To the Members of Senbo Industries Limited
Kolkata
Report on the Audit of Standalone Ind AS Financial Statements
Opinion
We have audited the accompanying standalone Ind AS financial statements of Senbo
Industries 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 then ended and 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 Ind AS financial statements give the information
required by the Companies Act, 2013, as amended ("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,
its profit including other comprehensive income its cash flows and the changes in equity
for the year ended on that date.
Basis for Opinion
We conducted our audit of the standalone Ind AS financial statements in accordance with
the Standards on Auditing (SAs),as 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 Ind AS 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 Act and the Rules there under, 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 audit opinion on the standalone Ind AS financial statements.
Emphasis of Matter
We draw attention to
Note: 15 regarding loan convert into cumulative redeemable preference Share.
Note: 17 regarding Liabilities written back – Municipality Tax, Khajna and
reduction in rental income, with retrospective effect from Ist April,2016.
Note: 22 Regarding sharing of expenses with a group company resulting in reduction
in expenditure, with retrospective effect from Ist April, 2016.
Note: 5e an investment property of the Company at Sonarpur has remained mortgaged
as collateral security with a bank to secure the credit facilities of Senbo Engineering
Ltd., a group company which had earlier provided substantial loans to the Company.
However, the said credit facilities taken from Oriental Bank of Commerce by Senbo
Engineering Limited have turned into Non Performing Asset on 31st January 2018 and notice
dated 05.04.2019 was served by the Bench of NCLT.
Our opinion is not qualified in respect of this matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the standalone Ind AS financial statements for the financial
year ended March 31, 2019. These matters were addressed in the context of our audit of the
standalone Ind AS financial statements as a whole, and in forming our opinion thereon, and
we do not provide a separate opinion on these matters. For matter below, our description
of how our audit addressed the matter is provided in that context. We have determined the
matters described below to be the key audit matters to be communicated in our report. We
have fulfilled the responsibilities described in the Auditors responsibilities for the
audit of the standalone Ind AS financial statements section of our report, including in
relation to these matters. Accordingly, our audit included the performance of procedures
designed to respond to our assessment of the risks of material misstatement of the
standalone Ind AS financial statements. The results of our audit procedures, including the
procedures performed to address the matters below, provide the basis for our audit opinion
on the accompanying standalone Ind AS financial statements.
Key audit matter
Refer Note: 16 on non-receipt of Party confirmations regarding Sundry Creditors Rs.
63.59 lakhs.
How our audit addressed the key audit matter
Obtained an understanding of managements process and evaluated design and tested
operating effectiveness of controls.
Other Information
The Companys Board of Directors is responsible for the other information. The other
information comprises the formation included in the Chairmans statement, Managing
Directors statement and the Directors Report including Annexures to the Directors
Report of the Annual Report of the Company, but does not include the standalone Ind AS
financial statements and our auditors report thereon. Our opinion on the standalone Ind
AS financial statements does not cover the other information and we do not express any
form of assurance conclusion thereon. In connection with our audit of the standalone Ind
AS financial statements, our responsibility is to read the other information and, in doing
so, consider whether such other information is materially inconsistent with the financial
statements or our knowledge obtained in the audit or otherwise appears to be materially
misstated. If, based on the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report that fact. We have
nothing to report in this regard.
Responsibilities of Management and Those Charge with Governance for the Standalone Ind
AS Financial Statements
The Companys Board of Directors is responsible for the matters stated in section
134(5) of the Act with respect to the preparation of these standalone Ind AS financial
statements that give a true and fair view of the financial position, 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 read with the
Companies (Indian Accounting Standards) Rules, 2015, as amended. 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 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 standalone Ind AS financial
statements that give a true and fair view and are free from material misstatement, whether
due to fraud or error. In preparing the standalone Ind AS 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 charged with governance are also responsible for overseeing the Companys
financial reporting process.
Auditors Responsibilities for the Audit of the Standalone Ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone Ind AS
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 standalone Ind AS 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 standalone Ind AS
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 appropriatein the circumstances. Under section 143(3)(i) of the
Act, 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 standalone Ind AS
financial statements, including the disclosures, and whether the standalone Ind AS
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 standalone Ind AS financial
statements for the financial year ended March 31, 2019 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 ("The Order")
issued by the Central Government of India in terms of Section 143 (11) of the Act, we give
in "Annexure A" a Statement on the matters specified in Paragraphs 3
& 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 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, the Statement of Profit & Loss including Other Comprehensive
Income, the Cash Flow Statement dealt and Statement of Changes in Equity dealt with by
this Report are in agreement with the books of account.
d. In our opinion, the aforesaid IND AS financial statements comply with the Indian
Accounting Standard (Ind AS) prescribed under section 133 of the Act;
e. On the basis of the 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 Section 164(2) of the
Act.
