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TAAL Enterprises Ltd.

BSE: 539956 Sector: Services
NSE: N.A. ISIN Code: INE524T01011
BSE 16:01 | 19 Feb 182.05 1.25
(0.69%)
OPEN

178.00

HIGH

195.95

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163.60

NSE 05:30 | 01 Jan TAAL Enterprises Ltd
OPEN 178.00
PREVIOUS CLOSE 180.80
VOLUME 6261
52-Week high 305.00
52-Week low 145.10
P/E 9.89
Mkt Cap.(Rs cr) 57
Buy Price 175.00
Buy Qty 1.00
Sell Price 182.05
Sell Qty 45.00
OPEN 178.00
CLOSE 180.80
VOLUME 6261
52-Week high 305.00
52-Week low 145.10
P/E 9.89
Mkt Cap.(Rs cr) 57
Buy Price 175.00
Buy Qty 1.00
Sell Price 182.05
Sell Qty 45.00

TAAL Enterprises Ltd. (TAALENTERPRISES) - Auditors Report

Company auditors report

To The Members of TAAL Enterprises Limited

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the Standalone Financial Statements of TAAL Enterprises Limited("the Company") which comprise of the Balance Sheet as at March 31 2019 theStatement of Profit and Loss Statement of Changes in Equity and Statement of Cash Flowsfor the year then ended and notes to the Standalone Financial Statements including asummary of Significant Accounting Policies and other Explanatory Information.

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 true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2019 and Profit Changes in Equity andits Cash Flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder Section143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditor's Responsibilities for the Audit of the Standalone FinancialStatements Section of our report. We are independent of the Company in accordance with theCode of Ethics issued by the Institute of Chartered Accountants of India (ICAI) togetherwith the ethical requirements that are relevant to our audit of the Standalone FinancialStatements under the provisions of the Act and the Rules thereunderand we have fulfilledour other ethical responsibilities in accordance with these requirements and the Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our opinion.

Emphasis of Matter

We draw attention to the following matters in the Notes to the Standalone FinancialStatements: a) Note 37 which states that the Company during the current quarter due tonon-availability of the requisite statutory licenses required for carrying on the demergedcharter business the demerged charter business has continued to be operated by TanejaAerospace and Aviation Limited in trust for and on behalf of the Company including bankingtransactions statutory compliances and all other commercial activities. However theaccounting entries pertaining to the demerged charter business are accounted in the booksof account of the Company. The said matter was stated as an Emphasis of Matter in ourStatutory Audit Reports for the year ended on or after March 31 2016 and Limited Review

Reports for the quarter ended on or after June 30 2016. Our opinion is not modified inrespect of this matter.

Key Audit Matter

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.

Key Audit Matter (Risk) How Was the Key Audit Matter Addressed in the Audit
Impairment of Investment in subsidiary Our audit procedures in respect of this area included:
Refer Note 39 to the Standalone Financial Statements The Company accounts for the investment in subsidiaries at cost and tests for any impairment in the value of investment on an annual basis in accordance with Para 9 of IND AS 36 on Impairment of Asset. 1. Detailed testing of compliance with Ind AS 36 - Impairment of Assets.
As on March 31 2019 one of the subsidiary companies outside India First Airways Inc. has an accumulated deficit of INR 616.37 lakhs (USD 1014252) and the carrying value of investment in the Standalone Financial Statements is at Rs. 477.49 lakhs. 2. Reviewed the net recoverable amount determined by the management which is based on the fair value of the aircraft as on March 31 2019 less the price to be paid by First Airways Inc. to the lessor of the aircraft on exercising the option to purchase the aircraft at the stipulated value.
First Airways Inc has entered into a purchase option agreement with the lessor to purchase an aircraft at a price equal to the Stipulated Loss Value of the Aircraft as specified in the lease agreement on the purchase date. 3. Assessed the reasonableness of the fair value of the aircraft as determined by a valuer appointed by the management and compared the fair value with data from independent sources available in the public domain.
For the purpose of impairment testing the management arrived at the net recoverable amount based on the fair value of the aircraft as on March 31 2019 less the price to be paid by First Airways Inc. to the lessor of the aircraft on exercising the option to purchase. 4. Compared the carrying value of the investment with the recoverable amount to assess for any impairment in the carrying amount of investment.
The net recoverable amount arrived at is greater than the carrying value of the investment as on March 31 2019 and hence there is no provision for impairment considered necessary.
Due to significance of the above matter and involvement of the management estimate and judgement we have considered this as a key audit matter.

Information Other than the Standalone Financial Statements and Auditor's Report Thereon

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Directors' report and ManagementReport but does not include the Standalone Financial Statements and our auditor's reportthereon.

