Lasa Supergenerics Ltd Directors Report.

To the members

Lasa supergenerics limited

1. Report on the financial statements

We have audited the accompanying financial statements of lasa supergenerics limited (the company), which comprise the balance sheet as at march 31, 2019, the statement of profit and loss (including other comprehensive income), the cash flow statement and the statement of changes in equity for the year ended, and a summary of the 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 (the act) in the manner so required and give a true & fair view in conformity with the indian accounting standard prescribed under section 133 of the act read with companies (indian accounting standards) rules, 2015, as amended, (ind as) and other accounting principles generally accepted in india, of the state of affairs of the company as at 31st march, 2019, its loss (other comprehensive income, changes in equity and its cash flows for the year ended on that date.

2. Basis for opinion

We conducted our audit in accordance with the standards on auditing (sas) specified under section 143(10) of the

Act. Our responsibilities under those standards are further described in the auditors responsibilities for the audit of the standalone financial statement 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 (icai) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the act and the rules made 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 obtain is sufficient & appropriate to provide a base for our opinion.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statement.

3. Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone 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 matters to be communicated in our report.

Key audit matter :- How the matter was addressed in our audit
Revenue recognition
The company provides a right of return to its customers as a customary business practice. These arrangements result in deductions to gross amounts invoiced. The initial revenue recognition is reduced taking into consideration the anticipated sales returns. Assessed appropriateness of the companys revenue recognition accounting policies, including those relating to anticipated sales return by comparing with applicable accounting standards
Revenue recognition Revenue is recognised when the control of the product being sold has transferred to the customer. Therefore, there is a risk of revenue being overstated on account of variation in the timing of transfer of control due to the pressure management may feel to achieve performance targets at the reporting period end. Assessed and tested designs, implementation and operating effectiveness of the companys general it controls and key it/ manual applications control over the companys systems which govern recording of revenue, creation of new customers, revenue cut-off and sales return accruals in the general ledger accounting system.
Other matters
Advance for capital goods amounting 1.82 crore shown under note no.11 to other current assets , in respect of advances given in respect of acquisition of abhinandan rasayan pvt ltd and funded by dombivli nagri sahakari bank ltd. The assessee took over loan to the extent of 1.82 cr which belonged to abhinandan rasayan pvt. Ltd. From dombivli nagri sahakari bank ltd. The same is reflected under secured loan and the same was considered as initial payment towards acquisition of manufacturing facility of abhinandan rasayan pvt. Ltd.
The said acquisition is under dispute due to alleged collusion between lender and abhinandan rasayan pvt. Ltd. To save abhinandan rasayan pvt. Ltd. Account turn bad in lenders books.
Due to the alleged foul play by other parties the deal stood cancelled as transaction did not succeed within stipulated period, we have shown the amount given as advance under advances for capital goods & also no interest has been provided on loan taken from dombivli nagari sahakari bank ltd. Since the matter is sub judice.
We have received ad interim relief from honble high court dt.29th june 2018 stating no coercive steps including declaration of our account as npa can be taken against company.

4. Managements responsibility for the financial statements

The companys management and 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 financial statements that give a true and fair view of the state of affairs (financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the company in accordance with the accounting principles generally accepted in india, including the indian accounting standards (ind as) 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 the assets of the company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgment 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.

5. 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 it 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 by expected to influence the economic decisions of users taken on the basis of these financial statements.

6. 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 section 143(11) of the act, we give in the annexure 1a 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 accounts 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, the statement of change in equity and the cash Flow statement dealt with by this report are in agreement with the relevant books of account;

D) in our opinion, the aforesaid financial statements comply with ind as specified under section 133 of the act;

E) on the basis of the written representations received from the directors and 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 o f the company and the operating effectiveness of such controls, refer to our separate report i n annexure 2 to this report;

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 (as amended), in our opinion and to the best of our information and according to the explanations given to us:

i. The company, has no pending litigations on its financial position;

ii. The company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There were no amounts which were required to be transferred to the investor education and protection fund by the company;

3. With respect to the other matters to be included in the auditors report in accordance with the requirements of section 197(16) of the act.

In our opinion and to the best of our information and according to the explanation given to us, the remuneration paid / provided by the company to its directors during the year is in accordance with the provisions of section 197 of the act.

The remuneration paid to any directors is not in excess of the limit laid down u/s 197 of the it act. The ministry of corporate affairs has not prescribed other details u/s 197 (16) which requires to be commented by us.

