The Members of
Telecanor Global Limited.
Report on the Stand alone Financial statements
We have Audited the accompanying standaione Financial statements of Telecanor Globallimited (the Company) which comprise the balance sheet as at 31 March 2019 the statementof profit and loss and cash flow statement for the year ended and the summery ofsignificant accounting policies and other explanatory information.
Management's Responsibility on standalone 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 preparationand presentation of the standalone financial statements that give true and view offinancial position financial performance and cash flow of the company in accordance withthe accounting principles generally accepted in India including the Accounting standardsspecified under Section 133 of the Act read with rule 7 of Company (Accounts) rules2014. This responsibly also includes maintenance of adequate accounting records inaccordance with the provisions of Act for safeguarding the assets of the company and forpreventing and detecting the frauds and other irregularities selection and applicationappropriate accounting policies making judgements and estimates that are reasonable andprudent and design implementation of and maintenance adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofaccounting records relevant to the preparation of financial statements that give true andfair view and free from material misstatement whether due to fraud or error.
Our responsibility is to express an opinion on these standalone financial statementsbased on our audit. We have taken the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the report under the provisionsof the Act and rules made there under.
We conducted our Audit in accordance with the standards on auditing specified underSection 143(10) of the^Act-These standard require that we comply ethical requirements andplan to perform the audit to obtain reasonable assurance about whether the financialstatements are free from material misstatements.
An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures depend on the Auditors judgementincluding the assessment of risk of material misstatements in the financial statementswhether due to fraud or error. In making those risk assessments the auditor considerinternal financial control relevant to the companies preparation of the financialstatements that give true and fair view in order to design audit procedures that areappropriate in circumstances. An audit also includes evaluating the appropriateness of theaccounting policies uses and reasonableness of the accounting estimate made by company'sDirectors as well as evaluating the overall presentation of financial statements.
We believe that the audit evidence obtained is sufficient and appropriate to provide abasis for our audit opinion on the standalone financial statements.
In our opinion and to the best of information and according to the explanations givento us the aforesaid standalone financial statements give the information required by theAct 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 31 March 2019and Its cash flows for the year ended to that date.
Report on other legal and regulatory requirements
1. As required by the companies (Auditor's Report) Order 2016 (the order) issued bythe central government of India in terms of sub section (11) of the section 143 of theAct we give Annexure A a statement on the matters specified in the paragraph 3 and 4 ofthe order.
2. As required by section 143 of the Act we report that:
a We have sought and obtained all the information and explanation which is best of ourknowledge and belief were necessary for the purpose of audit.
b. In our opinion proper books of accounts as required by law have kept by the companyso far as it appears from our examination of these 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 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 representation received from the Directors as on 31March 2019 taken on record by the Board of Directors none of the directors disqualifiedas on 31 March 2019 from being appointed as director in terms of section 164 (2) of theAct.
f. With respect to the adequacy of internal financial controls over financial reportingof the company and operating effectiveness of such controls refer to our separate reportin Annexure B and
g With respect to other matters to be included in the Auditor's report in accordancewith the rule 11 of Companies ( Audit and Auditors ) Rules 2014 in our opinion to thebest of our information according to the explanation given to us.
1) The Company has disclosed the impact of pending litigation on its financial positionin its financial statements.
2) The company has made provision as required under applicable law or accountingstandards for material foreseeable losses If any
3) The company has not transferred any amount to Investor Education and Protection fundas the company incurring continuously.
4) There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the company.