f. With respect to the adequacy of internal financial controls over financial reporting
of the Company and the operating effectiveness of such controls, refer to our separate
report in "Annexure B"; and 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 and certificate given to us:
i. The pending litigations of the Company would not have any impact on its financial
position. ii. The Company did not have any long-term contract including derivative
contract and as such no provision is required to be made for any likely material losses
arising there from. iii. The Company has never declared any dividend in its life time and
therefore, there is no need to transfer any amount to the Investor Education and
Protection Fund.
| Place: Kolkata |
For Agrawal & Kothari |
| Date: 30.05.2019 |
Chartered Accountants |
|
(Firms Regn. No 323424E) |
|
Sumit Agrawal - Partner |
|
Membership No.: 058302 |
Companies (Auditors Report) Order, 2016 ANNEXURE "A" TO AUDITORS REPORT
(Referred to in Paragraph 1 under the heading of ‘Report on Other Legal &
Regulatory Requirements of our Report)
1 In respect of its Fixed Assets:
a. The Company has updated its Fixed Assets Register to show full particulars including
quantitative details and situation of Fixed Assets left after sale of substantial Part of
Plant & Machinery during earlier years.
b. According to the information and explanations given to us, the Fixed Assets were
physically verified by the management and no material discrepancies were noticed.
c. According to the information and explanation 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 As explained to us, the inventory has been physically verified by the management at
the year end. We understand that no material discrepancy was noticed during verification.
3 The Company has provided guarantee against loan taken by the a group company Senbo
Engineering Ltd the details of the same has been provided in the note- 5e to the
financial statement apart from that no loans to parties covered in the Register maintained
under section 189 of The Companies Act, 2013 have been granted by 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 Act, with respect
to the loans & investments made.
5 On the basis of documents examined & information received, we understand that the
Company has not accepted any deposits from the public in pursuance of sections 73 to 76 or
any other relevant provisions of the Act.
6 According to information and explanations given to us, the Central Government has not
prescribed maintenance of cost records u/s 148 (1) of the Act, for any product of the
Company.
7 In respect of Statutory dues:
a) According to the records of the Company, there were no outstanding undisputed dues
over 6 months which remained unpaid as on 31st March, 2019; except in respect
of TDS Rs. 65,300/-.
b) According to the records of the Company, the dues of income-tax, sales-tax, service
tax, duty of custom, duty of excise, value added tax and cess on account of any dispute,
are as follows:
| Name of Statute |
Nature of Dues |
Amount in (Rs.) |
Period to which Amount Relates |
Forum Where Dispute is Pending |
| Central Excise |
Assessment dues |
10,39,548.00 |
2000-2001 |
Appeal Commissionerate, Kolkata |
| Sales Tax |
Assessment dues |
2,12,575.00 |
2007-2008 |
Appeal Authority, Sales Tax, Kolkata |
8 As per records produced before us, the Company has not defaulted in payment of dues
to any Financial Institution, Bank, and Government or debentures holders.
9 As per records produced before us, the Company has not raised any moneys by way of
any public offer or term loans during the year. Accordingly, paragraph 3(ix) of the Order
is not applicable.
10 According to the information and explanation given to us, no material fraud by the
company or on the company by its officers or employees has been noticed or reported during
the course of our audit.
11 According to the information and explanation given to us, 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, except ratification
of remuneration of one whole-time Director in the ensuing Annual General Meeting.
12 In our opinion and according to the information and explanations given to us, the
Company is not a Nidhi Company. Accordingly, paragraph 3 (VII) of the Order is not
applicable.
13 According to the information and explanation given to us, all transactions with the
related parties are in compliance with Section 177 and 188 of the Companies Act, 2013
where applicable, and the details have been disclosed in the Financial Statements etc as
required by the applicable accounting standards.
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 made any preferential
allotment / private placement of shares or fully / partly convertible debentures during
the year under review.
15 According to the information and explanation given to us and based on our
examination of the records of the Company, the Company has not entered into any non-cash
transactions with directors or persons connected with them. Accordingly, paragraph 3 (XV)
of the Order is not applicable.
16 The Company is not required to be registered under Section 45-IA of the Reserve Bank
of India Act, 1934.
| Place: Kolkata |
For Agrawal & Kothari |
| Date: 30.05.2019 |
Chartered Accountants |
|
(Firms Regn. No 323424E) |
|
CA Sumit Agrawal -Partner |
|
Membership No.: 058302 |
ANNEXURE "B" TO THE AUDITORS REPORT
Report on 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 Senbo
Industries Limited ("the Company") as of 31 st 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 (‘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
fruds 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 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 materials respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of
the internal 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 risk 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 control system
over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A companys internal financial control over reporting is a process designed to provide
reasonable assurance regarding the reliability of financial reporting and the preparation
of financial statement 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 details, 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 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 31st March,2018,
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.
| Place: Kolkata |
For Agrawal & Kothari |
| Date: 30.05.2019 |
Chartered Accountants |
|
(Firms Regn. No 323424E) |
|
Sumit Agrawal - Partner |
|
Membership No.: 058302 |
+91-9892691696