For thanawala & co.
Chartered accountants
Firm registration no: 110948w
Ca vijay thanawala
Place: mumbai (proprietor)
Date : 20th may, 2019 Membership no.: 15632

Annexure - 1 to the auditors report

The annexure referred to in independent auditors report to the members of the company on the financial statements for the year Ended march 31, 2019. We report that:

I. A) the company has maintained proper records showing full Particulars, including quantitative details and situation of fixed assets.

B) as explained to us, the company has a program for physical verification of fixed assets at periodic intervals. In our opinion, the period of verification is reasonable having regard to the size of the company and the nature of its assets. The discrepancies reported on such verification were not material and have been properly dealt with in the books of account.

C) based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to information and explanations given by the management, the title deeds of immovable properties are held in the name of the company subject to the assets which were transferred to the company as per nclt order in terms of demerger, but the title of the same are still under process to be changed from individual units to the company.

ii. The management has conducted physical verification of inventory at reasonable intervals during the year ended and no material discrepancies were noticed on such physical verification.

iii. The company has not granted any loans to company covered in the register maintained under section 189 of the companies act, 2013.

iv. In our opinion and according to the information and explanations given to us, the company has complied with all the provisions of section 185 and 186 of the companies act 2013, in respect of loans, investments, guarantees and security.

v. The company has not accepted any deposits from the public.

vi. Accordingly to the information and explanation given to us, cost records were maintained by the company pursuant to the order of the central government under section 148(1) of the companies act, 2013.

vii. A) undisputed statutory dues including provident fund, Employees state insurance, income-tax, sales tax, service tax, duty of custom, duty of excise, value added tax, cess and other material statutory dues have generally been regularly deposited with the appropriate authorities though there has been a slight delay in a few cases.

According to the information and explanations given to us, no undisputed amounts payable in respect of income- tax, service tax, sales-tax, duty of custom, duty of excise, value added tax, cess and other material statutory dues were outstanding, except employees state insurance corporation & provident fund amounting to 69,726 & 4,70,648/- respectively for the year end, for a period of more than six months from the date they became payable.

B) according to the records of the company, there is no dues outstanding of income-tax, sales- tax, service tax, duty of custom, duty of excise, value added tax and cess on account of any dispute for the year ended march 31, 2019.

viii. Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to information and explanations given by the management, it has been observed that the company has

Defaulted in repayment of dues of a foreign bank loan of bob from october 2018 for principal amount of usd 2,40,714 and interest of usd 1,01,244 equivalent to 1,66,77,010 and 70,14,321/- respectively.. Apart from this, the company has not defaulted in repayment of dues to any other financial institution, bank or debenture holders or government

ix. Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management and on an overall examination of the balance sheet, we report that the company has not raised any money by way of public issue or further public offer during the year.

x. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no fraud on or by the officers and employees of the company has been noticed or reported during the year.

xi. Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that the managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule v to the companies act, 2013.

xii. In our opinion, the company is not a nidhi company. Therefore, the provisions of clause 3(xii) of the order are not applicable to the company and hence not commented upon.

xiii. Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, transactions with the related parties are in compliance with section 177 and 188 of companies act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards.

xiv. According to the information and explanations given to us and on an overall examination of the balance sheet, 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. Based on our audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, 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 section 45-ia of the reserve bank of india act, 1934 are Not applicable to the company.

For thanawala & co.
Chartered accountants
Firm registration no: 110948w
Ca vijay thanawala
Place: mumbai (proprietor)
Date : 20th may, 2019 Membership no.: 15632

Annexure - 2 to independent auditors report

Referred to in paragraph 10(f) of the independent auditors report of even date to the members lasa supergenerics limited on the Financial statements for the year ended march 31, 2019

Report on the internal financial controls under clause(i)of subsec. 3 of section 143 of the act

We have audited the internal financial controls over financial reporting lasa supergenerics limited (the company) as of march 31, 2019 in conjunction with our audit of the 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 act.

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 deemed to be prescribed under section 143(10) of the act 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 icai. 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 authorizations of management and directors of the company; and

3. Provide reasonable assurance regarding prevention or timely detection of unauthorized 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 march 31, 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 thanawala & co.
Chartered accountants
Firm registration no: 110948w
Ca vijay thanawala
Place: mumbai (proprietor)
Date : 20th may, 2019 Membership no.: 15632