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Shilpa Medicare Ltd.

BSE: 530549 Sector: Health care
NSE: SHILPAMED ISIN Code: INE790G01031
BSE 00:00 | 18 Sep 245.40 -8.50
(-3.35%)
OPEN

241.25

HIGH

252.95

LOW

241.25

NSE 00:00 | 18 Sep 245.10 -8.85
(-3.48%)
OPEN

252.40

HIGH

253.30

LOW

242.50

OPEN 241.25
PREVIOUS CLOSE 253.90
VOLUME 1079
52-Week high 535.05
52-Week low 190.80
P/E 19.77
Mkt Cap.(Rs cr) 2,000
Buy Price 243.90
Buy Qty 36.00
Sell Price 252.90
Sell Qty 5.00
OPEN 241.25
CLOSE 253.90
VOLUME 1079
52-Week high 535.05
52-Week low 190.80
P/E 19.77
Mkt Cap.(Rs cr) 2,000
Buy Price 243.90
Buy Qty 36.00
Sell Price 252.90
Sell Qty 5.00

Shilpa Medicare Ltd. (SHILPAMED) - Auditors Report

Company auditors report

To

The Members of Shilpa Medicare Limited.

Report on the Standalone Indian Accounting Standards (Ind AS) Financial Statements

We have audited the accompanying standalone Ind AS financial statements of SHILPAMEDICARE LIMITED ("the Company") which comprise the Balance Sheet as at March312018 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Cash Flow and the Statement of Changes in Equity for the year then ended anda summary of the significant accounting policies and other explanatory information

Management's Responsibility for the Standalone 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) cashflows and changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards specified in theCompanies (Indian Accounting Standards) Rules 2015 (as amended) under Section 133 of theAct. This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone Ind AS financial statements that give a true and fair view and are freefrom material misstatement 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 andthe Rules made thereunder including the accounting and auditing standards and matterswhich are required to be included in the audit report under the provisions of the Act andthe Rules made thereunder.

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 Ind AS financial statements are free from materialmisstatement.

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 controlrelevant 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 of the state of affairs of theCompany as at March 31 2018 and its total comprehensive income (comprising of profit andother comprehensive income) its cash flows and the changes in equity for the year endedon that date.

Other Matter

The standalone financial statements of the Company as at and for the year ended March31 2017 were audited by the Company's predecessor auditor who had expressed an unmodifiedopinion on those standalone financial statements vide their report dated May 29 2017. Thebalances as at March 31 2017 as per the audited standalone financial statements dulyread in conjunction with note 48 and 50 of the financial statements have been consideredas opening balances for the purpose of these standalone financial statements.

Our opinion is not qualified in respect of above 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 paragraphs 3and 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 Statement of Cash Flow and the Statement of Changes in Equity dealt with bythis Report are in agreement with the books of account.

(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Indian Accounting Standards specified under Section 133 of the Act.

(e) 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 2018 from being appointed as a director in terms of Section 164 (2) of theAct.

(f) With respect of adequacy of the internal financial controls with reference tofinancial statements of the Company and the operating effectiveness of such controlsrefer to our separate report in ‘Annexure B".

(g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule llof 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 standalone financial statements.

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts.

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

iv The disclosures in the standalone Ind AS financial statements regarding holdings aswell as dealings in specified bank notes during the period from 8th November2016 to 30st December 2016 have not been made since they do not pertain to thefinancial year ended March 31 2018. However amounts as appearing in the auditedfinancial statements for the year ended March 31 2017 have been disclosed in note no. 42.

For Brahmayya & Co.
Chartered Accountants
Firm's Regn No. 000513S
Sd/-
K. Shravan
Place: Hyderabad Partner
Date : 28th May 2018 Membership No. 215798

Annexure - A to the Auditor's Report

The Annexure referred to in Para 1 under the heading of "Report on Other Legal andRegulatory Requirements" of our report of even date to the members of SHILPAMEDICARE LIMITED("the Company") for the year ended March 31 2018.

