THE MEMBERS OF SHRI RAM SWITCHGEARS LIMITED
Report on the Financial Statements
We have audited the accompanying financial statements of SHRI RAM SWITCHGEARS LIMITED("the company'')which comprise the Balance Sheet as at March 31 2018 the Statementof Profit and Loss and Cash Flow Statement for the year then ended and a summary ofsignificant accounting policies and other explanatory information.
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 with respect to the preparation of these financialstatements that give a true and fair view of the financial position financial performanceand cash flows of the Company in accordance with the accounting principles generallyaccepted in India including the Accounting Standards specified under Section 133 of theAct 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 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 financial statements that give a true and fair view and are free from materialmisstatement whether due 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 a true and fair view in order to design audit proceduresthat are appropriate in the circumstances.
An audit also includes evaluating the appropriateness of the accounting policies usedand the reasonableness of the accounting estimates made by the Company's Directors aswell as evaluating 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 standalone financial statements.
In our opinion and to the best of our information and according to the explanationsgiven t o us the financial statements give the information required by the Act in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India:
a) In the case of the Balance Sheet of the state of affairs of the Company as at March31 2018;
b) In the case of the Statement of Profit and Loss of the profit for the year ended onthat date; and
c) In the case of the Cash Flow Statement of the cash flows for the year ended on thatdate.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2018 issued by the CentralGovernment of India in terms of sub-Section (11) of Section 143 of The Companies Act 2013we 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 purpose 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 Statement of Profit and Loss and Cash Flow Statement dealt withby this Report are in agreement with the books of account.
d. In our opinion the aforesaid financial statements comply with Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014.
e. On the basis of written representations received from the directors as on March 312018 taken on record by the Board of Directors none of the directors is disqualified ason March 31 2018 from being appointed as a director in terms of Section 164(2) of theAct.
f. With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.
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 financial statements.
II. The Company did not have any long term contacts including derivativecontracts for which there were any material foreseeable losses
III. The Company has provided requisite disclosures in the financial statementsas to holdings as well as dealings
ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT
In terms of Companies (Auditor's Report) Order 2018 issued by Central Government ofIndia in terms of Section 143(11) of The Companies Act 2013 we further report on thematters specified in paragraph 3 and 4 of the said Order that:-
1. (i) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets.
(ii) Fixed assets have been physically verified by the management at regular intervals.As informed to us no Material discrepancies were noticed on such verification.
(iii) Based on our verification and according to information and explanations given tous The title deeds of immovable properties shown in the financial statements are held inthe name of the company.
2. Physical verification of inventory has been conducted at reasonable intervals bymanagement. The discrepancies notices were properly dealt with in the books of account ofthe Company.
3. The Company has not granted any loans secured or unsecured to companies firmsLLPs or other parties covered in register maintained under Section 189 of The CompaniesAct 2013.
4. The Company has not given any loans or guarantees/made any investments within themeaning of Section 185 & 186 of the Companies Act 2013.
5. The Company has not accepted any deposits.
6. The Company has not fall under the purview of the Companies as specified insub-Section (1) of Section 148 of The Companies Act 2013 and thus aforesaid Rulesregarding Cost Audit is not applicable.
7. (i) The Company is regular in depositing undisputed statutory dues with appropriateauthorities However Provision of statutory dues as shown in current liabilities are yetnot paid.
(ii) According to the information and explanation give to us there are no materialstatutory dues which have not been deposited with appropriate authorities on account ofany dispute except the following:
|NAME OF THE STATUTE ||SECTION ||RELATING PERIOD ||PENDING WITH JURISDICTION ||O/S DEMAND AMOUNT |
|INCOME TAX ACT 1961 ||220(2) ||A.Y. 2010 - 11 ||CPC ||1046 |
|INCOME TAX ACT 1961 ||143(3) ||A.Y. 2013 - 14 ||CPC ||237952 |
|INCOME TAX ACT 1961 ||201 ||A.Y. 2014- 15 ||CPC ||3897 |
Total Demand of Rs. 1 94 520/- is outstanding in respect of TDS as on May 2018 forvarious assessment years.
8. In our opinion and according to the information and explanation give to us theCompany has not defaulted in any repayment of dues to any financial institution or bank.
9. According to the information and explanation give to us the term loans has beenutilized for the purposes for which they were obtained.
10. Based upon the audit procedures performed and information and explanations given bythe management we report that no fraud by the Company or on the Company by itsofficers/employees have been noticed or reported during the course of our audit.
11. In our opinion and according to the information and explanations given to us theCompany has paid / provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.
12. The transactions entered into with related parties are in compliance with Section177 & 188 of The Companies Act 2013 and the details have been disclosed in thefinancial statements etc. as required by the applicable accounting standards.
13. The Company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year.
14. The Company has not entered into any non-cash transactions with directors orpersons connected with him during the year.
15. The Company is not required to be registered under Section 45-IA of The ReserveBank of India Act 1934.
ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT
Report on the Internal Financial Controls Under Clause (I) of Sub-Section 3 of Section143 of the Companies Act 2013
We have audited the internal financial controls over financial reporting of SHRI RAMSWITCHGEARS LTD. as of March 31 2018 in conjunction with our audit of the financialstatements of the Company for the year ended on 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 include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient 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.
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 Reportingand the Standards on Auditing issued by ICAI and deemed to be prescribed under Section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls both applicable to an audit of Internal Financial Controls and bothissued by the Institute of Chartered Accountants of India. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively 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 judgment 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) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorizations 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.
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 2018 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India with the current Year's classification/disclosure.