TO THE MEMBERS OF
MODULEX CONSTRUCTION TECHNOLOGIES LIMITED (Formerly knownas Tumus Electric Corporation Limited)
REPORT ON THE STANDALONE IND AS FINANCIAL STATEMENTS
We have audited the accompanying Standalone Ind AS financialstatements of Modulex Construction Technologies Limited (Formerly known as TumusElectric Corporation Limited) (the Company) which comprises the BalanceSheet as at March 31 2019 the Statement of Profit and Loss (including othercomprehensive Income) the Statement of Change in Equity and the Cash Flows for the yearthen ended and notes to the Financial Statements including a summary of the significantaccounting policies and other explanatory information.
In our opinion and to the best of our information and accordingto the explanations given to us the aforesaid Standalone Ind AS financial statements givethe information required by the Companies Act 2013 (the Act) in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 31 2019and its Profit (including other comprehensive income) its cash flows and the changes inequity for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards onAuditing (SAs) specified under section 143(10) of the Act. Our responsibilities underthose Standards are further described in the Auditor's Responsibilities for the Audit ofthe Financial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of theStandalone Ind AS financial statements under the provisions of the Act and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of the Standalone Ind AS financialstatements of the current period. These matters were addressed in the context of our auditof the Standalone Ind AS financial statements as a whole and in forming our opinionthereon and we do not provide a separate opinion on these matters. We have determined thematters described below to be the key audit matters to be communicated in our report.
|Key Audit Matter ||Auditor's Response |
|Investments in subsidiaries ||Principal Audit Procedures |
|During the year the Company has acquired 55691886 equity shares of Modulex Modular Buildings Private Limited by allotting 41572186 equity shares on preferential basis by swap of shares as per valuation approved by Bombay Stock ||Our audit approach consisted of complete verification of the correctness of accounting and legal compliance for such investments Testing the design and operating effectiveness of the internal controls and substantive testing as follows: |
|Exchange. || Relying on the appropriateness of the valuation report provided by the management for the fair value of shares of the company. |
|Investments in subsidiaries made during the year account for a significant percentage of the Company's net assets. Management assesses major investments whether there are indications of impairment and determines the recoverable amounts of the investments recognized on the balance sheet. || Relying on the valuation report based on which shares were acquired during the year |
| || Verification of the share certificate as evidence of investments in possession of the Company. |
|As such investment is made recently during the current year based on independent valuation impairment testing is not considered necessary. Refer Notes 2 to the Standalone Financial Statements. || |
|Issue of Share Capital on Private Placement Basis ||Principal Audit Procedures |
|During the year the Company has issued 41572186 number of equity shares on Private Placement basis to shareholders of Modulex Modular Buildings ||Our audit procedure included the following: |
| || Review of resolutions passed by the Company for issue of shares |
|Private Limited. The valuation and issue price of Equity Shares done in accordance Stock Exchange regulations along with various compliances/ rules and regulations of Companies Act 2013 Securities and Exchange Board of India (SEBI) and any other relevant Act to be adhered to before the issue of shares. || Review of in-principle approval received for issue of shares |
| || Obtaining valuation certificate of independent valuer to determine issue price which is also approved by Bombay Stock Exchange (BSE) |
| || Obtaining listing certificate received from BSE |
| || Verification of post issue compliances |
Information Other than the Standalone Financial Statements andAuditor's Report Thereon
The Company's Board of Directors is responsible for thepreparation of the other information. The other information comprises the informationincluded in the Management Discussion and Analysis Board's Report including Annexures toBoard's Report Business Responsibility Report Corporate Governance and Shareholder'sInformation but does not include the standalone financial statements and our auditor'sreport thereon Our opinion on the standalone financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon. In connectionwith our audit of the standalone financial statements our responsibility is to read theother information and in doing so consider whether the other information is materiallyinconsistent with the standalone financial statements or our knowledge obtained during thecourse of our audit or otherwise appears to be materially misstated. If based on the workwe have performed we conclude that there is a material misstatement of this otherinformation we are required to report that fact. We have nothing to report in thisregard.
Management's Responsibility for the Standalone Ind AS FinancialStatements
The Company's Board of Directors is responsible for the mattersstated in Section 134(5) of the Companies Act 2013 (the Act) with respect tothe preparation of these Standalone Ind AS financial statements to give a true and fairview of the state of affairs (financial position) Profit and Loss (financial performanceincluding other comprehensive income) cash flows and change in equity of the Company inaccordance with the accounting principles generally accepted in India including theaccounting standards specified under section 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 accounting policies; making judgments andestimates that are reasonable and prudent; and design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the Standalone Ind AS financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.
In preparing the financial statements management is responsiblefor assessing the Company's ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing thecompany's financial reporting process. Auditor's Responsibilities for the Audit of theFinancial Statements
Our objectives are to obtain reasonable assurance about whetherthe standalone Ind AS financial statements as a whole are free from material misstatementwhether due to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with SAs we exerciseprofessional judgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement ofthe financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control.
