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S & S Power Switchgear Ltd.

BSE: 517273 Sector: Engineering
NSE: S&SPOWER ISIN Code: INE902B01017
BSE 05:30 | 01 Jan S & S Power Switchgear Ltd
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S & S Power Switchgear Ltd. (S&SPOWER) - Auditors Report

Company auditors report

TO THE MEMBERS OF S&S POWER SWITCHGEAR LIMITED

Report on the Standalone Financial Statements

We have audited the accompanying Standalone Ind-AS financial statements of S&SPower Switchgear Limited ('the Company') which comprise the Balance Sheet as at 31stMarch 2018 the Statement of Profit and Loss (including Other Comprehensive Income) theCash Flow statement and the Statement of Changes in Equity for the year then ended and asummary of the significant accounting policies and other explanatory information.

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 preparationand presentation of these Standalone Ind-AS financial statements that give a true and fairview of the financial position financial performance including Other comprehensiveincome cash flows and changes in equity of the Company in accordance with the accountingprinciples generally accepted in India including the Indian Accounting Standardsprescribed under section 133 of the Companies Act 2013 read with the relevant rulesissued there under.

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 internal financial controls withreference to financial statements that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the standalone Ind-AS financial statements that give a true and fair viewand are free from material misstatements 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 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 standalone Ind-AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind-AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind-AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlsrelevant to the Company's preparation of the standalone Ind-AS financial statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the standalone Ind-ASfinancial 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 including Ind-AS of the stateof affairs of the Company as at 31st March 2018 and its loss (financial positionincluding other comprehensive income) its cash flows and the changes in equity for theyear ended on that date.

Other Matter

The comparative financial information for the transition date opening balance sheet asat 1st April 2016 and also the financial information for the period ended 31st March2017 prepared in accordance with Ind AS included in these standalone financial statementsis based on the previously issued statutory financial statements for the year ended 31stMarch 2016 and 31st March 2017 prepared in accordance with the accounting standardsprescribed under section 133 of the Act read with rule 7 of the Companies (Accounts)Rules 2014 as amended which were audited by the predecessor auditor GSV Associateswhose reports dated 26th May 2016 and 5th June 2017 expressed a modified opinion onthose Standalone Financial Statements and have been adjusted for the differences in theaccounting principles adopted by the Company on transition to Ind AS which have beenaudited by us. Our opinion is not modified in respect of this matter.

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 in theparagraph 3 and 4 of the order.

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(including other ComprehensiveIncome) the Cash Flow Statement and the Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account;

(d) In our opinion the aforesaid standalone Ind-AS financial statements comply with theIndian Accounting Standards specified under Section 133 of the Act;

(e) On the basis of the written representations received from the directors as on 31stMarch 2018 taken on record by the Board of Directors none of the directors aredisqualified as on 31st March 2018 from being appointed as a director in terms of Section164 (2) of the Act;

(f) With respect to the internal financial controls with reference to financialstatements of the Company and the operating effectiveness of such controls refer to ourseparate report in 'Annexure B'; and

(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 standalone Ind-AS financial statements - Refer note 40 to the standaloneInd-AS financial statements.

(ii) The Company does not have any material foreseeable losses for which a provisionmay be necessary.

(iii) There were no amounts that were required to be transferred to the investoreducation protection fund by the Company during the year ended 31st March 2018.

For C N K & Associates LLP

Chartered Accountants FRN: 101961W/W-100036

Vijay Mehta

Partner M.No.: 106533

Place: Chennai

Date: May 29 2018

Annexure - A to the Independent Auditors' Report

(Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements'section of our report of even date)

(i) (a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets;

(b) Fixed Assets were physically verified by Management during the year and no materialdiscrepancies were noticed during such verification.

(c) According to the information and explanations given to us and the record examinedby us we report that the title deeds comprising all the immovable properties of landand buildings which are freehold are held in the name of the Company as at the BalanceSheet date.

(ii) The inventory has been physically verified by the Management at reasonableintervals during the year and no material discrepancies have been noticed on suchverification;

(iii) The Company has granted unsecured loans to the parties covered in the registermaintained under Section 189 of the Act.

(a) In respect of the aforesaid loans the terms and conditions under which such loanswere granted are not prejudicial to the Company's interest.

(b) The aforesaid loans and interest are repayable on demand. The Company has notdemanded the repayment of the said loans and hence there does not arise a situation forcommenting on the regularity of repayment of principal and payment of interest.

(c) In respect of the aforesaid loans there is no amount which is overdue for morethan ninety days.

(iv) Attention is invited to Note 7.02 & 8.01 of the financial statements detailingthe Investments made by the company in its subsidiaries and loans and advances given bythe company to its subsidiaries and also the resolutions proposed in the ensuing AnnualGeneral Meeting seeking approval of members for such loans advances and investments. Inour opinion such loans advances and investments made by the company are not inconsonance with the provisions of Section of 185 and Section 186 of the Companies Act2018.

