Mar 31, 2023
The Members of DATAMATICS GLOBAL SERVICES LIMITED Report on the Audit of the Standalone Financial Statements
We have audited the accompanying standalone financial statements of DATAMATICS GLOBAL SERVICES LIMITED ("the Company"), which comprise of the Standalone Balance Sheet as at March 31, 2023, the Standalone Statement of Profit and Loss (including Other Comprehensive Income), the Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flows for the year ended on that date, and notes to the standalone financial statements including a summary of the significant accounting policies and other explanatory information ("the standalone financial statements").
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 and fair view in conformity with the Indian Accounting Standards prescribed under Section 133 of the Act read with the 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 March 31, 2023, the profit, other comprehensive income, changes in equity and its cash flows for the year ended on that date.
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 "Auditorâs Responsibilities for the Audit of the Standalone 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 standalone financial statements under the provisions of the Act and the Rules 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 obtained is sufficient and appropriate to provide a basis for our opinion on the standalone financial statements.
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 the key audit matters to be communicated in our report.
Key Audit Matter |
Auditor''s Response |
A. Revenue recognition in respect of fixed price contract |
|
The Company inter alia engages in fixed price contracts, wherein revenue is recognized using the percentage completion method based on the Companyâs estimate of contract cost. We identified revenue recognition of fixed price contracts as a Key Audit Matter since: ⢠accuracy and existence of revenues and onerous obligations, in respect of fixed price contracts, involves critical estimates. ⢠these estimates have high inherent uncertainty as it requires determination of the progress of the contract, costs incurred till date and future costs required to complete the remaining contract and performance obligations. ⢠estimate of costs is a critical estimate to determine the revenues and liability for a contract and these contracts may involve onerous obligations which require critical assessment of future costs. ⢠at the year-end, significant amount of unbilled revenue is recognized on the balance sheet date. |
Our audit procedures included discussion with the management to obtain an understanding of the systems, processes and controls implemented by the Company for recording and computing the costs, revenue and other estimates associated with such contracts. Our audit approach was a combination of test of internal controls and substantive procedures which included the following: ⢠we evaluated the design of internal controls relating to recording of costs incurred and estimate of costs required to complete the performance obligations. ⢠we tested the access and application controls pertaining to time recording, allocation and budgeting systems which prevents unauthorised changes to recording of costs incurred. ⢠we selected a sample of contracts and tested the operating effectiveness of the internal controls relating to costs incurred and estimate of costs, through the inspection of performance of these controls. ⢠we selected a sample of contracts and performed a retrospective review of costs incurred with estimate of costs to identify significant variations and verify whether those variations have been considered in estimating the future costs required to complete the contract. ⢠we reviewed a sample of contracts with unbilled revenue to identify possible delays in achieving milestones, which |
Key Audit Matter |
Auditor''s Response |
B. Transactions with Related Parties |
require change in estimated costs to complete the remaining performance obligations. ⢠we performed analytical procedures and test of details for reasonableness of incurred and estimated costs. |
The company has material related party transactions during the year. Related party transactions impose limitations on the auditorâs ability to obtain audit evidence that all other aspects of related party transactions (other than price) are equivalent to those of a similar armâs length transaction. Further the nature and complexity of such transactions and the involvement of management with respect to the roles and responsibilities of the entities involved in the transactions, makes it subjective. We identified transactions with related parties as key audit matter. |
Our audit procedures on transactions with related parties included the following: ⢠we obtained a comfort letter issued by an independent professional who is in charge of Transfer Pricing matters of the Company which states that the transactions are conducted at armâs length price. ⢠we also reviewed the income tax assessments of earlier years to corroborate whether the methodology adopted by the Company has been accepted by the income tax authorities in previous years. ⢠we also compared the pricing model and other terms of the current agreements with agreements of the previous years. |
The Companyâs Management and Board of Directors are responsible for the other information. The other information comprises the information included in the Companyâs Annual Report, but does not include the consolidated financial statements, the standalone financial statements and our respective Auditorsâ Report thereon. Our opinion on the standalone 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 financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our 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.
Management''s Responsibilities for the Standalone Financial Statements
The Companyâs Management and Board of Directors are responsible for the matters stated in Section 134(5) of Act with respect to the preparation and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including Accounting Standards specified under Section 133 of the Act (âInd AS"). 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 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 financial statements, management and Board of Directors are responsible for assessing the Companyâs 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.
The Management and Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
Auditor''s Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs 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 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 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 financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)0) 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 managementâs 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 Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the standalone 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 auditorâs 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 financial statements, including the disclosures, and whether the standalone 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 financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditorâs 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 (Auditorâs Report) Order, 2020 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Companies Act, 2013, we give in the "Annexure A", a statement on the matters specified in paragraphs 3 and 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 purposes of our audit.
b) In our opinion, proper books of account as required by law relating to preparation of the aforesaid standalone financial statements have been kept by the Company so far as it appears from our examination of those books.
c) The Standalone Balance Sheet, the Standalone Statement of Profit and Loss including Other Comprehensive Income, Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flows dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act read with rule 3 of the Companies (Indian Accounting Standards) Rules, 2015.
e) On the basis of the written representations received from the directors as on March 31, 2023 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2023 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 of the Company and the operating effectiveness of such controls, please refer to our separate report in "Annexure B". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial reporting.
g) With respect to the other matters to be included in the Auditorâs Report in accordance with the requirements of section 197(16) of the Act, as amended:
In our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under section 197(16) which are required to be commented upon by us.
h) With respect to the other matters to be included in the Auditorâs 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 disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Note No. 46 to the standalone 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 has been no delay in transferring amounts, required to be transferred to the Investor Education and Protection Fund by the Company.
iv. (a) The Management has represented that, to the
best of its knowledge and belief, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entity ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
(b) The Management has represented, that, to the best of its knowledge and belief, no funds have been received by the Company from any person or entity, including foreign entity ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
(c) Based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.
v. As stated in Note 41 (b) to the financial statements
a) The final dividend proposed in the previous year, declared and paid by the Company during the year is in accordance with Section 123 of the Act, as applicable.
b) The Board of Directors of the Company have proposed final dividend for the year which is subject to the approval of the members at the
ensuing Annual General Meeting. The amount of dividend proposed is in accordance with section 123 of the Act, as applicable.
vi. Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company with effect from April 1, 2023, and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended March 31, 2023.
Chartered Accountants
FRN: 101484W/W100197
Partner
Membership No. 109931
UDIN: 23109931BGXSMN4584
Place: Mumbai
Date: April 28, 2023
Mar 31, 2022
The Members of DATAMATICS GLOBAL SERVICES LIMITED Report on the Audit of the Standalone Financial StatementsOpinion
We have audited the accompanying Standalone financial statements of DATAMATICS GLOBAL SERVICES LIMITED ("the Company"), which comprise of the Standalone Balance Sheet as at March 31, 2022, the Standalone Statement of Profit and Loss and the Standalone Statement of Cash Flows for the year ended on that date, and notes to the Standalone financial statements including a summary of the significant accounting policies and other explanatory information ("the Standalone financial statements").
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 and fair view in conformity with the Indian Accounting Standards prescribed under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, ("Id AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2022, the profit, other comprehensive income, changes
in equity and its cash flows for the year ended on that date.
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 "Auditorâs Responsibilities for the Audit of the Standalone 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 Standalone financial statements under the provisions of the Act and the Rules 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 obtained is sufficient and appropriate to provide a basis for our opinion on the Standalone financial statements.
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.
