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Orient Green Power Company Ltd.

BSE: 533263 Sector: Infrastructure
NSE: GREENPOWER ISIN Code: INE999K01014
BSE 16:01 | 04 Aug 2.23 0.07
(3.24%)
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2.23

HIGH

2.26

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2.15

NSE 00:00 | 04 Aug 2.25 0.10
(4.65%)
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2.20

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2.25

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2.15

OPEN 2.23
PREVIOUS CLOSE 2.16
VOLUME 1341444
52-Week high 3.57
52-Week low 1.20
P/E 5.72
Mkt Cap.(Rs cr) 167
Buy Price 2.23
Buy Qty 2141.00
Sell Price 2.23
Sell Qty 38059.00
OPEN 2.23
CLOSE 2.16
VOLUME 1341444
52-Week high 3.57
52-Week low 1.20
P/E 5.72
Mkt Cap.(Rs cr) 167
Buy Price 2.23
Buy Qty 2141.00
Sell Price 2.23
Sell Qty 38059.00

Orient Green Power Company Ltd. (GREENPOWER) - Auditors Report

Company auditors report

The Members of Orient Green Power Company Limited

Report on the Audit of the Consolidated Financial Statements

Opinion

We have audited the accompanying consolidated financial statements of Orient GreenPower Company Limited (hereinafter referred to as the "Holding Company") and itssubsidiaries (the Holding Company and its subsidiaries together referred to as "theGroup") which comprise the Consolidated Balance Sheet as at March 31 2019 theConsolidated Statement of Profit and Loss (including Other Comprehensive Income) theConsolidated Statement of Changes in Equity and the Consolidated Statement of Cash Flowsfor the year ended on that date and a summary of the significant accounting policies andother explanatory information. (hereinafter referred to as "the consolidatedfinancial statements")

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid consolidated financial statements give the information requiredby the Companies Act 2013 (the "Act") in the manner so required and give a trueand fair view in conformity with Indian Accounting Standards prescribed under section 133of the Act read with the Companies (Indian Accounting Standards) Rules 2015 as amended("Ind AS") and other accounting principles generally accepted in India of theconsolidated state of affairs of the Group as at March 31 2019 the consolidated lossconsolidated total comprehensive loss consolidated changes in equity and its consolidatedcash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the consolidated financial statements in accordance with theStandards on Auditing (SAs) specified under section 143 (10) of the Act. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Consolidated Financial Statements section of ourreport. We are independent of the Group in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India (ICAI) together with the ethicalrequirements that are relevant to our audit of the consolidated financial statements underthe provisions of the Act and the Rules made thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the consolidated financial statements.

Emphasis of Matter

We draw attention to the following matters included in the Notes to the Ind ASfinancial statements:

(i) No provision is required for capital advances amounting to Rs. 12203.01 Lakhsconsidering the long gestation of the projects in wind power sector and expected executionof project in ensuing years.

(ii) Considering the stay granted by the Supreme Court of India on the order issued byCentral Electricity Regulatory Commission ('CERC') on reduction of floor price noprovision is considered necessary for trade receivables recognised up to March 312017 ofRs. 2071.49 Lakhs pertaining to Renewable Energy Certificates.

(iii) The group during the year tested the Property Plant and Equipment's forimpairment. Such testing conducted by an independent technical expert and approved by themanagement did not result in any material impairment losses.

(iv) Considering the uncertainty involved in realizing the interest income on a loan ofRs. 7639.36 lakhs granted to M/s. Janati Bio Power Private Limited (rate of interest10.5% p.a.) the group has discontinued recognizing interest income on the said loan witheffect from October 01 2018. Further as per the contention of the management noprovision for credit loss on this loan is required in view of the comfort letter given bySVL Limited assuring the repayment.

(v) During the year ended March 312019 the Group obtained a waiver of interest on theloan of Rs. 37212.07 Lakhs from SVL Limited w.e.f. April 1 2018 and modified therepayment date to March 31 2019 with further roll over with the consent of both theparties. Further as required by Ind AS 109 the loan has been fair valued and gain of Rs.3188.50 Lakhs has been accounted for during the year. The unwinding of fair value gain inthe nature of interest expense of Rs. 3188.50 lakhs has also been recognized during theyear.

Our opinion has not been modified in respect of the above matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the consolidated financial statements of the current year.These matters were addressed in the context of our audit of the consolidated financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. We did not audit the financial statements of certainsubsidiaries as at and for the year ended on March 312019 as considered in theconsolidated financial statements. These financial statements have been audited by otherauditors whose reports have been furnished to us by the Management and our identificationand reporting of the Key Audit Matters in so far as it relates to these subsidiaries isbased solely on the report of the other auditor.

We have determined the matter described below to be the key audit matter to becommunicated in our report.

