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Picturehouse Media Ltd.

BSE: 532355 Sector: Media
NSE: N.A. ISIN Code: INE448B01029
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NSE 05:30 | 01 Jan Picturehouse Media Ltd
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VOLUME 20
52-Week high 2.17
52-Week low 0.84
P/E
Mkt Cap.(Rs cr) 5
Buy Price 1.00
Buy Qty 10.00
Sell Price 1.00
Sell Qty 167.00

Picturehouse Media Ltd. (PICTUREHOUSE) - Auditors Report

Company auditors report

To the Members of Picturehouse Media Limited

Report on the Audit of the Standalone Financial Statements

Qualified Opinion

We have audited the standalone financial statements of Picturehouse Media Limited (the Company) which comprise the Balance Sheet as at 31st March 2019 and the Statement of Profit and Loss (including Other Comprehensive Income) the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended and notes to the financial statements including a summary of the significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanations given to us except for the effects of the matter described in the Basis for Qualified Opinion section of our report the aforesaid standalone financial statements give the information required by the Companies Act 2013 (the Act) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including Indian Accounting Standards (`Ind AS') specified under section 133 of the Act of the state of affairs of the Company as at 31st March 2019 and its loss including other comprehensive income its changes in equity and cash flows for the year ended on that date.

Basis for Qualified Opinion

1. Attention is invited to Note No.25.1 to the Standalone Financial Statements in relation to loans and advances made for film production (including interest accrued) amounting to Rs. 4239.76 lakhs whose realisability is significantly dependent on timely completion of production of films and the commercial viability of the films under production etc. Management is of the view that loans and advances can be realised at the time of release of the movies and accordingly the company is confident of realizing the entire amount of loans with interest and does not foresee any erosion in carrying value. We were unable to obtain sufficient appropriate audit evidence about the carrying amounts of loans and advances as at 31st March 2019 as the management was unable to provide us the current status of production films and confirmation of balances from the borrowers. Consequently we were unable to determine whether any adjustments to the carrying amounts of loans and advances were necessary.

2. Attention is invited to Note No.25.1 to the Standalone Financial Statements in relation to inventory i.e films production expenses amounting to Rs. 5066.31 lakhs mainly consists of advances given to artists and co-producers. As the management has not commenced the production of films the advances continued to be carried as inventory. However management states that it is evaluating options for optimal utilization of these payments. In the absences of demonstrable approach towards commencement and completion of production of films and also in the absence of confirmation of balances from the parties we are of the opinion that the realisability of the inventory is doubtful and in the absence of any provision in this regard the loss for the year is understated.

3. Attention is invited to Note no. 25.2 to the Standalone Financial Statements in relation to investment in equity shares in PVP Capital Limited (`PVPCL' a Wholly Owned Subsidiary Company) amounting to Rs. 2521.74 lakhs. Considering erosion in the net worth of the subsidiary company and its dependence on the holding company to continue as a going concern and in the absence of visible cash flows defaults in repayment of its dues to bank non-payment of statutory dues and other related factors indicates the existence of materiality uncertainty in carrying value of investments. Management asserts that no adjustment to the carrying value is required as it is confident that Investee Company has ability to garner the required cash flows. Whereas we were unable to assess the financial ability of the investee company particularly from the perspective of meetings its obligations. Hence we are of the opinion that the entire carrying value of investments need to be provided for and to this extent the loss for the year are understated.

4. Attention is invited to Note No.25.3 to the Standalone Financial Statements in relation to preparation of financial statements on Going Concern Basis without carrying any major business activity incurring continuous losses from operations adverse key financial ratios impact of our observations made in preceding paragraphs and other related factors indicates that there is an existence of material uncertainty that will cast significant doubt on the company's ability to continue as a going concern. Therefore company may not be able to realize its assets and discharge its liabilities in the normal course of business. Notwithstanding this the financial statements have been prepared as that of going concern and consequently the terminal values of various assets and liabilities have not been determined and we are therefore unable to express our opinion whether the preparation of financial statements on a going concern assumption is appropriate or not.

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act 2013. Our responsibilities under those Standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Companies Act 2013 and the rules thereunder and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our Qualified Opinion.

Emphasis of Matter

Attention is invited to Note no. 25.4 to the Standalone Financial Statements Bombay Stock Exchange Limited (BSE) has imposed penalty on the company amounting to Rs. 7.59 lakhs as per regulation 17 and 19 of the SEBI (LODR) Regulations 2015 for non compliance with the requirements pertaining to the composition of Board regarding failure to appoint Women Director and for non-compliance with the constitution of Nomination and Remuneration Committee. The company has disputed the same and is in the process of filing an appeal before Securities Appellate Tribunal (SAT).Pending disposal of the appeal the eventual obligation in this regard is unascertainable at this stage. Based on the management's assessment that it has good case to succeed in dispute no provision is made in the Standalone Financial Statements.

