You are here » Home » Companies » Company Overview » Sainik Finance & Industries Ltd

Sainik Finance & Industries Ltd.

BSE: 530265 Sector: Financials
NSE: N.A. ISIN Code: INE584B01013
BSE 00:00 | 16 Apr 20.00 -0.05
(-0.25%)
OPEN

20.95

HIGH

20.95

LOW

20.00

NSE 05:30 | 01 Jan Sainik Finance & Industries Ltd
OPEN 20.95
PREVIOUS CLOSE 20.05
VOLUME 525
52-Week high 34.60
52-Week low 14.20
P/E 3.46
Mkt Cap.(Rs cr) 22
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 20.95
CLOSE 20.05
VOLUME 525
52-Week high 34.60
52-Week low 14.20
P/E 3.46
Mkt Cap.(Rs cr) 22
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sainik Finance & Industries Ltd. (SAINIKFINANCE) - Auditors Report

Company auditors report

To the Members of Sainik Finance & Industries Limited Report on the Audit of theFinancial Statements Opinion

We have audited the accompanying financial statements of Sainik Finance &Industries Limited ("the Company") which comprise the Balance Sheet as atMarch 31 2019 the Statement of Profit and Loss the Cash Flow Statement for the yearthen ended and notes to the financial statements including a summary of the significantaccounting policies and 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 ('the Act') in the manner so required and give a true and fair view inconformity with the Accounting Standards prescribed under section 133 of the Act read withthe Companies (Accounting Standard)Rules 2006 as amended ("Accountingstandard") and other accounting principles generally accepted in India of the stateof affairs of the company as at 31st March 2019 and its profit and its cash flows for theyear ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provision of the Companies Act 2013 and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for 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. Wehave determined the matters described below to be the key audit matters to be communicatedin our report.

Key Audit matter Auditors' Response
1. Identification of Non-Performing assets (loans) in accordance with Reserve Bank of India(" the RBI")guidelines Our audit approach includes testing the design operating effectiveness of internal controls and substantive audit procedures in respect of asset classification pertaining to loans and advances.
In particular:
The company has given loans and advances amounting Rs.2466023723/- as at 31st March 2019. Identification of non-performing(loans and advances) in accordance with relevant Prudential Regulation issued by the RBI in respect of asset classification pertaining to loans and advances(herein after referred as "Relevant RBI Guidelines") is a key audit matter due to the current processes at the company which requires manual interventions management estimates and judgement and level of regulatory and other stakeholder focus. ? We have evaluated the company internal control system in adhering to the relevant RBI guidelines regarding assets assets classification pertaining to loans and advances.
? We have identified and tested the design and implementation as well as operational effectiveness of key control pertaining to monthly monitoring of overdue positions by business and finance team.
? We have test checked loans and advances to examine the validity of the recorded amount loan documentations examined the manual statements of accounts indicators of impairment and compliance with asset classification pertaining to loans and advances ? Evaluated the management judgment process and review controls over asset classification and discussed the asset classification with senior management including the Chief Executive Officer and Chief Financial Officer.
Accordingly our audit was focused on asset classification pertaining to advances due to materiality of the balances.

Information other than the Financial Statements and Auditors' Report thereon

• The Company's Board of Directors is responsible for the preparation of otherinformation which comprises the Director's Report including annexures to Director'sReport Management Discussion and Analysis Report and Report on Corporate Governance butdoes not include the financial statements and our auditor's report thereon.

• Our opinion on the financial statements does not cover the other information andaccordingly we do not express any form of assurance conclusion thereon.

• In connection with our audit of the financial statements our responsibility isto read the other information and in doing so consider whether the other information ismaterially inconsistent with financial statements or our knowledge obtained during thecourse of audit or otherwise appears to be materially misstated.

• Based on the work we have performed if we conclude that there is a materialmisstatement of this other information; we are required to report the fact. We havenothing to report in this regard.

Responsibility of Management for 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 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 the 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 the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a 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.

That Board of Directors is 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 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 misrepresentation 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.

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 charge with governance we determine thosematters that were of most significance in the audit of financial statements of the currentperiod and are therefore the key audit matters. We describe these matters in our auditor'sreport unless law or regulation precludes public disclosure about the matter or when inextremely rare circumstances in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public benefits of such communication.

Report on other legal and regulatory requirements

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 thematters specified in paragraphs 3 and 4 of the Order to the extent applicable.

