TO THE MEMBERS OF PAZEL INTERNATIONAL LIMITED
(FORMERLY RUTRON INTERNATIONAL LIMITED)
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS
We have audited the financial statements of PAZEL INTERNATIONAL LIMITED (FORMERLYRUTRON INTERNATIONAL LIMITED) ("the Company") which comprise the BalanceSheet as at 31 March 2019 and the Statement of Profit and Loss (including othercomprehensive income) Statement of Changes in Equity and Statement of Cash Flows for theyear then ended and notes to the financial statements including a summary of significantaccounting policies and other explanatory information (hereinafter referred to as"the financial statements").
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 ("the Act") in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at 31 March 2019 and profit (including othercomprehensive income) changes in equity and its cash flows for the year ended on thatdate.
BASIS FOR OPINION
We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder Section 143(10) of the Act. Our responsibilities under those SAs are furtherdescribed in the Auditor's Responsibilities for the Audit of the Financial Statementssection of our report. We are independent of the Company in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India (ICAI) together with theethical requirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules there under and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the ICAI's Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our opinion on the financial statements.
INFORMATION OTHER THAN THE FINANCIAL STATEMENTS AND AUDITOR'S REPORT THEREON
The Company's management and Board of Directors are responsible for the otherinformation. The other information comprises the information included in the Company'sannual report but does not include the financial statements and our auditors' reportthereon.
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 in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information; weare required to report that fact. We have nothing to report in this regard.
MANAGEMENT'S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
The Company's management and Board of Directors are responsible for the matters statedin Section 134(5) of the Act with respect to the preparation of these financial statementsthat give a true and fair view of the state of affairs (Financial Position) Profit / Loss(Financial Performance including other comprehensive income) changes in equity and cashflows of the Company in accordance with the accounting principles generally accepted inIndia including the Indian Accounting Standards (Ind AS) specified under Section 133 ofthe Act.
This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing the financial statements management and Board of Directors areresponsible 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.
Those Board of Directors is also responsible for overseeing the Company's financialreporting 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 controls with reference to financial statements in place andthe operating effectiveness of such 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 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 auditors'report. However future events or conditions may cause the Company 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.
Materiality is the magnitude of misstatement in the financial statements thatindividually 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 financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditors' report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.
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 mattersspecified in paragraphs 3 and 4 of "the Order" to the extent applicable.
(A) 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 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 statement of Profit and Loss (including the Statement of OtherComprehensive Income) the statement of Cash Flow and Statement of Changes in Equity dealtwith 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.
e. On the basis of written representations received from the directors as on 31st March2019 and taken on record by the Board of Directors none of the directors is disqualifiedas on 31st March 2019 from being appointed as a director under sub section (2) of section164 of the Act.
f. With respect to adequacy of the internal financial control system over financialreporting of the Company and the operating effectiveness of such Controls refer to ourseparate report in Annexure (B).
(B) With respect to the other matters included in the Auditor's Report in accordancewith the rule 11 of Companies (Audit and Auditors) Rule 2014 as amended 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 in its financial statements.
ii. The Company did not have any long-term contracts including derivatives contractsfor which there were any material foreseeable losses in its financial statements.
iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
(C) With respect to the matter to be included in the Auditors' Report under section197(16):
In our opinion and according to the information and explanations given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of Section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under Section 197(16) which arerequired to be commented upon by us.
For MNNY & Associates
CA Yuvrajsingh Rathore
Membership no.: 126873
Date: 30th May 2019
ANNEXURE (A) TO THE INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 1 under the heading "Report on other legal and regulatoryrequirements" of our report of even date on account of Pazel International Limited(Formerly Rutron International Limited)("the Company") for the year ended 31stMarch 2019.
(i) FIXED ASSET [CLAUSE 3(I)] -
In Respect of the company's Fixed Assets:
(a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets in computerized fixed assets register.
