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Rexnord Electronics & Controls Ltd.

BSE: 531888 Sector: Engineering
NSE: N.A. ISIN Code: INE687C01012
BSE 00:00 | 24 May 32.60 2.60
(8.67%)
OPEN

32.95

HIGH

32.95

LOW

30.90

NSE 05:30 | 01 Jan Rexnord Electronics & Controls Ltd
OPEN 32.95
PREVIOUS CLOSE 30.00
VOLUME 153
52-Week high 58.00
52-Week low 28.00
P/E 9.24
Mkt Cap.(Rs cr) 36
Buy Price 30.10
Buy Qty 30.00
Sell Price 32.95
Sell Qty 50.00
OPEN 32.95
CLOSE 30.00
VOLUME 153
52-Week high 58.00
52-Week low 28.00
P/E 9.24
Mkt Cap.(Rs cr) 36
Buy Price 30.10
Buy Qty 30.00
Sell Price 32.95
Sell Qty 50.00

Rexnord Electronics & Controls Ltd. (REXNORDELECTR) - Auditors Report

Company auditors report

To

The Members of

REXNORD ELECTRONICS AND CONTROLS LIMITED Report on the Standalone Ind AS FinancialStatements

We have audited the accompanying standalone Ind AS financial statements of

Rexnord Electronics and Controls Limited ("the Company") which comprisethe Balance Sheet as at 31 March 2018 the Statement of Profit and Loss

(including Other Comprehensive Income) the Statement of Changes in Equity and the CashFlow Statement for the year then ended and a summary of policies and other explanatoryinformation (hereinafter significant referred to as "the standalone Ind AS financialstatements").

Management's Responsibility for the Standalone Ind AS 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 preparation ofthese standalone Ind AS financial statements that give a true and fair view of thefinancial position financial performance (including other comprehensive income) changesin equity and cash flows of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) prescribedunder Section 133 of the Act read with relevant Rules issued there under.

This responsibility also includes the maintenance of adequate accounting records inaccordance with the provision of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit.

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 there under.

We conducted our audit of the Standalone Ind AS financial statements in accordance withthe Standards on Auditing specified under section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone Ind AS financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the standalone Ind AS financial statements. The procedures selected dependon the auditor's judgment including the assessment of the risks of material misstatementof the standalone Ind AS financial statements whether due to fraud or error. In makingthose risk assessments the auditor considers internal financial control relevant to theCompany's preparation of the standalone Ind AS financial statements that give true andfair view in order to design audit procedures that are appropriate in the circumstances.An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by Company's Board of Directors as wellas evaluating the overall presentation of the standalone Ind AS financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of affairs of theCompany as at 31 March 2018 and its profit and Other comprehensive income its changes inequity and its cash flows for the year ended on that date.

Other Matter

The standalone financial statements of the Company for the year ended March 31 2017were audited by another firm of chartered accountants under the

Companies Act 2013 who vide their report dated May 30 2017 expressed an unmodifiedopinion on those financial statements. Our opinion is not qualified in respect of thismatter.

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 Act we give in the "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the Order.

2. As required by section 143 (3) of the Act we report that: a) we have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purposes of our audit; b) in our opinion proper books ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books; c) the Balance Sheet the Statement of Profit and Loss(including other comprehensive income) the Statement of Changes in Equity and the CashFlow Statement dealt with by this Report are in agreement with the books of account; d) inour opinion the aforesaid standalone Ind AS financial statements comply with theAccounting Standards specified under Section 133 of the Act; e) on the basis of writtenrepresentations received from the directors as on 31 March 2018 taken on record by theBoard of Directors none of the directors is disqualified as on 31 March 2018 from beingappointed as a director in terms of Section 164 (2) of the Act; f) with respect to theadequacy of the internal financial controls over financial reporting of the Company andthe operating effectiveness of such controls refer to our separate report in"Annexure B"; and g) with respect to the other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules2014 in our opinion and to our best of our information and according to the explanationsgiven to us: (i) The Company has disclosed the impact of pending litigations on itsfinancial position in its standalone Ind AS financial statements – Refer Note36(i)(c) to the standalone Ind AS financial statements;

(ii) The Company did not have any long-term contracts including derivatives contractsfor which there were any material foreseeable losses; (iii) There were no amounts whichwere required to be transferred to the Investor Education and Protection Fund by theCompany; and

(iv) The disclosures regarding details of specified bank notes held and transactedduring 8 November 2016 to 30 December 2016 has not been made since the requirement doesnot pertain to financial year ended 31 March 2018.

For Rakesh Soni & Co.