(v) According to information and explanations given to us the Company has not acceptedany deposits within the meaning of Sections 73 to 76 of the Act and the rules framed thereunder to the extent notified;

(vi) According to the information and explanations given to us the Company is notrequired to maintain cost records pursuant to the Companies (Cost Records and Audit)Amendment Rules 2016 and prescribed by the Central Government under sub-section (1) ofsection 148 of the Companies Act 2013;

(vii) (a) According to the information and explanation given to us and the records ofthe Company examined by us in our opinion the Company is generally regular in depositingthe undisputed statutory dues including provident fund employees' state insurance Incometax Sales Tax Service Tax Duty of Excise Duty of Customs Value added tax Goods andService Tax and other material statutory dues as applicable with appropriate authorities.However we noticed delays in such remittances extending to maximum of 60 days.

(b) There were no undisputed amounts payable in respect of provident fund Sales TaxService Tax value added tax goods and service tax and other material statutory dues inarrears as at 31stMarch 2018 for a period of more than six months from the date theybecame payable.

(c) According to the information and explanations given to us and the records of theCompany examined by us the particulars of dues of income tax excise duty and customsduty as at 31st March 2018 which have not been deposited on account of a dispute are asfollows:. ( Refer note 40 to the Financial Statements).

(Rs. in Thousands)
S.No. Nature of Statute Nature of Dues Amount Period to which the amount relates Forum where the dispute is pending
1. Central Excise Act 1944 Excise Duty 34190* 1993 to 1997 CESTAT - Chennai
2. Foreign Trade Policy Differential Custom Duty 17247 1998 to 1999 DGFT – Delhi
3. Income Tax Act 1961 Tax on waiver of principal portion of loans by bankers 9298 AY 2007-08 ITAT – Chennai

* Rs. 5000 paid as deposit.

(viii) According to the records of the Company examined by us and the information andexplanations given to us the Company has not borrowed from financial institutions bankor government as at the balance sheet date. The Company has not issued any debentures.Therefore the provisions of clause 3 (viii) of the order are not applicable to theCompany;

(ix) According to the records of the Company examined by us and the information andexplanation given to us the Company has not raised money by way of initial public offeror further public offer (including debt instruments) and term loans during the year.Accordingly the provisions of Clause 3(ix) of the Order are not applicable to theCompany;

(x) According to the information and explanations given to us and to the best of ourknowledge no fraud by the Company or on the Company by its officers or employees has beennoticed or reported during the course of our audit;

(xi) In our opinion and according to Information and explanations given to us themanagerial remuneration has been paid in accordance with requisite approvals mandated bythe provisions of section 197 read with Schedule V of the Companies Act 2013;

(xii) The Company is not a Nidhi company and therefore the provisions of clause 3 (xii)of the order are not applicable to the company;

(xiii) In our opinion and according to information and explanations given to us thecompany is in compliance with the provisions of section 177 and 188 of the Companies Act2013 where applicable for all the transactions with the related parties and the detailsof related party transactions have been disclosed in the Financial Statements etc. asrequired by the applicable accounting standards;

(xiv) The company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review. Thereforeclause 3(xiv) is 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 during the year the Company has not enteredinto non-cash transactions with directors or persons connected with him. Accordinglyclause 3(xv) of the Order is not applicable to the Company;

(xvi) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company is not required to be registeredunder section 45-IA of the Reserve Bank of India Act 1934. Accordingly the provisions ofClause 3(xvi) of the Order are not applicable to the Company.

For C N K & Associates LLP

Chartered Accountants FRN: 101961W/W-100036

Vijay Mehta

Partner M.No.: 106533

Place: Chennai

Date: May 29 2018

Annexure - B to the Independent Auditors' Report

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 S&SPower Switchgear Limited ("the Company") as of 31stMarch 2018 inconjunction with our audit of the Standalone Ind-AS financial statements of the Companyfor the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's Board of Directors 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 ('ICAI'). Theseresponsibilities include the design implementation and maintenance of the internalfinancial controls with reference to financial statements that were operating effectivelyfor ensuring the orderly and efficient conduct of its business including adherence tocompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the 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 issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting were established andmaintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the internalfinancial controls over financial reporting and their operating effectiveness. Our auditof internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement 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 authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized 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 our information and according to the explanations givento us the Company has in all material respects "internal financial controls overfinancial reporting and such internal financial controls over financial reporting wereoperating effectively as at 31st March 2018 based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India.

For C N K & Associates LLP

Chartered Accountants FRN: 101961W/W-100036

Vijay Mehta

Partner M.No.: 106533

Place: Chennai

Date: May 29 2018