment Limited)
1. (a) The Company has generally maintaining proper records showing full particularsincluding quantitative details and situation of fixed assets.
(b) The fixed assets were physically verified during the year by the Management inaccordance with a regular programme of verification which in our opinion provides forphysical verification of all the fixed assets at reasonable intervals. According to theinformation and explanation given to us no material discrepancies were noticed on suchverification.
(c) The title deeds of the Immovable property were held in the name of the Company.
2. As explained to us the stock of finished goods in the Company's custody has beenphysically verified by the management as at the end of the Financial Year and no materialdiscrepancies were noticed on such physical verification.
3. The Company has not granted any loans secured or unsecured to companies firms orother parties covered in the Register maintained under Section189 of the act.
4. The Company has not granted loans falling within the purview of the provisions ofsection 185 of Companies Act 2013
5. The Company has not made investments falling within the purview of the provisions ofsection 186 of the Companies Act 2013.
5. According to the information and explanation given to us the Company has notaccepted any deposits from the public during the year within the meaning of Section 73 and76 of the Act and the rules framed there under.
6. Clause (vi) of Paragraph 3 of the Companies (Auditor's Report) Order 2016 relatingto maintenance of cost records is not applicable to the Company.
7. According to the information and explanations given to us and records of the Companyexamined by us in our opinion:
(a) There was no undisputed amounts payable in respect of Provident Fund ESIIncome-tax Sales Tax Wealth Tax service tax customs duty Excise duty VAT Cess andstatutory dues in arrears as at March 31 2017 for a period of more than six months fromthe date they became payable.
(b) There were no dues outstanding in respect of Sales Tax Income Tax Wealth TaxService Tax Customs Duty Excise Duty or VAT or Cess on account of any dispute.
8. Clause (viii) of Companies (Auditor's Report] Order 2016 i.e. CARO 2016 relatingto repayment of loans or borrowings to financial institutions bank Government anddebenture holders is not applicable to the Company.
9. The Company has not raised any money by way of IPO or FPO (including debtinstruments]. The Company has not availed any term loans.
10. There is no fraud by the Company or any fraud on the Company by its officers andemployees has been noticed or reported during the year.
11. The Company has not paid any managerial remuneration under section 197 of theCompanies Act 2013.
12. The Company is not a Nidhi Company.
13. All transactions with the related parties are in compliance with the section 177and 188 of the Companies Act 2013 where applicable and the details have been disclosed inthe financial statements as required by the applicable Accounting Standards.
14. The Company has made preferential allotment of warrants and has duly complied withthe provisions of Section 42 and 62 of the Companies Act 2013 and the amounts have beenraised for the purposes for which the funds were raised.
15. The Company has not entered into any non-cash transactions with directors orpersons connected with directors during the year.
16. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934
| ||For S N Murthy & Co |
| ||Chartered Accountants |
| ||FRN No. 002217S |
|Place: Hyderabad ||(P V S N Murthy) |
| ||Proprietor |
|Date: 29.05.2017 ||M. No. 21862 |
Annexure - B to the Independent Auditor's Report
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 M/sMillitoons Entertainment Limited ("the Company") as of 31 March 2017 inconjunction with our audit of the standalone financial statements of the Company for theyear ended on that date.
Managements Responsibility for Internal Financial Controls
The Companys 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 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 companys policies the safeguardingof its 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 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 on Audit of Internal Financial Controls over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note 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 auditors 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 Companys internal financial controlssystem 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 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 ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions 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 31 March 2016 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.
| ||For S N Murthy & Co |
| ||Chartered Accountants |
| ||FRN No. 002217S |
| ||Sd/- |
| ||(P V S N Murthy) |
| ||Proprietor M. No. 21862 |
|Place: Hyderabad || |
|Date: 29.05.2017 || |