To
The Members of
Rockon Enterprises Limited
Opinion
We have audited the standalone financial statements of Rockon Enterprises Limited
("the Company"), which comprise the Balance Sheet as at 31st March 2019,
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 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 state of affairs of the Company
as at March 31, 2019, and loss, and total comprehensive income, 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.
We have determined the matters described below to be key audit matter to be
communicated in our report.
| Key Audit matters |
How our audit addressed the key audit matter |
| (a) Impairment of financial assets (expected credit losses) |
| Inter Corporate Loans and Advances |
For loans which are assessed for impairment on a portfolio basis we performed
particularly the following proce- dures: |
| The Companys impairment provision for receivables from financing is not based on the
expected credit loss approach laid down under Ind AS 109. Bad debts during the year
amounted to Rs.1,68,28,959/-. Under this approach, the management has been required to
exercise judgment in areas such as; |
- We understood the methodology and policy laid down for loans given by the company. |
|
|
|
- We have verified the existence of recovery process plan in the event of default. |
| - calculation of past default rates |
- We have verified the historical trends of repayment of principal amount of loan and
repayment of interest. |
| - applying macro-economic factors to arrive at forward looking probability of default;
and |
|
| - Significant assumption regarding the probability of various scenarios and
discounting rates for different industries considering individual borrower profile. |
|
| In view of the high degree of estimation involved in the process of calculation
impairment provision and consid- ering its significance to the overall Ind AS financial
statement, whereby any error or omission in estimation may give rise to a material
misstatement of Ind AS financial statements, it is considered as a key audit matter. |
Principal Audit procedure: |
|
• Obtaining an understanding of the companies objectives for such investments and
assessment thereof in terms of Ind AS 109. |
| Measurement of Investment in accordance with Ind AS 109 "Financial
Instruments" |
• Obtaining an understanding of the determination of the measurement of the
investments and tested the reasonableness of the significant judgement applied by the
management. |
|
|
| On initial recognition, investment is recognized at fair value in case of investment
which is recognized at fair value through OCI. In that case that transaction costs are
attributable to the acquisition value of the investments. |
• Evaluated the design of internal controls relating to measurement and also
tested the operating effectiveness of the aforesaid controls. |
|
|
| The Companys investment are subsequently classified into following categories based
on the objective to manage the cash flows and options available in the standard: |
• Obtaining understanding of basis of valuation adopted in respect of fair value
investment and ensured that valuation techniques used are appropriate in circum- stances
and for which sufficient data are available to measure fair value. |
| • At amortised cost |
|
| • At fair value through profit or loss (FVTPL) |
|
| • At fair value through Other comprehensive Income (FVTOCI) |
• Assessed the appropriateness of the discloser in the standalone financial
statements in accordance with the applicable financial reporting framework. |
| Since valuation of investment at fair value involves critical assumptions, significant
risk in valuation and complexity in assessment of objectives, the valuation of investments
as per Ind AS 109 is determined to be a key audit matter in our audit of the standalone
financial statements. . |
|
Managements Responsibility 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 ("the Act") with respect to the preparation of
these standalone financial statements that give a true and fair view of the financial
position, financial performance, (changes in equity) 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. 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 statement 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.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order, 2016 ("the Order"),
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 statement on the matters specified in
paragraphs 3 and 4 of the Order, to the extent applicable.
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 purposes 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.
(c) The Balance Sheet, the Statement of Profit and Loss including other comprehensive
income, and the Cash Flow Statement dealt with by this Report are in agreement with the
books of account.
(d) In our opinion, the aforesaid standalone financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules,
e) On the basis of the written representations received from the directors as on 31st
March, 2019 taken on record by the Board of Directors, none of the directors is
disqualified as on 31st March, 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".
(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:
1. The Company has disclosed the impact of pending litigations on its financial
position in its financial statements.
2. The Company did not have any long-term contracts including derivative contracts for
which there were any material foreseeable losses.
3. There has been no delay in transferring amounts, required to be transferred, to the
Investor Education and Protection Fund by the Company.
