The Members of
SUBWAY FINANCE AND INVESTMENT CO LTD.
Report on the Financial Statements
We have audited the accompanying (Standalone) financial statements of SUBWAY FINANCEAND INVESTMENT CO LTD. which .comprise the Balance Sheet as at March 31 2018 theStatement of Profit and Loss Cash Flow Statement for the year then ended and a summaryof 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 with respect to the preparation of these (Standalone)financial statements that give a true and fair view of the financial position financialperformance and cash flows of the Company in accordance with the accounting principlesgenerally accepted in India including the Accounting Standards specified under Section133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting 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 financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.
Our responsibility is to express an opinion on these (Standalone) financial statementsbased on our audit.
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 but not for the purpose of expressing anopinion on whether the Company has in place an adequate internal financial controls systemover financial 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 (Standalone) financial statements
Basis of Qualified Opinion
a. Interest Income: Income has been recognized only on the basis of confirmationreceived from the concerned parties while actual receipt is not made during the period.Matter has been qualified in our report & our opinion is only based on confirmations& information provided by the management in this regard.
Furthermore there are no specific documentations available for changes in the rate ofinterest on the said loans advanced by NBFC during the said period.
b. As per explanations provided to us there were no bank transactions throughout theyear since the current account was blocked by Income tax department due to recoveries ofStatutory dues from a Director of the company in his personal income tax matter.
In our opinion and to the best of our information and according to the explanationsgiven to us except for the effects for the matters described in the "Basis forqualified Opinion" paragraph above the aforesaid (Standalone) financial statementsgive the information required by the Act in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2018 and its Profit/Loss and its CashFlow for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report] Order 2016 ("the Order")as amended issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the "Annexure A" a statement on the mattersspecified 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 except for the possible effects of matters described in the"Basis for qualified opinion" above obtained all the information andexplanations which to the best of our knowledge and belief were necessary for the purposeof our audit;
b. in our opinion except for the possible effects of matters described in the"Basis for qualified opinion" above proper books of account as required by lawhave been kept by the Company so far as it appears from our examination of those books;
c. 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
d. in our opinion except for the possible effects of matters described in "Basisfor qualified opinion" above the aforesaid (Standalone) Financial statements complywith the Accounting Standards specified under section 133 of the Act read with Rule 7 ofthe Companies (Accounts) Rules 2014.
e. The matters described in the "Basis for qualified opinion" above in ouropinion may have an adverse effect on the financial position/ actual results of theCompany.
f. 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.
g. 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".
h. 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 in our opinionand to the best of our information and according to the explanations given to us:
Except for the possible effects of matters described in "Basis for qualifiedopinion" above the aforesaid (Standalone) financial statements
i. The Company does not have any pending litigations which would impact its financialposition.
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
Priya Choudhary & Associates Chartered Accountants
Annexure A" to the Independent Auditors' Report
Referred to in paragraph 1 under the heading 'Report on Other Legal & RegulatoryRequirement' of our report of even date to the financial statements of the Company for theyear ended March 31 2018:
1) (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 in a phasedmanner designed to cover all the items over a period of three years which in ouropinion is reasonable having regard to the size of the company and nature of itsbusiness. Pursuant to the program a portion of the fixed asset has been physicallyverified by the management during the year and no material discrepancies between the booksrecords and the physical fixed assets have been noticed.
(c) The title deeds of immovable properties are held in the name of the company.
2) [a] The management has conducted the physical verification of inventory atreasonable intervals.
b) The discrepancies noticed on physical verification of the inventory as compared tobooks records which has been properly dealt with in the books of account were notmaterial.
3) The Company has not granted any loans secured or unsecured to companies firmsLimited Liability partnerships or other parties covered in the Register maintained undersection 189 of the Act. Being NBFC company the provisions of clause 3 (iii) (a] to (C) ofthe Order are not applicable to the Company and hence not commented upon.
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 Companies Act 2013In respect of loans investments guarantees and security.
5) The Company has not accepted any deposits from the public and hence the directivesissued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any otherrelevant provisions of the Act. No order in relation thereto has been passed by theCompany Law Board or National Company Law Tribunal or Reserve Bank of India or any Courtor any other Tribunal.
6) As informed to us the maintenance of Cost Records has not been specified by theCentral Government under sub-section (1) of Section 148 of the Act in respect of theactivities carried on by the company.