Key Audit Matter Auditors Response
Audit of testing of Impairment in the Property Plant The audit procedures that were performed were as under:
and Equipment and credit losses if any in the Loans and Advances has been identified as a Key Audit Matter considering the materiality involved. • Where the situation so warranted we reviewed the adequacy of the impairment provisions/credit losses estimated by the company for its Property Plant and Equipment and Loans based on the net-worth of the other companies the operating/ cash profits and the net present value of cash flows on the basis of the projected financial statements approved by the management and the Audit Committee of the company.
• We have reviewed the reasonableness of the projected revenues expenses remaining useful life of the Windmills and the net present value of the cash flows (NPV) of the company and the discount rate involved. We have also compared the NPV with the carrying amounts of the assets in order to ascertain the adequacy of the provisions. According to the information and explanations given to us by the management of the company we have also considered the long gestation and the pay-back period involved in the Wind Power Projects while estimating the amount and the timing of the provisions/credit losses against the Investments and the Loans.
• We have obtained and reviewed the reports on the valuation of the Windmills which was carried out by the company by engaging an Independent Valuer.

Information Other than the Standalone Financial Statements and Auditor's Report Thereon

The Holding Company's Board of Directors is responsible for the other information. Theother information comprises the information included in the Management Discussion &Analysis Director's Report and Corporate Governance Report but does not include theConsolidated Financial Statements and our auditor's report thereon.

Our opinion on the Consolidated Financial Statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Consolidated Financial Statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the Consolidated Financial

Statements 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 have nothing to report in this regard.

Management's Responsibility for the Consolidated Financial Statements

The Holding Company's Board of Directors is responsible for the matters stated insection 134 (5) of the Act with respect to preparation of these consolidated financialstatements that give a true and fair view of the consolidated financial positionconsolidated financial performance consolidated total comprehensive income consolidatedchanges in equity and consolidated cash flows of the Group in accordance with the Ind ASand other accounting principles generally accepted in India. The respective Board ofDirectors of the companies included in the Group are responsible for maintenance of theadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Holding company and the subsidiary and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments 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 consolidated financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the consolidated financial statements the respective Board of Directorsof the companies included in the Group are responsible for assessing the Holding Company'sand the subsidiary's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Holding company and/or the subsidiary or tocease operations or has no realistic alternative but to do so.

The respective Board of Directors of the companies included in the Group are alsoresponsible for overseeing the financial reporting process of those companies.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidatedfinancial statements as a whole are free from material misstatements whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these consolidated financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidatedfinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal financial controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143 (3) (i) of the Act we are also responsible for expressing our opinion on whether theCompany and its subsidiary companies which are companies incorporated in India haveadequate internal financial controls system in place and the operating effectiveness ofsuch controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the ability ofthe Holding Company and/or the subsidiary to continue as a going concern. If we concludethat a material uncertainty exists we are required to draw attention in our auditor'sreport to the related disclosures in the consolidated financial statements or if suchdisclosures are inadequate to modify our opinion. Our conclusions are based on the auditevidence obtained up to the date of our auditor's report. However future events orconditions may cause the Holding Company and/ or the subsidiary to cease to continue as agoing concern.

• Evaluate the overall presentation structure and content of the consolidatedfinancial statements including the disclosures and whether the consolidated financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.

• Obtain sufficient appropriate audit evidence regarding the financial informationof the entities or business activities within the Holding Company and the subsidiary toexpress an opinion on the consolidated financial statements. We are responsible for thedirection supervision and performance of the audit of the financial statements of suchentities included in the consolidated financial statements.

Materiality is the magnitude of misstatements in the consolidated financial statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the financial statements.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the consolidated financialstatements of the current year and are therefore the key audit matters. We describe thesematters in our auditor's report unless law or regulation precludes public disclosure aboutthe matter or when in extremely rare circumstances we determine that a matter should notbe communicated in our report because the adverse consequences of doing so wouldreasonably be expected to outweigh the public interest benefits of such communication.

Other Matters

We did not audit the financial statements of certain subsidiaries whose financialstatements reflect total assets of Rs. 23748.19 Lakhs as at March 312019 total revenuesof Rs. 1173.23 Lakhs and net cash flows amounting to Rs. 208.55 Lakhs after eliminationof inter group transactions for the year ended on that date as considered in theconsolidated financial statements.

These financial statements have been audited by other auditors whose reports have beenfurnished to us by the Management and our opinion on the consolidated financialstatements in so far as it relates to the amounts and disclosures included in respect ofthese subsidiaries and our report in terms of sub-sections (3) and (11) of Section 143 ofthe Act in so far as it relates to the aforesaid subsidiaries is based solely on thereports of the other auditors.

