XL Energy Ltd.
|BSE: 532788||Sector: Engineering|
|NSE: XLENERGY||ISIN Code: INE183H01011|
|BSE 00:00 | 10 Feb||XL Energy Ltd|
|NSE 05:30 | 01 Jan||XL Energy Ltd|
|BSE: 532788||Sector: Engineering|
|NSE: XLENERGY||ISIN Code: INE183H01011|
|BSE 00:00 | 10 Feb||XL Energy Ltd|
|NSE 05:30 | 01 Jan||XL Energy Ltd|
INDEPENDENT AUDITORS REPORT ON STANADALONE Ind AS FINANCIAL
STATEMENTS TO THE MEMBERS OF XL ENERGY LIMITED
Report on the Ind AS Financial Statements
We have audited the accompanying Ind AS financial statements of XL Energy Limited("the Company") which comprise the Balance Sheet as at 31st March 2018 theStatement of Profit and
Loss (including Other comprehensive income) the statement of changes in Equity and theCash Flow Statement for the year then ended and a summary of significant accountingpolicies and other explanatory information.
Managements Responsibility for the Standalone Ind AS Financial Statements
The Companys Board of Directors is responsible for the matters in section 134(5)of the Companies Act 2013 ("the Act") with respect to the preparation of theseInd AS financial statements that give a true and fair view of the financial positionfinancial performance including Other comprehensive income changes in Equity and cashflows of the Company in accordance with the accounting principles generally accepted inIndia including the Indian Accounting Standards specified under Section 133 of the Actread with Rule 3 of the Companies (Indian Accounting Standards) Rules 2015. Thisresponsibility also includes the maintenance of adequate accounting records in accordancewith the provision of the Act for safeguarding the assets of the Company and forpreventing and detecting the frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the Ind ASfinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error. In preparing the Ind AS financial statementsthe management is responsible for assessing the companys ability to continue as agoing concern disclosing as applicable matters related to going concern and using thegoing concern basis of accounting unless management either intends to liquidate theCompany or to cease operations or has no realistic alternative but to do so.
Our responsibility is to express an opinion on these Ind AS Financial Statements basedon our audit. We have taken into account the provisions of the Act the accounting andauditing standards and matters which are required to be included in the audit report underthe provisions of the Act and the Rules made there under and the Order under Section143(11) of the Act. We conducted our audit in accordance with the Standards on Auditingspecified under Section 143(10) of the Act. Those Standards require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the Ind AS Financial Statements are free from material misstatement. An auditinvolves performing procedures to obtain audit evidence about the amounts and thedisclosures in the Ind AS Financial Statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of theInd AS 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 Ind AS Financial Statements that give a true and fair view in order todesign audit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of the accounting policies used and the reasonableness ofthe accounting estimates made by the Company's Directors as well as evaluating theoverall presentation of the Ind AS Financial Statements. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for our auditopinion on the Ind AS Financial Statements.
The accompanying Ind AS financial statements have been prepared assuming that theCompany will continue as a going concern. As discussed in Note 5 to the Ind AS financialstatements the Company has suffered recurring losses from operations and has a netcapital deficiency that raise substantial doubt about its ability to continue as a goingconcern and therefore it may be unable to realise its assets and discharge itsliabilities in the normal course of business. The Ind AS financial statements (and notesthereto) do not adequately disclose this matter in para 5 of the Notes to Accounts. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our opinion.
Managements plans in regard to continuing operations are mentioned in para 5 ofthe Notes to
Emphasis of Matters:
In addition to the matter described in the Qualified Opinion section we havedetermined the matters described below to be the emphasis of matters to be communicated inour report:
(a) As reported in note 4 relating to Financial assets and liabilitiesManagement has informed us that settlement with Banks/ARCs is in an advanced stage ofcompletion. On completion of the same the assets and liabilities including fixed assetsas appearing in the books of account shall be reviewed and consequential effect on writeoff/ write back shall be done.
(b) Notes to Accounts at para 7 to the Ind AS financial statements which describes thebalances appearing under other long-term liabilities short term borrowings tradepayables other current liabilities long term loans and advances CWIP advances tradereceivables short term loans and advances and other current assets are subject toconfirmation and / or reconciliation if any. At this point of time the quantification ofits effect on the balance sheet is not ascertained and quantified.
(c) In Other Income group in Profit & Loss a/c. include Sale ofResidual rights in duty credit scrips relating to the periods 2008-09 to 2010-11 which isa contingent asset which will be crystallised upon the acceptance of the application madeby the Company to the Director General of Foreign Trade and the value of the asset and itsrealisability is not known and not certain on account of its time barred nature. Ouropinion is not modified in respect of these matters.
In our opinion with the exception of the matter described in the preceding paragraphsand to the best of our information and according to the explanations given to us theaforesaid Ind AS financial statements give the information required by the Act in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31stMarch 2018 and its loss (including Other Comprehensive income) changes in Equity and itscash flows for the year ended on that date.
The comparative financial information of the company for the year ended 31stMarch 2018 and the transition date opening balance sheet as at 01st April 2016included in these Ind AS financial statements are based on the previously issuedstatutory financial statements prepared in accordance with the Companies (AccountingStandards) Rules2006 audited as adjusted for the differences in the accounting principlesadopted by the company on transition to the Ind AS which have been audited by us. Ouropinion is not modified in respect of these matters.
