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Systematix Securities Ltd.

BSE: 531432 Sector: Financials
NSE: N.A. ISIN Code: N.A.
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Systematix Securities Ltd. (SYSTEMATIXSEC) - Auditors Report

Company auditors report

To

The Members of

M/s Systematix Securities Limited

Report on the Financial Statements

We have audited the accompanying standalone financial statements of SystematixSecurities Limited ("the Company") which comprise the Balance Sheet as atMarch 31 2017 the Statement of Profit and Loss the Cash Flow Statement and a summary ofthe significant 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 ("the Act") with respect to the preparation ofthese standalone financial statements to give a true and fair view of the financialposition financial performance cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Indian AccountingStandards specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding of theassets of the Company and for preventing and detecting frauds and other irregularities;selection and application of appropriate 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 financial statements that give a true and fair view and arefree from material misstatement whether due to fraud or error.

Auditor's Responsibility

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 and the Rules made thereunderincluding the accounting and auditing standards and matters which are required to beincluded in the audit report under the provisions of the Act and the Rules madethereunder.

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing specified under Section 143(10) of the Act. Those Standards andpronouncements require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the standalone financial statements arefree from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone financial statements. The procedures selected depend onthe auditors' judgment including the assessment of the risks of material misstatement ofthe standalone financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to the Company'spreparation of the standalone financial statements that give a true and fair view inorder

to design audit procedures that are appropriate in the circumstances. 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 standalone 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.

Opinion

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 Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2017 and its profit) its cash flows 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 issued by the CentralGovernment of India in terms of sub-section of section 143 of the Act ("theOrder") and on the basis of such checks of the books and records of the Company aswe considered appropriate and according to the information and explanations given to uswe give in the 'Annexure A' a statement on the matters specified in paragraphs 3 and 4 ofthe 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 the Cash Flow Statement dealtwith by this Report are in agreement with the books of account

d. in our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014;

e. on the basis of the written representations received from the directors as on 31March 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2017 from being appointed as a director in terms of Section164 (2) of the Act; and

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'; and

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 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 as at March 31 2017 onits financial position in its financial statements.

ii. The Company has made provision as at March 31 2017 as required under theapplicable law or accounting standards for material foreseeable losses if any onlong-term contracts including derivative contracts.

iii. There were no amounts required to be transferred to the Investor Education andProtection Fund by the Company during the year ended March 31 2017.

iv. The Company has provided requisite disclosures in the standalone financialstatements as to holding as well as dealings in Specified Bank Notes during the periodfrom 8th November 2016 to 30 December 2016 on the basis of information available withthe Company. Based on audit procedures and relying on management's representation wereport that disclosures are in accordance with the books of accounts maintained by theCompany and as produced to us by the Management.

For Sethiya Khandelwal & Co
Chartered Accountants
Registration No: 004058C
Place: Indore Rajesh Khandelwal
Date: 30/05/2017 (Proprietor)
M. No.: 076272

ANNEXURE A TO THE AUDITORS' REPORT

Referred to in paragraph 1 of the Independent Auditors' Report of even date to themembers of Systematix Securities Limited on the standalone financial statements asof and for the year ended March 31 2017

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

(b) The fixed assets are physically verified by the Management according to a phasedprogramme designed to cover all items over a period of three years which in our opinionis reasonable having regard to the size of the Company and the nature of its assets.Pursuant to the programme a portion of the fixed assets has been physically verified bythe Management during the year and no material discrepancies have been noticed on suchverification.

(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.

(2) The physical verification of inventory excluding stocks with third parties has beenconducted at reasonable intervals by the Management during the year. In respect ofinventory lying with third parties these have substantially been confirmed by them. Nomaterial discrepancies where noticed on physical verification of inventory as compared tobook records.

(3) The Company has not granted unsecured loans to Companies firms or parties 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 if any.

(5) The Company has not accepted any deposits from the public within the meaning ofSections 73 74 75 and 76 of the Act and the Rules framed there under to the extentnotified.

(6) Pursuant to the rules made by the Central Government of India the Company is notrequired to maintain cost records as specified under Section 148(1) of the Act in respectof its products.

(7) The Central Government has not prescribed the maintenance of cost records underSection 148(1) of the Act for any of the services rendered by the Company.

(8) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company amounts deducted in the books of account inrespect of undisputed statutory dues like income tax tax deduct at source and othermaterial statutory dues have been regularly deposited during the year by the Company withthe appropriate authorities. According to the information and explanations given to us noundisputed amounts payable in respect of provident fund income tax sales tax wealthtax service tax duty of customs value added tax cess and other material statutory dueswere in arrears as at 31 March 2017 for a period of more than six months from the datethey became payable.

(9) The Company does not have any loans or borrowings from any financial institutionbanks government or debenture holders during the year. Accordingly paragraph 3(viii) ofthe Order is not applicable.

(10) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loans during the year. Accordinglyparagraph 3(ix) of the Order is not applicable.

(11) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.

(12) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not paid / provided formanagerial remuneration during the year however requisite approvals mandated by theprovisions of Section 197 read with Schedule V to the Act has been taken by the company.

(13) 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 Order is notapplicable.

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

(15) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year.

(16) 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 noncashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

(17) The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.

For Sethiya Khandelwal & Co
Chartered Accountants
Registration No: 004058C
Place: Indore Rajesh Khandelwal
Date: 30/05/2017 (Proprietor)
M. No.: 076272

Annexure B to the Auditors' Report

Referred to in paragraph 2(f) of the Independent Auditors' Report of even date to themembers of Systematix Securities Limited on the standalone financial statements forthe year ended March 31 2017. Report on the Internal Financial Controls under Clause (i)of sub-section 3 of Section 143 of the Companies Act 2013 ('the Act')

We have audited the internal financial controls over financial reporting of SystematixSecurities Limited ('the Company') as of 31 March 2017 in conjunction with our auditof the 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 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 ('ICAI'). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to the Company's policies the safeguarding of its assetsthe prevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.

Auditors' 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 issued by ICAI and deemed to beprescribed under Section 143(10) of the Companies Act 2013 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 were established and maintained and if suchcontrols 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 auditors' 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 receipt and expenditure of the Company are being made only inaccordance with authorizations of the Management and directors of the Company.

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.

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 were operating effectively as at 31 March 2017 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.

For Sethiya Khandelwal & Co
Chartered Accountants
Registration No: 004058C
Place: Indore Rajesh Khandelwal
Date: 30/05/2017 (Proprietor)
M. No.: 076272