To the Members of Prism Informatics Ltd. Report on the Financial Statements
We have audited the accompanying financial statements of Prism Informatics Ltd. whichcomprise the Balance Sheet as at March 31 2015 the Statement of Profit and Loss &Cash Flow Statement for the year then ended and a summary of the significant accountingpolicies and other explanatory information.
Management's Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 (the Act) with respect to the preparationand presentation of these financial statements that give a true and fair view of thefinancial position financial performance and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that areresponsible 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 materialmisstatements whether due to fraud or error.
Our responsibility is to express an opinion on these financial statements based on ouraudit. We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatements.
An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances but not for the purpose of expressing anopinion on whether the Company has in place an adequate internal financial controls systemover financial reporting and the operating effectiveness of such controls. An audit alsoincludes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on 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 the Actin the manner so required and give a true and fair view except in case of Receivablebalances of Rs.18636855 and Unsecured Loan of Rs.15000000 from All State Finance& Leasing Ltd and Loan from Directors and entities in which director have interest ofRs. 27340302 which are subject to confirmation and reconciliation (if any) Unbilledrevenue Rs.1744061 which has been as certified by the management in conformity withthe accounting principles generally accepted in India
a) in the case of the Balance Sheet of the state of affairs of the Company as at March31 2015; b) in the case of the Statement of Profit and Loss of the profit of the Companyfor the year ended on that date. c) in the case of the Cash Flow Statement of the cashflows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2015 (the Order)issued by the Central Government of India in terms of sub section (11) of Section 143 ofthe Act we give in the Annexure a statement on the matters specified in the paragraph 3and 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 Cash Flow Statement dealtwith by this Report are in agreement with the books of account.
(d) In our opinion the Balance Sheet the Statement of Profit and Loss and Cash FlowStatement comply with the Accounting Standards specified under Section 133 of the Actread with Rule 7 of the Companies (Accounts) Rules 2014.
(e) On the basis of the written representations received from the directors as on March31 2015 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2015 from being appointed as a director in terms of Section 164(2) of theAct.
(f) 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 has disclosed the impact of pending litigations on its financialposition in its financial statements.
ii. The Company did not have any long term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. There were no amount which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
(g) Without qualifying our report we draw attention to Note no.1.1 to the financialstatements indicating that the Company's subsidiaries namely Prism Software ConsultancyDMCC (earlier known as Prism Software Consultancy JLT) Prism Infoglobal Prism INC andPrism PTE have been incurring losses from the operations resulting in substantial erosionof capital as on the balance sheet date. In the opinion of the management these conditionsindicate the existence of material uncertainty that may cast significant doubt about thesubsidiary's ability to continue as a going concern.
For E. A. PATIL & ASSOCIATES
(Firm Registration No. 117371W)
CA. E. A. Patil
Membership No. 031979
August 13 2015
Prism Informatics Ltd.
Annexure to the Auditor's Report for the financial year ended 31st March 2015.
i. (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) The Company has not carried out any physical verification of its fixed assets.
ii. The Company is a service sector company primarily rendering IT consultingsoftware implementation and software development services. Accordingly it does not holdany physical inventories. Thus paragraph 3(ii) of the Order is not applicable to theCompany.
iii. The company has granted loans to two body corporate covered in the registermaintained under Section 189 of the Companies Act 2013 (the Act).
(a) In case of the loans granted to the body corporate in the register maintained underSection 189 of the Act the terms of repayment the arrangements have not been defined.
(b) Refer note no 27D for the provision for doubtful principal and interest amount Rs141205425 granted to Associate enterprise Idhasoft Limited and Rs. 9668258 granted tosubsidiary Prism Software Consultancy DMCC (earlier known as Prism Software ConsultancyJLT)
iv. In our opinion and according to the information and explanations given to us thecompany has adequate Internal Control System commensurate with the size of the company andnature of its business with regard to purchase of fixed assets and sale of services. Howeverthe internal control in respect of service income & fixed assets needs to bestrengthened.
v. The Company has not accepted any deposits from the public.
vi. As per the information and explanations provided by management the CentralGovernment has not prescribed the maintenance of cost records under Section 148(1) of theAct for any of the services rendered by the company.
vii. (a) According to the information and explanations given to us and on the basis ofour examination of the records of the company amounts deducted/accrued in the books ofaccount in respect of undisputed statutory dues including Income tax TDS Service TaxValue Added Tax Profession tax Provident fund and other material statutory dues havebeen generally regularly deposited during the year by the company with the appropriateauthorities expect specified in following annexure which are outstanding as at the lastday of financial year for more than six months from the date it become payable:
|Name of Statute ||Nature of Dues ||Total Outstanding Liability as on 31st March 2015 ||Outstanding for More than 6 Months from the date they become Payable ||Others |
|Finance Act 1994 ||Service Tax Payable ||10471965 ||8485358 ||1986607 |
|Income Tax Act 1961 ||TDS Payable ||7670781 ||7049524 ||621257 |
|MVAT Act 2002 ||VAT / CST Payable ||85065 ||- ||85065 |
|PF Act ||Provident Fund Payable ||1288139 ||- ||1288139 |
|PT ||Professional Tax Payable ||35552 ||- ||35552 |
|Local Body Tax ||LBT ||146803 ||144403 ||2400 |
(b) According to the information and explanations given to us there are no materialdues of Income Tax Service Tax Value Added Tax or any other statutory due which have notbeen deposited with the appropriate authorities on account of any dispute.
viii. The company does not have accumulated losses at the end of the financial yearhowever the Company has not incurred cash losses in the current financial year and in theimmediately preceding financial year.
ix. In the opinion and according to the information and explanation give to us thecompany has availed loan the outstanding balance as on 31st March 2015 of which is Rs.1.5 crore which was due for repayment. However the company has requested for extension forthe same.
x. In our opinion and according to the information and explanations given to us thecompany has not given any guarantee for loans taken by the others from banks or financialinstitutions.
xi. According to the information and explanations given to us no fraud on or by thecompany has been noticed or reported during the course of our audit.
For E. A. PATIL & ASSOCIATES
(Firm Registration No. 117371W)
CA. E. A. Patil
Membership No. 031979
Mumbai August 13 2015
Currency : Indian Rupee