Report on other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the Annexure a statement on the matters Specified inparagraphs 3 and 4 of the Order.
2. As required by section 143(3) of the Act we report that:
We have sought and obtained all the information and explanations which to the best ofour knowledge and belief were necessary for the purposes of our audit. In our opinionproper books of account as required by law have been kept by the Company so far as appearsfrom our examination of those books i.e. the Balance Sheet the Statement of Profit andLoss (including Other Comprehensive income) changes in Equity and Cash Flow Statementdealt with by this Report are in agreement with the books of account.
In our opinion the aforesaid Ind AS financial statements subject to QualifiedOpinion and Emphasis of Matters supra complies with the Accounting Standards specifiedunder Section 133 of the Act.
On the basis of written representations received from the directors as on 31stMarch 2018 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2018 from being appointed as a director in terms ofSection 164(2) of the Act.
Due to insignificant operations of the company during the year other than transition toInd AS reporting on the issue of adequacy of the Internal Financial controls overfinancial reporting of the company and the operating effectiveness of such controls ascontemplated in sec.143 (3) (i) is not reported.
With respect to the other matters included in the Auditors Report in accordancewith Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to thebest of our information and according to the explanations given to us: i. The Company doesnot have any pending litigations which would impact its financial position other thanthose mentioned in financial statements. ii. The Company did not have any long-termcontracts including derivative contracts for which there were any material foreseeablelosses iii. There are no amounts relating to dividend that are due to be transferred tothe Investor Education and Protection Fund during the year.
Annexure referred to in paragraph 1 under Report on other Legal & RegulatoryRequirements of Our Report of even date to the members of XL Energy Limited on STANDALONEInd AS FINANCIAL STATEMENTS of the company for the year ended 31st March 2018
On the basis of such checks as we considered appropriate and according to theinformation and explanations given to us during the course of our audit we report that:
(i) (a) It is informed that the Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets at respectiveUnits of the Company. However a consolidated record of the same is not maintained. (b) Asexplained to us some of the fixed assets have been physically verified by the managementat reasonable intervals; as informed to us no material discrepancies were noticed on suchverification. However the records are not made available for our perusal. (c) The titledeeds of immovable properties are held in the name of the company.
(ii) As explained to us the Inventory has been physically verified during the year bythe Management and in our opinion the frequency of verification is reasonable.
(iii) The Company during the year has not granted any loans secured or unsecured tocompanies firms or other parties covered in the register maintained under section 189 ofthe Act. Therefore the provisions of clause 3(iii) (iii)(a) and (iii)(b) of the saidOrder are not applicable to the Company.
(iv) The Company during the year has not granted any loans investments or provided anyguarantees or security to the parties covered under section 185.
(v) 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.
(vi) The Central Government of India has not specified the maintenance of cost recordsunder subsection (1) of section 148 of the Act for any of the products of the Company.
(vii)(a) According to the information and explanations given to us and based on therecords of the company the companys outstanding statutory dues in Rs. Lakhs are:Indirect taxes Rs. 3.68; Tax Deducted at Source Rs. 0.20; P F Rs. 34.85; Income tax Rs.23.28 Total Rs. 62 Lakhs (b) According to the information and explanations given to usand the records of the Company examined by us the particulars of dues of income taxsales tax service tax duty of customs and duty of excise value added tax as at 31 March2018 which have not been deposited on account of a dispute are as follows: Income taxdues for the AY.2005-06 AY.2006-07 AY. 2007-08 & AY 2008-09 Rs. 255.99 Lakhs.
(viii) The Company has defaulted in repayment of loans or borrowing to a financialinstitution bank government or dues to debenture holders of the book value of Rs.80240.54 Lakhs as at 31.03.2018 and Rs. 81793.95 Lakhs as at 31.03.2017. The institutionwise details are at Note 4 (b)(i) of notes to financial statements.
In addition to the above there is an outstanding of USD 4.20 million worth ForeignCurrency convertible bonds.(FCCBs). As informed by the management the FCCBswere due for redemption in
October 2012 and as on the date of redemption the bond holders had to approach theCompany either for redemption or conversion to Equity shares but none of the bondholdershad approached the Company. Further it is informed that the Company also had made effortsto identify and locate the bondholders but since the bondholders were not identified theCompany could not redeem the FCCBs and they have been shown as outstanding liabilityin the balance sheet till date.
(ix) The Company has not raised any monies by way of initial public offer furtherpublic offer (including debt instruments) and term loans. Accordingly the provisions ofclause 3(ix) of the Order are not applicable to the Company.
(x) 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.
(xi) The managerial remuneration is not provided.
(xii) As the Company is not a Nidhi Company and the Nidhi Rules 2014 are notapplicable to it the provisions of clause 3(xii) of the Order are not applicable to theCompany.
(xiii) The Company has entered into transactions with related parties in compliancewith the provisions of sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the Ind AS financial statements as required underAccounting Standard 18 Related Party Disclosures specified under section 133 of the Actread with rule 7 of the Companies (Accounts) Rules 2014.
(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review.Accordingly the provisions of clause 3(xiv) of the Order are not applicable to theCompany.
(xv) The Company has not entered into any non-cash transactions with its directors orpersons connected with him. Accordingly the provisions of clause 3(xv) of the Order arenot applicable to the Company.
(xvi) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934. Accordingly the provisions of clause 3(xvi) of the Order are notapplicable to the Company.