For S L R & Associates
FRN : 015874S
Annexure - A to the Auditors' Report
The Annexure referred to in our Report of even date to the members of Telecanor GlobalLimited on the accounts of the company for the year ended 31st March 2019.
i. (a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) These fixed assets have been physically verified by the management during the yearand discrepancies noticed on such verification have been properly dealt with in the booksof accounts. In our opinion the frequency of verification is reasonable having regard tothe size of the company and the nature of the assets.
c) According to the information and explanation given us and basis of our examinationof records of company title deeds of immovable properties are held in the name ofcompany.
ii. There are no inventories held by the Company during the year.
iii. 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. Accordingly the paragraph 3(iiii) of the order is not applicable.
iv. The company has neither granted any loans nor have any investments and not givenany guarantees. Accordingly the paragraph 3(iv) of the order is not applicable.
v. The Company has not accepted any deposits from the public within the meaning ofSections 73 to 76 of the Act and the rules framed there under to the extent notified.Accordingly the paragraph 3(v) of the order is not applicable.
vi. The Company is not engaged in the production of the goods or providing services asprescribed by the Central Government under sec 148(1) of the Act Maintenance of costrecords is not applicable. Accordingly the paragraph 3(vi) of the order is notapplicable.
vii. (a) According to the information and explanations given to us and on the basis ofexamination of our records of our company various undisputed statutory dues areoutstanding which are within 6 months and beyond 6 months. the list is mentioned below:
|CST Payable ||Rs ||227324 |
|FBT Payable ||Rs ||75000 |
|IT Payable ||Rs ||12283431 |
|TDS Payable ||Rs ||3132778 |
|Service tax Payable ||Rs ||5653353 |
|VAT Payable ||Rs ||1674815 |
viii. The Company has defaulted in repayment of dues to Dhana Lakshmi bank as at thebalance sheet date. The default since beginning of 2012financial year. The amount of loansanctioned was Rs 32900000/- and OD/working capital sanctioned 10000000/- as percommunication received the bank has initiated legal proceedings for recovery of loan atDebt Recovery Tribunal (DRT). Dhanalakshmi bank has granted loans on the basis of pledgeof company shares (700000 shares) and other securities such as book debts. DhanalakshmiBank limited has assigned all debts due and payable by the company and accrued interestthereon other charges along with underlying security in favour of Phoenix ARC PrivateLimited as per assignment agreement dated on 28/03/2014.
The company has taken vehicle loan from Kotak Mahindra Bank and defaulted the same thevehicle was confiscated and sold by Bank. As per our books an amount of Rs 337000/- isoutstanding financial institution banks government or debenture holders during the year.
ix. The company has not raised any money by way of initial public offer or further pubic offer (Including debt instruments). Further the term loans taken by the Company wereapplied for the purpose for which they were obtained.
x. According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.
xi. The company has provided any managerial remuneration accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the Act.
xii. In our opinion and accordingto the information and explanations given to us theCompany is not a nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable.
xiii. According to the information and explanations given to us and based on ourexamination of the records of the Company there are no transactions with the relatedparties.
xiv. According to the information and explanations give 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 paragraph 3(xiv) of the Order is not applicable.
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 which requires compliance ofSection 192 of Companies Act 2013. Accordingly paragraph 3(xv) of the Order is notapplicable.
xvi. The Receivables (debtors) amounting Rs 63528539/-(net) out of which majority ofreceivables are outstanding since 2 years. The management hgsiQfprmed us they are makingfollow up efforts in this regard. However we observe that no effective legal action is hasbeen initiated and the same need to be initiated immediately.
| ||For S L R & Associates |
| ||Chartered Accountants |
|Date: 30.05.2019 ||FRN: 015874S |
|Place: Hyderabad ||Dronadula Adithya |
| ||Partner |
| ||M.No.: 240691 |
Annexure-B to the 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 over financial reporting of TelecanorGlobal Limited ("the Company") as of 31 March 2019 in conjunction with our auditof the standalone 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 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 reauired 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 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 risksofmaterial misstatement of the financial statements whether due to fraud or
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 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 cou d 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 31 March 2019 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 S L R & Associates |
| ||Chartered Accountants |
|Date: 30.05.2019 ||FRN: 015874S |
|Place: Hyderabad ||Dronadula Adithya |
| ||Partner |
| ||M.No.: 240691 |