To the Members of Muller & Phipps (India) Limited
Report on the Standalone Ind AS Financial Statements
We have audited the accompanying standalone financial statements ofMuller & Phipps (India) Limited (the Company') which comprise the BalanceSheet as at 31st March 2019 the Statement of Profit and Loss including thestatement of Other Comprehensive Income the Cash Flow Statement and the Statement ofChanges in Equity for the year then ended and a summary of significant accountingpolicies and other explanatory information.
Management's Responsibility for the Standalone 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 and presentation of these standalone financial statements that give a trueand fair view of the financial position financial performance and cashflows of theCompany in accordance with the accounting principles generally accepted in Indiaincluding the Indian Accounting Standards specified under section 133 of the Act readCompanies (Indian Accounting Standards) Rules 2015 as amended. This responsibility alsoincludes maintenance of adeaquate accounting records in accordance with the provisions ofthe Act for the safeguarding the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgements 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 statements thatgive true and fair view and free from material misstatements whether due to fraud orerror.
In preparing the standalone financial statements management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting 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 responsible for overseeing theCompany's financial reporting process.
Our responsibility is to express an opinion on these standalone Ind ASfinancial statements based on our audit.
We have taken into account the provisions of the Act the accountingand auditing standards and matters which are required to be included in the audit reportunder the provisions of the Act and the rules made thereunder. We conducted our audit inaccordance with the Standards on Auditing specified under section 143(10) of the Act.Those Standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the financial statements are free frommaterial misstatement. An audit involves performing procedures to obtain audit evidenceabout the amounts and the disclosures in the financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlsrelevant to the Company's preparation of the Ind AS financial statements that give atrue and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of accountingpolicies used and the reasonableness of the accounting estimates made by theCompany's Directors as well as evaluating the overall presentation of the standaloneInd AS financial statements.
We are independent of the Company in accordance with the Code of Ethicsissued by the ICAI together with the independence requirements that are relevant to ouraudit of the standalone financial statements under the provisions of the Act and the Rulesmade thereunder and we have fulfilled our other ethical responsibilities in accordancewith these requirements and the Code of Ethics.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the standalone Ind AS financialstatements.
Basis for Qualified Opinion
The financial statements have been prepared on a going concern basis bythe management as there are profits from operational activities for the year ended 31stMarch 2019 and even though the net worth of the Company has been completely erodedand also on the basis that they have business plans for profitable operations in thefuture. However no such detailed plans have been shown or explained to us to oursatisfaction and hence we are unable to form any opinion on the going concern status ofthe Company.
In our opinion and to the best of our information and according to theexplanations given to us except for the effects of the matters described in the Basis forQualified Opinion paragraph above the aforesaid standalone 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 March 31 2019 its profit including other comprehensiveincome its cash flows and the changes in equity for the year ended on that date.
Key Audit Matters
Key audit matters are those that in professional judgement were ofthe most significant in our audit of the Standalone Ind AS financial statements forfinanacial year March 31 2019. These matter were addressed in the context of our audit ofthe consolidated financial Ind AS financial statements as whole and in forming our opiniontheron and we do not provide a separate opinion on these matters. For each matter belowour description of how our audit addressed the matter is provide in that context.