Obtain an understanding of internal control relevant tothe audit in order to design audit procedures that are appropriate in the circumstances.Under section 143(3)(i) of the Act we are also responsible for expressing our opinion onwhether the company has adequate internal financial controls system in place and theoperating effectiveness of such controls.
Evaluate the appropriateness of accounting policies usedand the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of thegoing concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor's report tothe related disclosures in the financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the company to cease to continue as a going concern.
Evaluate the overall presentation structure and contentof the financial statements including the disclosures and whether the financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.
We communicate with those charged with governance regardingamong other matters the planned scope and timing of the audit and significant auditfindings including any significant deficiencies in internal control that we identifyduring our audit.
We also provide those charged with governance with a statementthat we have complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.
From the matters communicated with those charged with governancewe determine those matters that were of most significance in the audit of the financialstatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.
1. The comparative financial information of the Company for theyear ended March 31 2018 prepared in accordance with Ind AS included in these standalonefinancial statements have been audited by the predecessor auditors. The report of thepredecessor auditor on the comparative information dated May 28 2018 expressed anunmodified opinion.
Report on Other Legal and Regulatory Requirements
1) As required by the Companies (Auditor's Report) Order2016 issued by the Central Government of India in terms of sub-section (11) of section143 of the Act (hereinafter referred to as the Order) and on the basis ofsuch checks of the books and records of the Company as we considered appropriate andaccording to the information and explanations given to us we give in the Annexure A astatement on the matters specified in paragraphs 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 andexplanations which to the best of our knowledge and belief were necessary for the purposesof our audit;
b) In our opinion proper books of account as required by lawhave been kept by the Company so far as it appears from our examination of those books;
c) The Balance Sheet the statement of Profit and Loss includingthe Statement of Other Comprehensive Income the Cash Flow Statement and Statement ofChanges in Equity dealt with by this report are in agreement with the books of account;
d) In our opinion the aforesaid Standalone Ind AS financialstatements comply with the Accounting Standards specified under Section 133 of the Actread with Rule 7 of the Companies (Accounts) Rules 2014.
e) On the basis of the written representations received from thedirectors as on March 31 2019 taken on record by the Board of Directors none of thedirectors is disqualified as on March 31 2019 from being appointed as a director in termsof Section 164 (2) of the Act;
f) With respect to the adequacy of the internal financialcontrols over financial reporting of the Company and the operating effectiveness of suchcontrols refer to our separate report in Annexure B to this report;
g) With respect to the other matters to be included in theAuditors' Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules2014 in our opinion and to the best of our knowledge and belief and according to theinformation and explanations given to us:
i. the Company has no pending litigations as at March 31 2019 onits financial position in its Standalone Ind AS financial statements to the extentdeterminable/ascertainable;
ii. the Company does not have long term contracts includingderivate contracts for which there were any requirement to provide for materialforeseeable losses.
iii. there were no amounts which were required to be transferredto the Investor Education and Protection Fund by the Company.
For T. P. Ostwal & Associates LLP
(Registration No. 124444W/W100150)
Anil A. Mehta Partner
Membership Number: 030529
Place: Mumbai Date: May 29 2019
ANNEXURE A TO INDEPENDENT AUDITORS' REPORT ON THE STANDALONE INDAS FINANCIAL STATEMENT OF MODULEX CONSTRUCTION TECHNOLOGIES LIMITED
Referred to in paragraph 1 under Report on Other Legal andRegulatory requirement section of our report of even date
i According to information and explanation given to us theCompany does not have any fixed asset and accordingly Paragraph 3 (i)(a) to (c) of theOrder are not applicable to the Company.
ii According to information and explanation given to us theCompany has no inventories during the year or as at 31st March 2019 andaccordingly the clause is not applicable to the Company.
iii According to information and explanation given to us theCompany has not granted any loan secured or unsecured to companies firms LimitedLiability Partnership firm or other parties covered in the register maintained undersection 189 of the Companies Act 2013. Accordingly Paragraph 3 (iii) (a) 3 (iii)(b) and3(iii)(c) of the Order are not applicable to the Company.
iv In our opinion and according to the information andexplanations given to us the Company has complied with the provisions of Section 185 and186 of the Companies Act 2013 to the extent applicable in respect of the loansinvestments guarantees and security.
v The Company has not accepted any deposits from the publicwithin the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance ofDeposits) Rules 2014 (as amended). Accordingly Paragraph 3(v) of the Order is notapplicable to the Company.
vi According to the information and explanations given to us themaintenance of cost records under sub section (1) of section 148 of the Companies Act isnot applicable to the Company.
vii (a) According to the information and explanations given to usand for the records of the Company examined by us undisputed statutory dues includingProvident Fund Employees' State Insurance Income Tax Sales tax Service Tax duty ofCustom duty of excise Value Added Tax Cess Goods and Service Tax (GST) and othermaterial statutory dues as applicable have not been regularly deposited with theappropriate authorities.
According to the information and explanation given to us by themanagement the dues of Income Tax deducted and outstanding for more than six months areas follows:
|Nature of the Statue ||Nature of Dues ||Amount (in Rs) ||Period to which the Amount relates |
|Income Tax Act 1961 ||Tax deducted at Source (194J) ||208147 ||2018-19 |
(b) According to the information and explanations given to us andthe records of the Company examined by us there are no disputed statutory dues that havenot been deposited on account of disputed matters pending before appropriate authorities.