Key Audit Matter |
Auditor''s Response |
A. Revenue recognition in respect of fixed price contract |
|
The Company inter alia engages in fixed price contracts, wherein revenue is recognized using the percentage of completion method based on the companyâs estimate of contract cost. We identified revenue recognition of fixed price contract as a Key Audit Matter since: ⢠accuracy and existence of revenues and onerous obligations, in respect of fixed price contracts, involves critical estimates. ⢠these estimates have high inherent uncertainty as it requires determination of the progress of the contract, costs incurred till date and future costs required to complete the remaining contract and performance obligations. ⢠estimate of costs is a critical estimate to determine the revenues and liability for a contract and these contracts may involve onerous obligations which require critical assessment of future costs. ⢠at the year-end significant amount of unbilled revenue is recognized on the balance sheet date. |
Our audit procedures included discussion with the management to obtain an understanding of the systems, processes and controls implemented by the Company for recording and computing the costs, revenue and other estimates associated with such contracts. Our audit approach was a combination of test of internal controls and substantive procedures which included the following: ⢠we evaluated the design of internal controls relating to recording of costs incurred and estimate of costs required to complete the performance obligations. ⢠we tested the access and application controls pertaining to time recording, allocation and budgeting systems which prevents unauthorised changes to recording of costs incurred. ⢠we selected a sample of contracts and tested the operating effectiveness of the internal controls relating to costs incurred and estimate of costs, through the inspection of performance of these controls. ⢠we selected a sample of contracts and performed a retrospective review of costs incurred with estimate of costs to identify significant variations and verify whether those variations have been considered in estimating the future costs required to complete the contract. ⢠we reviewed a sample of contracts with unbilled revenue to identify possible delays in achieving milestones, which |
Other Information
The Companyâs management and Board of Directors are responsible for the other information. The other information comprises the information included in the Companyâs Annual Report, but does not include the standalone financial statements and our Auditorsâ Report thereon. Our opinion on the standalone 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 financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially i nconsistent with the standalone financial statements or our knowledge obtained during the course of our 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.
Management''s Responsibilities for the Standalone Financial Statements
The Companyâs Management and Board of Directors are responsible for the matters stated in Section 134(5) of Act with respect to the preparation and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including Accounting Standards specified under Section 133 of the Act (âInd AS"). 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
Key Audit Matter |
Auditor''s Response |
B. Transactions with Related Parties |
require change in estimated costs to complete the remaining performance obligations. ⢠we performed analytical procedures and test of details for reasonableness of i ncurred and estimated costs. |
The company has material related party transactions during the year. Related party transactions impose limitations on the auditorâs ability to obtain audit evidence that all other aspects of related party transactions (other than price) are equivalent to those of a similar armâs length transaction. Further the nature and complexity of such transactions and the involvement of management with respect to the roles and responsibilities of the entities involved in the transactions, makes it subjective. |
Our audit procedures on transactions with related parties included the following: ⢠we obtained a comfort letter issued by the independent professional who is in charge of Transfer Pricing matters of the Company which states that the transactions are conducted at armâs length price. ⢠we also reviewed the income tax assessments of earlier years to corroborate whether the methodology adopted by the Company has been accepted by the income tax authorities in previous years. ⢠we also compared the pricing model and other terms of the current agreements with agreements of the previous years. |
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 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 financial statements, management and Board of Directors are responsible for assessing the Companyâs 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.
The management and Board of Directors are responsible for overseeing the Companyâs financial reporting process.
Auditor''s Responsibility for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs 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 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 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 financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)0) 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 managementâs 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 Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the standalone 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 auditorâs 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 financial statements, including the disclosures, and whether the standalone 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 financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditorâs 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.
1. Attention is drawn to Note No. 44 to the standalone financial statements; the Company has an investment of Rs. 646.52 million in two wholly owned subsidiaries and has also extended loans and advances of Rs. 0.05 million to these subsidiaries as on March 31, 2022. The total net worth of these subsidiaries as on March 31, 2022 is Rs. 631.73 million which is lower than the amount of investment. The investment is for long term and of strategic nature. As the management is confident of turning around these subsidiaries in the near future hence, no provision for diminution in the value of investment has been considered necessary by the management.
Our opinion is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2020 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Companies Act, 2013, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 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 purposes of our audit.
b) In our opinion, proper books of account as required by law relating to preparation of the aforesaid standalone financial statements have been kept by the Company so far as it appears from our examination of those books.
c) The Standalone Balance Sheet, the Standalone Statement of Profit and Loss including Other Comprehensive Income, Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flow dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid Standalone financial statements comply with the Indian Accounting Standards (Ind AS) specified under Section 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 March 31, 2022 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2022 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 of the Company and the operating effectiveness of such controls, please refer to our separate report in "Annexure B". Our report expresses unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial reporting.
g) With respect to the other matters to be included in the
Auditorâs Report in accordance with the requirements of section 197(16) of the Act, as amended:
In our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under section 197(16) which are required to be commented upon by us.
h) With respect to the other matters to be included in the Auditorâs 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 disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Note No. 46 to the standalone 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
iv. (a) The Management has represented that, to the
best of its knowledge and belief, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entity ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
(b) The Management has represented, that, to the best of its knowledge and belief, no funds have been received by the Company from any person or entity, including foreign entity ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
(c) Based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to one notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.
v. As stated in Note 40 (B) to the financial statements
(a) The interim dividend declared and paid by the Company during the year is in accordance with Section 123 of the Act, as applicable.
(b) The Board of Directors of the Company have proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. The amount of dividend proposed is in accordance with section 123 of the Act, as applicable.
Chartered Accountants
FRN: 101484W/W100197
Partner
Membership No. 109931
UDIN: 22109931AHZNXI3622
Place: Mumbai
Date: April 28, 2022
Mar 31, 2021
The Members of DATAMATICS GLOBAL SERVICES LIMITED Report on the Audit of the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements of DATAMATICS GLOBAL SERVICES LIMITED ("the Company"), which comprise the Standalone Balance Sheet as at March 31, 2021, the Standalone Statement of Profit and Loss (including Other Comprehensive Income), the Standalone Statement of Changes in Equity, the Standalone Statement of Cash Flows for the year then ended and notes to the standalone financial statements, including a summary of significant accounting policies and other explanatory information ("the standalone financial statements").
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 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, 2021, the profit, other comprehensive income, changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the standalone financial statements 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 ''Auditorâs Responsibility for the Audit of the Standalone Financial Statementsâ 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 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 obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
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 the key audit matters to be communicated in our report.
Key Audit Matter |
Auditor''s Response |
A. Revenue recognition in respect of fixed price contract |
|
The Company inter alia engages in fixed price contracts, wherein revenue is recognized using the percentage of completion method based on the company''s estimate of contract cost. We identified revenue recognition of fixed price contract as a Key Audit Matter since: ⢠accuracy and existence of revenues and onerous obligations, in respect of fixed price contracts, involves critical estimates. ⢠these estimates have high inherent uncertainty as it requires determination of the progress of the contract, costs incurred till date and future costs required to complete the remaining contract and performance obligations. ⢠estimate of costs is a critical estimate to determine the revenues and liability for a contract and these contracts may involve onerous obligations which require critical assessment of future costs. ⢠at the year-end significant amount of unbilled revenue is recognized on the balance sheet date. |
Our audit procedures included discussion with the management to obtain an understanding of the systems, processes and controls implemented by the Company for recording and computing the costs, revenue and other estimates associated with such contracts. Our audit approach was a combination of test of internal controls and substantive procedures which included the following: ⢠we evaluated the design of internal controls relating to recording of costs incurred and estimate of costs required to complete the performance obligations. ⢠we tested the access and application controls pertaining to time recording, allocation and budgeting systems which prevents unauthorised changes to recording of costs incurred. ⢠we selected a sample of contracts and tested the operating effectiveness of the internal controls relating to costs incurred and estimate of costs, through the inspection of performance of these controls. ⢠we selected a sample of contracts and performed a retrospective review of costs incurred with estimate of costs to identify significant variations and verify whether those variations have been considered in estimating the future costs required to complete the contract. |
⢠we reviewed a sample of contracts with unbilled revenue to identify possible delays in achieving milestones, which require change in estimated costs to complete the remaining performance obligations. ⢠we performed analytical procedures and test of details for reasonableness of incurred and estimated costs. |
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Key Audit Matter |
Auditor''s Response |
B. Transactions with Related Parties |
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The company has material related party transactions during the year. Related party transactions impose limitations on the auditorâs ability to obtain audit evidence that all other aspects of related party transactions (other than price) are equivalent to those of a similar armâs length transaction. Further the nature and complexity of such transactions and the involvement of management with respect to the roles and responsibilities of the entities involved in the transactions, makes it subjective. |
Our audit procedures on transactions with related parties included the following: ⢠we obtained a comfort letter issued by the independent professional who is in charge of Transfer Pricing matters of the Company which states that the transactions are conducted at armâs length price. ⢠we also reviewed the income tax assessments of earlier years to corroborate whether the methodology adopted by the Company has been accepted by the income tax authorities in previous years. ⢠we also compared the pricing model and other terms of the current agreements with agreements of the previous years. |
The Companyâs management and Board of Directors are responsible for the other information. The other information comprises the information included in the Companyâs Annual Report, but does not include the standalone financial statements and our Auditorsâ Report thereon. Our opinion on the standalone 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 financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our 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.
