DILIP BUILDCON Auditors Report

Report on the Standalone Indian Accounting Standards (Ind AS) Financial Statements


1. We have audited the accompanying standalone Ind AS Financial Statements of Dilip Buildcon Limited (the Company), which comprise the Balance Sheet as at 31st March 2017, 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.


Management’s Responsibility for the Standalone Ind AS Financial Statements


2. The Company’s 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 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) prescribed 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 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 standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.


Auditor’s Responsibility


3. Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.


In conducting 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 thereunder. We conducted our audit of the standalone Ind AS financial statements 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 standalone Ind AS financial statements are free from material misstatement.


An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the standalone 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 accounting policies used and the reasonableness of the accounting estimates made by Company’s Directors, as well as evaluating the overall presentation of the standalone Ind AS 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 standalone Ind AS financial statements.


Opinion


4. 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 Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the state of affairs of the Company as at 31st March 2017, and its profit (including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.


Emphasis of Matter


5. Without qualifying our opinion we draw attention to the following:


Note 43 to the standalone Ind AS Financial Statements in respect of application made to Settlement Commission and the liability for tax/interest thereon made in the books of accounts based on the application made with the Settlement Commission


Other Matter


6. The comparative financial information of the Company for the year ended March 31, 2016 and the transition date opening balance sheet as at April 1, 2015 included in these standalone Ind AS financial statements for the year ended March 31, 2016 and March 31, 2015, are based on the statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 (as amended) audited by us, on which we expressed an unmodified opinion dated June 17, 2016 and June 5, 2015 as adjusted for the differences in accounting principles adopted by the Company on transition to the Ind AS which have been audited by us.


Our opinion on the standalone Ind AS financial statements and our report on Other Legal and Regulatory requirements below is not modified in respect of these matters.


Report on Other Legal and Regulatory Requirements


7. As required by the Companies (Auditor’s 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, and on the basis of such verification of the books and records as considered appropriate and available and according to the information and explanations given to us, we enclose in the Annexure ‘A’ a statement on the matters specified in paragraphs 3 and 4 of the order, to the extent applicable.


8. 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), the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.


(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.


(e) On the basis of written representations received from directors as on 31st March 2017 and taken on record by the Board of Directors, we report that 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 Auditor’s 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 has disclosed the impact of pending litigations on its financial position in its financial statements to the extent determinable/ascertainable. - Refer Note 25 to the financial statements.


ii) The Company does not have any long term contracts including derivative contracts for which there are 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 Company during the year ended March 31, 2017.


iv) The Company has provided requisite disclosures in the standalone Ind AS financial statements as regards to holdings as well as dealings in Specified Bank Notes during the period from 8th November 2016 to 30th December 2016. Based on audit procedures and relying on representations provided to us by the management we report that the disclosures are in accordance with the books of account maintained by the Company and as produced to us by the Management. Refer Note 48 to the standalone Ind AS Financial Statements.


Annexure ‘A’ to the Auditors’ Report


Statement on the matters specified in paragraphs 3 and 4 of Companies (Auditor’s Report) Order, 2016 (Referred to in paragraph 7 of our Audit Report of even date)


I) a) The Company has maintained proper records showing full particulars, including quantitative details and situations of fixed assets, except for certain items of plant and machinery and vehicles for which location of said assets were under process of being compiled/updated.


b) According to information and explanations given to us, fixed assets of the Company are being physically verified according to a phased programme of verification so as to verify all assets within a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its fixed assets. As informed, during the year no material discrepancies to the extent reconciled with the records available in this respect were noticed on such verifications.


c) According to the information and explanations given to us, the title deeds of immovable properties are in the name of the Company except the following, wherein the Company is in the process of updating the documents in the name of the Company.
