There are no loans or borrowings payable to government anyfinancial institution or banks
viii during the year. The Company has no debenture during theyear. Accordingly the paragraph 3 (viii) of the Order is not applicable to the Company.
According to the information and explanations given to us theterm loans have been applied
ix for the purposes for which they were obtained. The Company didnot raise any money by way of initial public offer or further public offer (including debtinstruments).
x Based upon the audit procedures performed for the purpose ofreporting the true and fair view of the Financial Statements and according to theinformation and explanations provided by the management we report that no fraud by theCompany or no material fraud on the Company by the officers and employees of the Companyhas been noticed or reported during the year.
xi According to the information and explanations given to us theCompany has not paid / provided for any managerial remuneration during the year.
xii In our opinion and according the information and explanationgiven to us the Company is not a Nidhi Company. Accordingly paragraph 3(xii) of theOrder is not applicable to the Company.
xiii According to the information and explanation given to us andbased on our verification of the records of the Company and on the basis of review andapproval by the Board and Audit Committee the transactions with related parties are incompliance with Section 177 and 188 of the Act where applicable and the details of suchtransactions have been disclosed in the Standalone Ind AS financial statements as requiredby the applicable accounting standards.
xiv During the year the Company has made private placement ofshares during the year on non-cash basis under swap arrangement for the purpose ofacquiring shares of subsidiary as stated in note 6 to the standalone financial statements.In respect of the same in our opinion the Company has complied with the requirements ofsection 42 of the Act and Rules framed there under.
xv According to the information and explanation given to us andbased on our examination of the records of the Company the Company has not entered intoany non-cash transactions with its directors or persons connected with them during theyear. Accordingly paragraph 3(xv) of the Order is not applicable to the Company.
xvi The Company is not required to be registered under Section45-IA of the Reserve Bank of India Act 1934. Accordingly paragraph 3(xvi) of the Orderis not applicable to the Company.
For T. P. Ostwal & Associ ates LLP
(Registration No. 124444W/W100150)
Anil A. Mehta
Membership Number: 030529
Date: May 29 2019
ANNEXURE B TO INDEPENDENT AUDITORS' REPORT ON THE STANDALONE INDAS
FINANCIAL STATEMENT OF MODULEX CONSTRUCTION TECHNOLOGIES LIMITED
(Formerly known as Tumus Electric CorporationLimited)
Referred to in paragraph 2(f) under Report on Other Legaland Regulatory requirement section of our report of even date
Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013.
1. We have audited the internal financial controls over financialreporting of Modulex Construction Technologies Limited (the Company) as ofMarch 31 2019 in conjunction with our audit of the Standalone Ind AS financial statementsof the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
2. The Company's management is responsible for establishing andmaintaining internal financial controls based on the internal control over 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 (the Guidance Note) issued by the Institute of CharteredAccountants of India (ICAI). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence tocompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.
3. Our responsibility is to express an opinion on the Company'sinternal financial controls over financial reporting based on our audit. We conducted ouraudit in accordance with the Guidance Note and the Standards on Auditing issued by ICAIand deemed to be prescribed under section 143(10) of the Act to the extent applicable toan audit of internal financial controls both issued by the ICAI. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively in all material respects.
4. Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financial controls system over financialreporting and their operating effectiveness. Our audit of internal financial controls overfinancial reporting included obtaining an understanding of internal financial controlsover financial reporting 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 judgment including theassessment of the risks of material misstatement of the Standalone Ind AS financialstatements whether due to fraud or error.
5. We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our audit opinion on the Company'sinternal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
6. A company's internal financial control over financialreporting is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of Standalone Ind AS financial statements forexternal purposes in accordance with generally accepted accounting principles. A company'sinternal financial control over financial reporting includes those policies and proceduresthat
i. Pertain to the maintenance of records that in reasonabledetail accurately and fairly reflect the transactions and dispositions of the assets ofthe company;
ii. Provide reasonable assurance that transactions are recordedas necessary to permit preparation of Standalone Ind AS financial statements in accordancewith generally accepted accounting principles and that receipts and expenditures of thecompany are being made only in accordance with authorizations of management and directorsof the company; and
iii. Provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition use or disposition of the company's assets thatcould have a material effect on the Standalone Ind AS financial statements.
Inherent Limitations of Internal Financial Controls overFinancial Reporting
7. Because of the inherent limitations of internal financialcontrols over financial reporting including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols over financial reporting to future periods are subject to the risk that theinternal financial control over financial reporting may become inadequate because ofchanges in conditions or that the degree of compliance with the policies or proceduresmay deteriorate.
8. In our opinion the Company has in all material respects anadequate internal financial controls system over financial reporting and such internalfinancial controls over financial reporting were operating effectively as at March 312019 based on the internal control over financial reporting criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India.
For T. P. Ostwal & Associates
LLP Chartered Accountants
(Registration No. 124444W/W100150)
Anil A. Mehta
Membership Number: 030529
Date: May 29 2019