The Members of STI India Limited
Report on the Standalone Ind AS Financial Statements
1. We have audited the accompanying standalone Ind AS financial statements of STIIndia Limited ("the Company") which comprise the Balance Sheet as at 31March 2018 the Statement of Profit and Loss (including other comprehensive income) theCash Flow Statement and the statement of changes in equity for the year then ended and asummary of the significant accounting policies and other explanatory information (hereinafter referred to as "standalone Ind AS financial statements").
Management's Responsibility for the Standalone Ind AS Financial Statements
2. 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 cash flowsand changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind As) specifiedunder Section 133 of the Act read with relevant rules issued thereunder. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act; safeguarding the assets of the Company; preventing anddetecting 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 standalone Ind AS financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.
3. Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit.
4. 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 oftheAct and the Rules made there under.
5. 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 standalone Ind AS financial statements are free from material misstatement.
6. An audit involves performing procedures to obtain audit evidence about the amountsand the 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 controlsrelevant 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 IndASfinancial statements.
7. 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.
8. 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 including the Ind AS of thestate of affairs of the Company as at 31 March 2018 and its financial performanceincluding other comprehensive income its cash flows and the changes in equity for theyear ended on that date.
Report on Other Legal and Regulatory Requirements
9. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of Section 143(11) of the Act we givein the Annexure I a statement on the matters specified in paragraphs 3 and 4 of the Order.
10. As required by Section143(3) oftheAct 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 the statement of profit and loss the statement of cash flow andthe statement of changes in equity dealt with by this report are in agreement with thebooks of account.
d. In our opinion the aforesaid standalone Ind As financial statements comply with theIndian Accounting Standards (Ind As) specified under Section 133 of the Act read withrelevant rule issued thereunder.
e. On the basis of the written representations received from the directors as on 31stMarch 2018 and taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2018 from being appointed as a director in terms ofSection164(2) of the Act;
f. We have also audited the internal financial controls over financial reporting(IFCoFR) of the Company as of 31 March 2018 in conjunction with our audit of thestandalone Ind AS financial statements of the Company for the year ended on that date andour report dated 08.05.2018 as per Annexure II expressed.
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) Amendment Rules 2018 inour opinion and to the best of our information and according to the explanations given tous:
i. As detailed in Note 22 to the standalone Ind AS financial statements the Companyhas disclosed the impact of pending litigations on its standalone Ind AS financialstatements;
ii. The company does not have any long-term contracts including derivative contractsfor which there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection F und by the company.
iv. Attention is also invited to;
Note No.34 in "Notes to Account regarding the standalone Ind AS financialstatements of the Company having been prepared on going concern basis notwithstanding thefact that its net worth is completely eroded.
For V.K BESWAL & ASSOCIATES
CA K.V. Beswal
M No.: 131054
Firm Registration No.: 101083W
Date: 08th May 2018
Annexure I to the Auditor's Report even date CARO 2016:
1. In respect of Fixed Assets:
a. The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
b. The fixed assets have been physically verified by the management at reasonableintervals during the year. We are informed that no material discrepancies were noticed bythe management on such verification.
c. The title deeds in respect of all immovable properties are held in the name of thecompany.
2. In respect of Inventories:
As explained to us physical verification of inventory has been conducted during theyear at reasonable intervals by the management and in our opinion and according to theinformation and explanation given to us the Company is maintaining proper records of itsinventories and no material discrepancies were noticed on physical verification
3. In respect of loans secured or unsecured granted by the Company to other Companiesfirms LLP or other parties covered in the register maintained under section 189 of theCompanies Act 2013.
a. The terms and conditions of grant of such loans are not prejudicial to the interestof the Company.
b. The repayments of the principal are regular. Loan is given Interest free.
c. The amounts are payable on demand.
4. The Company has complied with the provisions of section 185 and 186 of the CompaniesAct 2013 in respect of guarantees given and securities provided. However there is noLoans given and Investments made during the year.
5. During the year the company has not accepted any deposits from public or by anymeans hence the said clause 3(v) of the said order is not applicable to the Company.
6. As per the information and explanations provided to us we are of the opinion thatin pursuant to the prescribed rules by Central Government the Company had maintained costrecords u/s. 148(1) of the Companies Act 2013 however we have not done a detailedexamination of the same.
7. In respect of Statutory Dues:
(a) According to record of the Company produced before us the Company is generallyregular in depositing with appropriate authorities undisputed statutory dues includingprovident fund investor education and protection fund employees'' state insuranceincome tax sales tax service tax customs duty excise duty cess and other statutorydues applicable to it. According to the information and explanations given no undisputedamounts payable in respect of Income-Tax sales tax service tax customs duty exciseduty/cess were outstanding as at 31.03.2018 for a period of more than six months from thedate they became payable except as given below:
Statement of Arrears of statutory dues outstanding (excluding interest) for more than six months as at 31 st March 2018:
|Sr. No Nature of Dues ||Amount (^in Lacs) ||Period to which amount relates |
|1. Central Sales Tax ||3.87 ||1995-96 |
|2. Tax Deducted at Source ||25.41 ||2017-18 |
|3. Tax Collection at Source ||1.43 ||2017-18 |
|4. Profession Tax ||0.88 ||2017-18 |
|5. Provident Fund ||118.49 ||2017-18 |
|6. ESIC ||10.82 ||2017-18 |
|Total ||160.90 || |
(b) According to the records of the company there are no dues of Income- Tax salestax wealth tax service tax customs duty excise duty/cess which have not been depositedon account of any dispute except as given below.