7) (a) According to the records of the Company the undisputed statutory dues includingProvident Fund Employees State Insurance Income Tax Sales Tax Wealth Tax Service TaxCustom Duty and
Excise Duty Cess have regularly deposited with the appropriate authorities. There areno undisputed amount payable in respect of such statutory dues which have remainedoutstanding as at 31st March 2018 for a period more than six months from the date theybecame payable except the following Income Tax Liabilities.
|Assessment Year ||Outstanding Amount in INR' |
|2006-07 ||105691 |
|2007-08 ||39219 |
b) According to the information and explanation given to us subject to above thereare no dues of income tax sales tax service tax duty of customs duty of excise valueadded tax outstanding on account of any dispute.
8) In our opinion and according to the information and explanations given to us theCompany has not defaulted in the repayment of dues to banks. The Company has not taken anyloan either from financial institutions or from the government and has not issued anydebentures.
9) Based upon the audit procedures performed and the information and explanations givenby the management the company has not raised moneys by way of initial public offer orfurther public offer including debt instruments and term Loans during the period.
10) Based upon the audit procedures performed and the information and explanationsgiven by the management we report that no fraud by the Company or on the company by itsofficers or employees has been noticed or reported during the year.
11) Based upon the audit procedures performecTand the information and explanationsgiven by the management managerial remuneration has not been paid or provided hence therequisite approvals mandated by the provisions of section 197 read with Schedule V to theCompanies Act are not required;
12) In our opinion the Company is not a Nidhi Company. Therefore the provisions ofclause 4 (xii) of the Order are not applicable to the Company.
13) In our opinion all transactions with the related parties are in compliance withsection 177 and 188 of Companies Act 2013 and the details have been disclosed in theFinancial Statements as required by the applicable accounting standards.
14) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year underreview.
15) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not entered into any non-cash transactions withdirectors or persons connected with him.
16) The company is registered under section 45 IA of the Reserve Bank of India Act1934 .The Company has received the Registration Certificate from RBI vide Registration no13.00209 dated 03.03.1998.
Priya Choudhary & Associates Chartered Accountants
"Annexure B" to the Independent Auditor's Report of even date on theStandalone Financial Statements of SUBWAY FINANCE AND INVESTMENT CO LTD.
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 SUBWAYFINANCE AND INVESTMENT CO LTD. as of March 31 2018 in conjunction with our audit of thestandalone financial statements 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 our audit. These responsibilities include the designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring the orderly and efficient conduct of its 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 theCompanies Act 2013.
Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted pur audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10] of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively 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 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 ofmanagement 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 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 ouraudit.
Priya Choudhary & Associates Chartered Accountants
Auditor's Report on Quarterly Financial Results and Year to Date Results of the Company
to the Clause 41 of the Listing Agreement
Board of Directors of
Subway Finance & Investment Company Limited
We have audited the quarterly financial results Subway Finance & Investment CompanyLimited for the quarter ended 31st March 2018 and the year to date results forthe period 1st April 2017 to 31st March 2018 attached herewithbeing submitted by the company pursuant to the requirement of clause 41 of the ListingAgreement except for the disclosures regarding 'Public Shareholding' and Promoterand Promoter Group Shareholding' which have been traced from disclosures made by themanagement and have not been audited by us. These quarterly financial results as well asthe year to date financial results have been prepared on the basis of the interimfinancial statements which are the responsibility of the company's management.
Our responsibility is to express an opinion on these financial results based on ouraudit of such interim financial statements which have been prepared in accordance withthe recognition and measurement principles laid down in Accounting Standard (AS) 25Interim Financial Reporting issued pursuant to the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014 or by theInstitute of Chartered Accountants of India and other accounting principles generallyaccepted in India. . .
We conducted our audit in accordance with the auditing standards generally accepted inIndia. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial results are free of material misstatement(s). Anaudit includes examining on a test basis evidence supporting the amounts disclosed asfifiancial results. An audit also includes assessing the accounting principles used andsignificant estimates made by management. We believe that our audit provides a reasonablebasis for our opinion.
In our opinion and to the best of our information and according to the explanationsgiven to us these quarterly financial results as well as the year to date results:
I. have been presented in accordance with the requirements of clause 41 of the ListingAgreement in this regard; and
II. Give a true and fair view of the net loss and other financial information for thequarter ended 31st March 2018 as well as the year to date results for theperiod from 1st April 2017 to 31st March 2018 except thequalification mentioned in the Audit report.
Further we also report that we have on the basis of the books of account and otherrecords and information and explanations given to us by the management also verified thenumber of shares as well as percentage of shareholdings in respect of aggregate amount ofpublic shareholdings as furnished by the company in terms of clause 35 of the ListingAgreement and found the same to be correct.
Further we would like to report that company is unable to fulfill the listingrequirements pertaining to NOF as prescribed by RBI as per master circular "MasterDirection DNBR. PD. 008/03.10.1 19/2016-17".
M/S Priya Choudhary & Associates