As required by Section 143 (3) of the Act we report to the extent applicable that:a) We have sought and obtained all the information and explanations which to the best ofour knowledge and belief were necessary for the purposes of our audit. b) In our opinionproper books of account as required by law have been kept by the Company so far as itappears from our examination of those books. c) The Balance Sheet the Statement of Profitand Loss and the Cash Flow Statement dealt with by this Report are in agreement with thebooks of account. d) In our opinion the aforesaid financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014. e) On the basis of the written representations receivedfrom the directors as on 31st March 2019 taken on record by the Board of Directors noneof the directors is disqualified as on 31st March 2019 from being appointed as a directorin terms of Section 164 (2) of the Act. f) With respect to the adequacy of the internalfinancial controls over financial reporting of the Company and the operating effectivenessof such controls refer to our separate Report in "Annexure (B)". g) Withrespect to the other matters to be included in the Auditors' Report in accordance with therequirements of section 197(16) of the Act as amended In our opinion and to the best ofour information and accordingly to the explanations given to us no remuneration has beenpaid by the company to its directors during the year. h) With respect to the other mattersto be included in the Auditor's Report in accordance with Rule 11 of the Companies (Auditand Auditors) Rules 2014 in our opinion and to the best of our information and accordingto the explanations given to us: i. There is no pending litigation which would have itsimpact on financial statement of the Company. ii. The Company did not have any long-termcontracts including derivative contracts for which there were any material foreseeablelosses. iii. There are no amounts required to be transferred to the Investor Education andProtection Fund by the Company.

For NAGAR GOEL & CHAWLA

Chartered Accountants

ICAI Firm Registration No. : 009933N
Dharmender Singhal
Place : New Delhi Partner
Dated : 27th May 2019 Membership No. : 515984

ANNEXURE (A) TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE FINANCIALSTATEMENTS OF SAINIK FINANCE & INDUSTRIES LIMITED

The Annexure referred to in Independent Auditors' Report to the members of the Companyon the financial statements for the year ended 31 March 2019 we report that: (i) (a)According to the information and explanations given to us the Company has maintainedproper records showing full particulars including quantitative details and situation offixed assets (property plant and equipment).

(b) According to the information and explanations given to us the Company has aregular programme of physical verification of its property plant and equipment by whichall fixed assets (property plant and equipment) are verified at periodic intervals. Inour opinion the period of verification is reasonable having regard to the size of theCompany and the nature of its assets. No material discrepancies were noticed duringphysical verification of fixed assets (property plant and equipment).

(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 areheld in the name of the Company.

(ii) According to the information and explanations given to us the management hasconducted physically verification in respect of finished goods at reasonable intervals. Nomaterial discrepancies were noticed during physical verification of inventories ascompared to book records.

(iii) In our opinion and according to the information and explanations provided to usthe Company has granted loans to a Company covered in the register maintained undersection 189 of the Companies Act 2013 ('the Act').

(a) In our opinion the rate of interest and other terms and conditions on which theloans had been granted to the parties listed in the register maintained under section 189of the Act were not prima facie prejudicial to the interest of the Company.

(b) The terms of arrangement do not stipulate any repayment schedule and the loans arerepayable on demand with interest.

(c) Since the term of arrangement do not stipulate any repayment schedule and the loansare repayable on demand no question of overdue amounts will arise in respect of the loansgranted to the parties listed in the register maintained under section 189 of the Act.

(iv) In our opinion and according to the information and explanations provided to usthe Company did not make any investment as per provisions of section 186(1) of the Act.Further the Company is exempted from compliance of section 185 and 186 (exceptsub-section "1" of Section 186) of the Act.

(v) According to the information and explanations provided to us the Company has notaccepted any deposits from the public. Accordingly the directives issued by Reserve Bankof India and the provisions of section 73 to 76 or any other relevant provisions of theAct and rules framed thereunder in this regard are not applicable. (vi) According to theinformation and explanations provided to us the Central Government has not specified formaintenance of cost records under section 148(1) of the Companies Act 2013 in respect ofthe activities carried on by the Company. Hence the provisions of paragraph 3(vi) of theOrder is not applicable to the Company.

(vii) In respect of statutory dues;

(a) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the Company is regular in depositing withappropriate authorities undisputed statutory dues including provident fund investoreducation and protection fund employees' state insurance income-tax sales tax servicetax custom duty excise duty value added tax goods and service tax and other materialstatutory dues as applicable.

Further there are no undisputed amounts payable outstanding as at 31 March 2019 for aperiod of more than six months from the date they become payable.

(b) According to the information and explanations given to us there are no materialstatutory dues which have not been deposited with the appropriate authorities on accountof any dispute.

