To
The Members of Priyadarsini Limited,
Hyderabad.
Report on the financial statements
We have audited the accompanying financial statements of M/S.PRIYADARSINI LIMITED,
Hyderabad (the Company), which comprise the Balance Sheet as at 31st March, 2017, the
Statement of Profit and Loss of the Company and Cash Flow Statement of the Company for the
year ended 31st March, 2017 and a summary of significant accounting policies and other
explanatory information.
Managements Responsibility for the financial statements
The Companys Board of Directors is responsible for the matters stated in Sec.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 financial position, financial performance
and cash flow of the company in accordance with the Accounting principles generally
accepted in India, including the Accounting Standards specified under Sec. 133 of the Act,
read with Rule 7 of the Companies (Account) 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.
Auditors Responsibility
Our responsibility is to express an opinion on these financial statements based on our
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 there under.
We conducted our audit in accordance with the standards on Auditing specified under
Section 143(10) of the Act. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. 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. In making those risk assessments, the auditor
considers internal financial control relevant to the companys preparation of the
financial statements that give true and fair view in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on
whether the Company has in place an adequate internal financial control system over
financial reporting and the operating effectiveness of such controls. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness
of the accounting estimates made by the Companys Directors, as well as evaluating the
overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion on the financial statements.
Basis for Qualified Opinion
1. The Companies accounts have been classified as NPA by all the Secured Creditors and
in order to revive the company which has become sick by restructuring the secured
creditors a proposal of OTS is in Process. Hence no provision is made for interest in the
accounts which is estimated at Rs.5700 lakhs since the date of classification as NPA.
2. The provision for gratuity was not made on actuarial valuation
Opinion
Note: 1 In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid 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:
I) In the case of the Balance Sheet, of the State of Affairs of the Company as at 31st
March 2017;
ii) In the case of Statement of Profit and Loss, of the Loss of the Company for the
year ended on that date; and iii) the case of Cash Flow statement, of the cash flows for
the year ended as on that date.
Report on other Legal and Regulatory Requirements
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 Act,
we give in the Annexure A a statement on the matters specified in paragraph 3 and
4 of the said order.
As required by Section 143 (3) of theAct, we report that: a) We have 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 appears from our examination of those books.
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.
d) In our opinion, the aforesaid financial statements comply with the Accounting
Standards specified under Sec. 133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules, 2014.
e) On the basis of the written representations received from the Directors as on 31st
March, 2016, taken on record by the Board of Directors, none of the Directors is
disqualified as on 31st March,2017, from being appointed as 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.
I) The company does not have any pending litigations which would impact 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.
iv) The company has provided requisite disclosures in its financial statements as to
the holdings as well as dealings in Specified Bank Notes during the period from 8
November, 2016 to 30 December, 2016 and these are in accordance with the books of accounts
maintained by the company.
Refer Note No.2.33 to the financial statements.
| For P.SRINIVASAN & Co., |
| Chartered Accountants |
| Firms Registration No.004055S |
|
K.RANGANATHAN |
|
Hyderabad |
| Place: Hyderabad |
Partner |
| Date: 29-05-2017 |
Membership No. 010842 |
ANNEXURE A to the Auditors Report
Annexure referred to in Paragraph 1 of section – Report on Other Legal and
Regulatory Requirements of the Independent Auditors Report of even date M/S.PRIYADARSINI
LIMITED, Hyderabad (the Company) on the financial statements for the year
ended March 31, 2017,
I. In respect of fixed assets
a) The company is maintaining proper records showing full particulars, including
quantitative details and situation of fixed assets;
b) As explained to us, all the fixed assets have been physically verified by the
Management during the year. No material discrepancies were noticed on such verification.
c) The title deeds of immovable property are held in the name of company.
ii. In respect of its inventories:
a) As explained to us, the inventories excepting in case of goods in transit, were
physically verified during the year by the Management at reasonable intervals.
