We have audited the accompanying financial statements of CONTINENTAL SECURITIES LIMITED("the Company") which comprise the Balance Sheet as at March 31 2018theStatement of Profit and Loss the Cash Flow Statement for the year then ended and asummary of the significant accounting policies and other explanatory information.
The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31stMarch 2018 and its profit/loss and its cash flows for the year ended on that date.
1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the 'Annexure A' a statement on the matters specifiedin paragraphs 3 and 4 of the Order to the extent applicable.
e) On the basis of the written representations received from the directors as on 31stMarch 2018taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2018 from being appointed as a director in terms of Section164 (2) of the Act.
f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in 'Annexure B'.
For B.L DUSAD & CO.
The Annexure referred to in paragraph 1 of Our Report on "Other Legal andRegulatory Requirements".
a. The company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets.
b. As explained to us fixed assets have been physically verified by the management atreasonable intervals; no material discrepancies were noticed on such verification.
ii. In respect of loans secured or unsecured granted by the company to companiesfirms or other parties in the register maintained under section 189 of the companies Act.a. According to the information and explanations given to us the company has not grantedany loan to the parties listed in the register maintained under section 189 of the Act b.The company has also given advances in the nature of loans of its employees which arerecovered regularly together with interest if applicable as per company policy.
iii. In respect of loans investments guarantees and security provisions of section185 and 186 of the Companies Act 2013 have been complied with.
iv. The company has not accepted any deposits from the public covered under sections 73to 76 of the Companies Act 2013.
v. As per information & explanation given by the management maintenance of costrecords has not been specified by the Central Government under sub-section (1) of section148of the Companies Act 2013.
vi. a. According to the records of the company undisputed statutory dues includingProvident Fund Investor Education and Protection Fund Employees' State InsuranceIncome-tax Sales-tax Service Tax Custom Duty Excise Duty value added taxcess and anyother statutory dues to the extent applicable have generally been regularly depositedwith the appropriate authorities. According to the information and explanations given tous there were no outstanding statutory dues as on 31st of March 2018 for a period of morethan six months from the date they became payable.
b. According to the information and explanations given to us there is no amountpayable in respect of income tax service tax sales tax customs duty excise duty valueadded tax and cess whichever applicable which have not been deposited on account of anydisputes.
vii. In our opinion and according to the information and explanations given by themanagement we are of the opinion that the Company has not defaulted in repayment of duesto a financial institution bank Government or debenture holders as applicable to thecompany.
viii. Based on our audit procedures and according to the information given by themanagement the company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments) or taken any term loan during the year.
ix. According to the information and explanations given to us we report that no fraudby the company or any fraud on the Company by its officers or employees has been noticedor reported during the year.
x. According to the information and explanations given to uswe report that managerialremuneration has been paid in accordance with the requisite approvals mandated by theprovisions of section 197 read with Schedule V to the Companies Act.
xi. The company is not a Nidhi Company. Therefore clause xii) of the order is notapplicable to the company.
xii. According to the information and explanations given to usall transactions withthe related parties are in compliance with sections 177 and 188 of Companies Act 2013where applicable and the details have been disclosed in the Financial Statements etc. asrequired by the applicable accounting standards.
xiii. The company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review.
xiv. