RUNGTA IRRIGATION LIMITED 101
Report on the IND AS Financial Statements
We have audited the accompanying IND AS financial statements of Rungta IrrigationLimited [CIN : L74899DL1986PLC023934 ] ("the Company") which comprise theBalance Sheet as at March 31 2018 and the Statement of Profit and Loss (including othercomprehensive income) and the Statement of Cash Flows for the year then ended and asummary of the significant accounting policies and other explanatory information.
Management's Responsibility for the 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 IND AS financial statements that give a true and fair view of the State of affairsProfit/loss and other comprehensive income changes in equity and cash flows of theCompany in accordance with the
Accounting Principles generally accepted in India including the Indian AccountingStandards "(IND AS)" specified under Section 133 of the Act read with Rule 7 ofthe Companies (Accounts) Rules 2014.
This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions 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 IND ASfinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
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.
Our responsibility is to express an opinion on these IND AS financial statements basedon 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 financial statements in accordance with the Standards onAuditing specified under Section 143(10) of the Act. Those Standards require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the IND AS financial statements are free from materialmisstatement.
An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the IND AS financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of theIND AS financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to the Company'spreparation of the IND AS financial statements that give a true and fair view in order todesign audit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of the accounting policies used and the reasonableness ofthe accounting estimates made by the Company's Directors as well as evaluating theoverall presentation of the IND AS financial statements.
We are also responsible to conclude on the appropriateness of management's use of thegoing concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the entity's ability to continue as a going concern. If we conclude that amaterial uncertainty exits we are required to draw attention in the auditor's report tothe related disclosures in the financial statements or if such disclosures are inadequateto modify the opinion. Our conclusions are based on the audit evidence obtained up to theauditor's report.
However future events or conditions may cause an entity to cease to continue as agoing concern.
We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our audit opinion on the IND AS financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid IND AS financial statements give the information required bythe Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 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 ("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 based on our audit 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 [including other comprehensiveincome] the Statement of changes in Equity and the Statement of Cash Flow dealt with bythis Report are in agreement with the books of account.
d) In our opinion the aforesaid IND AS financial statements comply with the IndianAccounting Standards prescribed under section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.
e) On the basis of the written representations received from the directors of theCompany as on March 31 2018 taken on record by the Board of Directors none of thedirectors is disqualified as on March 31 2018 from being appointed as a director in termsof Section 164(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'.
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 as amended inour opinion and to the best of our information and according to the explanations given tous:
i. The Company has disclosed the impact of pending litigations on its financialposition in its IND AS financial statements. Refer Note No. 38 to the IND AS financialstatements.
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
To the Independent Auditor's Report 31 March 2018 on the IND AS Financial Statements(Referred to in our report of even date)
i. a) The company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets.
b) As explained to us fixed assets have been physically verified by the management atreasonable intervals; no material discrepancies were noticed on such verification.
c) According to the information and explanations given to us the records examined byus and based on the examination of the conveyance deeds provided to us we report thatthe title deeds comprising all the immovable properties of land and buildings which arefreehold are held in the name of the Company as at the balance sheet date. In respect ofimmovable properties of land and building that have been taken on lease and disclosed asfixed assets in the financial statements the lease agreements are in the name of theCompany.
ii. As explained to us inventories have been physically verified during the year bythe management at reasonable intervals. The discrepancies noticed on physical verificationof stocks between the physical stocks and the book records were not material.
iii. According to the information and explanations given to us and on the basis of ourexamination of the books of account the Company has not granted any loans secured orunsecured to companies firms Limited Liability Partnerships or other parties listed inthe register maintained under Section 189 of the Companies Act 2013. Consequently theprovisions of clauses iii (a) (b) and (c)of the order are not applicable to the Company.
iv. In our opinion and according to the information and explanations given to us thecompany has not granted any loans or provided any guarantees or security to the partiescovered under Section 185 and 186 of the Act in respect of grant of loans makinginvestments and providing guarantees and securities as applicable.
v. According to the information and explanations given to us the company has notaccepted any deposits during the year and does not have any unclaimed deposits as at March31 2018 and therefore the provisions of the clause 3 (v) of the Order are not applicableto the Company. vi. We have broadly reviewed the records maintained by the Companypursuant the rules prescribed by Central Government for maintenance of cost records undersection 148(1) of the Act and are of the opinion that prima facie the prescribed accountsand records have been made and maintained. However we have not made a detailedexamination of the records.
vii. According to the information and explanations given to us in respect of statutorydues:
(a) The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income Tax Sales Tax Service TaxGoods and Service Tax Value Added TaxCustoms Duty Excise Duty Cess and other materialstatutory dues applicable to it with the appropriate authorities.
(b) There were no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income Tax
(except as mentioned in the notes to accounts) Sales Tax Service Tax Value AddedTax Goods and Service Tax Customs Duty Excise Duty Cess and other material statutorydues in arrears as at March 31 2018 for a period of more than six months from the datethey became payable.
viii. In our opinion and according to the information and explanations given by themanagement we are of the opinion that the Company has not defaulted in repayment of duesto a financial institution bank Government or debenture holders as applicable to thecompany. ix. Based on our audit procedures and according to the information given by themanagement the company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments) or taken any term loan during the year.
x. According to the information and explanations given to us we report that no fraudby the company or any fraud on the Company by its officers or employees has been noticedor reported during the year.
xi. According to the information and explanations given to us and based on ourexamination of the records the Company has paid or provided for managerial remunerationin accordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V of the Act.
xii. In our opinion and according to the information and explanations given to us thecompany is not a Nidhi Company. Therefore paragraph 3 (xii) of the order is not applicableto the company.
xiii. According to the information and explanations given to us all transactions withthe related parties are in compliance with sections 177 and 188 of Companies Act 2013where applicable and the details have been disclosed in the IND AS Financial Statementsetc. as required by the applicable accounting standards.
xiv. According to the information and explanations given to us and based on ourexamination of the records the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year underreview. Accordingly paragraph 3(xiv) of the Order is not applicable to the Company.
xv. According to the information and explanations given to us and based on ourexamination of the records the company has not entered into non-cash transactions withdirectors or persons connected with him. Accordingly paragraph 3(xv) of the Order is notapplicable to the Company.
xvi. The company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934. Accordingly paragraph 3(xvi) of the Order is not applicable tothe company.
Report on Internal Financial Controls Over Financial Reporting
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of M/S RungtaIrrigation Limited ("the Company") as of March 31 2018 in conjunction with ouraudit of the IND AS financial statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls 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. 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 Companies Act 2013.
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 ICAIand deemed to be prescribed under section
143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls both applicable to an audit of Internal Financial Controls and bothissued by the Institute of Chartered Accountants of India. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively 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 IND AS 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 of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
2. provide reasonable assurance that transactions are recorded as necessary to permitpreparation of IND AS financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and
3. provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial effect on the IND AS financial statements.
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.
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 March 31 2018 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.
FOR MAMRAJ & CO.
FIRM REGD. NO. 006396N
DELHI - 30/05/2018