|Nature of the Act ||Nature of the Dues ||Amount ||Period to which the amount relates ||Forum where dispute is pending |
|Central Sales Tax Act 1956 ||CST ||63.00 ||1995-96 ||Writ Petition filed in M.P High Court |
|Central Sales Tax Act 1956 ||Excise Duty ||27.03 ||September 2004 ||In the High Court of M.P |
|Central Sales Tax Act 1944 ||Excise Duty ||65.49 ||March 2004 to September 2004 ||In the High Court of M.P |
|Central Sales Tax Act 1944 ||Excise Duty ||11.02 ||2007-08 & 2008-09 ||Additional Commissioner of Central Excise Indore |
|Income Tax Act 1961 Tribunal Indore ||Penalty ||7.00 ||A.Y. 2005-06 ||Income Tax Appellate Tribunal Indore |
|Income Tax Act 1961 ||Penalty ||0.50 ||A.Y.2016-17 ||CIT(A)-Indore |
|Total || ||174.04 || || |
8. As per the information and explanations given to us the company has not taken loansfrom bank or financial institutions. The company has not defaulted in repayment of dues todebenture holders.
9. During the year the Company has not raised any fund by way of initial public offeror further public offer (including debt instruments) and term loans therefore no commentsunder the clause are called for.
10. Based upon the audit procedures performed and information and explanations given bythe management we report that no fraud on or by the Company has been noticed or reportedduring the course of our audit.
11. According to the records of the Company the Managerial Remuneration has been paidor provided in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Companies Act 2013.
12. In our opinion and to the best of our information and according to the explanationsprovided by the management we are of the opinion that the company is not a Nidhi company.Hence in our opinion the clause does not apply to the company.
13. The Company has disclosed all the transactions with the related parties in theFinancial Statements during the year and the transactions are in compliance with sections177 and 188 of Companies Act 2013.
14. During the year under consideration the company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures hencecomments under this clause are not called for.
15. According to the provisions of section 192 of Companies Act 2013 the company hasnot entered into any non-cash transactions with directors or persons connected with himduring the year hence no comments under this clause are called for.
16. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934 hence this clause is not applicable and no comments under thisclause are called for.
For V.K BESWAL & ASSOCIATES
CA K.V. Beswal
Firm Registration No:101083W
Date: 08th May 2018
Annexure II Independent Auditor's report on the Internal Financial Controls withreferences to financial statement & it operating effectiveness under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")
1. In conjunction with our audit of the standalone Ind AS financial statements of STIIndia Limited ("the Company") as of and for the year ended 31 March 2018 wehave audited the internal financial controls over financial reporting (IFCoFR) of thecompany of as of that date.
Management's Responsibility for Internal Financial Controls
2. The Company's Board of Directors is responsible for establishing and maintaininginternal financial controls based on the criteria being specified by management. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls with references to financial statement that were operating effectivelyfor ensuring the orderly and efficient conduct of the company's business includingadherence to company's policies the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial information as required under the Act.
3. Our responsibility is to express an opinion on the Company's IFCoFR based on ouraudit. We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India (ICAI) and deemed to be prescribed undersection 143(10) of the Act to the extent applicable to an audit of IFCoFR and theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting (the"Guidance Note") issued by the ICAI. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate IFCoFR were established and maintained and ifsuch controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the IFCoFR and their operating effectiveness. Our audit of IFCoFR included obtaining anunderstanding of IFCoFR assessing the risk that a material weakness exists and testingand evaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgement including theassessment of the risks of material misstatement of the financial statements whether dueto fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's IFCoFR.
Meaning of Internal Financial Controls over Financial Reporting
6. A company's IFCoFR is a process designed to provide reasonable assurance regardingthe reliability of financial reporting and the preparation of standalone Ind AS financialstatements for external purposes in accordance with generally accepted accountingprinciples including the Ind AS. A company's IFCoFR includes those policies and proceduresthat (1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and in accordance with generally accepted accountingprinciples including Ind AS and that receipts and expenditures of the company are beingmade only in accordance 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 standalone Ind AS financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
7. Because of the inherent limitations of IFCoFR including the possibility ofcollusion or improper management override of controls material misstatements due to erroror fraud may occur and not be detected. Also projections of any evaluation of the IFCoFRto future periods are subject to the risk that IFCoFR may become inadequate because ofchanges in conditions or that the degree of compliance with the policies or proceduresmay deteriorate.
8. In our opinion the Company has in all material respects adequate internalfinancial controls over financial reporting and such internal financial controls overfinancial reporting were operating effectively as at 31 March 2018 based on the criteriabeing specified by management.
| ||For V.K BESWAL & ASSOCIATES |
| ||Chartered Accountants |
| ||CA K.V. Beswal |
| ||Partner |
|Place: Mumbai ||Membership N umber-131054 |
|Date: 08th May 2018 ||Firm Registration No:101083W |