Our opinion on the Standalone Financial Statements does not cover the other informationand we do not and will 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 knowledge obtained in the audit or otherwise appears to be materiallymisstated. 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 and Those Charged with Governance for the StandaloneFinancial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Act with respect to the preparation of these Standalone Financial Statementsthat give a true and fair view of the financial position financial performance changesin Equity 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. This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding of the assets of theCompany and 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 Standalone Financial Statement that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

In preparing the Standalone Financial Statements the Board of Directors is responsiblefor assessing the Company's ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless the Board of Directors either intends to liquidate the Company or tocease operations or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Company's financialreporting process.

Auditor's Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the StandaloneFinancial 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 Financial Statements.

We give in "Annexure A" a detailed description of Auditor's responsibilitiesfor Audit of the Standalone Financial Statements.

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 Act we give in"Annexure B" a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.

2. As required by Section 143(3) of the Act we report that: (a) We have sought andobtained all the information and explanations which to the best of our knowledge andbelief 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 Sheetthe Statement of Profit and Loss the Statement of Changes in Equity and the Cash FlowStatement dealt with 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 March312019 taken on record by the Board of Directors none of the directors is disqualifiedas on March 312019from being appointed as a director in terms of Section 164 (2) of theAct.

(f) With respect to the adequacy of the internal financial controls with reference toStandalone Financial Statements of the Company and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure C".

(g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule11 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. TheCompany does not have any pending litigations which would impact its financial position.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 wererequired to be transferred to the Investor Education and Protection Fund by the Company.

3. As required by The Companies (Amendment) Act 2017 in our opinion according toinformation explanations given to us the remuneration paid by the Company to itsdirectors is within the limits laid prescribed under Section 197 of the Act and the Rulesthereunder except that the remuneration paid to one whole-time Director as approved by theBoard is subject to approval through special resolution by the Members of the Company inthe next general meeting of the Company. Refer Note 41 to the Standalone FinancialStatements.

For MSKA & Associates
Chartered Accountants
ICAI Firm Registration No. 105047W
Deepak Rao
Place : Bengaluru Partner
Date : June 24 2019 Membership No. 113292

ANNEXURE A TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONE FINANCIALSTATEMENTS OF TAAL ENTERPRISES LIMITED

Auditor's Responsibilities for the Audit of the 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 the risks of material misstatement of the financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under Section 143(3) (i) ofthe Act we are also responsible for expressing our opinion on whether the company hasinternal financial controls with reference to financial statements in place and theoperating 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 financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

Evaluate the overall presentation structure and content of the financial statementsincluding the disclosures and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevantethical requirements regarding independence and to communicate with them allrelationships 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 financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

For MSKA & Associates
Chartered Accountants
ICAI Firm Registration No. 105047W
Deepak Rao
Place : Bengaluru Partner
Date : June 24 2019 Membership No. 113292

ANNEXURE B TO INDEPENDENT AUDITORS' REPORT OF EVEN DATE ON THE STANDALONE FINANCIALSTATEMENTS OF TAAL ENTERPRISES LIMITED FOR THE YEAR ENDED MARCH 31 2019

[Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements' in the Independent Auditors' Report]

i. (a) The company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets (Property Plant and Equipment).

(b) All the fixed have been physically verified by the management during the year andno material discrepancies were identified on such verification.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the Company does not own any immovableproperties. Accordingly of the provisions stated in paragraph 3(i)(c) of the order arenot applicable to the Company. ii. The Company is involved in the business of renderingservices. Accordingly the provisions stated in paragraph 3(ii) of the Order are notapplicable to the Company. iii. The Company has granted loans secured or unsecured to oneCompany covered in the register maintained under Section 189 of the Act.

(a) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the rate of interest and other terms andconditions on which the loans have been granted to the Companies listed in the registermaintained under Section 189 of the Act are not prima facie prejudicial to the interestof the Company.

(b) In case of the loans granted to the Companies listed in the register maintainedunder Section 189 of the Act schedule of repayment of principal and payment of interesthave not been stipulated. In the absence of stipulation of repayment terms we are unableto comment on the regularity of repayment of principal and payment of interest.

(c) There are no amounts overdue for more than ninety days in respect of the loangranted to Companies listed in the register maintained under Section 189 of the Act. iv.In our opinion and according to the information and explanations given to us the Companyhas complied with the provisions of Section 185 and 186 of the Act in respect of loansinvestments guarantees and security made. v. In our opinion and according to theinformation and explanations given to us there are no amounts outstanding which are inthe nature of deposits as on March 31 2019 and the Company has not accepted any depositsduring the year.

vi. The provisions of Sub-section (1) of Section 148 of the Act are not applicable tothe Company as the Central Government of India has not specified the maintenance of costrecords for any of the products of the Company.