The Companyâs Management and Board of Directors are responsible for the matters stated in Section 134(5) of Act with respect to the preparation and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including Accounting Standards specified under Section 133 of the Act (âInd AS"). 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 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 financial statements, management and Board of Directors are responsible for assessing the Companyâs 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.
The management and Board of Directors are responsible for overseeing the Companyâs financial reporting process.
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs 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 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 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 financial control relevant to the audit in order to design audit procedures that are appropriate in 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 managementâs 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 Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the standalone 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 auditorâs 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 financial statements, including the disclosures, and whether the standalone 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 financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditorâs 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.
1. Attention is drawn to Note No. 42 to the standalone financial statements; the Company has an investment of Rs. 646.52 million in two wholly owned subsidiaries and has also extended loans and advances of Rs. 0.05 million to these subsidiaries as on March 31, 2021. The total net worth of these subsidiaries as on March 31, 2021 is Rs. 509.11 million which is lower than the amount of investment. The investment is for long term and of strategic nature. As the management is confident of turning around these subsidiaries in the near future hence, no provision for diminution in the value of investment has been considered necessary by the management.
Our opinion is not modified in respect of this matter.
2. We draw attention to note 51 of the standalone financial statements, regarding the approval of Scheme of Amalgamation between the Company and its wholly owned subsidiary company, Datamatics Digital Limited, by the National Company Law Tribunal (âNCLT"), vide NCLTâs order dated November 6, 2020, with appointed date of June 1, 2019. A certified copy of the order sanctioning the Scheme has been filed by the Company with the Registrar of the Companies, Mumbai, on December 7 2020 Accordingly, the audited standalone financial statements for the year ended March 31, 2020, have been restated by the Company after recognising the effect of the merger from the appointed date as stated in the aforesaid note.
Our opinion is not modified in respect of this matter Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2016 (âthe 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 paragraphs 3 and 4 of the Order, to the extent applicable.
2. As required by Section 143(3) of the Act, based on our audit 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 relating to preparation of the aforesaid standalone financial statements have been kept by the Company so far as it appears from our examination of those books.
(c) The Standalone Balance Sheet, the Standalone Statement of Profit and Loss including Other Comprehensive Income, Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flow dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 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 March 31, 2021 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2021 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 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 Auditorâs 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 disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Note No.
44 to the standalone financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses; and
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
(h) With respect to the other matters to be included in the Auditorâs Report in accordance with the requirements of section 197(16) of the Act, as amended:
In our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under section 197(16) which are required to be commented upon by us.
Chartered Accountants FRN: 101484W/W100197
Partner
Membership No. 109931 UDIN: 21109931AAAABU4097
Place: Mumbai Date: May 26, 2021
Mar 31, 2018
Report on the Standalone Ind AS Financial Statements
We have audited accompanying Standalone Ind AS financial statements of DATAMATICS GLOBAL SERVICES LIMITED (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018 and the Statement of Profit and Loss (including other comprehensive income) and Cash Flow Statement and the statement for changes in equity for the year then ended, and a summary of significant accounting policies and other explanatory information (hereinafter referred to as âStandalone Ind AS financial statementsâ).
Managementâs Responsibility for the Standalone Ind AS Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of Companies Act, 2013 (âthe Actâ) with respect to the preparation and presentation 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 relevant rules issued thereunder.
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.
Auditorâs Responsibility
Our responsibility is to express an opinion on these Standalone Ind AS 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 thereunder.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards and pronouncements 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 the disclosures in the Standalone Ind AS financial statements. The procedures selected depend on the auditorâs judgment, 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 Companyâs 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 the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs 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
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 (financial position) as at March 31, 2018, and its financial performance including other comprehensive income, its cash flow and the changes in equity for the year ended on that date.
Emphasis of matter
Attention is drawn to Note No. 37 the Company has an investment of Rs. 646.30 million in two wholly owned subsidiaries and has also extended loans and advances of Rs. 10.94 million to these subsidiaries as on March 31, 2018. The net worth of these subsidiaries has declined. We are given to understand that, these investments are for long term and of strategic matter and the management is confident of turning around the subsidiaries in the near future. In view of this, we are unable to comment on whether provision if any, for the diminution in the value of investments is required to be made. Our opinion is not modified in respect of this matter.
Other Matter
The comparative financial information of the Company for the year ended March 31, 2017 and the transition date opening balance sheet as at April 1, 2016 included in these Standalone Ind AS financial statements, are based on the previously issued statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006. For the year ended March 31, 2017 and March 31, 2016 on which the predecessor auditor expressed an unmodified opinion vide audit report dated May 23, 2017 and May 27, 2016 respectively on those Standalone Ind As financial statements, as adjusted for the differences in the accounting principles adopted by the Company on transition to the Ind AS, which have been audited by us. Our opinion is not modified in respect of this matter.
Report on other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ) 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 paragraphs 3 and 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 of the aforesaid Standalone Ind As financial statements.
b) In our opinion, proper books of account as required by law relating to preparation of the aforesaid Standalone Ind As financial statements 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 (including Other Comprehensive Income), Cash Flow Statement and the statement of changes in equity dealt with by this report are in agreement with the books of account maintained for the purpose of preparation of the Standalone Ind As financial statements.
d) In our opinion, the aforesaid Standalone Ind AS financial statements comply with the Accounting Standards specified under Section 133 of Companies Act, 2013, read with rule 7 of the Companies (Accounts) Rules, 2014.
e) On the basis of the written representations received from the directors, as on March 31, 2018 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164(2) of the Companies Act, 2013.
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 âAnnexure Bâ; and
g) With respect to the other matters to be included in the Auditorâs 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 Standalone Ind AS Financial Statements (Refer Note No. 40 to the standalone Ind AS financial statement).
ii. The Company did not have any material foreseeable losses on long-Term contracts including derivatives contracts as at March 31, 2018.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the company.
iv. The reporting on disclosures relating to Specified Bank Notes is not applicable to the Company for the year ended March 31, 2018.
Referred to in paragraph 1 of âReport on other Legal and Regulatory Requirementsâ in our Report of even date on the accounts of DATAMATICS GLOBAL SERVICE LIMITED for the year ended March 31, 2018
i. (a) The Company is generally maintaining proper records showing full particulars including quantitative details and situation of fixed assets.
(b) The fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanation given to us, no material discrepancies were noticed on such verification.
(c) According to information and explanations 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.
ii. The Companyâs nature of operations does not require it to hold inventories. Consequently, clause 3(ii) of the order is not applicable.
iii. The Company has not granted loans, secured or unsecured, to companies, firms, limited liability partnerships or other parties covered in the register maintained under Section 189 of the Act. Hence sub clauses (a) to (c) of clause 3(iii) are not applicable to the Company.
iv. According to information and explanation provided to us in respect of loans, investments, guarantees and securities, the company has complied with the provisions of Section 185 and 186 of the companies Act, 2013.
v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the rules framed there under to the extent notified and therefore clause 3(v) is not applicable.
vi. The Central Government has not prescribed maintenance of cost records under sub section (1) of section 148 of the Companies Act, 2013, for any of the products of the company.
vii. (a) According to the information and explanation given to us and the records of the Company examined by us, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employeesâ state insurance, income tax, sales tax, service tax, duty of custom, duty of excise duty, value added tax, cess, Goods & Service Tax and any other material statutory dues applicable to it. According to the information and explanations given to us, no undisputed arrears of statutory dues except the following mentioned below were outstanding as at March 31, 2018 for a period of more than six months from the date they became payable.
(b) According to the information and explanation given to us and the records of the Company examined by us, there are no dues of Value Added Tax, Sales Tax, Excise Duty and Customs Duty which have not been deposited on account of any dispute. The disputed amounts that have not been deposited in respect of Income Tax and Service Tax are as under:
Sr. No. |
Name of the Statute |
Nature of the dues |
Financial Year to which it relates |
Forum where the dues is pending |
Rs. in million |
1. |
Income Tax, 1961 |
Income Tax Dues |
2011-12 |
Assistant Commissioner of Income Tax |
17.74 |
viii. According to the records of the Company examined by us and information and explanation given to us, the Company has not defaulted in repayment of dues to banks during the year. The company has not taken any loan or borrowing from government, financial institution, and has not issued debentures during the year.
ix. The Company has not raised any money by way of public issue/ further offer (including debt instruments). The money raised on term loans have been applied for the purpose for which it was raised.
x. To the best of our knowledge and according to the information and explanation given to us, no fraud by the Company and no fraud on the Company by its officers or employees has been noticed or reported during the year.
xi. In our opinion and according to the information and explanations given to us, the managerial remuneration has been paid or 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 and according to the information and explanations given to us, the nature of the activities of the company does not attract any special statue applicable to Nidhi Company. Accordingly, clause 3(xii) of the order is not applicable to the company.
xiii. According to the information and explanation given to us, and based on our examination of the records of the Company, transactions with the related parties are in compliance with Sec 177 and 188 of Companies Act, 2013 where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.
xiv. In our opinion and 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 or private placement of shares or fully or partly convertible debentures during the year. Accordingly, 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, 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 him. Accordingly, clause 3 (xv) of the Order is not applicable to the Company.
xvi. The company is not required to be registered under Sec 45-IA of the Reserve Bank of India Act, 1934. Accordingly, clause 3 (xvi) of the Order is not applicable to the Company.
