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Pulz Electronics Ltd.

BSE: 535030 Sector: Engineering
NSE: PULZ ISIN Code: INE335X01014
BSE 05:30 | 01 Jan Pulz Electronics Ltd
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Pulz Electronics Ltd. (PULZ) - Auditors Report

Company auditors report

To the Members of Pulz Electronics Limited

(Earlier known as Pulz Electronics Private Limited)

REPORT ON THE FINANCIAL STATEMENTS

We have audited the accompanying financial statements of Pulz Electronics Limited ("theCompany") which comprise the Balance Sheet as at 31st March 2018 the Statement ofProfit and Loss and Cash Flow Statement for the year then ended and a summary of thesignificant accounting policies and other explanatory information.

MANAGEMENT’S RESPONSIBILITY FOR THE 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 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 Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of accounting recordsrelevant to the preparation and presentation of the financial statements that give a trueand fair view and are free from material misstatement whether due to fraud or error.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on these financial statements based on ouraudit.

While conducting the audit we have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions 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 misstatement.

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. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof 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.

OPINION

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 in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31 stMarch 2018 and its profit and its cash flows for the year ended on that date.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditor’s Report) Order 2016 ("theOrder") issued by the Government of India in terms of Section 143(11) of the Act wegive in the Annexure "A" a statement on the matters specified in paragraphs 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 Statement of Profit and Loss and Cash Flow Statement dealt withby 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 31stMarch 2018 and taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2018 from being appointed as a director in terms of Section164(2) of the Act.

(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". Our report expresses an unmodified opinion onthe adequacy opinion on the adequacy and operating effectiveness of the Company's internalfinancial control over financial reporting.

(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 in its financial statements.

ii. The Company did not have any long-term contracts including derivative contracts; assuch the question of commenting on any material foreseeable losses thereon does not arise.

iii. There has not been an occasion in case of the Company during the period underreport to transfer any sums to the Investor Education and Protection Fund. The question ofdelay in transferring such sums does notarise.

For KNP AND ASSOCIATES

Chartered Accountants Firm Regn. No. 142448W

CA Nisha Unadkat

Partner

Mem.No. 145206

Place: Mumbai Dated: May 29 2018

ANNEXURE "A" TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in Paragraph 1 under the heading of "Report on Other Legal andRegulatory Requirements"of our report of even date)(i)

a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

b) As explained to us the fixed assets have been physically verified by the managementin accordance with the phased programme of verification which in our opinion isreasonable having regard to the size of the Company and the nature of its assets.According to information and explanation given to us no material discrepancies werenoticed on such verification.

c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties asincluded in Note 11 on Fixed Assets to the financial statements are held in the name ofthe Company.

(ii) As explained to us the inventories were physically verified during the period bythe management at reasonable intervals and no material discrepancies were noticed on suchphysical verification.

(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms Limited LiabilityPartnership or other parties covered in the register maintained under Section 189 of theAct. Accordingly Clause 3 (iii) (a) (b) and (c) of the Order are not applicable andhence not commented upon.

(iv) According to the information and explanations given to us the Company has notgranted any loans made investment or provided guarantee. Hence reporting under Clause3(iv) of the Order is not applicable.

(v) The Company has not accepted any deposits from the public. Accordingly Clause 3(v)of the Order is not applicable.

(vi) The Cost records prescribed under Section 148(1) of the Act is not applicable tothe Company and hence Clause 3(vi) of the Order is not applicable.

(vii) (a)According to the information and explanations given to us and the records ofthe Company examined by us in our opinion the Company is generally been regular indepositing undisputed statutory dues including Provident Fund Employees' State InsuranceIncome Tax Sales Tax Service tax. Custom duty Excise duty value added tax cess andother statutory dues as applicable with the appropriate authorities. There were noundisputed amounts payable in respect of Provident Fund Employees' State InsuranceIncome tax Sales Tax Service Tax Customs Duty Excise Duty Value Added Tax Cess andother material statutory dues in arrears as at March 312018 for a period of more than sixmonths from the date they become payable.

(b) There were no dues which have not been deposited in respect of Income tax SalesTax Service Tax Customs Duty Excise Duty and Value Added Tax on account of any dispute.

(viii) In our opinion and according to information and explanation given to us theCompany has not defaulted in repayment of its loans and borrowings to financialinstitutions bank government or dues to debentures holders.

(ix) In our opinion and according to information and explanation given to us theCompany has not taken any Term Loan hence Clause 3(ix) of the order for utilisation ofTerm Loan for the purpose for which they were raised is not applicable.

The Company has raised money by way of initial Public Offer during the year the endutilisation and non-utilisation of monies funds for the purpose for which it is raised isas given below:

Objects as Stated In the Prospectus Projected Utilization of Proceeds as Per Prospectus Actual Utilization of Proceeds upto 31/03/2018 Variations if any upto 31/03/2018 Deviations If any upto 31/03/2018
Acquisitions and Other Strategic Initiatives 250.99 0 Nil Nil
General Corporate Purpose 96.05 96.05 Nil Nil
Issue Expenses 45.00 38.868 Nil Nil
TOTAL 392.04 134.918 Nil Nil

(x) Based upon the audit procedures performed and according to the information andexplanations given to us no fraud by the Company or any fraud on the Company by itsofficer/employees has been noticed or reported during the period nor have we been informedabout any such case by the Management.

(xi) In our opinion and according to information and explanations given to us theCompany has paid/provided remuneration in accordance with requisite approvals mandated bythe provisions of section 197 read with schedule V of the CompaniesAct2013.

(xii) As the Company is not Nidhi Company the reporting under clause 3(xii) of theOrder is not applicable.

(xiii) In our opinion and according to the information and explanations given to us theCompany is in compliance with Section 177 and 188 of the Companies Act 2013 whereapplicable for all transactions with the related parties and the details of related partytransactions have been disclosed in the financial statements etc. as required by theapplicable accounting standards.

(xiv) During the period the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures and hence reporting underclause 3(xiv) of the order is not applicable to the Company.

(xv) In our opinion and according to the information and explanations given to usduring the period the Company has not entered into any non-cash transactions with itsdirectors or persons connected with him and hence provisions of section 192 of theCompanies Act 2013 are not applicable.

(xvi) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

For KNP AND ASSOCIATES

Chartered Accountants Firm Regn. No. 142448W

CA Nisha Unadkat

Partner

Mem.No. 145206

Place: Mumbai Dated: May 29 2018

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in Paragraph 2(f) under the heading of "Report on Other Legal andRegulatory Requirements' of our report of even date)

Report on the Internal Financial Controls under Clause (I) of Subsection 3 of Section143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of PulzElectronics Limited ("the Company") as of March 31 2018 in conjunction withour audit of the financial statem ents of the Company for the period 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 overfinancial 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 company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

AUDITORS' RESPONSIBILITY

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 to the extent applicable toan audit of internal financial controls both issued by the Institute of CharteredAccountants of India. 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 overfinancial 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 judgement including the assessment of the risks ofmaterial misstatement 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 and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

Because of the Inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

OPINION

In our opinion to the best of information and explanations given to us the Companyhas in all materials respects an adequate internal financial controls system overfinancial reporting and such financial controls over financial reporting are operatingeffectively as at March 31 2018 based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India.

For KNP AND ASSOCIATES

Chartered Accountants Firm Regn. No. 142448W

CA Nisha Unadkat

Partner

Mem.No. 145206

Place: Mumbai Dated: May 29 2018