1. a. The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

b. As explained to us the management has physically verified the fixed assets duringthe year and there is a regular programme of physical verification which in our opinionis reasonable having regard to the size of the Company and the nature of the assets. Nodiscrepancies were noticed on such verification.

c. According to the information and explanation given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the names of the Company.

2. As explained to us the inventories have been physically verified by the managementat reasonable intervals during the year. In our opinion the frequency of verification isreasonable. The discrepancies noticed on physical verification between the physical stocksand book records were not material.

3. According to the information and explanation given to us the Company has grantedunsecured loans to Companies covered in the register maintained under section 189 of theCompanies Act 2013 ('the Act').

a. The terms and conditions of such loans granted are not prejudicial to the interestof the Company.

b. The schedule of repayment of principal and payment of interest has been stipulatedin the agreement and repayments or receipts of principal amounts and interest have beenmade as per stipulations.

c. As there were no overdue amounts in respect of the loan granted to a Company coveredin the register maintained under section 189 of the Act.

4. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Act with respectto the loans and investments made.

5. The Company has not accepted any deposits from the public. Hence the provisions ofSections 73 to 76 or any other relevant provisions of the Companies Act 2013 and therules framed thereunder do not apply to the Company.

6. We have broadly reviewed the cost records maintained by the Company pursuant tosub-section (1) of section 148 of the Companies Act 2013 and are the opinion that primefacie the prescribed accounts and records have been made and maintained. We have howevernot made a detailed examination of the cost records with a view to determine whether theyare accurate or complete.

7. a. According to the records the Company is generally regular in depositingundisputed statutory dues including Provident

Fund Employees State Insurance Income-Tax Sales-Tax Service Tax Goods and ServicesTax Duty of Customs Duty of Excise Value Added Tax Cess and all other statutory dueswith the appropriate authorities and there are no arrears of outstanding statutory dues asat March 31 2018 for a period more than six months from the date they became payable.

b. According to the records of the Company and the information and explanations givento us there were no dues of Income-Tax or Sales-Tax or Service Tax or Duty of Customs orDuty of Excise or Value Added Tax have not been deposited on account of any dispute.

8. In our opinion and according to the information and explanations given to us theCompany has not defaulted in repayment of dues to any financial institutions and Banksduring the year. The Company did not have any debentures outstanding as at the year end.

9. The Company did not raise any money by way of initial public offer or further publicoffer (including debt instruments) and term loans during the year. Accordingly theprovisions of paragraph 3 (ix) of the Companies (Auditor's Report) Order 2016 are notapplicable.

10. According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.

11. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Act.

12. 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 Companies (Auditor'sReport) Order 2016 is not applicable.

13. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with 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.

14. During the year the Company has notmade any preferential allotment or privateplacement of shares or fully or partly convertible debentures. Company has made allotmentof 1399994 Equity shares during the year as per the Scheme of Amalgamation of NavyaBiologicals Private Limited with Shilpa Medicare Limited.

15. 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 Companies (Auditor's Report) Order 2016 is not applicable.

16. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

For Brahmayya & Co.
Chartered Accountants
Firm's Regn No. 000513S
Sd/-
K. Shravan
Place: Hyderabad Partner
Date : 28th May 2018 Membership No. 215798

Annexure - B to the Auditor's 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 SHILPAMEDICARE LIMITED ("the Company") as of March 31 2018 in conjunction with ouraudit of the standalone Ind AS financial statements of the Company for the year ended onthat 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 (TCAI5). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that wrere operating effectively for ensuring the orderlyand efficient conduct of its business including adherence to Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

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 to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material aspects.

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 and error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion. Meaning of Internal Financial Controls overFinancial 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 financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditure of the Company are being made only inaccordance with authorisations of management and directors of the Company; and

3. Provide reasonable assurance regarding prevention or timely detection ofunauthorised 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 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 wrere operating effectively as at March 31 2018based 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 ('ICAI').

For Brahmayya & Co.
Chartered Accountants
Firm's Regn No. 000513S
Sd/-
K. Shravan
Place: Hyderabad Partner
Date : 28th May 2018 Membership No. 215798