Report on the Internal Financial Controls under Clause (i) of Sub-Section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of DATAMATICS GLOBAL SERVICES LIMITED (âthe Companyâ) as of 31 March 2018 in conjunction with our audit of the Standalone Ind AS financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Companyâs Board of Directors are 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 (âICAIâ). 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 Companyâs 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 Companies Act, 2013.
Auditorsâ Responsibility
Our responsibility is to express an opinion on the Companyâs 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 âGuidance Noteâ) 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, 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 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 auditorâs judgment, including the assessment of the risks of material misstatement of the Standalone Ind AS 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 Companyâs internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A Companyâs 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 Companyâs 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 Companyâs 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, to the best of our information and according to the explanations given to us, 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 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.
For M L Bhuwania and Co. LLP
Chartered Accountants
Firm Registration Number: 101484W / W100197
Ashishkumar Bairagra
Partner
Membership No: 109931
Place: Mumbai
Date: May 29, 2018
Mar 31, 2015
We have audited the accompanying standalone financial statements of
DATAMATICS GLOBAL SERVICES LIMITED (formerly known as DATAMATICS
TECHNOLOGIES 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 Standalone Financial Statements
The Company's Board of Directors are responsible for the matters
stated in Section 134(5) of Companies Act, 2013 ("the Act") with
respect to 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 Standards specified under section 133 of the Act, read with
Rule 7 of the Companies (Accounts) 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.
Auditor's Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit. We conducted our audit in
accordance with the provisions of the Act, the Accounting and Auditing
standards and the 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 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 financial control relevant
to the Company's preparation of the financial statements that give a
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 controls 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 Company's 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 standalone
financial statements.
Opinion
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:
a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31,2015;
b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
c) in the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
Emphasis of Matter
With reference to note number 41 to the financial statements regarding
the Company's investments aggregating Rs. 995,976,964 in five of its
wholly owned subsidiaries and loans and advances aggregating Rs.
323,408,544 to these subsidiaries, net worth has declined and two of
these have incurred losses. As explained in the said note, these
investments are for long term and of strategic nature. Accordingly,
the said investments and loans and advances are considered good and
recoverable by the Company. In view of this, we are unable to comment
on whether provision, if any, for the diminution in the value of
investments is required to be made. Our opinion is not qualified in
respect of this matter.
Report on other Legal and Regulatory Requirements
1. 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 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.
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, 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 standalone financial statements comply
with the Accounting Standards specified under section 133 ofthe Act,
read with rule 7 ofthe Companies (Accounts) Rules, 2014.
e) On the basis ofthe written representations received from the
directors, as on March 31,2015 and taken on record by the Board of
Directors, we report that 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 Act.
f) With respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 ofthe Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our knowledge and belief
and according to the information and explanations given to us. In our
opinion and to the best of our knowledge and belief and according to
the information and explanations given to us:
i) The Company has disclosed the impact of pending litigations on its
financial position in its standalone financial statements - Refer Note
26 to 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 has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.
Annexure to the Auditors' Report
Referred to in paragraph 1 of Report on other legal and regulatory
requirement of the Auditor's report of even date to the members of
DATAMATICS GLOBAL SERVICES LIMITED (formerly known as DATAMATICS
TECHNOLOGIES LIMITED) for the year ended March 31,2015;
1. In respect of the fixed assets of the Company:
(a) The Company has generally maintained proper records showing full
particulars including quantitative details and situation offixed
assets.
(b) As explained to us, all fixed assets have been physically verified
by the management at reasonable intervals during the year and no
material discrepancies were noticed on such verification.
2. The Company's nature of operations does not require it to hold
inventories. Consequently, clause 3(ii) of the order is not applicable.
3. As informed to us, the Company has not granted loans, secured or
unsecured, to companies, firms or other parties covered in the register
maintained under section 189 of the Act. Hence sub clauses (a) & (b) of
clause 3(iii) of the order are not applicable to the Company.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business with regard to purchase of fixed assets and with regard to the
sale of goods and services. During the course of our audit we have not
observed any continuing failure to correct major weaknesses in internal
control system.
5. In our opinion and according to the information and explanations
given to us, the Company has not accepted deposits during the year and
do not have any unclaimed deposits. Therefore, the provisions of the
clause 3(v) of the Order are not applicable to the Company. .
6. We have been informed that the Central Government has not prescribed
maintenance of cost records under section 148 (1) of the Act.
7. According to the information and explanations given and on the basis
of records produced before us:
(a) The Company is generally regular in depositing with appropriate
authorities 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 and other material statutory dues applicable to it.
According to the information and explanations given to us, no
undisputed arrears of statutory dues were outstanding as at March 31,
2015 for a period of more than six months from the date they became
payable.
(b) The disputed statutory dues aggregating Rs. 5,024,525/- pending
before the appropriate authorities are as under:
Name of the Statute Nature of the dues Forum where the dues is pending
Sales Tax Act Sales Tax Asst.Commissionar of Sales Tax
Name of the Statute Amount in Rs
Sales Tax Act 5,024,525
Total 5,024,525
8. The Company does not have any accumulated losses at the end of the
financial year. The Company has not incurred cash losses in the current
financial year and in the immediately preceding financial year.
9. In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to a
financial institution, bank or debenture holders.
10. In our opinion and according to the information and explanations
given to us, the terms and conditions on which the Company has given
guarantees for loans taken by its subsidiaries from banks are not prima
facie, prejudicial to the interest of the Company.
11. The term loans have been used for the purpose they were applied
for.
12. To the best of our knowledge and belief and according to the
information and explanations 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 Kanu Doshi Associates
Chartered Accountants
Firm Registration Number: 104746W
Jyoti Kawa
Partner
Membership No: 105654
Place : Mumbai
Date : May 27, 2015
Mar 31, 2014
We have audited accompanying financial statements of DATAMATICS GLOBAL
SERVICES LIMITED (formerly known as DATAMATICS TECHNOLOGIES LIMITED)
("the Company"), which comprise the Balance Sheet as at March
31,2014 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
Management is responsible for the preparation of these 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 Standards referred to in sub section (3C) of section 211
of the Companies Act, 1956 ("the Act") read with the General
Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate
Affairs in respect of section 133 of Companies Act, 2013. This
responsibility includes the design, implementation and maintenance of
internal control 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.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. 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 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 the management, 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.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the 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:
a. in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2014;
b. in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
c. in the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
Emphasis of Matter
With reference to note number 42 to the financial statements regarding
the Company''s investments aggregating Rs. 995,121,964 in four of its
wholly owned subsidiaries and loans and advances aggregating Rs.
197,108,961 to these subsidiaries which have incurred losses and net
worth has declined. As explained in the said note, these investments
are for long term and of strategic nature. Accordingly, the said
investments and loans and advances are considered good and recoverable
by the Company. In view of this, we are unable to comment on whether
provision, if any, for the diminution in the value of investments is
required to be made. Our opinion is not qualified in respect of this
matter.
Report on other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003,("the
order") as amended by the Companies (Auditor''s Report) (Amendment)
Order, 2004, issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
2. As required by section 227(3) of the Act, 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 Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement comply with the Accounting Standards referred to in
sub-section (3C) of Section 211 of the Companies Act, 1956 read with
the General Circular 15/2013 dated 13th September 2013 of the Ministry
of Corporate Affairs in respect of section 133 of Companies Act, 2013.
e) On the basis of the written representations received from the
directors, as on March 31, 2014 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
March 31, 2014 from being appointed as a director in terms of clause
(g) of sub-section (1) of Section 274 of the Companies Act, 1956.
