TO THE MEMBERS OF
SHREE PACETRONIX LIMITED Opinion
We have audited the accompanying Standalone financial statements of Shree PacetronixLimited ("the Company") which comprise the Balance Sheet as at 31stMarch 2019 the Statement of Profit and Loss (including other comprehensive income) thestatement of changes in equity and the statement of cash flows for the year then endedand notes to the financial statements including a summary of significant accountingpolicies. (hereinafter referred to as "the Standalone Ind As financialstatements").
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Standalone financial statements give the information requiredby the Companies Act 2013 ("the Act") in the manner so required and give a trueand fair view in conformity with the accounting principles generally accepted in India ofthe state of affairs of the Company as at 31st March 2019 and its profit totalcomprehensive income cash flows and the changes in equity for the year ended on thatdate.
Basis of our opinion
We conducted our audit in accordance with the Standard 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 ofStandalone Financial Statements section of our report. We are independent of the Companyin accordance 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 provisions 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 our opinion.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Standalone financial statements of the current period.These matters were addressed in the context of our audit of the Standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters.
Information Other than the Standalone Financial Statements and Auditor's Report Thereon
The Company's Board of Directors is responsible for preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexures to Board's Report BusinessResponsibility Report Corporate Governance and Shareholder's Information but does notinclude the standalone financial statements and our auditor's report thereon.
Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained during the course of audit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.
Responsibilities of Management 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 preparation ofthese standalone Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income changesin equity and cash flows of the Company in accordance with accounting principles generallyaccepted in India including Indian Accounting Standards (Ind AS) prescribed under section133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015 asamended. 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 implementation and maintenance of accounting policies; making judgments andestimates that are reasonable and prudent; and design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the standalone Ind AS financial statement that give a true and fair viewand are free from material misstatement whether due to fraud or error.
In preparing the standalone Ind AS financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.
The Board of Directors are also responsible for overseeing the company's financialreporting process.
Auditor's Responsibilities for the Audit of Standalone Ind AS Financial Statement
Our objectives are to obtain reasonable assurance about whether the Standalone Ind ASfinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone Ind AS 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 therisks of material misstatement of the standalone Ind AS financial statements whether dueto fraud or error design and perform audit procedures responsive to those risks andobtain audit evidence that is sufficient and appropriate to provide a basis for ouropinion. The risk of not detecting a material misstatement resulting from fraud is higherthan for one resulting from error as fraud may involve collusion forgery intentionalomissions misrepresentations or the override of internal control.
Obtain an understanding of internal financial controls relevant to the audit in orderto design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Companies Act 2013 we are also responsible for expressing our opinionon whether the company has adequate internal financial controls with reference toFinancial Statements in place and the operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basis ofaccounting 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 standalone Ind AS financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.Evaluate the overall presentation structure andcontent of the standalone Ind AS financial statements including the disclosures andwhether the standalone Ind AS financial statements represent the underlying transactionsand events in a manner that achieves fair presentation. Materiality is the magnitude ofmisstatements in the standalone financial statements that individually or in aggregatemakes it probable that the economic decisions of a reasonably knowledgeable user of thefinancial statements may be influenced. We consider quantitative materiality andqualitative factors in (i) planning the scope of our audit work and in evaluating theresults of our work; and (ii) to evaluate the effect of any identified misstatements inthe financial statements. We communicate with those charged with governance regardingamong other matters the planned scope and timing of the audit and significant auditfindings including any significant deficiencies in internal control that we identifyduring 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 charged with governance we determine thosematters that were of most significance in the audit of the standalone Ind AS financialstatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.
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) Wehave sought and obtained all the information and explanations which to the best of ourknowledge 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 including Other Comprehensive Income Statement of Changes in Equity and theStatement of Cash Flows dealt with by this Report are in agreement with the books ofaccount. d) In our opinion the aforesaid standalone Ind AS financial statements complywith the Indian Accounting Standards specified under Section 133 of the Act read with Rule7 of the Companies (Accounts) Rules 2014. e) On the basis of the written representationsreceived from the directors as on 31st March 2019 taken on record by the Board ofDirectors none of the directors is disqualified as on 31st March 2019 from beingappointed as a director in terms of Section 164 (2) of the Act. f) With respect to theadequacy of the Internal Financial Control with reference to Financial Statements of theCompany and the operating effectiveness of such controls refer to our separate Report in"Annexure B" g) In our opinion and to the best of our information and accordingto the explanations given to us the remuneration paid by the Company to its directorsduring the year is in accordance with the provisions of section 197(16) of the Act. h)With respect to the other matters to be included in the Auditor's Report in accordancewith Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to thebest 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 Ind AS financial statements. ii) The Company has madeprovision as required under the applicable law or accounting standards for materialforeseeable losses if any on long-term contracts including derivative contracts. iii)There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company.
