The Members of
BHAGHEERATHA ENGINEERING LIMITED
Kochi
Opinion
We have audited the standalone financial statements of Bhagheeratha Engineering
Limited, which comprise the balance sheet as at 31st March 2019, and the statement of
profit and loss, statement of changes in equity and statement of cash flows for the year
then ended, and notes to the financial statements, including a summary of significant
accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations
given to us, the aforesaid standalone financial statements give the information required
by the Companies Act, 2013 in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India, of the state of
affairs of the Company as at March 31, 2019, and its loss, changes in equity and its cash
flows for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specified
under section 143(10) of the Companies Act, 2013. Our responsibilities under those
Standards are further described in the Auditors Responsibilities for the Audit of the
Financial Statements section of our report. We are independent of the Company in
accordance with the Code of Ethics issued by the Institute of Chartered Accountants of
India together with the ethical requirements that are relevant to our audit of the
financial statements under the provisions of the Companies Act, 2013 and the Rules
thereunder, and we have fulfilled our other ethical responsibilities in accordance with
these requirements and the Code of Ethics. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the financial statements of the current period. These matters
were addressed in the context of our audit of the financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
Responsibilities of Management and Those Charged with Governance for the Standalone
Financial Statements
The Companys Board of Directors is responsible for the matters stated in Section
134(5) of the Companies Act, 2013 with respect to the preparation of these financial
statements that give a true and fair view of the financial position, financial performance
and cash flows of the Company in accordance with the accounting principles generally
accepted in India, including the Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding of the assets of the Company
and for preventing and detecting frauds and other irregularities; selection and
application of appropriate accounting policies; making judgments and estimates that are
reasonable and prudent; and design, implementation and maintenance of adequate internal
financial controls, that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and presentation of
the financial statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the
Companys ability to continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting unless management
either intends to liquidate the Company or to cease operations, or has no realistic
alternative but to do so.
Those Board of Directors are also responsible for overseeing the Companys financial
reporting process.
Auditors Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to fraud or error,
and to issue an auditors report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with SAs
will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial
statements, whether due to fraud or error, design and perform audit procedures responsive
to those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order
to design audit procedures that are appropriate in the circumstances. Under section
143(3)(i) of the Companies Act, 2013, we are also responsible for expressing our opinion
on whether the company has adequate internal financial controls system in place and the
operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of managements use of the going concern
basis of accounting and, based on the audit evidence obtained, whether a material
uncertainty exists related to events or conditions that may cast significant doubt on the
Companys ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditors report to the
related disclosures in the 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 auditors report. However, future events or conditions may cause the Company
to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial
statements, including the disclosures, and whether the financial statements represent the
underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied
with relevant ethical requirements regarding independence, and to communicate with them
all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those
matters that were of most significance in the audit of the financial statements of the
current period and are therefore the key audit matters. We describe these matters in our
auditors report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably
be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order, 2016 issued by the Central
Government of India in terms of sub-section (11) of section 143 of The Companies Act 2013,
we give in the Annexure A,a statement on the matters specified in paragraphs 3 and 4 of
the 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 best
of our knowledge and belief were necessary for the purpose of our audit;
b. In our opinion proper books of account as required by law have been kept by the
Company so far as it appears from our examination of those books and proper returns
adequate for the purposes of our audit have been received from the branches not visited by
us.
c. The Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with
by this Report are in agreement with the books of account and with the returns received
from branches not visited by us.
d. In our opinion the aforesaid financial statements comply with Accounting Standards
specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts)
Rules, 2014.
e. On the basis of written representations received from the directors as on March
31,2019 taken on record by the Board of Directors, none of the directors is disqualified
as on March 31,2019 from being appointed as a director in terms of Section 164(2)of the
Act.
f. With respect to the adequacy of the internal financial controls over financial
reporting of the Company and the operating effectiveness of such controls, refer to our
separate Report in "Annexure B".