ANNEXURE TO THE AUDITORS'' REPORT Referred to in paragraph 1 of Report
on other legal and regulatory requirement of the Auditor''s report of
even date to the members of DATAMATICS GLOBAL SERVICES LIMITED
(formerly known as DATAMATICS TECHNOLOGIES LIMITED) for the year ended
March 31, 2014;
i. (a) The Company has generally maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
(b) As explained to us, all fixed assets have been physically verified
by the management at reasonable intervals during the year and no
material discrepancies were noticed on such verification.
(c) During the year, the Company has executed Business Transfer
Agreement with its wholly owned subsidiary i.e. Datamatics eRetail
Pulbilshing Limited ("DERPL") and accordingly transferred its
digital publishing and e-Retail business segment having net written
down value of fixed assets and capital WIP of Rs. 91,497,927 as on
November 30, 2013 on a slump sale basis. Further, with effect from
January 1, 2014 DERPL has been merged with Lexicon Publishing Services
Private Limited (LPSPL). The fixed assets transferred during the year
were not substantial and in result forms part of the Group, and
therefore, do not affect the going concern assumption.
ii. The Company''s nature of operations does not require it to hold
inventories. Consequently, clause 4(ii) of the order is not applicable.
iii. As informed to us, the Company has neither granted nor taken any
loans, secured or unsecured, to / from companies, firms or other
parties covered in the register maintained under section 301 of the
Companies Act, 1956. Hence clauses (iii) (a) to (iii) (g) of paragraph
4 of the order are not applicable to the Company.
iv. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business with regard to purchase of fixed assets and with regard to the
sale of goods and services. During the course of our audit we have not
observed any continuing failure to correct major weaknesses in internal
control system.
v. (a) In our opinion and according to the information and explanation
given to us, the particulars of contract or arrangements referred to in
Section 301 of the Act, have been entered in the register required to
be maintained under that Section.
(b) where each such transaction is in excess of rupees five lakhs in
respect of each party, the transactions have been made at prices which
are prima facie reasonable having regard to the prevailing market
prices at the relevant time.
vi. During the year, the Company has not accepted any deposits from the
public. As such, the compliance with directives issued by the Reserve
Bank of India and the provisions of section 58A, 58AA of the Companies
Act, 1956 and the rules framed there under are not applicable.
vii. In our opinion, the internal audit functions carried out during
the year by a firm of Chartered Accountants appointed by the management
have been commensurate with the size of the Company and nature of its
business.
viii. We have been informed that the Central Government has not
prescribed maintenance of cost records under section 209 (1) (d) of the
Companies Act, 1956.
ix. (a) According to the information and explanations given and on the
basis of records produced before us, the Company is generally regular
in depositing with appropriate authorities 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 and other material statutory dues
applicable to it. According to the information and explanations given
to us, no undisputed arrears of statutory dues were outstanding as at
March 31, 2014 for a period of more than six months from the date they
became payable.
(b) The disputed statutory dues aggregating Rs. 23,637,346/- pending
before the appropriate authorities are as under:
Sr.
No. Name of the
Statute Nature of the dues Forum where
the dues is
pending Amount in Rs.
1 Income Tax
Act, 1961 Tax Deducted At
Source Income Tax
Officer (TDS) 493,418
2 Sales Tax Act Sales Tax Ass. Commissioner of
Sales Tax 5,024,525
Total 5,517,943
x. The Company has no accumulated losses and has not incurred cash
losses in the current financial year and in the immediately preceding
financial year.
xi. In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to a
financial institution, bank or debenture holders.
xii. According to the information and explanations given to us, the
Company has not granted any loans or advances on the basis of security
by way of pledge of shares, debentures and other securities.
xiii. In our opinion, the provisions of any special statute applicable
to Chit Fund, Nidhi or Mutual Benefit Fund / Societies are not
applicable to the Company.
xiv. According to the information and explanations given to us, the
Company has maintained proper records of transactions and contracts in
respect of dealing and trading in shares, securities, debentures and
other investment and timely entries have generally been made therein.
All shares, securities, debentures and other investments have been held
by the Company in its own name.
xv. I n our opinion and according to the information and explanations
given to us, the terms and conditions on which the Company has given
guarantees for loans taken by its subsidiaries from banks are not prima
facie, prejudicial to the interest of the Company.
xvi. The term loans have been used for the purpose they were applied
for.
xvii. On the basis of an overall examination of the Balance Sheet of
the Company and according to the information and explanations given to
us, in our opinion there are no funds raised on short-term basis, which
have been used for long-term investment.
xviii. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under section
301 of the Companies Act, 1956 during the year.
xix. The Company has not issued debentures during the financial year
and hence, the question of creating securities in respect thereof does
not arise.
xx. During the year, the company has not raised any money through
Public Issue. Hence the clause 4(xx) of the order is not applicable.
xxi. On the basis of our examination and according to the information
and explanation given to us, no fraud, on or by the Company, has been
noticed or reported during the course of our audit.
For Kanu Doshi Associates
Chartered Accountants
Firm Registration Number: 104746W
Manoj Kumar Pati
Partner
Membership No: 504536
Place : Mumbai
Date : May 28, 2014
Mar 31, 2013
Report on the Financial Statements
We have audited accompanying fi nancial statements of DATAMATICS GLOBAL
SERVICES LIMITED (formerly known as DATAMATICS TECHNOLOGIES LIMITED)
("the Company"), which comprise the Balance Sheet as at March 31, 2013
and the Statement of Profi t and Loss and Cash Flow Statement for the
year then ended, and a summary of signifi cant accounting policies and
other explanatory information.
Management'' Responsibility for the Financial Statements
Management is responsible for the preparation of these fi nancial
statements that give a true and fair view of the fi nancial position,
fi nancial performance and cash fl ows of the Company in accordance
with the Accounting Standards referred to in sub section (3C) of
section 211 of the Companies Act, 1956 ("the Act"). This responsibility
includes the design, implementation and maintenance of internal control
relevant to the preparation and presentation of the fi nancial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these fi nancial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the fi nancial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the fi nancial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the fi nancial
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 fi nancial
statements 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 the management, as well as evaluating
the overall presentation of the fi nancial statements.
We believe that the audit evidence we have obtained is suffi cient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the fi nancial 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:
a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2013;
b) in the case of the Statement of Profi t and Loss, of the profi t for
the year ended on that date; and
c) in the case of Cash Flow Statement, of the cash fl ows for the year
ended on that date.
Emphasis of Matter
The Company has an investment of Rs. 997,376,964 in fi ve of its wholly
owned subsidiaries and has also extended loans and advances ofRs.
208,204,849 to these subsidiaries. As discussed in Note No. 42 of notes
forming part of the fi nancial statements, the net worth of these
subsidiaries has declined. These investments are for long term and of
strategic nature. In view of this, we are unable to comment on whether
provision, if any, for the diminution in the value of investments is
required to be made. Accordingly our opinion has not been qualifi ed.
Report on other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003,("the
order") as amended by the Companies (Auditor''s Report) (Amendment)
Order, 2004, issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Act, we give in the Annexure a
statement on the matters specifi ed in paragraphs 4 and 5 of the said
Order.
2. As required by section 227(3) of the Act, 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 Profi t and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
account.
d) In our opinion, the Balance Sheet, Statement of Profi t and Loss and
Cash Flow Statement comply with the Accounting Standards referred to in
sub-section (3C) of Section 211 of the Companies Act, 1956.
e) On the basis of the written representations received from the
directors, as on March 31, 2013 and taken on record by the Board of
Directors, we report that none of the directors is disqualifi ed as on
March 31, 2013 from being appointed as a director in terms of clause
(g) of sub-section (1) of Section 274 of the Companies Act, 1956.
ANNEXURE TO THE AUDITOR''S REPORT
(Referred to in paragraph 1 of Report on other legal and regulatory
requirement of the Auditor''s report of even date to the members of
DATAMATICS GLOBAL SERVICES LIMITED (formerly known as DATAMATICS
TECHNOLOGIES LIMITED) for the year ended March 31, 2013)
i. (a) The Company has generally maintained proper records showing full
particulars including quantitative details and situation of fi xed
assets.
(b) As explained to us, All Fixed assets have been physically verifi ed
by the management at reasonable intervals during the year and no
material discrepancies were noticed on such verifi cation.
