Parsharti Investment Limited
Report on the Financial Statements
We have audited the financial statements of PARSHARTI INVESTMENT LIMITED("the Company") which comprise the balance sheet as at March 31 2019 thestatement of Profit and Loss and statement of cash flows for the year then ended andnotes to the financial statements including a summary of significant accounting policiesand other explanatory information.
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 theCompanies Act 2013 in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of affairs of theCompany as at March 31 2019 and its profit and its cash flows for the year ended onthat date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial 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 thefinancial statements under the provisions of the Companies Act 2013 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 professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.Accordingly we have nothing to report in this regard.
Information Other than the Financial Statements and Auditor's report thereon
The Company's Board of Directors is responsible for the preparation of otherinformation. The Other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexures to the Board report andShareholder's information but does not include the financial statement and our auditor'sreport thereon.
Our opinion on the financial statements does not cover the other information and we donot express any form of assurance conclusion thereon.
In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained during thecourse of our audit or otherwise appears to be materially misstated.
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.
Responsibility of Management and those charged with Governance for the FinancialStatements
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 the accountingprinciples generally accepted in India including the accounting Standards specified undersection 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 financial statement that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.
In preparing the financial statements the Management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative 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 the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these 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 financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Act we are also responsible for expressing our opinion on whether the Company hasadequate internal financial control 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 the 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 Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the entity to cease to continue asa going concern.
Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.
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.
Company's Certificate of Registration (COR) has been cancelled by RBI under section 45-IA (6) of the Reserve Bank of India Act 1934 vide their letter dated 21stAugust 2018 due to non-achievement of minimum requirement of Net owned Funds of र200 Lakhs. The company has already achieved the desired level of Net owned funds on 9thAugust 2018 by way of Preferential issue to promoter and promoters group by issuing334000 equity shares of र 10 each at a price of र 30 per share includingpremium of र 20 per equity share amounting to र 10020000. Company has filedan appeal with Department of Financial Services Ministry of Finance New Delhi. Thehearing of the said appeal was conducted on 8th May 2019. The Order ofMinistry of Finance is awaited. We do not express any form of assurance conclusionthereon.
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 ofthe Companies Act 2013 we give in the 'Annexure A' a statement on the matters specifiedin paragraphs 3 and 4 of the Order to the extent applicable.
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 purposes of our audit.
b) In our opinion proper books of account 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 and Loss and the 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 under Section 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 2019 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2019 from being appointed as a director in terms of Section 164 (2) of theAct.
f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B".
g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of 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 outstanding long-term contracts including derivativecontracts as at March 31 2019 for which there were any material foreseeable losses.
iii. There has been there no delay in transferring amounts required to be transferredto the Investor Education and Protection Fund by the Company.
For M/s B.K.G. & Associates
Firm Reg. No. 114852(w)
CA. B K Gupta
Membership No- 040889
Place : Mumbai
Date: 17th May 2019
ANNEXURE A' TO THE INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 1 under "Report on Other Legal and RegulatoryRequirements" of our report to the Members of Parsharti Investment Limited ('theCompany') for the year ended March 31st 2019.
On the basis of such checks as were considered appropriate and according to theinformation and explanations given to us during the course of audit we state that:
(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets;
(b) Fixed assets have been physically verified by the management during the year. Thefrequency of verification is considered reasonable having regards to the size of thecompany and the nature of its assets. No material discrepancies were identified on suchverification.
(c) As the company does not have any immovable properties Clause (i)(c) of theParagraph 3 of the Order is not applicable to the Company.
(ii) The Inventory has been physically verified during the year by the management atreasonable intervals. No discrepancies were noticed on such verification.
(iii) According to the information and explanation given to us the Company has notgranted any loans secured or unsecured to companies firms or other parties covered inthe register maintained under Section 189 of the Companies Act 2013.
(iv) In our opinion and according to the information and explanations given to us inrespect of loans investment guarantees securities the provision of section 185 and 186of the Companies Act of 2013 have been complied with.