Particulars



Gross Value (Amt. Lakhs)



in Net Value (Amt. in Lakhs)



Land



22.61



22.61



ii) As per information and explanations given to us the inventory has been physically verified by the management at intervals as defined by the management. In our opinion, the frequency of verification needs to be further improved having regard to the size of the Company and nature of its business. As informed to us, the discrepancies noticed on verification to the extent reconciled with the records available in this respect between the physical stocks and the book records were not material and have been appropriately dealt with.


iii) According to the information and explanations provided to us, the Company has given unsecured loan/advance to nineteen parties (subsidiaries) covered in the Register maintained under Section 189 of the Companies Act, 2013.


a) We have been explained that these loans were given in view of the said companies being wholly owned subsidiaries where the Company is having long term strategic interest and thus such loans are not prejudicial to the interests of the Company.


b) Interest has not been charged and stipulations for repayment of principal amount has not been made against loans outstanding at the year end from the subsidiaries as given in (iii) (a) above. Having regard to the above facts and explanations, it is not possible to ascertain and comment whether the receipt of principal amount and interest are regular or not.


c) Since the repayment schedule for such loans is not stipulated, no loan is overdue for more than ninety days. Hence it is not possible to ascertain and comment whether the Company has taken reasonable steps for recovery of the Principal and the Interest.


iv) In our opinion and according to the information and explanations provided to us, the Company has complied with the provisions of Section 185 and 186 of the Companies Act, 2013 in respect of loans given, Investments made, guarantees given.


v) According to the information and explanations given to us, the Company has not accepted any deposits during the year from public within the meaning of the directives issued by Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act, 2013 and rules framed thereunder and thus the provisions of Clause 3(v) of the Order are not applicable.


vi) The Company is required to maintain cost records as prescribed by the Central Government under section 148(1) of the Companies Act, 2013. We have broadly reviewed the cost records maintained by the Company pursuant to the rules made by the Central Government for the maintenance of the cost records under section 148(1) of the Companies Act, 2013 and are of the opinion that prima facie, the prescribed records have been maintained. We have, however, not made a detailed examination of the said records.


vii) a) According to the information and explanations given to us, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees’ State Insurance, Income Tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Value Added Tax, Cess except for Provident Fund and Tax deducted at source wherein certain delays in payments were observed during the year ended 31.03.2017. There were no undisputed amounts of statutory dues including Provident Fund, Employees’ State Insurance, Income Tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Value Added Tax, Cess which were due for more than six months from the date they become payable as at the year end.


b) According to the records examined by us and as per the information and explanations given to us, the particulars of statutory dues as at March 31, 2017 which have not been deposited on account of disputes and the forum where the dispute is pending is as under:




















Name of the Statute



Nature of Dues



Disputed Amount



Period to which it pertains



Forum where pending



M. P. VAT ACT, 2002



VAT & Entry Tax



Rs.156.56 lakhs



F.Y 2008-09



M.P. Commercial Tax Appellate



viii) According to information and explanations given to us, the Company has not defaulted in repayment of dues of loans taken from banks and financial institutions. The Company has not borrowed any amount from Debenture holders during the year.


ix) According to the information and explanations given to us, the Company raised money by way of initial public offer of equity shares during the year. The Company has used the money raised by way of initial public offer of equity shares and term loans during the year for the purpose for which they were raised.


x) According to the information and explanations given to us, no material fraud on the Company by its officers or employees, has been noticed and reported during the year, nor have we been informed of such case by the management.


xi) According to the information and explanations given to us, and based on our examination of the records, the Company has paid / provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V of the Companies Act, 2013.


xii) In our opinion and according to the information and explanation given to us, the Company is not a nidhi Company. Accordingly, provision of clause 3 (xii) of the Order is not applicable.


xiii) According to the information and explanation given to us and based on our verification of the records of the Company and on the basis of review and approvals by the Board of Directors and Audit Committee, the transactions with the related parties are in compliance with Section 177 and 188 of the Act where applicable and the details have been disclosed in the financial statements as required by applicable accounting standard.


xiv) According to the information and explanation given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year, therefore provisions of Clause 3(xiv) of the order is not applicable.


xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or person connected with them. Accordingly, paragraph 3 (xv) of the Order is not applicable.


xvi) According to the information and explanations given to us and based on our examination of the records of the Company, the Company is not required to be registered under Section 45 IA of the Reserve Bank of India Act, 1934. Accordingly provisions of Clause 3 (xvi) of the Order is not applicable to the Company.



For Mukund M. Chitale & Co. For Naresh Rajani & Co.


Chartered Accountants Chartered Accountants


Firm Registration Firm Registration


No. 106655W No. 008422C


SD/- SD/-


(S.M. Chitale) (Naresh Rajani)


Partner Place: Mumbai Proprietor Place: Bhopal


M.No. 111383 Date: 17.05.2017 M. No. 077500 Date: 17.05.2017

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