With respect to the other matters to be included in the Auditors Report in accordance
with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the
best of our information and according to the explanations given to us:
i) the Company has disclosed the impact of pending litigations on its financial
position in its financial statements — Refer Note 31 & 32 to the financial
statements.
ii) the Company does not have any long-term contracts requiring a provision for
material foreseeable losses.
iii) The Company does not have any amounts required to be transferred to the Investor
Education and Protection Fund.
|
For SANKAR & MOORTHY |
|
Chartered Accountants |
|
FRN: 003575S |
|
Sd/- |
|
CA. V C JAMES, B.Sc., F.C.A |
| Kochi |
Partner |
| 23rd August 2019 |
(Membership No. 022565) |
ANNEXURE - A TO THE INDEPENDENT AUDITORS REPORT
Statement referred to in our report of even date to the members of BHAGHEERATHA
ENGINEERING LTD on the accounts for the year ended 31st March, 2019 we report that.
1. a. The company has maintained records showing particulars including quantitative
details and situation of fixed assets.
b. The Company has a regular programme of physical verification of its fixed assets by
which fixed assets are verified in a phased manner over a period of three years. In
accordance with this programme, certain fixed assets were verified during the year and no
material discrepancies were noticed on such verification. In our opinion, this periodicity
of physical verification is reasonable having regard to the size of the Company and the
nature of its assets.
c. According to the information and explanations given to us and on the basis of our
examination of the records of the Company, the title deeds of immovable properties are
held in the name of the Company.
2. a. Physical verification of inventory has been conducted by the management at
reasonable intervals during the year.
b. In our opinion and according to the information and explanations given to us, the
procedure for physical verification of inventory is reasonable and adequate in relation to
the size of the company and the nature of its business.
c. On the basis of examination of the records of inventory, in our opinion, the company
has generally maintained proper records of inventory. Material discrepancies noticed on
physical verification of inventory as compared to the book records have been properly
dealt with in the books of accounts.
3. The company has not granted any loans, secured or unsecured to companies, firms, or
other parties, covered in the register maintained under section 189 of the Companies Act.
Clauses (iii) (a) to (iii) (b) of paragraph 3 of the said Order are not applicable to the
company.
4. In our opinion and according to the information and explanations given to us, the
company has complied with the provisions of section 185 and 186 of the Companies Act, 2013
in respect of loans, investments, guarantees, and security.
5. In our opinion and according to the information and explanations given to us, the
company had accepted deposits, in respect of which, directives issued by the Reserve Bank
of India and the provisions of section 73 to 76 or any other relevant provisions of the
Companies Act, 2013 and rules framed there under, to the extent applicable, have been
complied with.
6. The provisions regarding maintenance of cost records under section 148 of the
Companies Act, 2013 are not applicable to the company.
7. a. According to the information and explanations provided to us, the company is
generally regular in depositing with appropriate authorities undisputed statutory dues
including provident fund, employees state insurance, income tax, and other material
statutory dues, applicable to it.
b. As per the information given to us, the following statutory dues have not been
deposited on account of disputes:-
| Nature of the Dues |
Amount in Rs. |
Period to which the amount relates |
Forum where dispute is pending |
| VAT |
29,94,873/- |
2005-06 |
|
| VAT |
84,91,609/- |
2006-07 |
Revision Board, Calcutta |
| VAT |
20,80,000/- |
2007-08 |
|
c. According to the information and explanations given to us there were no amounts
which were required to be transferred to the Investor Education and Protection Fund by the
Company.
8. According to the information and explanations given to us the company has not raised
any money by way of Initial Public Offer or Further Public offer (Including Debt
Instrument).
9. According to the information and explanations given to us, during the year, no fraud
on or by the company has been noticed or reported.
10. According to the information and explanations given to us and based on our
examination of the records of the Company, the Company has paid/provided for managerial
remuneration in accordance with the requisite approvals mandated by the provisions of
section 197 read with Schedule V to the Act.
11. In our opinion and according to the information and explanations given to us, the
Company is not a Nidhi company. Accordingly, paragraph 3(xii) of the Order is not
applicable.