Chartered Accountants

(Firm Registration No. 114625W)
Rahul Chomal

Partner

Membership No. 427631
Place: Mumbai
Dated: May 30 2018

ANNEXURE A TO INDEPENDENT AUDITOR'S REPORT – 31st MARCH 2018

Referred to in paragraph 1 under the heading of "Report on Other Legal andRegulatory Requirements" of our report of even date

Based on the audit procedures performed for the purpose of reporting a true and fairview on the financial statements of the Company and taking into consideration theinformation and explanations given to us and the books of account and other recordsexamined by us in the normal course of audit we report that: (i) (a) the Company hasmaintained records showing particulars including quantitative details and situation ofits fixed assets; (b) as explained to us all the fixed assets have been physicallyverified by the management at the close of the year. We were informed that no materialdiscrepancy have been noticed by the management on such verification as compared to theaforesaid records of fixed assets; and (c) According to the information and explanationsgiven to us in our opinion the title deeds of immoveable properties are held in the nameof the Company except in the case of a plot of land purchased during the financial year2016-17 by the Company as detailed below:

Particulars Area (In Gross Net Remarks
Hectare) Block Block (`
( ` in in lakhs)
lakhs
A plot of land situated at S. No. 61 H. No. 1 Part at Village- Kaman Taluka 0.242 14.50 14.50 Plot purchased by executing Memorandum of Understanding and possession taken. Sale deed is yet to be executed and registered.
-Vasai District - Palghar (MS)

(ii) as certified by the management physical verification of inventories was conductedby the management at the close of the year. There were no material discrepancies noticedon physical verification of inventories as compared to book records and the same have beenproperly dealt with in the books of account.

(iii) the Company has during the year not granted any loans secured or unsecured tocompanies firms limited liability partnerships or other parties covered in the registermaintained under section 189 of the Act. Accordingly the provisions of clauses (a) (b)and (c) of paragraph 3 (iii) of the Order are not applicable to the Company.

(iv) in our opinion and according to the information and explanation given to us theCompany has complied with the provisions of section 186 the Act in respect of theinvestment made by it during the year. The Company has during the year not granted anyloans and given any guarantee or provided any security in connection with a loan coveredunder the sections 185 and 186 of the Act.

(v) the Company has not accepted any deposit from public during the year in accordancewith the provisions of sections 73 to 76 of the Act and rules framed there under.

(vi) We have broadly reviewed the books of account maintained by the

Company in respect of the products where pursuant to the rules made by the CentralGovernment of India the maintenance of cost records has been specified under sub section(1) of Section 148 of the Act and are of the opinion that prima facie the prescribedaccounts and records have been made and maintained. We have not however made a detailedexamination of the records with a view of determine whether they are accurate or complete.

(vii) (a) on the basis of books and records examined by us amount deducted/ accrued inthe books of account in respect of undisputed statutory dues including provident fundemployees state insurance income-tax sales-tax service tax goods and services taxw.e.f. 1 July 2017 duty of customs duty of excise value added tax cess and otherstatutory dues have generally been regularly deposited with the appropriate authorities.There are no arrears of undisputed statutory dues as at the last day of financial yearconcerned outstanding for a period of more than six months from the date they becamepayable except Central Sales Tax ` 26255.00.

(b) on the basis of books and records examined by us there are no dues of income taxsales tax service tax goods and services tax w.e.f. 1 July 2017 duty of customs dutyof excise and value added tax which have not been deposited with appropriate authoritieson account of any dispute.

(viii) on the basis of selective checks carried out during the course of audit we areof the opinion that the Company has not defaulted in the repayment of dues to financialinstitutions and banks. There are no dues payable to the debenture holders and Government.

(ix) As per the records of the Company the Company did not raise any money by way ofinitial public offer or further public offer (including debt instruments) during the year.In respect of term loans obtained during the year we are of the opinion that the termloans were applied for the purpose for which they were obtained.

(x) According to the information and explanations given to us no fraud by the Companyor on the Company by its officers or employees has been noticed or reported during thecourse of our audit.

(xi) According to the information and explanations given to us the Company has paid/provided managerial remuneration in accordance with the requisite approvals mandated bythe provisions of Section 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a nidhi company. Accordingly provisions of paragraph 3(xii) of the Orderare not applicable to the Company.

(xiii) According to the information and explanations given to us transactions with therelated parties are in compliance with Section 177 and Section 188 of the Act whereapplicable and details of such transactions have been disclosed in the standalone Ind ASfinancial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us the Company has notmade any preferential allotment or private placement of shares or fully or partlyconvertible debentures during the year. Accordingly provisions of paragraph 3(xiv) of theOrder are not applicable to the Company.

(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly provisions ofparagraph 3(xv) of the Order are not applicable to the Company.

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

For Rakesh Soni & Co.

Chartered Accountants

(Firm Registration No. 114625W)
Rahul Chomal

Partner

Membership No. 427631
Place: Mumbai
Dated: May 30 2018

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

We have audited the internal financial controls over financial reporting of RexnordElectronics and Controls Limited ("the Company") as of 31 March 2018 inconjunction with our audit of the standalone Ind AS 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 internalfinancial controls based on the internal control over financial 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 ("the ICAI"). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to Company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Act.

Auditor's 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 issued by the ICAI anddeemed to be prescribed under section 143(10) of the Act to the extent applicable to anaudit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the ICAI. Those Standards and the Guidance Note require thatwe comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.

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 the risks ofmaterial misstatement of the standalone Ind AS financial statements whether due to fraudor error. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols system over 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 the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31 March 2018 based on theinternal control over financial reporting criteria established by the

Company considering the essential components of internal control stated in the GuidanceNote issued by the ICAI.

For Rakesh Soni & Co.

Chartered Accountants

(Firm Registration No. 114625W)
Rahul Chomal

Partner

Membership No. 427631
Place: Mumbai
Dated: May 30 2018