(viii) In our opinion and according to the information and explanations given to usthe Company has not raised loan or borrowings from banks financial institutions andGovernment or debenture holders during the year under audit and therefore paragraph3(viii) of the Order is not applicable.

(ix) According to the information and explanations provided to us the company has notraised any moneys by way of initial public offer or further public offer (including debtinstruments) and not availed the facility of term loans during the year under audit andtherefore paragraph 3(ix) of the Order is not applicable. (x) During the course of ourexamination of the books and records of the Company carried out in accordance with thegenerally accepted auditing practices in India and according to the information andexplanations given to us no fraud on or by the company or any fraud by its officers oremployees was noticed or reported during the year.

(xi) To the best of our knowledge and according to the information and explanationsgiven to us no managerial remuneration has been paid or provided during the year underaudit. Accordingly paragraph 3(xi) of the Order is not applicable on the Company.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable.

(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

(xiv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year under audit.

(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 paragraph 3(xv) ofthe Order is not applicable.

(xvi) To the best of our knowledge and according to the information and explanationsgiven to us the company has registered under section 45-IA of the Reserve Bank of IndiaAct 1934

For NAGAR GOEL & CHAWLA

Chartered Accountants

ICAI Firm Registration No. : 009933N
Dharmender Singhal
Place : New Delhi Partner
Dated : 27th May 2019 Membership No. : 515984

ANNEXURE- (B) TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE FINANCIALSTATEMENTS OF SAINIK FINANCE & INDUSTRIES LIMITED

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 SainikFinance & Industries Limited ("the Company") as of March 31 2019 inconjunction with our audit of the financial statements of the Company for the year endedon 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. 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 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 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 of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company; 2. providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorizations 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 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 March 31 2019 based on"the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India".

For NAGAR GOEL & CHAWLA

Chartered Accountants

ICAI Firm Registration No. : 009933N
Dharmender Singhal
Place : New Delhi Partner
Dated: 27th May 2019 Membership No. : 515984

NON-BANKING FINANCIAL COMPANIES AUDITOR'S REPORT FOR THE YEAR ENDED 31ST MARCH 2019

To

Board of Directors

M/s Sainik Finance & Industries Limited

129 Transport Centre Rohtak Road Punjabi Bagh New Delhi - 110 035 Dear Sir

As required by the "Non-Banking Financial Companies Auditor's Report (ReserveBank) Directions 2016" issued by Reserve Bank of India (RBI) on the mattersspecified in Chapter - II of the said Directions to the extent applicable to the Companywe report that:

1. The company is engaged in the business of Non-banking financial institution and hasobtained certificate of registration from RBI as a Non- banking financial companywithout accepting public deposit vide Certificate of Registration (COR) no. N.14.02967.

2. Company meeting the 50% income/assets criteria is eligible to hold certificate ofregistration but on verification of accounts and on basis of our judgment we report thatthe company under reporting has maintained more than 50% of assets as financial assets andfulfill the income criteria as on 31st March 2019.

3. The Company is meeting the requirement of net owned funds applicable to aNon-Banking Financial Companies as laid down in Master Direction - Non-Banking FinancialCompany - Non-Systematically Important Non-Deposit taking Company (Reserve Bank)Directions 2016.

4. A resolution for non-acceptance of any public deposit was passed in the meeting ofthe board of directors.

5. The company has not accepted any public deposit during the year ended 31st March2019.

6. In our opinion and to the best of our information and according to the explanationgiven to us the company has complied with the prudential norms related to incomerecognition accounting standards assets classification and provisioning for bad anddoubtful debts as applicable to it in terms of non-financial (Non deposit Accepting orHolding) Companies Prudential Norms (Reserve Bank) Directions 2007.

7. As per the information and according to the explanation given to us and based on ouraudit the Company does not meet the eligibility criteria to be a Systematically ImportantNon-Deposit taking NBFC as defined in Non-Banking Financial Company - SystematicallyImportant Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions2016; and therefore (a) The company is not required to compute capital adequacy ratio inform NBS-7.

(b) The company is not required to furnish to reserve bank of India the annualstatement of capital funds risk assets/ exposures and risk assets ratio (NBS-7).

8. As per the information and according to the explanation given to us and based on ouraudit the Company does not cover under NBFC Micro Finance Institutions (MFI) as definedin the Non-Banking Financial Company - Non-Systematically Important Non-Deposit takingCompany (Reserve Bank) Directions 2016.

For NAGAR GOEL & CHAWLA

Chartered Accountants

ICAI Firm Registration No. : 009933N
Dharmender Singhal
Place : New Delhi Partner
Dated: 27th May 2019 Membership No. : 515984

.