|Key audit matters ||How our audit addressed the key audit matter |
|Recognised of tax credit (as prescribed in 2.10 of the financial statement) || |
|The Group has recognized Minimum Alternate Tax (MAT) credit receivable of Rs. 4.6 lakhs as at 31st March 2019. The recognisition of MAT credit and deferred tax asset (together referred to as "tax credit" hereinafter) is a key audit matter as the responsibility of such tax credits within the allowed time frame involves significant estimate of financial projection availability of sufficient taxable income in the future and significant judgement in the interpretation of tax regulations and tax positions adopted by the group. || |
| || Our audit procedures included considering the Group's accounting policies with respect to recognition of tax credits in accordance with Ind AS 12 "Income Taxes" |
| || We preformed test of controls over recognition of tax credits through inspection of evidence of performance of these controls. |
| || We preformed the following tests of details: We involved our tax specialists who evalued the group's tax positions by comparing with prior years and past precedents. |
| || We discussed the future business plans and financial projection with the company. |
| || We assessed the managements long term financial projections and the key assumptions used in the projection by comparing it to the approved business plan and projections used for impairment assessment where applicable. |
| || We have assessed the disclosure in accordance with the requirements of Ind AS 12 "Income Taxes" |
| Related Party Transaction (as perscribed in Schedule 36 of the financial statements) || |
|During the year the company has purchased goods from Pharmpak Private Limited worth || Our audit procedures included considering the compliance with the various requirements for entering in to such related party transaction. |
|Rs. 1.41 crore respectively. || We performed test of controls over related party transactions through inspection of evidence of performance of these controls. |
|The company has paid director sitting fees to Mr. Milan Dalal of Rs. 25000/- || We performed the following tests of details: |
|The company has purchased printing and stationeries from Western Press Private Limited for Rs. 1.79 lakhs || We have read the valuation reports and fairness apinion obtained from independent valuers and assessed the objectivity and competence of the independent valuers. |
|During the year the group has provided for a total of Rs. 20.90 lakhs as interest to Foods and Inns Ltd. Getz Pharma Pvt Ltd and its subsidiary Muller & Phillips Agencies Ltd. || We have read the approvals obtained from Board of Directors Shareholders and all other regulatory approvals for the transactions. |
|The company has provided for Doubtful Advance of Rs. 46585/- against its Subsidary Muller & Phipps (Industrial Services) Ltd. || We have assessed the disclosures in accordance with Ind AS 24 " Related Party Disclosures". |
|Determination of transaction prices for such related party transaction outside the normal course of business is a key audit and the significant judgements involved in determining the transaction value. || |
Other information such as "Information Other than the FinancialStatements and Auditor's Report Thereon"
The Company's Board of Director is responsible for the otherinformation. The other information comprises the information included in the Annualreport but does not include the Ind AS financial statement and our auditor's reportthereon.
Our opinion on on the Ind AS financial statement does not cover theother information and we do not express any form of
assurance conclusion thereon. In connection with our audit of the IndAS financial statements our responsibility is to read the other information and in doingso consider whether such other information is materially inconsistent with the financialstatements or our knowledge obtained in the audit or otherwise appears to be materiallymisstated. 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.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2016issued by Central Government of India in terms of sub-section
(11) of section 143 of the Act we give in the Annexure I' astatement on the matters specified in paragraphs 3 and 4 of the Order to the extentapplicable.
2. As required by section 143(3) of the Act we report that:
a. We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purpose of our audit.
b. In our opinion proper books of account as required by law have beenkept by the Company so far as appears from our examination of those books.
c. The Balance Sheet the Statement of Profit and Loss including theStatement of Other Comprehensive Income the Cash Flow Statement and Changes in Equitydealt with by this Report are in agreement with the books of account.
d. In our opinion the aforesaid standalone financial statements complywith the Accounting Standards specified under section 133 of the Act read Companies(Indian Accounting Statndards) Rules 2015 as amended.
e. The going concern matter described under the Basis of Qualificationparagraph above in our opinion may have an adverse effect on the functioning of theCompany.
f. On the basis of written representations received from the directorsas on 31st March 2019 and taken on record by the Board of Directors none ofthe directors is disqualified as on 31st March 2019 from being appointed as adirector in terms of section 164(2) of the Act.
g. With respect to the adequacy of the internal financial controls overfinancial reporting of the Company and the operating effectiveness of such controls referto our separate Report in Annexure II'.
3. With respect to other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 inour opinion and to the best of our information and according to the explaination given tous:
i. The Company has disclosed the impact of pending litigations on itsfinancial positions in its financial statements Refer Note 31 to the financialstatements.
ii. The Company did not have any long-term contract includingderivative contracts for which there were any material forseeable losses.
iii. There were no amounts which were required to be transferred to theInvestor Education and Protection Fund by the Company.
iv. The disclosure in the standalone financial statements dealing inspecified bank notes during the period from 8 November 2016 to 30 November 2016 have notbeen made in the financial statements since they do not pertain to the financial yearended 31st March 2019.
4. With respect to the matter to be included in the Auditors Reportunder Section 197(16): In our Opinion and according to information and explanation givento us the remuneration paid during the current year by the Holding Company and itssubsidiaries which are incorporated in India is in accordance with the provisions ofSection 197 of the Act. The remuneration paid t any director by the Holding Company andits subsidiaries which are incorporated in India is not in excess of the limit laid downunder Section 197 of the Act. The ministry of Corporate Affairs has not prescribed otherdetails under Section 197(16) which are required t be commented upon by us.
| ||For K. F. Jetsey & Co. |
| ||Chartered Accountants |
| ||Firm's Registration No. 104209W |
| ||(CA. Keshav Jetsey) |
|Place: Mumbai ||Propreitor |
|Date: 30th May 2019 ||Membership No. 033206 |