| 1. We have audited the accompanying standalone financial statements of
Alchemist Realty Limited ("the Company"), which comprise the Balance
Sheet as at March 31, 2015, and the Statement of Profit and Loss and
Cash Flow Statement for the year then ended, and a summary of
significant accounting policies and other explanatory information.
Management's Responsibility for the 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 financial statements
that give a true and fair view of the financial position, financial
performance and cash flows of the Company in accordance with the
Accounting principles generally accepted in India, including the
Accounting Standard specified under Section 133 of the Act, read with
the provision of the Companies (Accounts) Rules, 2014. This
responsibility includes the maintenance of adequate accounting records
in accordance with the provision of the Act for safeguarding of the
assets of the Company and for preventing and detecting the 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 internal
financial control, that were operating effectively for ensuring the
accuracy and completeness of the accounting records, relevant to the
preparation and presentations of the financial statements that give a
true and fair view and free from material misstatement, whether due to
fraud or error.
Auditor's Responsibility
3. Our responsibility is to express an opinion on these Standalone
financial statements based on our audit.
4. 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 Rules
made there under.
5. 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.
6. An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditor's 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 control relevant to the
Company's preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity's internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the
reasonableness of the accounting estimates made by management, as well
as evaluating the overall presentation of the financial statements.
7. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our Qualified audit opinion on
the Standalone financial statement.
Opinion
8. 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 31,2015 and its profit and its Cash
Flow for the year ended on that date.
Emphasis of the Matter
a. Attention is invited to note No 14.1 and 14.2 of the financial
statements wherein amount of Rs. 5867.44 lacs has been shown under the
head of long term advances, "out of which Rs. 1247.14 Lacs has been
given to various parties and the matter is sub judice in various courts
for acquiring properties and advances amounting to Rs. 1830.12 lacs
given to various other parties but the sale deeds for properties have
not so far been executed in favor of the company". These advances have
been considered as good by the management of the company . It is
relevant to point out that these are material advances and are pending
since long, more than three years, and the management has not made any
provision for the same.
Attention is also invited to note No 14.3 of the financial statements
for amount shown under the head " long term advance Rs. 1887.92 Lacs
given to various parties on account of franchisee fee and other
expenses for acquiring rights of Realogy Corpn. Inc. USA for their
brand (Century 21 ) which is recoverable from its subsidiary Century 21
Properties (India) Pvt. Ltd as and when the rights will be transferred
to it". It is relevant to note that the amount has been advanced since
long and rights have not been transferred so far.
b. We draw attention to note 14.4, the company has advanced as loan a
sum of Rs.7.21 Cores to two parties as interest free unsecured loan,
the same is in violation of sub section 7 of section 186 of the
Companies Act 2013. This sub section requires the "No loans shall be
given under this section at a rate lower than the prevailing yield of
one year, three year, five year or ten year Government Security closest
to the tenure of the loan.
c. Attention is invited to note No 17 and 17.1 of the financial
statements which states Trade receivables amounting to Rs. 14931.00
lacs out of Which export debtors for merchant trade transaction are
14171.29 lacs and other receivables are Rs. 742.10 which are
outstanding for more than six months from the date they become due from
payment. Attention is invited to point 17.1 wherein the company has
extended credit from time to time as per the market practice for export
debtors and regular follow up is being done to recover the same and
management is confident to recover the same, in view of the same,
management feels that the same are recoverable and there is no need to
make the provision at this juncture. For other receivables amounting to
Rs. 742.10 lacs, these are long outstanding for more than 3 years and
the management has not made any provision for the same.
Report on Other Legal and Regulatory Requirement's
9. As required by the Companies (Auditor's Report) Order, 2015 ("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
statement on the matters specified in the paragraph 3 and 4 of the
Order, to the extent applicable.