Our Opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole and in forming our opinion thereon and we do not provide a separate opinion on these matters. In addition to the matter described in the Basis for Qualified Opinion section we have determined the matters described below to be the key audit matters to be communicated in our Report.

Contingent Liabilities in relation to Service Tax Litigations

Key Audit MatterAuditor's Response
The Company has received certain demand orders and notices relating to service tax matters. The company is contesting these demands (refer note no.25.10 (a) to the standalone financial statements).Our audit procedures included the following:
(i) Understanding the current status of the service tax litigations.
(ii) Examining recent orders and/or communication received from various service tax authorities and follow up action thereon.
There is high level of judgment required in estimating the level of provisioning. The management's assessment is supported by the facts of matter their own judgment and advices from legal and independent service tax consultants where ever considered necessary. Accordingly unexpected adverse outcomes may significantly impact the management's reported loss and the Balance Sheet.(iii) Evaluating the merit of the subject matter under consideration with reference to the grounds presented therein and available independent legal advice; and
We determined the above area as a Key Audit Matter in view of associated uncertainty relating to the outcome of these matters which requires application of judgment in interpretation of law. Accordingly our audit was focused on analysing the facts of subject matter under consideration and judgements/interpretation of law involved.(iv) Review and analysis of evaluation of the contentions of the management through discussions collection of details of the subject matter under consideration the likely outcome and consequent potential outflows on service tax issues.

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

The Company's Board of Directors is responsible for the other information. The other information comprises the information included in the management discussion and analysis Board's Report including annexures to Board's Report and Report on Corporate Governance but does not include the standalone financial statements and our auditor's report thereon. The above reports are expected to be made available to us after the date of the auditor's report.

Our opinion on the standalone financial statements does not cover the other information and we will not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements our responsibility is to read the other information identified above when it becomes available and in doing so consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

When we read the above reports if we conclude that there is a material misstatement therein we are required to communicate the matter to those charged with governance.

Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act 2013 (the Act) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position financial performance including other comprehensive income cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India including the Accounting Standards specified under section 133 of the Act read with relevant rules issued thereunder. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; the selection and application of appropriate accounting policies; making judgments and the estimates that are reasonable and prudent; and the design implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement whether due to fraud or error.

In preparing the standalone financial statements management is responsible for assessing the Company's ability to continue as a going concern disclosing as applicable matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Company's financial reporting process.

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

Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement whether due to fraud or error and to issue an Auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if individually or in the aggregate they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

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

Identify and assess the risks of material misstatement of the financial statements whether due to fraud or error design and perform audit procedures responsive to those risks and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error as fraud may involve collusion forgery intentional omissions misrepresentations or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act 2013 we are also responsible for expressing our opinion on whether the company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.

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

Conclude on the appropriateness of management's use of the going concern basis of accounting and based on the audit evidence obtained whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists we are required to draw attention in our auditor's report to the related disclosures in the 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's report. However future events or conditions may cause the Company to cease to continue as a going concern.

Evaluate the overall presentation structure and content of the financial statements including the disclosures and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

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

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

From the matters communicated with those charged with governance we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when in extremely rare circumstances we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be 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 of the Act we give in the Annexure A statement on the matters specified in the paragraph 3 and 4 of the order.

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 best of our knowledge and belief were necessary for the purpose of our audit.

b) Except for the effects of the matter described in the Basis for Qualified Opinion Paragraph above in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.

c) The Balance Sheet the Statement of Profit and Loss including Other Comprehensive Income the Statement of Cash Flows and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

d) Except for the effects of the matter described in the Basis for Qualified Opinion Paragraph above in our opinion aforesaid Standalone Financial Statements comply with the Indian Accounting Standards specified under Section 133 of the Companies Act 2013 read with Rule 7 of the Companies (Accounts) Rules 2014

e) The matter described in the Basis for Qualified Opinion Paragraph above in our opinion may have an adverse effect on the functioning of the company.

f) On the basis of written representations received from the directors as on 31st March 2019 taken on record by the Board of Directors none of the directors is disqualified as on 31st March 2019 from being appointed as a director in terms of Section 164(2) of the Act.

g) The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the Basis for Qualified Opinion Paragraph above.

h) With respect to the adequacy of the Internal financial control over financial reporting of the company and operating effectiveness of such controls refer to our separate report in Annexure B; and

i) In accordance with the requirements of section 197(16) of the Companies Act 2013 as amended in our opinion and to the best of our information and according to the explanations given to us during the year the company has not paid remuneration to the directors in accordance with the provisions of section 197 of the Companies Act 2013. Therefore remuneration paid to the directors over and above the limits laid down under this section doesn't arise.