b) In our opinion, procedures of physical verification of inventory followed by the
Management are reasonable and adequate in relation to the size of the Company and the
nature of its business.
c) On the basis of our examination of records of the inventory, in our opinion, the
Company is maintaining proper records of inventory. No material discrepancies were noted
on such verification.
iii. In respect of loans:
As informed to us, 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. iv. In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of Sections 185 and 186 of the
Act in respect of grant of loans, making investments and providing guarantees and
securities, as applicable.
v) The company has not accepted any deposits, and hence clause (v) of Companies
(Auditors Report) Order, 2016 is not applicable.
vi) We have broadly reviewed the books of account maintained by company pursuant to
rules prescribed by the central government of India for maintenance of cost records under
Section 148(1) of the Companies Act, 2013 in respect of products of the company and are of
the opinion that prima facie, the prescribed accounts and records have been made and
maintained. However, we have not made a detailed examination of the records.
vii. a) According to the information and explanations given to us and the records as
produced and examined by us, in our opinion, the company regular in depositing undisputed
statutory dues like income tax and not regular in depositing other material statutory dues
during the year by the company with the appropriate authorities. As explained to us, the
company has dues on account of Employees State Insurance, Provident Fund and Sales Tax.
According to the information and explanations given to us, undisputed amounts payable
in respect of Provident Fund, ESI and Sales Tax were in arrears as at 31 March 2017 for a
period of more than six months from the period they became payable. b) According to the
information and explanations given to us, the company did not have any dues of excise
duty, sales tax etc with the appropriate authorities on account of dispute.
As informed to us, the company did not have any dues on account of Wealth tax.
viii. In our opinion and according to the information and explanations given to us, the
company has defaulted in repayment of dues to its bankers and financial institutions.
ix. In our opinion and according to the information and explanations given to us, the
company has not raised any money by way of public offer or further public offer (including
debt instruments) and the term loans were applied for the purposes for which those are
raised.
x) In our opinion and according to the information and explanations given to us, no
fraud by the company or on the company by its officers or employees has been noticed or
reported during the course of audit.
xi. According to the information and explanations given to us, the company has not paid
or provided any managerial remuneration during the year.
xii. The Company is not a Nidhi Company and hence reporting under clause 3(xii) of the
Order is not applicable.
xiii. In our opinion and according to the information and explanations given to us the
Company is in compliance with Section 177 and 188 of the Act, where applicable, for all
transactions with the related parties and the details of related party transactions have
been disclosed in the financial statements as required by the applicable accounting
standards.
xiv. During the year, the Company has not made any preferential allotment or private
placement of shares or fully or partly convertible debentures and hence reporting under
clause 3(xiv) of the Order is not applicable to the Company.
xv. In our opinion and according to the information and explanations given to us,
during the year the Company has not entered into any non-cash transactions with its
Directors or persons connected to its Directors and hence provisions of Section 192 of the
Act are not applicable.
xvi. The Company is not required to be registered under Section 45-IAof the Reserve
Bank of IndiaAct, 1934.
| For P.SRINIVASAN & Co., |
| Chartered Accountants |
| Firms Registration No.004055S |
| K.RANGANATHAN |
| Partner |
| M.No. 010842 |
| Place: Secunderabad |
| Date: 29-05-2017 |
ANNEXURE B to the Auditors Report
Report on the Internal Financial Controls under Clause (i) of sub-section 3 of Section
143 of the Companies Act, 2013 (theAct)
We have audited the internal financial controls over financial reporting of
M/S.PRIYADARSINI LIMITED, Hyderabad (the Company) as of 31 March 2017 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 the 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 CompaniesAct, 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 were 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 the
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 31 March 2017, 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
CharteredAccountants of India.
| For P.SRINIVASAN & Co., |
| Chartered Accountants |
| Firms Registration No.004055S |
| K.RANGANATHAN |
| Partner |
| M.No. |
| 010842 |
| Place: Secunderabad |
| Date: 29-5-2017 |
+91-9892691696