(c) During the year, the Company has not disposed off a substantial
part of the fi xed assets.
ii. The Company''s nature of operations does not require it to hold
inventories. Consequently, clause 4(ii) of the order is not applicable
iii. As informed to us, the Company has neither granted nor taken any
loans, secured or unsecured, to/from companies, fi rms or other parties
covered in the register maintained under section 301 of the Companies
Act, 1956. Hence clauses (iii) (a) to (iii) (g) of paragraph 4 of the
order are not applicable to the Company.
iv In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business with regard to purchase of inventory, fi xed assets and with
regard to the sale of goods and services. During the course of our
audit we have not observed any continuing failure to correct major
weaknesses in internal control system.
v. (a) In our opinion and according to the information and explanations
given to us, the particulars of contracts or arrangements referred to
in Section 301 of the Act, have been entered in the register required
to be maintained under that section.
(b) Where each such transaction is in excess of rupees fi ve lakhs in
respect of each party, the transactions have been made at prices which
are prima facie reasonable having regard to the prevailing market
prices at the relevant time
vi. During the year, the Company has not accepted any deposits from the
public. As such, the compliance with directives issued by the Reserve
Bank of India and the provisions of section 58A, 58AA of the Companies
Act, 1956 and the rules framed there under are not applicable.
vii. In our opinion, the internal audit functions carried out during
the year by a fi rm of Chartered Accountants appointed by the
management have been commensurate with the size of the Company and
nature of its business.
viii. We have been informed that the Central Government has not
prescribed maintenance of cost records under section 209 (1) (d) of the
Companies Act, 1956.
ix. (a) According to the information and explanations given to us and
on the basis of records produced before us, the Company is generally
regular in depositing with appropriate authorities 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 and other material statutory dues
applicable to it. According to the information and explanations given
to us, no undisputed arrears of statutory dues were outstanding as at
March 31, 2013 for a period of more than six months from the date they
became payable.
x. The Company has no accumulated losses and has not incurred cash
losses in the current fi nancial year and in the immediately preceding
fi nancial year.
xi. In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to a fi
nancial institution, bank or debenture holders.
xii. According to the information and explanations given to us, the
Company has not granted any loans or advances on the basis of security
by way of pledge of shares, debentures and other securities.
xiii. In our opinion, the provisions of any special statute applicable
to Chit Fund, Nidhi or Mutual Benefi t Fund/Societies are not
applicable to the Company.
xiv. According to the information and explanations given to us, the
Company has maintained proper records of transactions and contracts in
respect of dealing and trading in shares, securities, debentures and
other investment and timely entries have generally been made therein.
All shares, securities, debentures and other investment have been held
by the Company in its own name except in respect of investments made
under the Portfolio Management Scheme (PMS) as disclosed in Note No. 41
of accompanying notes to the fi nancial statements aggregating to Rs.
623,646. Further, the investments made under PMS by Reliance Capital
Asset Management Ltd. were in a pool account, therefore those
investments are not held by the Company in its own name.
xv. In our opinion and according to the information and explanations
given to us, the terms and conditions on which the Company has given
guarantees for loans taken by its subsidiaries from banks are not prima
facie, prejudicial to the interest of the Company.
xvi. The Company has not taken any term loan during the year.
xvii. On the basis of an overall examination of the Balance Sheet of
the Company and according to the information and explanations given to
us, in our opinion there are no funds raised on short-term basis, which
have been used for long-term investment.
xviii. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under section
301 of the Companies Act, 1956 during the year.
xix. The Company has not issued debentures during the fi nancial year
and hence, the question of creating securities in respect thereof does
not arise.
xx. During the year, the company has not raised any money through
Public Issue. Hence the clause 4(xx) of the order is not applicable.
xxi. On the basis of our examination and according to the information
and explanation given to us, no fraud, on or by the Company, has been
noticed or reported during the course of our audit.
For Kanu Doshi Associates
Chartered Accountants
Firm Registration Number: 104746W
Arati Parmar
Place : London Partner
Date : May 23, 2013 Membership No: 102888
Mar 31, 2012
1. We have audited the attached Balance Sheet of DATAMATICS GLOBAL
SERVICES LIMITED (formerly known as DATAMATICS TECHNOLOGIES LIMITED) as
at March 31, 2012, the Statement of Profit and Loss and also the Cash
Flow Statement for the year ended on that date annexed thereto. These
financial statements are the responsibility of the CompanyÃs
Management. Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (AuditorÃs Report) Order, 2003, as
amended by the Companies (AuditorÃs Report) (Amendment) Order, 2004,
issued by the Central Government of India in terms of sub-section (4A)
of section 227 of the Companies Act, 1956, according to the information
and explanations given to us during the course of the audit and on the
basis of such checks as we considered appropriate, we enclose in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of
the said Order.
4. Further to our comments in the Annexure referred to above, we
report that:
(i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
(ii) 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;
(iii) 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;
(iv) In our opinion, the Balance Sheet, the Statement of Profit and
Loss and the Cash Flow Statement dealt with by this report are in
compliance with the Accounting Standards referred to in sub-section
(3C) of Section 211 of the Companies Act, 1956;
(v) On the basis of written representations received from the
directors, as on March 31, 2012 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
March 31, 2012 from being appointed as a director in terms of clause
(g) of sub-section (1) of Section 274 of the Companies Act, 1956;
(vi) The Company has an investment of Rs. 928,338,219 in six of its
wholly owned subsidiaries and has also extended loans and advances of Rs.
196,919,433 to these subsidiaries. As discussed in Note No. 42 of notes
forming part of the financial statements, the net worth of these
subsidiaries has declined. These investments are for long term and of
strategic nature. In view of this, we are unable to comment on whether
provision, if any, for the diminution in the value of investments is
required to be made.
(vii) In our opinion and to the best of our information and according
to the explanations given to us, the said accounts, read together with
the Significant Accounting Policies and the Note No. (vi) above in
particular and the other notes thereon in general, give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2012;
(b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow statement, of the cash flows for the
year ended on that date.
Annexure to the Auditorsà Report (Referred to in paragraph 3 of our
Report of even date on the accounts of DATAMATICS GLOBAL SERVICES
LIMITED (formerly known as DATAMATICS TECHNOLOGIES LIMITED) for the
year ended March 31, 2012)
(i) (a) The Company has generally maintained proper records showing
full particulars including quantitative details and situation of fixed
assets.
(b) As explained to us, All Fixed assets have been physically verified
by the management at reasonable intervals during the year and no
material discrepancies were noticed on such verification.
(c) During the year, the Company has not disposed off a substantial
part of the fixed assets.
(ii) The CompanyÃs nature of operations does not require it to hold
inventories. Consequently, clause 4(ii) of the order is not applicable.
(iii) As informed to us, the Company has neither granted nor taken any
loans, secured or unsecured, to / from Companies, firms or other
parties covered in the register maintained under section 301 of the
Companies Act, 1956. Hence clauses (iii) (a) to (iii) (g) of paragraph
4 of the order are not applicable to the Company.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business with regard to purchase of inventory, fixed assets and with
regard to the sale of goods and services. During the course of our
audit we have not observed any continuing failure to correct major
weaknesses in internal control system
(v) (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act, have been entered in the
register required to be maintained under that section.
(b) There was no transaction exceeding the value of five lakhs rupees
in respect of any party covered in the relevant register.
(vi) During the year, the Company has not accepted any deposits from
the public. As such, the compliance with directives issued by the
Reserve Bank of India and the provisions of section 58A, 58AA of the
Companies Act, 1956 and the rules framed there under are not
applicable.
(vii) In our opinion, the internal audit functions carried out during
the year by a firm of Chartered Accountants appointed by the management
have been commensurate with the size of the Company and nature of its
business.
(viii) We have been informed that the Central Government has not
prescribed maintenance of cost records under section 209 (1) (d) of the
Companies Act, 1956.
(ix) (a) According to the information and explanations given to us and
on the basis of records produced before us, the Company is generally
regular in depositing with appropriate authorities undisputed statutory
dues including provident fund, employeesà state insurance, income tax,
sales tax, wealth tax, service tax, custom duty, excise duty, cess and
other material statutory dues applicable to it. According to the
information and explanations given to us, no undisputed arrears of
statutory dues were outstanding as at March 31, 2012 for a period of
more than six months from the date they became payable.
(b) The disputed statutory dues aggregating Rs. 26,013,996 pending before
the appropriate authorities are as under:
Sr.
No. Name of the
Statute Nature of
the dues Forum where the Amount
dues is pending in Rs.
