TO
THE MEMBERS OF
LEEL ELECTRICALS LIMITED
Report on the Consolidated Indian Accounting Standards (IND AS) Financial Statements
1. We have audited the accompanying consolidated Ind AS financial statements of LEEL
Electricals Limited (hereinafter referred to as the "Holding Company" or
"Parent Company") and its subsidiaries (the Holding Company and its subsidiaries
together referred to as "the Group"), comprising of the consolidated balance
sheet as at 31st March 2018, the consolidated statement of profit and loss (including
other comprehensive income), the consolidated statement of cash flows for the year then
ended and the consolidated statement for changes in equity for the year then ended, and a
summary of significant accounting policies and other explanatory information prepared
based on the relevant records (hereinafter referred to as "the consolidated Ind AS
financial statements").
Managements Responsibility for the Consolidated Ind AS Financial Statements
2. The Holding Companys Board of Directors is responsible for the preparation of these
consolidated Ind AS financial statements in terms of the requirements of the Companies
Act, 2013 (hereinafter referred to as "the Act") that give a true and fair view
of the consolidated financial position, consolidated financial performance (including
other comprehensive income), consolidated cash flows and consolidated statement of changes
in equity of the Group in accordance with the accounting principles generally accepted in
India, including the Indian Accounting Standards specified in the Companies (Indian
Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act. The Holding
Companys Board of Directors is also responsible for ensuring accuracy of records
including financial information considered necessary for the preparation of consolidated
Ind AS financial statements. The respective Board of Directors of the companies included
in the Group are responsible for maintenance of adequate accounting records in accordance
with the provisions of the Act for safeguarding of the assets of the Group and for
preventing and detecting frauds and other irregularities; the selection and application of
appropriate accounting policies; making judgments and estimates that are reasonable and
prudent; and the 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, which have been used for the purpose of preparation of the
consolidated Ind AS financial statements by the Directors of the Holding Company, as
aforesaid.
Auditors Responsibility
3. Our responsibility is to express an opinion on these consolidated Ind AS financial
statements based on our audit. While conducting the audit, we have taken into account the
provisions of the Act, the accounting and auditing standards and matters which are
required to be included in the audit report under the provisions of the Act and the Rules
made thereunder.
4. We conducted our audit of the consolidated Ind AS financial statements in accordance
with the Standards on Auditing specified under section 143(10) of the Act and other
applicable authoritative pronouncements issued by the Institute of Chartered Accountants
of India. Those standards and pronouncements require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether
the consolidated Ind AS financial statements are free from material misstatement.
5. An audit involves performing procedures to obtain audit evidence about the amounts
and the disclosures in the consolidated Ind AS financial statements. The procedures
selected depend on the auditors judgment, including the assessment of the risks of
material misstatement of the consolidated Ind AS financial statements, whether due to
fraud or error. In making those risk assessments, the auditor considers internal financial
control relevant to the Holding Companys preparation of the consolidated Ind AS financial
statements that give a true and fair view, in order to design audit procedures that are
appropriate in the circumstances. An audit also includes evaluating the appropriateness of
the accounting policies used and the reasonableness of the accounting estimates made by
the Holding Companys Board of Directors, as well as evaluating the overall presentation
of the consolidated Ind AS financial statements.
6. We believe that the audit evidence obtained by us and the audit evidence obtained by
the other auditors in terms of their reports referred to in sub-paragraph 8 of the Other
Matters paragraph below, other than the unaudited financial statements and unaudited
consolidated financial statements/information as certified by the management and referred
to in sub-paragraph 9 of the Other Matters paragraph below, is sufficient and appropriate
to provide a basis for our audit opinion on the consolidated Ind AS financial statements.
Opinion
7. In our opinion and to the best of our information and according to the explanations
given to us, the aforesaid consolidated Ind AS financial statements give the information
required by the Act in the manner so required and give a true and fair view in conformity
with the accounting principles generally accepted in India, of the consolidated state of
affairs of the Group as at 31st March 2018, and their consolidated Profit (financial
performance including other comprehensive income), their consolidated cash flows and the
consolidated changes in equity for the year ended on that date.
Other Matters
8. We did not audit the financial statements/financial information of three
subsidiaries, whose financial statements/financial information reflect total assets of
272.41 crores and net assets of 98.27 crores as at March 31, 2018, total revenues of
342.87 crores and net cash inflow amounting to 1.67 crores for the year ended on that
date, as considered in the consolidated financial statements, whose financial
statements/information have not been audited by us. These financial statements/financial
information have been audited by other auditors whose reports have been furnished to us by
the management, and our opinion on the consolidated Ind AS financial statements insofar as
it relates to the amounts and disclosures included in respect of these subsidiaries and
our report in terms of subsection (3) of Section 143 of the Act insofar as it relates to
the aforesaid subsidiaries is based solely on the reports of the other auditors.
All of these subsidiaries are located outside India whose financial statements/
financial information have been prepared in accordance with accounting principles
generally accepted in their respective countries and which have been audited by other
auditors under generally accepted auditing standards applicable in their respective
countries. The Companys management has converted the financial statements of such
subsidiaries located outside India from accounting principles generally accepted in their
respective countries to accounting policy generally accepted in India. We have audit these
conversion adjustments made by the Companys management. Our opinion in so far as it
relates to the balances and affairs of such subsidiaries located outside India is based on
the report of other auditors and the conversion adjustments prepared by the management of
the Company and audited by us.
