To the Members of NEHA INTERNATIONAL LIMITED
Report on the Financial Statements:
We have audited the accompanying financial statements of NEHA INTERNATIONAL LIMITED("the Company") which comprise the Balance Sheet as at March 31 2017 theStatement of Profit and Loss and the Cash Flow Statement for the period then ended and asummary of significant accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements:
The Company's Board of Directors is 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 and cash flows of the Company in accordance with accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; andthe design implementation and maintenance of adequate internal financial control thatwere operating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.
Our responsibility is to express an opinion on these financial statements based on ouraudit. We conducted our audit in accordance with the Standards on Auditing specified undersection 143(10) of the Act issued by the Institute of Chartered Accountants of India.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 audit procedures to obtain auditevidence about the amounts and disclosures in the financial statements. 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. Inmaking those risk assessments the auditor considers internal financial control relevantto the Company's preparation and fair presentation of the financial statements that givetrue and fair view in order to design audit procedures that are appropriate in thecircumstances and for the purpose of expressing an opinion on whether the company has anadequate Internal Financial Control System over Financial Reporting in place and theoperating effectiveness of such Controls. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of the accountingestimates made by management as well as evaluating the overall presentation of thefinancial statements. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion on the financial statements.
Emphasis of Matter:
During the year the company has disposed off the entire shareholding in one of itssubsidiaries M/s. Dream Flowers PLC Ethiopia. The entire shareholding was sold to HansaHorticulture Dubai for US$ 360000 of which US$ 240000 was received till date.
In our opinion and to the best of our information and according to the explanationsgiven to us the financial statements give the information required by the Act in themanner 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 at March31 2017; and
b) in the case of the Profit and Loss Account of the profit for the period ended onthat date.
c) in the case of the cash flow statement of the Cash Flows for the period ended onthat date.
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 of India in terms of sub-section (11) of section 143 andon the basis of such checks of the books and records of the company as we consideredappropriate and according to the information and explanation given to us we giveAnnexure-A a statement on the matters specified in the paragraphs 3 and 4 of the Order tothe extent applicable to the company.
2. As required by section 143(3) of the Act we report that:
a. we have obtained all the information and explanations which to the best of ourknowledge and belief were necessary for the purpose of our audit;
b. in our opinion proper books of account as required by law have been kept by theCompany so far as appears from our examination of those books;
c. the Balance Sheet and Statement of Profit and Loss dealt with by this Report are inagreement with the books of account;
d. in our opinion the Balance Sheet and Statement of Profit and Loss comply with theAccounting Standards specified under section 133 of the Companies Act 2013 read with rule7 of the Companies (Accounts)Rules2014.
e. on the basis of written representations received from the directors as on March 312017 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of section 164(2) ofAct.
f. Based on the Internal Financial Control Report given by the Independent Auditors M.M. Reddy & Co we are of the opinion that the company has adequate internal financialcontrols system in place and the operating effectiveness of such controls. (enclosedIndependent Auditors Report of M. M. REDDY & Co. on Internal Financial Controls asAnnexure B)
g. With respect to the other matters to be included in auditor's report in accordancewith Rule 11 of Companies (Audit and Auditors)Rules 2014 in our opinion and to the bestof our information and according to the explanation given to us;
i. The Company has disclosed the impact of pending litigation of its financial positionin its financial statements.
ii. In our opinion and as per the information and explanations provided to us thecompany not entered into any long term contracts including derivate contracts requiringunder applicable laws or accounting standards for material foreseeable losses and
iii. There has been no delay in transferring to the Investor Education and ProtectionFund by the Company.
iv. With reference to Note No. 48 The Company has provided requisite disclosures inits financial statements as well as dealings in Specified Bank Notes during the periodfrom 8th November 2016 to 30th December 2016 and these are inaccordance with the books of account maintained by the company.
| ||For MATHESH & RAMANA |
| ||CHARTERED ACCOUNTANTS |
| ||Sd/- |
|Place: Hyderabad ||B. V. RAMANA REDDY |
|Date: 30/05/2017 ||Partner M. No. 026967 |
ANNEXURE-A TO THE INDEPENDENT AUDITOR'S REPORT
Re: NEHA INTERNATIONAL LIMITED
Referred to in Paragraph 1 under section (Report on other Legal and RegulatoryRequirements of our Report of even date)
(i) (a) The company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) All the assets have been physically verified by the management during the year andthere is a regular program of verification which in our opinion is reasonable havingregard to the size of the company and the nature of its assets. No material discrepancieswere noticed on such verification.
(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.
(ii) (a) The Management has conducted physical verification of inventory (excludingstocks lying with third parties) at reasonable intervals. In respect of inventory lyingwith third parties these have substantially been confirmed by them. In our opinion thefrequency of verification is reasonable.
(b) In our opinion and according to the information and explanations given to us theprocedures of physical verification of inventories followed by the management arereasonable and adequate in relation to the size of the company and the nature of itsbusiness. (c) The Company is generally maintaining proper records of inventory. Thediscrepancies noticed on verification between physical stock and book records were notmaterial in relation to the operations of the Company and the same have been properlydealt with in the books of account.
(iii) (a) The company has not granted loans to the parties covered in the registermaintained under section 189 of the Companies Act 2013
(b) The company is regular in recovering the principal amounts as stipulated and hasbeen regular in the receiving of interest.
(c) There were no overdue amounts of loans granted to companies firms or other partieslisted in the register maintained under section 189 of the Companies Act 2013.
(iv) According to the information and explanations given to us in respect of loansinvestments guarantees and security the company has complied with provisions of section185 and 186 of the Companies Act 2013.
(v) According to the information and explanations given to us the Company has notaccepted any deposits in terms of directives issued by Reserve Bank of India and theprovisions of Sections 73 to 76 or any other relevant provisions of the Companies Act andthe rules framed there under except in case of Advance from Customers Rs.54528486/--which has remained for a period beyond 365 days.
(vi) In our opinion and according to the information and explanations given to us thecompany is maintaining proper cost records as been prescribed by the Central Governmentunder sub section (1) of section 148 of the Companies Act 2013 for the activities of theCompany.
(vii) (a) The company is regular in depositing with appropriate authorities theundisputed statutory dues including Income Tax Sales Tax Duty of Excise Value Added Tax(VAT) and other material statutory dues applicable.
(b) According to the information and explanations given to us there were no undisputedamounts payable in respect of service tax and sales tax which were in arrears as at 31stMarch 2017 for a period of more than six months from the date they became payable.
(c) According to the information and explanation given to us there are no dues ofsales tax income tax and excise duty which have not been deposited on account of anydispute.
(viii) The Company has not defaulted in repayment of loans or borrowings availed fromany financial institution banks government or debenture holders during the year.
(ix) In our opinion and according to the information and explanations given to usmoney raised by way of Initial Public offer or Further public offer (including debtinstruments) and term loans were applied for the purposes for which those are raised.
(x) In our opinion and according to the information and explanations given to us Nofraud by the company or any fraud on the Company by its officers or employees has beennoticed or reported during the year.
(xi) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.
(xii) In our opinion and according to the information and explanations given to us thecompany is not a Nidhi company.
(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 given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year.
(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him.
(xvi) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.
| ||For MATHESH & RAMANA |
| ||CHARTERED ACCOUNTANTS |
| ||Sd/- |
|Place: Hyderabad ||B. V. RAMANA REDDY |
|Date: 30.05.2017 ||Partner M. No. 026967 |