The Members of
RELIABLE VENTURES INDIA LIMITED
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS
We have audited the accompanying financial statements of Reliable Ventures IndiaLimited (the Company) which comprise the balance sheet as at March 31 2019the Statement 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 (Act') in the manner so required and give a true and fair viewin conformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at March 312019 its Profit / Loss and cash flows for the yearended on that date.
Basis for opinion
We conducted our audit in accordance with the standards on auditing specified undersection 143 (10) of the Companies Act 2013. Our responsibilities under those Standardsare further described in the auditor's responsibilities for the audit of the financialstatements section of our report. We are independent of the
Company in accordance with the code of ethics issued by the Institute of CharteredAccountants of India together with the ethical requirements that are relevant to our auditof the financial statements under the provisions of the Act and the rules there under andwe have fulfilled our other ethical responsibilities in accordance with these requirementsand the code of ethics.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide 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.
We have determined the matters below to be key audit matters to be communicated in ourreport:
1. Expected credit loss allowances: Ind-AS accounting framework was implemented onApril 1st 2016 Accordingly Ind-AS 109 is a new and complex standard that requires theCompany to recognise Expected Credit Loss (ECL) on financial instruments. This is asignificant departure from the earlier rule based provisioning. Expected credit lossallowances relating to loans and advances are determined on a portfolio basis with theuse of impairment models. These models are based on historical loss experience and use anumber of key assumptions including probability of default loss given default (includingpropensity for possession and forced sale discounts for mortgages) and valuation ofrecoveries. Our work therefore focused on the appropriateness of modelling methodologiesadopted and the significant judgements required. Refer to Note 2.2(f-iii) to the financialstatements accounting policy on accounting for the impairment of financial assets and Note8 and Note 33(a) to the financial statements for measurement of provision for expectedcredit loss in trade receivables and for credit risk disclosures wherein management noprovisioning regarding the expected credit losses on financial instruments.
Auditors Response: We evaluated management's process and tested key controls aroundthe determination of extent of requirement of expected credit loss allowances includingcontrols relating to the identification of events leading to a significant increase inrisk and credit impairment events; and the review and approval by the Board for therequirement for making expected credit loss allowances including the impairment modeloutputs and key management judgements applied. We found that these key controls wereavailable and operated though not properly documented. We have also reviewed themanagement response and representation and based on the same we have place reliance onthese key controls for the purposes of our audit.
2. Balances of Various Financial Assets and Liabilities: Note No 38 to thefinancial statements which describes that the Balances in Trade Receivables TradePayables and Short Term Loans & Advances are subject to confirmation andreconciliation if any. Hence the effect thereof on Profit/ Loss Assets andLiabilities if any is not ascertainable.
Auditors Response: We evaluated the management procedure and tested key controlsemployed by the management to review over the reconciliation and recoverability of thelong outstanding assets and payability of long outstanding liabilities Based on theexplanations and representations provided by the management it was explained to us thatthe Board is carrying out a regular review of balances of long outstanding TradeReceivables Trade Payables and Short Term Loans & Advances. As per their opinionthere will be no substantial impact on their reconciliation with their balanceconfirmations. Based on the same we have place reliance on these key controls for thepurposes of our audit.
Information other than the financial statements and auditors' report thereon
The Company's board of directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the Board'sReport including Annexures to Board's Report Business Responsibility Report but does notinclude the financial statements and our auditor's report 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 read the other information and in doing so consider whetherthe other information is materially inconsistent with the standalone financial statementsor our knowledge obtained during the course of our audit or otherwise appears to bematerially 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.
Management's responsibility for the financial statements
The Company's board of directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give atrue and fair view of the financial position financial performance and cash flows of theCompany in accordance with the accounting principles generally accepted in Indiaincluding the Indian Accounting Standards specified under section 133 of the Act. 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 the accountingrecords relevant to the preparation and presentation of the financial statement that givea true and fair view and are free from material misstatement whether due to fraud orerror.
In preparing the financial statements 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 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 Companies Act 2013 we are also responsible for expressing our opinion on whetherthe company has adequate internal financial controls system in place and the operatingeffectiveness 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 auditor'sreport. 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 misstatements 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 ourauditor's 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.
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 IndianAccounting Standards prescribed under Section 133 of the Act except for Ind AS 19 onprovisioning of gratuity and leave encashment as per provisions of said Ind AS and Ind AS18 for revenue to be measured at fair value of the consideration received or receivableand Ind AS 39 on recognition of financial assets and liabilities at fair value;
(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 312019 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. Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial 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;
a. The Company does not have any pending litigations which would impact its financialposition other than those mentioned in Note 32 (Contingent Liabilities) to the FinancialStatements;
b. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses; and
c. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company
|For PAREKH SHAH & LODHA |
|Chartered Accountants |
|Firm Registration No.: 107487W |
|Sd /- |
|Ashutosh Dwivedi (Partner) |
|M. No.: 410227 |
|Place: Mumbai |
|Date: 29th May 2019 |