9. We did not audit the consolidated financial statements/ financial information of one
wholly owned foreign subsidiary and financial statements/ financial information of one
wholly owned foreign subsidiary that reflect total assets of 28.23 crores and net asset
of (2.69) crores as at March 31, 2018, and total revenues of 51.87 crores and net cash
outflow amounting to 2.44 crores for the year ended on that date, as considered in the
consolidated financial statements. These unaudited consolidated financial statements/
financial statements / financial information have been furnished to us by the management,
and our opinion on the consolidated Ind AS financial statements insofar as it relates to
the amounts and disclosures included in respect of these subsidiaries and our report in
terms of subsection (3) of Section 143 of the Act insofar as it relates to the aforesaid
subsidiaries, is based solely on such unaudited consolidated financial statements/
financial statements/ information. In our opinion and according to the information and
explanations given to us by the Management, these consolidated financial statements/
financial statements/ information are not material to the Group.
10. Our opinion on the consolidated Ind AS financial statements and our report on Other
Legal and Regulatory Requirements below, is not modified in respect of the other matters
covered in para 8 and 9, with respect to our reliance on the work done and the reports of
the other auditors and the consolidated financial statements/ financial statements/
information certified by the Management.
Report on Other Legal and Regulatory Requirements
11. As required by sub-section 3 of Section 143 of the Act, we report, to the extent
applicable, 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 purposes of our audit of the aforesaid
consolidated Ind AS financial statements.
b. In our opinion, proper books of account as required by law maintained by the Holding
Company, its subsidiaries included in the Group, including relevant records relating to
preparation of the aforesaid consolidated Ind AS financial statements have been kept so
far as it appears from our examination of those books and records of the Holding Company
and the reports of the other auditors.
c. The consolidated balance sheet, the consolidated statement of profit and loss
(including other comprehensive income), the consolidated statement of cash flows and
consolidated statement of changes in equity dealt with by this Report are in agreement
with the relevant books of account maintained by the Holding Company and its subsidiaries
included in the Group including relevant records relating to the preparation of the
consolidated Ind AS financial statements.
d. In our opinion, the aforesaid consolidated Ind AS financial statements comply with
the Indian Accounting Standards specified under Section 133 of the Act.
e. On the basis of the written representations received from the directors of the
Holding Company as on 31st March 2018 taken on record by the Board of Directors of the
Holding Company none of the directors of the Holding Company is disqualified as on 31st
March, 2018 from being appointed as a director in terms of sub-section (2) of Section 164
of the Act. None of the subsidiaries of the Holding Company is incorporated in India, as
such provisions of section 164(2) of the Companies Act 2013 are not applicable on these
subsidiaries.
f. With respect to the adequacy of the internal financial controls with reference to
financial statements of the Group and the operating effectiveness of such controls, refer
to our separate report in "Annexure A".
g. 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 consolidated Ind AS financial statements disclose the impact, if any, of pending
litigations as at March 31, 2018 on the consolidated financial position of the Group.
Refer Note 36 to the consolidated Ind AS financial statements;
ii. The Group did not have any long term contracts including derivative contracts for
which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be transferred, to
the Investor Education and Protection Fund by the Group during the year ended March 31,
2018, as applicable; and
iv. The reporting on disclosures relating to Specified Bank Notes is not applicable to
the Group for the year ended March 31, 2018.
For Goel Garg & Co. Chartered Accountants
Firms Registration Number 000397N
Place of Signature: New Delhi
Date: May 30, 2018
Ashok Kumar Agarwal Partner
Membership Number 084600
Annexure A to the Independent Auditors Report
Referred to in paragraph 11(f) of the Independent Auditors Report of even date to the
members of LEEL Electricals Limited on the consolidated Ind AS financial statements as of
and for the year ended March 31, 2018.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section
143 of the Companies Act, 2013 ("the Act")
In conjunction with our audit of the consolidated financial statements of the Company
as of and for the year ended March 31, 2018, we have audited the internal financial
controls with reference to financial statements of LEEL ELECTRICALS LIMITED (hereinafter
referred to as "the Holding Company"). Reporting under clause (i) of sub section
3 of Section 143 of the Act in respect of the adequacy of the internal financial controls
with reference to financial statements is not applicable to its subsidiaries, being all
incorporated outside India.
Managements Responsibility for Internal Financial Controls
The Holding Companys Board of Directors are responsible for establishing and
maintaining internal financial controls based on, internal control over financial
reporting criteria established by Holding 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 the respective 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 Act.
Auditors Responsibility
Our responsibility is to express an opinion on the Companys internal financial
controls with reference to financial statements 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") issued by ICAI 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 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
with reference to financial statements 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 with reference to financial statements and their
operating effectiveness. Our audit of internal financial controls with reference to
financial statements included obtaining an understanding of internal financial controls
with reference to financial statements, 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 Ind AS
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
with reference to financial statements.
Meaning of Internal financial controls with reference to financial statements
A companys internal financial control with reference to financial statements 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 with
reference to financial statements 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 with reference to financial
statements
Because of the inherent limitations of internal financial controls with reference to
financial statements, 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 with
reference to financial statements to future periods are subject
to the risk that the internal financial control with reference to financial statements
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 Holding Company, have, in all material respects, an adequate
internal financial controls system with reference to financial statements and such
internal financial controls with reference to financial statements were operating
effectively as at March 31, 2018, based on the internal control over financial reporting
criteria established by the Holding 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 Goel Garg & Co.
Chartered Accountants
Firms Registration Number 000397N
Place of Signature: New Delhi
Date: May 30, 2018
Ashok Kumar Agarwal
Partner
Membership Number 084600
+91-9892691696