10. 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, 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 Section 133 of the Companies Act,
2013, read with Rule 7 of the Companies(Accounts) Rules,2014;
e) In our opinion the matter described in observation and comments made
in Emphasis of the matter can adversely affect the functioning of the
company.
f) On the basis of written representations received from the directors
as on March 31, 2015, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2015, from being
appointed as a director in terms of section 164(2) of the Companies
Act, 2013.
g) With respect to the other matters included in the Auditor's Report
in accordance with Rule 11 of Companies (Audit and Auditors)Rules, 2014
in our opinion and to the best of our information and according to
explanations given to us:
i. The Company has not disclosed the impact of pending litigations in
its financial statements with respect to suits on or by the company in
respect of suits filed by the company for acquisition of properties as
referred to in note 14.1 and 14.2 of the financial statements.
ii. The company did not have any long term contracts including
derivative contracts for which there were any material foreseeable
losses.
iii. There no amounts which required to be transferred, to the
Investor Education and Protection Fund by the company
Annexure to the Independent Auditors' Report
The Annexure referred to in our Independent Auditors' Report of even
date to the members of Alchemist Realty Limited on the financial
statements as of and for the year ended 31st March, 2015 . We report
that:
1. (a) The company has maintained proper records showing full
particulars including quantitative details and situation of its fixed
assets.
(b) As explained to us, fixed assets have been physically verified by
the management at reasonable intervals; no material discrepancies were
noticed on such verification.
(c) In our opinion and according to the information and explanations
given to us, no substantial part of fixed asset has been disposed
during the year and therefore it does not affect the going concern
status of the company.
2. (a) As explained to us, inventories have been physically verified
during the year by the management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
(c) In our opinion and on the basis of our examination of the records,
the Company is generally maintaining proper records of its inventories.
No material discrepancy was noticed on physical verification of stocks
by the management as compared to book records.
3. a) According to information and explanations given to us, the company
has granted unsecured loan to two subsidiary company, i.e. Alchemist
Hill Resorts Private Limited and Century 21 Properties India Private
Limited (party covered under section 189 of the companies Act. 2013)
amounting to Rs. 721.12 Lacs which is prejudicial to the interest of the
company.
i) The principle amounts are repayable over the varying periods as
informed to us , while the interest is recoverable at the discretion of
the company.
ii) We are unable to comment on the overdue amount of Rs One lakh in
respect of principle and interest as necessary documents, terms and
conditions on which loans have been given have not been made available
to us .
4. In our opinion and according to the information and explanations
given to us, there is generally an adequate internal control procedure
commensurate with the size of the company and the nature of its
business, for the purchase of inventories & fixed assets and for the
sale of goods and services. During the course of our audit, no major
instance of continuing failure to correct any weaknesses in the
internal controls has been noticed.
5. According to the information ad explanation given to us, the
company has not accepted deposits from public. Therefore the provision
of clause (v) of paragraph 3 of CARO 2015 are not applicable to the
company
6. The rules prescribed by the Central Government for the maintenance
of cost records under sub-section (1) of section 148 the Companies Act,
2013 are not applicable to the Company.
7. (a) According to the records of the company, undisputed statutory
dues including Provident Fund, Investor Education and Protection Fund,
Employees' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service
Tax, Custom Duty, Excise Duty, cess to the extent applicable and any
other statutory dues have generally been regularly deposited with the
appropriate authorities. According to the information and explanations
given to us there were no outstanding statutory dues as on 31st of
March, 2015 for a period of more than six months from the date they
became payable.
(b) According to the information and explanations given to us, there is
no amounts payable in respect of income tax, wealth tax, service tax,
sales tax, customs duty and excise duty which have not been deposited
on account of any disputes.
8. The Company does not have any accumulated loss and has not incurred
cash loss during the financial year covered by our audit and in the
immediately preceding financial year.
9. Based on our audit procedures and on the information and
explanations given by the management, we are of the opinion that, the
Company has not defaulted in repayment of dues to a financial
institution, bank or debenture holders.
10. According to the information and explanations given to us, the
Company has not given any guarantees for loan taken by others from a
bank or financial institution the terms and conditions whereof are
prejudicial to the interest of the company.
11. The Company has not raised any new term loan during the period.
The total amount of vehicle loan from HDFC Bank Ltd has been repaid
during the year.
12. During the course of our examination of the books and records of
the company, carried out in accordance with the generally accepted
auditing practice in India, and according to the information and
explanation given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
year, nor have we been informed of any such case by the management.
FOR K.SINGH & ASSOCIATES
CHARTERED ACCOUNTANTS
Firm No. 012458N
KULTAR SINGH
PLACE : New Delhi Partner
DATED:28/05/2015 Membership No. 091673
|