1 Income Tax
Act, 1961 Income Tax Commissioner of 570,185
Income Tax (Appeals)
2 Income Tax
Act, 1961 Income Tax Income Tax Appellant 1,872,539
Tribunal (Appeals)
3 Income Tax
Act, 1961 Tax Deducted
At Source Income Tax Officer (TDS) 18,496,747
4 Sales Tax
Act Sales Tax Ass. Commissioner of
Sales Tax 5,074,525
Total 26,013,996
(x) The Company has no accumulated losses and has not incurred cash
losses in the current financial year and in the immediately preceding
financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to a
financial institution, bank or debenture holders.
(xii) According to the information and explanations given to us, the
Company has not granted any loans or advances on the basis of security
by way of pledge of shares, debentures and other securities.
(xiii) In our opinion, the provisions of any special statute applicable
to Chit Fund, Nidhi or Mutual Benefit Fund / Societies are not
applicable to the Company.
(xiv) According to the information and explanations given to us, the
Company has maintained proper records of transactions and contracts in
respect of dealing and trading in shares, securities, debentures and
other investment and timely entries have generally been made therein.
All shares, securities, debentures and other investment have been held
by the Company in its own name except in respect of investments made
under the Portfolio Management Scheme (PMS) as disclosed in Note No. 41
of notes forming part of the financial statements aggregating to Rs.
623,646. Further, the investments made under PMS by Reliance Capital
Asset Management Ltd. were in a pool account, therefore those
investments are not held by the Company in its own name.
(xv) According to the information and explanations given to us and the
record examined by us, the Company has not given any guarantee for
loans taken by others from banks or financial institutions.
(xvi) The Company has not taken any term loan during the year.
(xvii) On the basis of an overall examination of the Balance Sheet of
the Company and according to the information and explanations given to
us, in our opinion there are no funds raised on short-term basis, which
have been used for long-term investment.
(xviii) The Company has not made any preferential allotment of shares
to parties and companies covered in the register maintained under
section 301 of the Companies Act, 1956 during the year.
(xix) The Company has not issued debentures during the financial year
and hence, the question of creating securities in respect thereof does
not arise.
(xx) We have verified the end use of money raised by public issue as
disclosed by the Management in Note no. 45 of the notes forming part of
the financial statements.
(xxi) On the basis of our examination and according to the information
and explanation given to us, no fraud, on or by the Company, has been
noticed or reported during the course of our audit.
For Kanu Doshi Associates
Chartered Accountants
Firm Registration No.: 104746W
Place:Mumbai Arati Parmar
Date :May 30, 2012 Partner
Membership No.: 102888
Mar 31, 2011
1. We have audited the attached Balance Sheet of DATAMATICS GLOBAL
SERVICES LIMITED (formerly known as DATAMATICS TECHNOLOGIES LIMITED) as
at March 31, 2011, the Profit and Loss Account and also the Cash Flow
Statement for the year ended on that date annexed thereto. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India.Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditor's Report) Order, 2003, as
amended by the Companies (Auditor's Report) (Amendment) Order, 2004,
issued by the Central Government of India in terms of sub-section (4A)
of Section 227 of the Companies Act, 1956, according to the information
and explanations given to us during the course of the audit and on the
basis of such checks as we considered appropriate, we enclose in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of
the said Order.
4. Further to our comments in the Annexure referred to above, we
report that:
(i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
(ii) 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;
(iii) The Balance Sheet, Profit and Loss Account and Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
(iv) In our opinion, the Balance Sheet, the Profit and Loss Account and
the Cash Flow Statement dealt with by this report are in compliance
with the Accounting Standards referred to in sub-section (3C) of
Section 211 of the Companies Act, 1956.
(v) On the basis of written representations received from the
directors, as on March 31,2011 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
March 31,2011 from being appointed as a director in terms of clause (g)
of sub-section (1) of Section 274 of the Companies Act, 1956;
(vi) The Company has an investment of Rs 812,412,594 in seven of its
wholly owned subsidiaries and has also extended loans and advances ofRs
101,714,678 to these subsidiaries. As discussed in Note No. 19 of
Schedule'O', the net worth of these subsidiaries has declined. These
investments are for long term and of strategic nature. In view of this,
we are unable to comment on whether provision, if any, for the
diminution in the value of investments is required to be made.
(vii) In our opinion and to the best of our information and according
to the explanations given to us, the said accounts, read together with
the Significant Accounting Policies and the Note No. (vi) above in
particular and the other notes thereon in general, give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31,2011;
(b) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(c) in the case of the Cash Flow statement, of the cash flows for the
year ended on that date.
AUDITORS' REPORT I 49
ANNEXURE TO THE AUDITOR'S REPORT
(Referred to in paragraph 3 of our Report of even date on the accounts
of DATAMATICS GLOBAL SERVICES LIMITED (formerly known as DATAMATICS
TECHNOLOGIES LIMITED) for the year ended March 31,2011)
(i) (a) The Company has generally maintained proper records showing
full particulars including quantitative details and
situation of fixed assets.
(b) As explained to us, All Fixed assets have been physically verified
by the management at reasonable intervals during the year and no
material discrepancies were noticed on such verification.
(c) During the year, the Company has not disposed off a substantial
part of the fixed assets.
(ii) The Company's nature of operations does not require it to hold
inventories. Consequently, clause 4(ii) of the order is not applicable.
(iii) As informed to us, the Company has neither granted nor taken any
loans, secured or unsecured, to/from companies, firms or other parties
covered in the register maintained under Section 301 of the Companies
Act, 1956. Hence clauses (iii) (a) to (iii) (g) of paragraph 4 of the
order are not applicable to the Company.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business with regard to purchase of inventory, fixed assets and with
regard to the sale of goods and services. During the course of our
audit we have not observed any continuing failure to correct major
weaknesses in internal control system.
(v) (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act, have been entered in the
register required to be maintained under that section.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five lakhs in respect of
each party during the year have been made at prices which are
reasonable having regard to the prevailing market prices at relevant
time.
(vi) During the year, the Company has not accepted any deposits from
the public. As such, the compliance with directives issued by the
Reserve Bank of India and the provisions of Section 58A, 58AA of the
Companies Act, 1956 and the rules framed there under are not
applicable.
(vii) In our opinion, the internal audit functions carried out during
the year by a firm of Chartered Accountants appointed by the management
have been commensurate with the size of the Company and nature of its
business.
(viii) We have been informed that the Central Government has not
prescribed maintenance of cost records under Section 209 (1) (d) of the
Companies Act, 1956.
(ix) (a) According to the information and explanations given to us and
on the basis of records produced before us,the Company is generally
regular in depositing with appropriate authorities undisputed statutory
dues including provident fund, employees'state insurance, income tax,
sales tax, wealth tax, service tax, custom duty,excise duty,cess and
other material statutory dues applicable to it. According to the
information and explanations given to us, no undisputed arrears of
statutory dues were outstanding as at March 31,2011 for a period of
more than six months from the date they became payable.
(b) The disputed statutory dues aggregating Rs 20,679,214 pending before
the appropriate authorities are as under:
Sr.
No. Name of the Statute Nature of
the dues Forum where
the dispute is Amount in Rs
pending
1 Income Tax Act, 1961 IncomeTax Deputy
Commissioner of 1,538,878
income tax
(Appeals)
2 IncomeTax Act, 1961 IncomeTax Commissioner of
Income tax 575,540
(Appeals)
3 IncomeTax Act, 1961 IncomeTax Income tax
Appellant
tribunal 2,642,551
(Appeals)
4 Income Tax Act, 1961 Tax Deducted
at Source IncomeTax
Officer (TDS) 10,847,720
5 Sales Tax Act Sales Tax Asst.
Commissioner of
sales Tax 5,074,525
Total 20,679,214
(x) The Company has no accumulated losses and has not incurred cash
losses in the current financial year and in the immediately preceding
financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to a
financial institution, bank or debenture holders.
(xii) According to the information and explanations given to us, the
Company has not granted any loans or advances on the basis of security
by way of pledge of shares, debentures and other securities.
(xiii) In our opinion, the provisions of any special statute applicable
to Chit Fund, Nidhi or Mutual Benefit Fund/Societies are not applicable
to the Company.
(xiv) According to the information and explanations given to us, the
Company has maintained proper records of transactions and contracts in
respect of dealing and trading in shares, securities, debentures and
other investment and timely entries have generally been made therein.
All shares, securities, debentures and other investment have been held
by the Company in its own name except in respect of investments made
under the Portfolio Management Scheme (PMS) as disclosed in Note No. 18
of Schedule'0'of the accounts aggregating toRs 6,23,646. Further, the
investments made under PMS by Reliance Capital Asset Management Ltd.
were in a pool account, therefore those investments are not held by the
Company in its own name.