(b) As informed and represented to us by the management of the company fixed assetshave been physically verified by the management during the period under review and nomaterial discrepancies noticed during such physical verification of fixed assets.
(c) According to the information and explanation given to us the company does not holdany immovable properties in its own name during the period under review.
(ii) INVENTORY [CLAUSE 3(II)] -
In Respect of Inventories:
(a) According to the information and explanation given to us physical verification ofinventories has been conducted at reasonable intervals by the Management during the year.
(b) As informed by the management no material discrepancies were noticed on physicalverification of inventories as compared to book records.
(iii) LOAN GIVEN BY COMPANY [CLAUSE 3(III)] -
According to the information and explanation given to us during the period underreview the Company has not granted any loans whether secured or unsecured to companiesfirms Limited Liability Partnerships or other parties listed in the register maintainedunder section 189 of the Companies Act 2013. Therefore details under Sub Clause (a) (b)& (c) of Clause 3 (iii) of the Companies (Auditor's Report) Order 2016 are notapplicable to the company.
(iv) LOAN TO DIRECTOR AND INVESTMENT BY THE COMPANY [CLAUSE 3(IV)] -
According to the information and explanation given to us during the period underreview the Company has not directly or indirectly advanced any loan to any of thedirectors or to any other person in whom the directors are interested or given anyguarantees or provided any securities in connection with the loan taken by them or suchother person pursuant to the provisions of section 185 nor made any investments pursuantto the provisions of section 186 of Companies Act 2013. Hence the details thereof are notapplicable as required under clause 3 (iv) of the Companies (Auditor's Report) Order2016.
(v) DEPOSITS [CLAUSE 3(V)] -
According to the information and explanation given to us the Company has not acceptedany deposits from public covered under the provisions of section 73 to 76 or any otherrelevant provisions of the Companies Act 2013 and the rules framed there under duringthe year under review. According to the information and explanations given to us no Orderhas been passed by the Company Law Board or the National Company Law Tribunal or theReserve Bank of India or any Court or any other Tribunal on the Company. Therefore clause3 (v) of the Companies (Auditor's Report) Order 2016 is not applicable to the company.
(vi) COST RECORDS [CLAUSE 3(VI)] -
As per information and explanation given by the management provisions in relation tomaintenance of cost records as specified by the central Government under sub section (1)of section 148 of the Companies Act 2013 are not applicable to the Company. Thereforeclause 3 (vi) of the Companies (Auditor's Report) Order 2016 is not applicable to thecompany.
(vii) STATUTORY DUES [CLAUSE 3(VII)] -
In Respect of Statutory Dues:
(a) According to information and explanation given to us and on the basis of therecords of the Company undisputed statutory dues including provident fund Employees'State Insurance profession tax income-tax Goods and Service tax Duty of customs cessand any other material statutory dues have generally been regularly deposited during theyear by the Company with the appropriate authorities.
According to the information and explanation given to us no undisputed amounts payablein respect of provident fund Employees' State Insurance profession tax income-taxGoods and Service tax duty of customs cess and any other material statutory dues were inarrears as at 31st March 2019 for a period of more than six months from the date theybecame payable.
(b) According to the records of the Company and explanation given to us there are nomaterial dues of provident fund Employees' State Insurance profession tax income-taxGoods and Service tax Duty of customs cess and any other statutory dues on account ofdispute which have not been deposited with the appropriates authorities on account of anydisputes as on 31st March 2019.
(viii) REPAYMENT OF LOAN [CLAUSE 3(VIII)] -
Based on our audit procedures and the information and explanation given by managementthe company has not borrowed funds from financial institutions banks or money raisedthrough the issue of debentures during the period under review. Therefore details requiredto be disclosed under clause 3 (viii) of the Companies (Auditor's Report) Order 2016 isnot applicable to the company.
(ix) UTILISATION OF IPO AND FURTHER PUBLIC OFFER [CLAUSE 3(XI)] -
According to the records of the Company and explanation given to us the company didnot raised money by way of Initial Public Offer (IPO) or further public offer (includingdebt instruments) and term loans during the period under review therefore clause 3(ix)of the Companies (Auditor's Report) Order 2016 is not applicable to the company.