12. According to the information and explanations given to us and based on our
examination of the records of the Company, transactions with the related parties are in
compliance with sections 177 and 188 of the Act where applicable and details of such
transactions have been disclosed in the financial statements as required by the applicable
accounting standards.
13. According to the information and explanations given to us and based on our
examination of the records of the Company, the Company has not made any preferential
allotment or private placement of shares or fully or partly convertible debentures during
the year.
14. According to the information and explanations given to us and based on our
examination of the records of the Company, the Company has not entered into non-cash
transactions with directors or persons connected with them. Accordingly, paragraph 3(xv)
of the Order is not applicable.
15. As per the information and explanations given to us, the company has not defaulted
in repayment of its dues to banks and financial institutions.
16. The Company is not required to be registered under section 45-IA of the Reserve
Bank of India Act 1934.
|
For SANKAR & MOORTHY |
|
Chartered Accountants |
|
FRN: 003575S |
|
Sd/- |
|
CA. V C JAMES, B.Sc., F.C.A |
| Kochi |
Partner |
| 23rd August 2019 |
(Membership No. 022565) |
ANNEXURE- B TO THE INDEPENDENT AUDITORS REPORT OF EVEN DATE ON THE FINANCIAL
STATEMENTS OF BHAGHEERATHA ENGINEERING LTD.
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
BHAGHEERATHA ENGINEERING LTD. ("the Company") as of 31 March 2019 in conjunction
with our audit of the standalone financial statements of the Company for the year ended on
that date.
Managements Responsibility for Internal Financial Controls
The Companys management is responsible for establishing and maintaining internal
financial controls based on the internal control over financial reporting criteria
established by the Company considering the essential components of internal control stated
in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting
issued by the Institute of Chartered Accountants of India (‘ICAI). These
responsibilities include the design, implementation and maintenance of adequate internal
financial controls that were operating effectively for ensuring the orderly and efficient
conduct of its business, including adherence to companys policies, the safeguarding of
its assets, the prevention and detection of frauds and errors, the accuracy and
completeness of the accounting records, and the timely preparation of reliable financial
information, as required under the Companies Act, 2013.
Auditors Responsibility
Our responsibility is to express an opinion on the Companys internal financial
controls over financial reporting based on our audit. We conducted our audit in accordance
with 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 be prescribed under section 143(10) of the Companies Act, 2013, to the extent
applicable to an audit of internal financial controls, both applicable to an audit of
Internal Financial Controls and, both issued by the Institute of Chartered Accountants of
India. Those Standards and the Guidance Note require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether
adequate internal financial controls over financial reporting was established and
maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of
the internal financial controls system over financial reporting and their operating
effectiveness. Our audit of internal financial controls over financial reporting included
obtaining an understanding of internal financial controls over financial reporting,
assessing the risk that a material weakness exists, and testing and evaluating the design
and operating effectiveness of internal control based on the assessed risk. The procedures
selected depend on the auditors judgment, including the assessment of the risks of
material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion on the Companys internal financial controls system
over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A companys internal financial control over financial reporting is a process designed
to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A companys internal financial control over financial
reporting includes those policies and procedures that (1) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2) provide reasonable assurance that
transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorisations of
management and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorised acquisition, use, or disposition of the
companys 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 financial
reporting, including the possibility of collusion or improper management override of
controls, material misstatements due to error or fraud may occur and not be detected.
Also, projections of any evaluation of the internal financial controls over financial
reporting to future periods are subject to the risk that the internal financial control
over financial reporting may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal
financial controls system over financial reporting and such internal financial controls
over financial reporting were operating effectively as at 31 March 2019, based on the
internal control over financial reporting criteria established by the Company considering
the essential components of internal control stated in the Guidance Note on Audit of
Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered
Accountants of India.
|
For SANKAR & MOORTHY |
|
Chartered Accountants |
|
FRN: 003575S |
|
Sd/- |
| Kochi |
CA. V C JAMES, B.Sc., F.C.A |
| 23rd August 2019 |
Partner |
|
(Membership No. 022565) |
+91-9892691696