(xv) According to the information and explanations given to us and the
record examined by us, the Company has not given any guarantee for
loans taken by others from banks or financial institutions.
(xvi) The Company has not taken any term loan during the year.
(xvii) On the basis of an overall examination of the Balance Sheet of
the Company and according to the information and explanations given to
us, in our opinion there are no funds raised on short-term basis, which
have been used for long-term investment.
(xviii) The Company has not made any preferential allotment of shares
to parties and companies covered in the register maintained under
Section 301 of the Companies Act, 1956 during the year.
(xix) The Company has not issued debentures during the financial year
and hence, the question of creating securities in respect thereof does
not arise.
(xx) We have verified the end use of money raised by public issue as
disclosed by the Management in Note No. 23 of Schedule '0' to the
Financial Statements.
(xxi) On the basis of our examination and according to the information
and explanation given to us, no fraud, on or by the Company, has been
noticed or reported during the course of our audit.
For Kanu Doshi Associates
Chartered Accountants
Firm Registration No.: 104746W
Arati Parmar
Place : Mumbai Partner
Date : 27th May,2011 Membership No.: 102888
Mar 31, 2010
1. We have audited the attached Balance Sheet of DATAMATICS GLOBAL
SERVICES LIMITED (formerly known as DATAMATICS TECHNOLOGIES LIMITED) as
at March 31, 2010, the Profit and Loss Account and also the Cash Flow
Statement for the year ended on that date annexed thereto. These
financial statements are the responsibility of the Companys
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003, as
amended by the Companies (Auditors Report) (Amendment) Order, 2004,
issued by the Central Government of India in terms of sub-section (4A)
of Section 227 of the Companies Act, 1956, according to the information
and explanations given to us during the course of the audit and on the
basis of such checks as we considered appropriate, we enclose in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of
the said Order.
4. Further to our comments in the Annexure referred to above, we
report that:
(i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
(ii) 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;
(iii) The Balance Sheet, Profit and Loss Account and Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
(iv) In our opinion, the Balance Sheet, Proft and Loss Account and Cash
Flow Statement dealt with by this report comply with the Companies
(Accounting Standards) Rules, 2006 and/or the accounting standards
referred to in sub-section (3C) of Section 211 of the Companies Act,
1956.
(v) On the basis of written representations received from the
directors, as on March 31, 2010 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
March 31, 2010 from being appointed as a director in terms of clause
(g) of sub-section (1) of Section 274 of the Companies Act, 1956;
(vi) The Company has an investment of Rs. 731,278,219 in six of its
wholly owned subsidiaries and has also extended loans and advances of
Rs. 139,592,553 to these subsidiaries. As discussed in Note No. 22 of
Schedule ÃO, the net worth of these subsidiaries has declined. These
investments are for long term and of strategic nature. In view of this,
we are unable to comment on whether provision, if any, for the
diminution in the value of investments is required to be made.
(vii) In our opinion and to the best of our information and according
to the explanations given to us, the said accounts, read together with
the Signifcant Accounting Policies and the Note No. (vi) above in
particular and the other notes thereon in general, give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2010;
(b) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(c) in the case of the Cash Flow statement, of the cash flows for the
year ended on that date.
ANNEXURE TO THE AUDITORS REPORT
(Referred to in paragraph 3 of our Report of even date on the accounts
of DATAMATICS GLOBAL SERVICES LIMITED (formerly known as DATAMATICS
TECHNOLOGIES LIMITED) for the year ended March 31, 2010)
(i) (a) The Company has generally maintained proper records showing
full particulars including quantitative details and situation of fixed
assets.
(b) As explained to us, All Fixed assets have been physically verified
by the management at reasonable intervals during the year and no
material discrepancies were noticed on such verification.
(c) During the year, the Company has not disposed off a substantial
part of its fixed assets.
(ii) The Companys nature of operations does not require it to hold
inventories. Consequently, clause 4(ii) of the order is not applicable.
(iii) As informed to us, the Company has neither granted nor taken any
loans, secured or unsecured, to/from companies, firms or other parties
covered in the register maintained under Section 301 of the Companies
Act, 1956. Hence clauses (iii) (a) to (iii) (g) of paragraph 4 of the
order are not applicable to the Company.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business with regard to purchase of inventory, fixed assets and with
regard to the sale of goods and services. During the course of our
audit we have not observed any continuing failure to correct major
weaknesses in internal control system
(v) (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act, have been entered in the
register required to be maintained under that section.
(b) There was no transaction exceeding the value of five lakhs rupees
in respect of any party covered in the relevant register.
(vi) During the year, the Company has not accepted any deposits from
the public. As such, the compliance with directives issued by the
Reserve Bank of India and the provisions of Section 58A, 58AA of the
Companies Act, 1956 and the rules framed thereunder are not applicable.
As per the information and explanation given to us, the Company has
complied with directives issued by the Reserve Bank of India and the
provisions of Section 58A, 58AA of the Companies Act, 1956 and the
rules framed thereunder with regard to the repayment of deposits during
the year.
(vii) In our opinion, the internal audit functions carried out during
the year by a firm of Chartered Accountants appointed by the management
have been commensurate with the size of the Company and nature of its
business.
(viii) We have been informed that the Central Government has not
prescribed maintenance of cost records under Section 209 (1)
(d) of the Companies Act, 1956.
(ix) (a) According to the information and explanations given to us and
on the basis of records produced before us, the Company is generally
regular in depositing with appropriate authorities undisputed statutory
dues including provident fund, employees state insurance, income tax,
sales tax, wealth tax, service tax, custom duty, excise duty, cess and
other material statutory dues applicable to it. According to the
information and explanations given to us, no undisputed arrears of
statutory dues were outstanding as at March 31, 2010 for a period of
more than six months from the date they became payable.
(b) The disputed statutory dues aggregating Rs. 60,30,769 pending
before the appropriate authorities are as under:
Sr.
No. Name of
the Statute Nature of
the dues Forum where the
dispute is Amount in Rs.
pending
1 Income Tax
Act, 1961 Income Tax Appellate Tribunal 78,362
2 Income Tax
Act, 1961 Income Tax Commissioner of
Income tax 25,35,405
(Appeals)
3 Income Tax
Act, 1961 Income Tax Deputy Commissioner 34,17,002
of Income Tax
Total 60,30,769
(x) The Company has no accumulated losses and has not incurred cash
losses in the current financial year and in the immediately
preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to a
financial institution, bank or debenture holders.
(xii) According to the information and explanations given to us, the
Company has not granted any loans or advances on the basis of security
by way of pledge of shares, debentures and other securities.
(xiii) In our opinion, the provisions of any special statute applicable
to Chit Fund, Nidhi or Mutual Benefit Fund/Societies are not applicable
to the Company.
(xiv) According to the information and explanations given to us, the
Company has maintained proper records of transactions and contracts in
respect of dealing and trading in shares, securities, debentures and
other investment and timely entries have generally been made therein.
All shares, securities, debentures and other investment have been held
by the Company in its own name except in respect of investments made
under the Portfolio Management Scheme (PMS) as disclosed in Note No. 21
of Schedule ÃO of the accounts aggregating to Rs. 7,219,372. Further,
the investments made under PMS by Reliance Capital Asset Management
Ltd. were in a pool account, therefore those investments are not held
by the Company in its own name.
(xv) According to the information and explanations given to us and the
record examined by us, the Company has not given any guarantee for
loans taken by others from banks or financial institutions.
(xvi) The Company has not taken any term loan during the year.
(xvii) On the basis of an overall examination of the Balance Sheet of
the Company and according to the information and explanations given to
us, in our opinion there are no funds raised on short-term basis, which
have been used for long-term investment.
(xviii) The Company has not made any preferential allotment of shares
to parties and companies covered in the register maintained under
Section 301 of the Companies Act, 1956 during the year.
(xix) The Company has not issued debentures during the financial year
and hence, the question of creating securities in respect thereof does
not arise.
(xx) We have verified the end use of money raised by public issue as
disclosed by the Management in Note No. 25 of Schedule ÃO to the
Financial Statements.
(xxi) On the basis of our examination and according to the information
and explanation given to us, no fraud, on or by the Company, has been
noticed or reported during the course of our audit.
For Kanu Doshi Associates
Chartered Accountants
Firm Registration No.: 104746W
Arati Parmar
Partner
Mem. No.: 102888
Place : Mumbai
Date : 25th May, 2010