Accordingly the provisions stated in paragraph 3 (vi) of the Order are not applicableto the Company. assets (Property Plant and Equipment)

vii. (a) According to the information and explanations given to us and the records ofthe Company examined by us in our opinion undisputed statutory dues including providentfund employees' state insurance income-tax goods and service tax duty of customs cessand any other statutory dues have not been regularly deposited with the appropriateauthorities and there has been a delay in few cases.

However no undisputed statutory dues were in arrears as at March 31 2019 for aperiod of more than six months from the date they became payable.

(b) According to the information and explanation given to us and the records of theCompany examined by us there are no dues of income tax goods and service tax customsduty cess and any other statutory dues which have not been deposited on account of anydispute.

viii. In our opinion and according to the information and explanations given to us theCompany has not defaulted in repayment of dues to the financial institution bank ordebenture holders.

ix. 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. Accordingly theprovisions stated in paragraph 3 (ix) of the Order are not applicable to the Company.

x. During the course of our audit 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 employees.

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 and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly the provisions stated in paragraph 3(xii) ofthe Order are not applicable to the Company.

xiii. 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.

xiv. 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. Accordingly the provisions stated in paragraph 3 (xiv) of the Order are notapplicable to the Company.

xv. 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 non-cashtransactions with directors or persons connected with him. Accordingly provisions statedin paragraph 3(xv) of the Order are not applicable to the Company.

xvi. In our opinion the Company is not required to be registered under Section 45 IAof the Reserve Bank of India Act 1934 and accordingly the provisions stated in paragraphclause 3 (xvi) of the Order are not applicable to the Company.

For MSKA & Associates
Chartered Accountants
ICAI Firm Registration No. 105047W
Deepak Rao
Place : Bengaluru Partner
Date : June 24 2019 Membership No. 113292

ANNEXURE C TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONE FINANCIALSTATEMENTS OF TAAL ENTERPRISES LIMITED

[Referred to in paragraph 2(f) under ‘Report on Other Legal and RegulatoryRequirements' in the Independent Auditors' Report]

Report on the Internal Financial Controls under Clause (i) of Sub-Section 3 of Section143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls withreference controls to StandaloneFinancial Statements of TAAL Enterprises Limited ("the Company") as of March 312019 in conjunction with our audit of the Standalone Financial Statements of the Companyfor the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's Management is responsible for establishing and maintaining internalfinancialcontrols based on the internal control with reference to Standalone FinancialStatements criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India (ICAI) (the"Guidance Note"). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence toCompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to Standalone Financial Statements based on our audit. Weconducted our audit in accordance with the Guidance Note and the Standards on Auditingissued by ICAI and deemed to be prescribed under Section 143(10) of the Act to the extentapplicable to an audit of internal financial controls. Those Standards and the GuidanceNote require that we comply with ethical requirements and plan and perform the audit toobtain reasonable assurance about whether internal financial controls with reference toStandalone Financial Statements was established and maintained and if such controlsoperated effectively in all material respects.

Our audit involves performing procedures to obtain audit reference evidenceabout theinternal financial to Standalone Financial Statements and their operating effectiveness.Our audit of internal financial controls with reference to Standalone Financial Statementsincluded obtaining an understanding of internal financial controls with reference toStandalone Financial Statements assessing the risk that a material weakness exists andtesting and evaluating the design and operating effectiveness of internal control based onthe assessed risk. The procedures selected depend on the auditor's judgement includingthe assessment of the risks of material misstatement of the Standalone FinancialStatements 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 withreference to Standalone Financial Statements.

Meaning of Internal Financial Controls With Reference to Standalone FinancialStatements

A Company's internal financial control with reference to Standalone FinancialStatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of Standalone Financial Statements for externalpurposes in accordance with generally accepted accounting principles. A Company's internalfinancial control with reference to Standalone Financial Statements includes thosepolicies and procedures that (1) pertain to the maintenance of records that in reasonabledetail accurately and fairly reflect the transactions and dispositions of the assets ofthe company; (2) provide reasonable assurance that transactions are recorded as necessaryto permit preparation of Standalone Financial Statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorizations of management and directors of thecompany; 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 Standalone Financial Statements.

Inherent Limitations of Internal Financial Controls With Reference to StandaloneFinancial Statements

Because of the inherent limitations of internal financial controls with reference toStandalone Financial Statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to Standalone Financial Statements to future periods are subjectto the risk that the internal financial control with reference to Standalone FinancialStatements may become inadequate because of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an internal financialcontrols with reference to Standalone Financial Statements and such internal financialcontrols with reference to Standalone Financial Statements were operating effectively asat March 31 2019 based on the internal control with reference to Standalone FinancialStatements criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note.

For MSKA & Associates
Chartered Accountants
ICAI Firm Registration No. 105047W
Deepak Rao
Place : Bengaluru Partner
Date : June 24 2019 Membership No. 113292