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UFO Moviez India Ltd.

BSE: 539141 Sector: Media
NSE: UFO ISIN Code: INE527H01019
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VOLUME 594
52-Week high 610.95
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OPEN 366.00
CLOSE 365.45
VOLUME 594
52-Week high 610.95
52-Week low 316.00
P/E 14.17
Mkt Cap.(Rs cr) 1,028
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

UFO Moviez India Ltd. (UFO) - Auditors Report

Company auditors report

To

The Members of

UFO Moviez India Limited

Report on the Consolidated Financial Statements

We have audited the accompanying consolidated financial statements of UFO Moviez IndiaLimited (hereinafter referred to as "the Holding Company") its subsidiaries(the Holding Company and its subsidiaries together referred to as "the Group")and its associates comprising of the consolidated Balance Sheet as at March 312017 theconsolidated Statement of Profit and Loss and consolidated Cash Flow Statement for theyear then ended and a summary of significant accounting policies and other explanatoryinformation (hereinafter referred to as ‘the consolidated financial statements').

Management's Responsibility for the Consolidated Financial Statements

The Holding Company's Board of Directors is responsible for the preparation of theseconsolidated financial statements in terms of the requirement of the Companies Act 2013("the Act") that give a true and fair view of the consolidated financialposition consolidated financial performance and consolidated cash flows of the Groupincluding its associates in accordance with accounting principles generally accepted inIndia including the Accounting Standards specified under Section 133 of the Act readwith Rule 7 of the Companies (Accounts) Rules 2014 and Companies (Accounting Standards)Amendment Rules 2016. The respective Board of Directors of the companies included in theGroup and of its associates are responsible for maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding of the assets of the Groupand of its associates and for preventing and detecting frauds and other irregularities;the selection and application of appropriate accounting policies; making judgments andestimates that are reasonable and prudent; and the design implementation and maintenanceof adequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error which have been used for the purposeof preparation of the consolidated financial statements by the Directors of the HoldingCompany as aforesaid.

Auditor's Responsibility

Our responsibility is to express an opinion on these consolidated financial statementsbased on our audit. While conducting the audit we have taken into account the provisionsof the Act 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 in accordance with the Standards on Auditing issued bythe Institute of Chartered Accountants of India as specified under Section 143(10) of theAct. Those Standards require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether the financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the consolidated financial statements. The procedures selected depend onthe auditor's judgment including the assessment of the risks of material misstatement ofthe consolidated financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to the HoldingCompany's preparation of the consolidated financial statements that give a true and fairview in order to design audit procedures that are appropriate in the circumstances. Anaudit also includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by the Holding Company's Board ofDirectors as well as evaluating the overall presentation of the consolidated financialstatements. We believe that the audit evidence obtained by us and the audit evidenceobtained by the other auditors in terms of their reports referred to in paragraph (a) ofthe Other Matters paragraph below is sufficient and appropriate to provide a basis forour audit opinion on the consolidated financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us and based on the consideration of reports of other auditors on separatefinancial statements and on the other financial information of the subsidiaries andassociates the aforesaid consolidated 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 consolidated state of affairs ofthe Group and its associates as at March 312017 their consolidated profit and theirconsolidated cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to note 34(d)(ii) to the consolidated financial statement for ademand of Rs. 220111033/- (excluding interest and penalty) received by the HoldingCompany during the year ended March 312016 for disallowance of CENVAT credit on digitalcinema equipments and which is more fully described therein. Based on legal opinionobtained the Holding Company is of the view that it should be entitled to avail CENVATcredit and is contesting this demand. Hence no provision has been considered by themanagement in these consolidated financial statements. Our opinion is not qualified inrespect of this matter.