For: Ajay Sharma & Company.
Chartered Accountants Firm Registration No. 013306C
CA Ajay Sharma Place: Indore Proprietor Date : May 30 2019 Membership No. 404968
Annexure A to Independent Auditors' Report
The Annexure referred to in paragraph 1 under 'Report on Ohter Legal and RegularityRequirements section of our repoart of even date to the members of Shree PacetronixLimited on the standalone Ind AS financial statements as of and for the year ended March31 2019. We report that : i. In respect of the Company's fixed assets: (a) The Companyhas maintained proper records showing full particulars including quantitative details andsituation of fixed assets.
(b) As explained to us the fixed assets have been physically verified by themanagement during the year in a phased periodical manner which in our opinion isreasonable having regard to the size of the Company and nature of its assets. According tothe information and explanations given to us no material discrepancies were noticed onsuch physical verification.
(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. As explained to us the inventory of the Company hasbeen physically verified by the management at reasonable intervals during the year and nomaterial discrepancies have been noticed. iii. The company has not granted any loans toparties covered in the register maintained under section 189 of the Companies Act 2013.Therefore the provisions of Clause (iii) [(a) (b) (c)] of the said Order are notapplicable to the Company. iv. In our opinion and according to the information andexplanations given to us the company has complied with the provisions of section 185 and186 of the Companies Act 2013 in respect guarantee given on behalf of its subsidiary.
The company has not given any loans and made investments covered under section 185 and186 of the Companies Act 2013. v. The Company has not accepted any deposits from publicduring the year and does not have any unclaimed deposits as at March 31 2019. Thereforethe provisions of Clause (v) of the said Order are not applicable to the Company. vi. TheCentral government has not prescribed the maintenance of cost records under sub-section(l) of section 148 of the Companies Act 2013 for business activities carried out by theCompany. Thus reporting under Clause (vi) of the said Order is not applicable to theCompany. vii. According to the information and explanations provided to us in respect ofstatutory: (a) The Company has generally been regular in depositing undisputed statutorydues including of provident fund employees' state insurance income tax customs dutyGoods and services tax custom duty cess and other material statutory dues asapplicable with the appropriate authorities.
(b) There are no undisputed amounts payable in respect of the aforesaid dues wereoutstanding as at March 31 2019 for a period of more than six months from the date theybecame payable except Professional Tax of Rs.
60840 and Bihar Vat of Rs. 54030.
(c) There were no dues of income-tax sales-tax value added tax Goods and servicetax customs duty and excise duty which have not been deposited on account of anydispute. viii. In our opinion and according to the information given to us the Companyhas not defaulted in repayment of loans taken from banks or financial institutions duringthe year. ix. The Company has not raise any money by way of initial public offer orfurther public offer (including debt instruments) during the year. The term loans taken bythe company during the year were applied for the purpose for which the loans wereobtained; x. To the best of our knowledge and according to the information andexplanations given to us no material fraud by the Company or on the Company by itsofficers or employees has been noticed or reported during the year in the course of ouraudit. xi. 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. xii. In our opinion the Company is not anidhi company. Therefore the provisions of Clause 3(xii) of the Order are not applicableto the Company. xiii. According to the information and explanations provided and based onour examination of the records of the Company transactions with the related parties arein compliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the standalone financial statements as required by theapplicable accounting standards.
xiv. According to the information and explanations provided to us and on an overallexamination of the records of the balance sheet the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. Therefore reporting under Clause 3 (xiv) of the Order is not applicable to theCompany. xv. According to the information and explanations provided by the management theCompany has not entered into non-cash transactions with directors or persons connected toits directors as referred to in Section 192 of the Companies Act 2013. xvi. The Companyis not required to be registered under section 45-IA of the Reserve Bank of IndiaAct1934.
Annexure B to Auditor's Report
The Annexure referred to in paragraph 2 (F) under 'Report on Ohter Legal and RegularityRequirements section of our repoart of even date to the members of Shree PacetronixLimited on the standalone Ind AS financial statements as of and for the year ended March31 2019. We report that :
We have audited the internal financial controls over financial reporting of ShreePacetronix Limited ("the Company") as of 31 March 2019 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.
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 Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants of India(ICAI'). These responsibilities include the design implementation and maintenanceof adequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company's policiesthe safeguarding 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.
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") issued by the Institute of Chartered Accountants of India(ICAI') and the Standards on Auditing prescribed under section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controls.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and 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 respects. Our audit involves performingprocedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal control based on the assessed risk. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thestandalone 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 of themanagement 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.
In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at 31 March 2019 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note.