Independent Auditors' Report
TO THE MEMBERS OF SHABA CHEMICALS LIMITED INDORE
Report on the Financial Statements
We have audited the accompanying Ind AS financial statements of SHABA CHEMICALSLIMITED ('the Company') which comprise the Financial Statement Balance Sheet as atMarch 31 2018 the Statement of Profit and Loss the Statement of Cash Flow andStatement of change in equity for the year ended on that date and a summary of thesignificant accounting policies and other explanatory information.(Hereinafter refer asIND As Financial Statement)
Management's Responsibility for the 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 of these IndAS financial statements that give a true and fair view of the financial positionfinancial performance cash flows and change in equity of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandard ("Ind AS") as The Indian Accounting Standards specified under Section133 of the Act read with Rule 7 of the 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 financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.
Our responsibility is to express an opinion on these financial statements based on ouraudit. 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 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 financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give true and fair view in order to design audit procedures thatare appropriate in the circumstances but not for the purpose of expressing an opinion onwhether the Company has in place an adequate internal financial controls system overfinancial reporting and the operating effectiveness of such controls. An audit alsoincludes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the financial statements.
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 the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 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 2015 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in theAnnexure a statement on the matters specified in paragraphs 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.
(a) 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.
(b) In our opinion the aforesaid financial statements comply with the AccountingStandards specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014.
(f) On the basis of the written representations received from the directors as on March31 2018 taken on record by the Board of Directors none of the Directors is disqualifiedas on March 31 2017 from being appointed as auditor in terms of Section 164(2) of theAct.
(c) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule11 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:
i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements Refer Note 23(A) (i) to the financialstatements.
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
I. There were no amounts required to be transferred to the Investor Education andProtection Fund by the Company.
| ||FOR S.N.KABRA & CO. |
| ||CHARTERED ACCOUNTANTS |
| ||CA. S.N.KABRA |
|Place: Indore ||PARTNER |
|Date: 25th May 2018 ||FIRM REGISTRATION NO 03439C |
Annexure 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. In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars includingquantitative details and situation of the fixed assets. There is no any fixed asset in thecompany. (b) The Company has a program of verification of fixed assets to cover all theitems in a phased manner over a period of three years which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. Pursuant to theprogramme the management is in the process of carrying out the physical verification andreconciling the same with the book records. Material discrepancies if any between thebook records and the physical verification would be dealt with on completion of suchreconciliation.
II. In respect of its inventories: No any inventories and operation in the Company.Hence not applicable.
III. The Company has not granted loans secured or unsecured to companies firms orother parties covered in the Register maintained under Section189 of the Companies Act2013.
IV. In our opinion and according to the information and explanations given to ushaving regard to the explanations that some of the items purchased are of special natureand suitable alternative sources are not readily available for obtaining comparablequotations there is an adequate internal control system commensurate with the size of theCompany and the nature of its business with regard to purchases of inventory and fixedassets and the sale of goods and services. During the course of our audit we have notobserved any major weakness in such internal control system.
V. According to the information and explanations given to us the Company has notaccepted any deposit during the year. In respect of unclaimed deposits the Company hascomplied with the provisions of Sections 73 to 76 or any other relevant provisions of theCompanies Act 2013.
VI. We have broadly reviewed the cost records maintained by the Company pursuant to theCompanies (Cost Records and Audit) Rules 2014 as amended and prescribed by the CentralGovernment under sub-section (1) of the Section148 of the Companies Act 2013 and are ofthe opinion that prima facie the prescribed cost records have been maintained. Wehave however not made a detailed examination of the cost records with a view todetermine whether they are accurate or complete.
VII. According to the information and explanations given to us in respect of statutorydues:
(a) The Company has been generally regular in depositing undisputed statutory duesincluding provident fund employees' state insurance income tax sales tax wealth taxservice tax custom duty excise duty value added tax cess and other material statutorydues applicable to it with the appropriate authorities.
(b) There were no undisputed amounts payable in respect of provident fund employees'state insurance income tax sales tax wealth tax service tax customs duty exciseduty value added tax cess and other material statutory dues in arrears as at March 312018 for a period of more than six months from the date they became payable.
(c) There are no amounts pending to be transferred to Investor Education and ProtectionFund in accordance with the relevant provisions of the Companies Act 1956 (1 of 1956) andrules made there under.
VIII. In our opinion and according to the information and explanations given to us theCompany has not defaulted in the repayment of dues to financial institutions and banks.The Company has not issued any debentures.
IX. No money raised by way of initial public offer or further public offer and termloans have been taken by the Company during the year. According to the information andexplanations given to us the Company has not given guarantees for loans taken by othersfrom banks and financial institutions.
X. To the best of our knowledge and according to the information and explanations givento us no fraud by the Company and no material fraud on the Company has been noticed orreported during the year.
XI. No managerial remuneration has been paid or provided to any of the directors ormanagers hence there has been no contravention of the provisions of Section 197 read withschedule 5 to the Companies Act 2013.
XII. This Company is not a NIDHI Company.
XIII. There were no related party transactions reported and observed during the yearhence all transaction with the related party is in compliance with Section 177 and 188 ofthe Companies Act 2013 where applicable and the details have been disclosed in thefinancial statement as required by the applicable Indian accounting standard.
XIV. The company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year.
XV. The company has not entered into any non-cash transaction with the director orperson concerned therefore the provision of Section 192 of Companies Act 2013 has notbeen contravened.
XVI. The company is not required to be registered under Section 45 IA of Reserve Bankof India
| ||FOR S.N.KABRA & CO. |
| ||CHARTERED ACCOUNTANTS |
| ||Sd/- |
| ||CA. S.N.KABRA |
|PLACE: INDORE ||PARTNER |
|DATE: 25TH MAY 2018 ||(FIRM REG. NO. 003439C) |