For DMKH & Co.
Chartered Accountants
FRN:-116886W
Sd/-
Manish Kankani
(Partner)
M.No.:-158020
Place: Mumbai
Date: 20/05/2019
ANNEXURE A TO THE AUDITORS REPORT
The Annexure referred to in our Independent Auditors Report to the members of the
Company on the standalone financial statements for the year ended March 31st, 2019, we
report that:
(i) (a) The Company has maintained proper records showing full particulars, including
quantitative details and situation of fixed assets.
(b) The Company has a regular program of physical verification of its fixed assets by
which fixed assets are verified in a phased manner over a period of one years. In
accordance with this program, 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) There are no immovable properties held by the Company.
(ii) (a) There are no inventories held by the Company.
(iii) (a) The Company has granted loans to one party covered in the register maintained
under section 189 of the Companies Act,2013 (the Act),
(b) In the case of the loans granted to any parties in the register maintained under
section 189 of the act, the borrowers have been regular in the payment of the interest as
stipulated. The terms of arrangements do not stipulate any repayment schedule and the
loans are repayable on demand.
(iv) In our opinion and according to the information and explanations given to us, the
Company has complied with provision of section 185 and 186 of Act, with respect to the
loan and investment made.
(v) The Company has not accepted any deposits during the year within the meaning of the
provisions of section 73 to 76 or any other relevant provisions of the Companies Act and
the rules framed there under.
(vi) The Central Government has not prescribed the maintenance of cost records under
section148 (1) of the Act, for any of the services rendered by the Company
(vii) (a) According to the information and explanations given to us and on the basis of
our examination of the records, the Company is regular in depositing undisputed statutory
dues including provident fund, income tax, service tax, cess and other material statutory
dues with the appropriate authorities. As explained to us, the Company did not have any
dues on account of sales tax, duty of customs, value added tax, employees state insurance
and duty of excise.
(b) According to the information and explanation given to us, there is no dispute
pending in respect of dues of provident fund/sales tax/wealth tax/service tax/custom
duty/excise duty/cess/value added tax, were in arrears as at 31st march, 2019 for a period
of more than six month from the date they became payable.
| Name of the statute |
Nature of the dues |
Amount (Rs.) |
Period to which the amount related |
Forum where dispute pending |
| Income Tax Act |
Income Tax And Interest |
326141 |
Assessment Year 2007- OS |
Assessing Officer of Income Tax |
| Income Tax Act |
Income Tax And Interest |
2004460 |
Assessment Year 201112 |
Assessing Officer of Income Tax |
(xiii) The Company did not have any outstanding dues to financial institutions, banks
or debenture holders during the year.
(ix) The Company did not raise any money by way of initial public offer or further
public offer (including debt instruments) and term loans during the year. Accordingly,
paragraph 3 (ix) of the Order is not applicable.
(x) Based upon the audit procedure performed for purpose of reporting the true and fair
view of the Financial Statements and According to the information and explanations given
to us, no material fraud on or by the Company has been noticed or reported during the
course of our audit.
(xi) According to the information and explanations given to us and based on our
examination of the record of the Company, managerial remuneration has been paid/provided
in accordance with the requisite approvals.
(xii) In our opinion and according to the information and explanations given to us, the
company is not Nidhi Company. Accordingly paragraph 3(xii) of Order is not applicable.
(xiii) 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 Standalone financial statements as required by the
applicable accounting standards.
(xiv) The company has not made any preferential allotment or private placement of
shares or fully or partly convertible debentures during the year under review.
(xv) According to the information and explanations given to us and based on our
examination of the record of the Company, the company has not entered into any non-cash
transactions with directors or persons connected with him.
(xvi) According to the information and explanations given to us, the provisions of the
section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the company.
For DMKH & Co.
Chartered Accountants
FRN:- 116886W
SD/-
Manish Kankani
(Partner)
M.No.:- 158020
Place: Mumbai
Date: 20/05/2019
+91-9892691696