Our opinion on the consolidated financial statements and our report on Other Legal andRegulatory Requirements below is not modified in respect of the above matter with respectto our reliance on the work done and the reports of the other auditors.

Report on Other Legal and Regulatory Requirements

As required by Section 143(3) of the Act we report to the extent applicable 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 of the aforesaidconsolidated financial statements.

b. In our opinion proper books of account as required by law relating to preparationof the aforesaid consolidated financial statements have been kept so far as it appearsfrom our examination of those books and the reports of the other auditors.

c. The Consolidated Balance Sheet the Consolidated Statement of Profit and Loss(including other comprehensive income) Consolidated Statement of Changes in Equity andthe Consolidated Cash Flow Statement dealt with by this Report are in agreement with therelevant books of account maintained for the purpose of preparation of the consolidatedfinancial statements.

d. In our opinion the aforesaid consolidated financial statements comply with theIndian Accounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.

e. On the basis of the written representations received from the directors of theHolding Company as on March 31 2019 taken on record by the Board of Directors of theHolding Company and the reports of the statutory auditor of its subsidiaries incorporatedin India none of the directors of the group companies incorporated in India isdisqualified as on March 31 2019 from being appointed as a director in terms of Section164 (2) of the Act.

f. With respect to the adequacy of internal financial controls over financial reportingof the Group and the operating effectiveness of such controls refer to our separatereport in "Annexure A" to this report which is based on the auditor's report ofholding company and subsidiaries incorporated in India.

g. With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended in our opinionand to the best of our information and according to the explanations given to us theremuneration paid by the Holding Company and the subsidiaries to its directors during theyear is in accordance with the provisions of section 197 (16) of the Act.

h. With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditor's) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Group has disclosed the impact of pending litigations on its financial positionin its Ind AS consolidated financial statements.

ii. The Group did not have any material foreseeable losses on long-term contractsincluding derivative contracts.

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Holding Company and its subsidiarycompanies incorporated in India.

For G. D. Apte & Co
Chartered Accountants
Firm Registration Number: 100 515W
C. M. Dixit
Chennai Partner
April 29 2019 Membership Number: 017 532

'Annexure A' to the Independent Auditor's Report of Even Date on the ConsolidatedFinancial Statements of Orient Green Power Company Limited - Report on the InternalFinancial Controls under Clause (i) of Subsection 3 of Section 143 of the Companies Act2013 ("the Act")

The Members of Orient Green Power Company Limited

In conjunction with our audit of the consolidated Ind AS financial statements of OrientGreen Power Company Limited as at and for the year ended March 31 2019 we have auditedthe internal financial controls over financial reporting of Orient Green Power CompanyLimited (hereinafter referred to as the "Holding Company") and its subsidiarieswhich are companies incorporated in India as of that date.

Management's Responsibility for Internal Financial Controls

The respective Board of Directors of the Holding Company and its subsidiaries whichare companies incorporated in India are responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (Guidance Note) issued by the Institute of Chartered Accountants of India(ICAI). These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to the Company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to financial statements of the Holding Company and itssubsidiaries which are companies incorporated in India based on our audit. We conductedour audit in accordance with the Guidance Note and the Standards on Auditing specifiedunder section 143(10) of the Act to the extent applicable to an audit of internalfinancial controls both issued by the ICAI. Those Standards and the Guidance Note requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls with reference tofinancial statements was established and maintained and if such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to financial statements and their operatingeffectiveness. Our audit of internal financial controls with reference to financialstatements included obtaining an understanding of internal financial controls withreference to financial statements assessing the risk that a material weakness exists andtesting and evaluating the design and operating effectiveness of internal control based onthe assessed risk. The procedures selected depend on the auditor's judgement includingthe assessment of the risks of material misstatement of the consolidated financialstatements whether due to fraud or error.

We believe that the audit evidence we have obtained and the audit evidence obtained bythe other auditors in terms of their reports referred to in the Other Matters paragraphbelow is sufficient and appropriate to provide a basis for our audit opinion on theCompany's internal financial controls with reference to financial statements.

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 thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material 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.

Opinion

In our opinion the Holding Company and its subsidiaries which are companiesincorporated in India have maintained 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 2019 based on theinternal control over financial reporting criteria established considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.

Other Matters

Our report under Section 143(3)(i) of the Act on the adequacy and operatingeffectiveness of the internal financial controls over financial reporting in so far as itrelates to certain subsidiaries not audited by us and which are companies incorporated inIndia is based on the corresponding reports of the auditors of such subsidiaries.

Our opinion has not been modified in respect of the above matter.

For G. D. Apte & Co
Chartered Accountants
Firm Registration Number: 100 515W
C. M. Dixit
Chennai Partner
April 29 2019 Membership Number: 017 532