Report on Other Legal and Regulatory Requirements

As required by section 143 (3) of the Act based on our audit and on the considerationof report of the other auditors on separate financial statements and the other financialinformation of subsidiaries and associates as noted in the ‘other matter' paragraphwe report to the extent applicable that:

(a) We / the other auditors whose reports we have relied upon have sought and obtainedall the information and explanations which to the best of our knowledge and belief werenecessary for the purpose of our audit of the aforesaid consolidated financial statements;

(b) In our opinion proper books of account as required by law relating to preparationof the aforesaid consolidation of the financial statements have been kept so far as itappears from our examination of those books and reports of the other auditors;

(c) The consolidated Balance Sheet consolidated Statement of Profit and Loss andconsolidated Cash Flow Statement dealt with by this Report are in agreement with the booksof account;

(d) In our opinion the aforesaid consolidated financial statements comply with theAccounting Standards specified under section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014 and Companies (Accounting Standards) Amendment Rules2016;

(e) The matter described under the Emphasis of Matters paragraph above in our opinionmay have an adverse effect on the functioning of the group;

(f) On the basis of the written representations received from the directors of theHolding Company as on March 312017 taken on record by the Board of Directors of theHolding Company and the reports of the statutory auditors who are appointed under Section139 of the Act of its subsidiary companies and associate companies incorporated in Indianone of the directors of the Group's companies and its associates incorporated in Indiaare disqualified as on March 312017 from being appointed as a director in terms ofSection 164 (2) of the Act.

(g) With respect to the adequacy and the operating effectiveness of the internalfinancial controls over financial reporting of the Holding Company its subsidiarycompanies and associate companies incorporated in India refer to our separate report InRs.Annexure 1" to this report;

(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 and basedon the consideration of the report of the other auditors on separate financial statementsas also the other financial information of the subsidiaries and associates as noted in the‘Other matter' paragraph:

i. The consolidated financial statements disclose the impact of pending litigations onits consolidated financial position of the Group and its associates - Refer Note 34 to theconsolidated financial statements;

ii. The Group and its associates did not have any material foreseeable losses inlong-term contracts including derivative contracts during the year ended March 312017

iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Holding Company its subsidiaries and associatesincorporated in India during the year ended March 312017

iv. The Holding Company has for itself and its subsidiaries incorporated in Indiahave provided requisite disclosures in Note 40 to these consolidated financial statementsas to the holding of Specified Bank Notes on November 8 2016 and December 30 2016 aswell as dealings in Specified Bank Notes during the period from November 8 2016 toDecember 30 2016 by these companies. Based on our audit procedures and relying on themanagement representation of the Holding Company regarding the holding and nature of cashtransactions including Specified Bank Notes we report that these disclosures are inaccordance with the books of accounts maintained by the Group and as produced to us by theManagement of the Holding Company.

Other Matter

(a) We did not audit the financial statements and other financial information inrespect of seven subsidiaries whose financial statements include total assets of Rs.1358512953/- and net assets of Rs. 344952916/- as at March 31 2017 and totalrevenues of Rs. 1258118683/- and net cash outflows of Rs. 160592942/- for the yearended on that date. These financial statement and other financial information have beenaudited by other auditors which financial statements other financial information andauditor's reports have been furnished to us by the management. The consolidated financialstatements also include the Company's share of net profit of Rs. 36038026/- for the yearended March 312017 in respect of three associates whose financial statements otherfinancial information have been audited by other auditors and whose reports have beenfurnished to us by the Management. Our opinion on the consolidated financial statementsin so far as it relates to the amounts and disclosures included in respect of thesesubsidiaries and associates and our report in terms of sub-sections (3) of Section 143 ofthe Act in so far as it relates to the aforesaid subsidiaries and associates is basedsolely on the reports of such other auditors. Our opinion is not qualified in respect ofthis matter.

Certain of these subsidiaries and associates are located outside India whose financialstatements and other financial information have been prepared in accordance withaccounting principles generally accepted in their respective countries and which have beenaudited by other auditors under generally accepted auditing standards applicable in theirrespective countries. The Company's management has converted the financial statements ofsuch subsidiaries and associates located outside India from accounting principlesgenerally accepted in their respective countries to accounting principles generallyaccepted in India. We have audited these conversion adjustments made by the Company'smanagement. Our opinion in so far as it relates to the balances and affairs of suchsubsidiaries and associates located outside India is based on the report of other auditorsand the conversion adjustments prepared by the management of the Company and audited byus.