(v) No deposits within the meaning of Sections 73 to 76 of the Act and rules framedthere under have been accepted by the Company. Hence the provisions of clause (v) of theParagraph 3 of the Order are not applicable to the Company.
(vi) To the best of our knowledge and as explained the Central Government has notprescribed the maintenance of cost records under section 148 (1) of the Act in respect ofactivities undertaken by the Company during the year.
(vii) (a) According to the books of account and records as produced and examined by usin accordance with the generally accepted auditing practices in India in our opinion theCompany is regular in depositing undisputed statutory dues in respect of provident fundemployees state insurance income tax wealth tax service tax sales tax customs dutyexcise duty value added tax cess goods and service tax and other statutory duesapplicable to the Company with appropriate authorities. According to the information andexplanation given to us no undisputed amounts payable in respect of the aforesaidstatutory dues were outstanding as at the last day of the financial year for a period ofmore than six months from the date they became payable.
(b) On the basis of our examination of the documents and records the company does nothave any disputed statutory liabilities.
(viii) According to the information and explanation given to us the Company has notdefaulted in repayment of dues of the financial institution or bank or debenture holders.
(ix) The Company has not raised any money by way of public issue or further publicoffer and term loans during the year. Hence the provisions of clause (ix) of theParagraph 3 of the Order are not applicable to the Company.
(x) During the course of our examination of the books of account and records of thecompany carried out in accordance with the generally accepted auditing practices in Indiaand according to the information and explanations given to us we have neither come acrossany instance of fraud on or by the Company noticed or reported during the year nor havewe been informed of such case by the management.
(xi) According to the information and explanations given to us the company has notpaid any managerial remuneration during the year.
(xii) The Company is not a Nidhi Company. Hence the provisions of clause (xii) of theParagraph 3 of the Order are not applicable to the Company.
(xiii) According to the information and explanations given to us all the transactionswith related parties are in compliance with section 177 and 188 of the Companies Act 2013and details of such transactions have been disclosed in the financial statements asrequired by the applicable Accounting Standard.
(xiv) According to the information and explanation given to us the Company has madepreferential allotment of shares during the year to Promoter or Promoter group which is incompliance with requirement of Companies Act 2013 and the amount raised has been used forthe purpose for which the funds were raised.
(xv) According to the information and explanation given to us the Company has notentered into any non-cash transactions with directors or persons connected with them andhence the provisions of clause (xv) of the Paragraph 3 of the Order are not applicable tothe Company.
(xvi) Company's Certificate of Registration (COR) has been cancelled by RBI undersection 45-IA (6) of the Reserve Bank of India Act 1934 vide their letter dated 21stAugust 2018 due to non-achievement of minimum requirement of Net owned Funds of र200 Lakhs. The company has already achieved the desired level of Net owned funds on 9thAugust 2018 by way of Preferential issue to promoter and promoters group by issuing334000 equity shares of र 10 each at a price of र 30 per share includingpremium of र 20 per equity share amounting to र 10020000. Company has filedan appeal with Department of Financial Services Ministry of Finance New Delhi. Thehearing of the said appeal was conducted on 8th May 2019. The Order ofMinistry of Finance is awaited.
For M/s B.K.G. & Associates
Firm Reg. No. 114852(w)
CA. B K Gupta
Date: 17th May 2019
'ANNEXURE B' TO THE INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 2(e) under "Report on Other Legal and RegulatoryRequirements" of our report to the members of Parsharti Investment Limited ('thecompany') for the year ended March 31st 2019.
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 PARSHARTIINVESTMENT LIMITED ("the Company") as of March 31 2019 in conjunction with ouraudit of the financial statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Company's 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. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to the Company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Act.
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 the Institute ofChartered Accountants of India and specified under Section 143(10) of the Act to theextent applicable to an audit of internal financial controls both applicable to an auditof Internal Financial Controls and both issued by the Institute of Chartered Accountantsof India. 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 auditor's judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the internal financial controls system over financialreporting.
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 authorizations ofmanagement and directors of the Company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized 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.
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 March 31 2019 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 M/s B.K.G. & Associates
Firm Reg. No. 114852(w)
CA. B K Gupta
Date: 17th May 2019