(x) REPORTING OF FRAUD [CLAUSE 3(X)] -
To the best of our knowledge and according to the information and explanations given tous no material fraud by the Company or no material fraud on the Company by its officersor employees has been noticed or reported during the course of our audit.
(xi) APPROVAL OF MANAGERIAL REMUNERATION [CLAUSE 3(XI)] -
Based upon the audit procedures performed and the information and the explanationsgiven by the management the managerial remuneration has been paid or provided inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Companies Act 2013.
(xii) NIDHI COMPANY [CLAUSE 3(XII)] -
As per information and explanation given by the management the company is not a ChitFund Nidhi or Mutual Benefit Fund/ Society. Therefore clause 3(xii) of the Companies(Auditor's Report) Order 2016 is not applicable to the company.
(xiii) RELATED PARTY TRANSACTION [CLAUSE 3(XIII)] -
As per information and explanation given by the management all transactions with therelated parties are in compliance with sections 177 and 188 of Companies Act 2013 whereapplicable for all the transactions with the related parties and the details of therelated party transactions have been disclosed in the financial statements as required bythe applicable accounting standards.
(xiv) PRIVATE PLACEMENT OF PREFERENTIAL ISSUES [CLAUSE 3(XIV)] -
As per information and explanation given by the management the company has not madeany preferential allotment or private placement of shares or fully or partly convertibledebentures during the period under review hence requirement of section 42 of theCompanies Act 2013 are not applicable to the company. Therefore details under clause3(xiv) of the Companies (Auditor's Report) Order 2016 are not applicable to the company.
(xv) NON CASH TRANSACTION [CLAUSE 3(XV)] -
As per information and explanation given by the management the company has not enteredinto any non-cash transactions with directors or persons connected to its directors.Therefore compliance pursuant to the provisions of section 192 of Companies Act 2013 isnot applicable. Therefore details under clause 3 (xv) of the Companies (Auditor's Report)Order 2016 are not applicable to the company.
(xvi) REGISTER UNDER RBI ACT 1934 [CLAUSE 3(XVI)] -
As per information and explanation given by the management the company is not requiredto be registered under section 45-IA of the Reserve Bank of India Act 1934. Thereforeclause 3 (xvi) of the Companies (Auditor's Report) Order 2016 is not applicable to thecompany.
For MNNY & Associates
CA Yuvrajsingh Rathore
Membership No. 126873
Date: 30th May 2019
ANNEXURE (B) TO THE INDEPENDENT AUDITORS' REPORT
(Referred to in paragraph 2(f) under the heading "Report on other legal andregulatory requirements" of our report of even date on account of PazelInternational Limited (Formerly Rutron International Limited) ("theCompany")for the year ended 31st March 2019 Report on the Internal FinancialControls Over Financial Reporting under Clause (i) of Sub section 3 of section 143 of theCompanies Act 2013 ("the Act").
We have audited the internal financial controls over financial reporting of PazelInternational Limited (Formerly Rutron International Limited) ("theCompany") as of 31st March 2019 in conjunction with our audit of the financialstatements of the company for the year ended on that date.
MANAGEMENT'S RESPONSIBILITY FOR THE 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 essentials components of internal controlstated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") issued by the Institute of Chartered Accountantsof 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.
Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We have conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") and the Standards on Auditing issued by theInstitute of Chartered Accountants of India and deemed to be prescribed under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate 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 risks of materialmisstatement of the financial statements whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.
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 andpreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A Company's internal financial control over financialreporting includes policies and procedures that :
(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditure of the Company are being made only inaccordance with authorizations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial 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 to the best of our information and according to the explanation givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at 31st March 2019 based on "the internalcontrol over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Noteon Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India".
For MNNY & Associates
Membership no.: 126873
Date: 30th May 2019