(b) The accompanying consolidated financial statements include unaudited financialstatements and other unaudited financial information in respect of five subsidiarieswhose financial statements and other financial information reflect total assets of Rs.868502263/- and net assets of Rs. 802601341/- as at March 31 2017 and total revenuesof Rs. 1734690/- and net cash outflows of Rs. 10953438/- for the year ended on thatdate. These unaudited financial statements and other unaudited financial information havebeen furnished to us by the management. The consolidated financial statements also includethe Company's share of net profit of Rs. 32921878/- for the year ended March 312017 inrespect of two associates whose financial statements other financial information havenot been audited and whose unaudited financial statements other unaudited financialinformation have been furnished to us by the Management. Our opinion in so far as itrelates amounts and disclosures included in respect of these subsidiaries and associatesand our report in terms of sub-sections (3) of Section 143 of the Act in so far as itrelates to the aforesaid subsidiaries and associates is based solely on such unauditedfinancial statement and other unaudited financial information. Our opinion is notqualified in respect of this matter. In our opinion and according to the information andexplanations given to us by the Management these financial statements and other financialinformation are not material to the Group.

Our above opinion on the consolidated financial statements and our report on OtherLegal and Regulatory Requirements above is not modified in respect of the above matterswith respect to our reliance on the work done and the reports of the other auditors andthe financial statements and other financial information certified by the Management.

For S.R. Batliboi & Associates LLP

Chartered Accountants

ICAI Firm Registration

Number: 101049W/E300004

per Govind Ahuja

Partner

Membership Number: 48966

Place of Signature: Mumbai

Date: May 17 2017

Annexure 1 to the Independent Auditor's Report of even date on the ConsolidatedFinancial Statements of UFO Moviez India Limited

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

In conjunction with our audit of the consolidated financial statements of UFO MoviezIndia Limited as of and for the year ended March 312017 we have audited the internalfinancial controls over financial reporting of UFO Moviez India Limited (hereinafterreferred to as the "Holding Company") and its subsidiary companies and itsassociate companies which are companies incorporated in India as of that date.

Management's Responsibility for Internal Financial Controls

The respective Board of Directors of the of the Holding Company its subsidiarycompanies and its associate companies which are companies incorporated in India areresponsible for establishing and maintaining internal financial controls based on theinternal control over financial reporting criteria established by the Holding Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India. These responsibilities include the design implementationand maintenance of adequate internal financial controls that were operating effectivelyfor ensuring the orderly and efficient conduct of its business including adherence to therespective 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.

Auditor's 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 both issued by Instituteof Chartered Accountants of India and deemed to be prescribed under section 143(10) ofthe Act to the extent applicable to an audit of internal financial controls. 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 was 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 auditor's judgement 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 and the audit evidence obtained bythe other auditors in terms of their reports referred to in the Other Matters paragraphbelow is sufficient and appropriate to provide a basis for our audit opinion on theinternal financial controls system over 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 authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised 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.

Opinion

In our opinion the Holding Company its subsidiary companies and its associatecompanies which are companies incorporated in India have maintained in all materialrespects an adequate internal financial controls system over financial reporting and suchinternal financial controls over financial reporting were operating effectively as atMarch 312017 based on the internal control over financial reporting criteria establishedby the Holding Company considering the essential components of internal control stated inthe Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issuedby the Institute of Chartered Accountants of India.

Other Matters

The management has certified to us that in respect of one unaudited Indian Subsidiarythe internal financial controls over financial reporting are adequate and operatingeffectively. In our opinion and according to information and explanation given to us thissubsidiary is not material to the Group.

Read with above paragraph our report under Section 143(3)(i) of the Act on theadequacy and operating effectiveness of the internal financial controls over financialreporting of the Holding Company insofar as it relates to two subsidiary companies andtwo associate companies which are companies incorporated in India is based on thecorresponding reports of the auditors of such subsidiary and associate incorporated inIndia.

For S.R. Batliboi & Associates LLP

Chartered Accountants

ICAI Firm Registration

Number: 101049W/E300004

per Govind Ahuja

Partner

Membership Number: 48966

Place of Signature: Mumbai

Date: May 17 2017