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

i. The Company has disclosed the impact of pending litigations on its financial position in its Standalone Financial Statements. Refer Note No.25.10 to the Standalone Financial Statements.

ii. The Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses and

iii. There are no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

For Brahmayya & Co.
Chartered Accountants
Firm Regn. No.000511S
Sd/-
Place : ChennaiK. Jitendra Kumar
Date : 30th May 2019Partner
Membership No.201825

Annexure - A to the Independent Auditors' Report

Referred to in Clause 1 of Report on Other Legal and Regulatory Requirements Paragraph of the Independent Auditors' Report of even date the members of Picturehouse Media Limited on the Standalone Financial Statements as of and for the year ended 31st March 2019.

1. (a) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets.

(b) As explained to us fixed assets have been physically verified by the management at reasonable intervals; no material discrepancies were noticed on such verification.

(c) The Company does not have any immovable properties in its name and hence clause (c) of paragraph 3(i) of the Order is not applicable to the Company.

2. As explained to us by the management the company is a service company namely movie production. The movie production/ making of content require various types qualities of content related consumable and inputs. Due to the multiplicity and complexity of the items it is not practicable to maintain the quantitative records/ continuous stock register. All the purchases of content related consumable/consumables are treated as consumed. In view of this the company does not maintain stock register and also does not carry out physical verification of stock. However the management physically verifies the finished content copyrights of Programs/ Film rights with reference to title documents/agreements in hand at the end of the year.

3. According to the information and explanations given to us the Company has not granted any loans secured or unsecured to Companies Firms Limited Liability Partnership or other parties covered in the register maintained under section 189 of the Companies Act 2013. Therefore the provisions of clause (iii) (iii)(a) (iii)(b) and (iii)(c) of Paragraph 3 of the Order are not applicable to the company.

4. In our opinion and according to the information and explanations given to us the Company has complied with the provisions of section 185 and 186 of the Act with respect to the loans given investments made guarantees given and securities given.

5. The company has not accepted deposits from public during this year. Therefore the provision of clause 3(v) of the companies (Auditor's Report) Order 2016 is not applicable to the company for the year under audit.

6. To the best of our knowledge and as explained the Central Government has not prescribed the maintenance of cost records under section 148(1) of the Act for the services of the Company.

7. (a) According to the information and explanations give to us and on the basis of our examination of the records Undisputed statutory dues including Goods and Service Tax (GST) Provident Fund Employees' State Insurance Income tax Sales tax Service tax Duty of Customs Duty of Excise Value Added Tax Cess and other material statutory dues as applicable have not been regularly deposited with the appropriate authorities and there have been significant delays.

Undisputed amounts payable in respect thereof which were outstanding at the yearend for a period of more than six months from the date they became payable are as follows:

Statement of Arrears of Statutory Dues Outstanding dues More than Six Months

(Rs. in Lakhs)

Name of the StatueNature of DuesAmount (Rs.)Period to which relatesDue dateDate of payment
The Finance Act 1994Service Tax4.69RCM payable as on 31.03.20176th of the following monthYet to be remitted
The Income Tax Act 1961Tax Deducted at Source276.16*April 2016 to March 20187th of the following monthYet to be remitted
The Income Tax Act 1961Interest on Tax Deducted at Source51.77*April 2016 to March 20187th of the following monthYet to be remitted
The Income Tax Act 1961Tax Deducted at Source9.68April 2018 to August 20187th of the following monthYet to be remitted
The Income Tax Act 1961Interest on Tax Deducted at Source49.71April 2018 to March 20197th of the following monthYet to be remitted

*The company has requested the Assessing Officer to adjust the amount payable with the refund to be received amounting to Rs.346.05 lakhs.

(b) According to the information and explanations given to us the details of dues of Service Tax which is not deposited on account of dispute as on 31st March 2019 is given below:

 

(Rs. in Lakhs)

Name of the StatueNature of DuesTax amount DisputedPeriod to which relatesForum where dispute is pending
The Finance Act 1994Service Tax1604.76 (includes penalty of Rs. 802.43)F.Y 2011-12 to F.Y 2014-15Customs Excise and Service Tax Appellate Tribunal
The Finance Act 1994Service Tax155.42 lakhs and penalty of Rs. 15.64 lakhsF.Y 2015-16 to FY 2017- 18 (Till June 2017)Commissioner of CGST and Central Excise

8. In our opinion and according to the information and explanations given to us the company does not have loans or borrowings from Government or dues to debenture holders and the company has not default in repayment of loans to financial institution during the year. Accordingly paragraph 3(viii) of the order is not applicable.

9. The company has not raised monies by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Therefore provisions of clause (ix) of Paragraph 3 of the Order are not applicable.

10. According to the information and explanations given to us no fraud by the Company and no fraud on the Company by its officers or employees has been noticed or reported during the course of our audit.

11. According to the information and explanations given to us and based on our examination of the records of the Company during the year company has not paid any managerial remuneration as per section 197 of the Companies Act 2013. Therefore the provisions of clause 3(xi) of the companies (Auditor's Report) Order 2016 are not applicable to the company for the year under audit.

12. In our opinion and according to the information and explanations given to us the company is not a nidhi company. Therefore the provisions of clause 3(xii) of the companies (Auditor's Report) Order 2016 are not applicable to the company for the year under audit.

13. According to the information and explanations given to us and based on our examination of the records of the Company the transactions with the related parties are in compliance with Sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the Standalone Financial Statements as required by the applicable accounting standards.

14. According to the information and explanations given to us and based on our examination of the records of the Company the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Therefore the provisions of clause 3(xiv) of the companies (Auditor's Report) Order 2016 are not applicable to the company for the year under audit.

15. According to the information and explanations given to us and based on our examination of the records of the Company the Company has not entered into non-cash transactions with directors or persons connected with him. Therefore the provisions of Clause (xv) of Paragraph 3 of the Order are not applicable.

16. The company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.

For Brahmayya & Co.
Chartered Accountants
Firm Regn. No.000511S
Sd/-
Place : ChennaiK.Jitendra Kumar
Date : 30th May 2019Partner
Membership No. 201825

Annexure B to the Independent Auditor's Report

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 (the Act)

We have audited the internal financial controls over financial reporting of Picturehouse Media Limited (the Company) as of 31st March 2019 in conjunction with our audit of the Standalone 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 internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (`ICAI').

These responsibilities include the design implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business including adherence to company's policies the safeguarding of its assets the prevention and detection of frauds and errors the accuracy and completeness of the accounting records and the timely preparation of reliable financial information as required under the Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the Guidance Note) and the Standards on Auditing issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act 2013 to the extent applicable to an audit of internal financial controls both applicable to an audit of Internal Financial Controls and both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting assessing the risk that a material weakness exists and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor's judgement including the assessment of the risks of material misstatement of the standalone financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified audit opinion on the company's internal financial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Standalone Financial Statements for external purposes in accordance with generally accepted accounting principles. A company's internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of Standalone Financial Statements in accordance with generally accepted accounting principles and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition use or disposition of the company's assets that could have a material effect on the Standalone Financial Statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting with reference to the standalone financial statements including the possibility of collusion or improper management override of controls material misstatements due to error or fraud may occur and not be detected. Also subject to note 25.3 to these financial statements in relation to preparation of financial statements on going concern the projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Qualified Opinion

According to the information and explanations given to us and based on our audit the following weaknesses have been identified in the operating effectiveness of the company's internal financial control over financial reporting with reference to the standalone financial statements as at 31st March 2019:

The company's internal financial control with regard to assessment of carrying value of investments loans and advances and inventory as more fully explained in note 25.1 and 25.2 to these financial statements were not operating effectively and could potentially result in the not providing adjustments that may be required to be made to the carrying value of such assets and also company needs to strengthen its documentation relating to disbursement of loans.

A `material weakness' is a deficiency or a combination of deficiencies in internal financial control over financial reporting such that there is a reasonable possibility that a material misstatement of the company's annual or interim financial statements will not be prevented or detected on a timely basis.

In our opinion except for the possible effects of the material weakness described above on the achievement of the objectives of the control criteria the company has maintained in all material respects adequate internal financial controls over financial reporting and such internal financial controls over financial reporting were operating effectively as 31st March 2019 based on internal control over financial reporting established by the company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.

We have considered the material weakness identified and reported above in determining the nature timing and extent of audit tests applied in our audit of the standalone financial statements of the company and we have issued a qualified opinion on the standalone financial statements.

For Brahmayya & Co.
Chartered Accountants
Firm Regn. No: 0000511S
Sd/-
K. Jitendra Kumar
Place : ChennaiPartner
Date : 30th May 2019Membership No. 201825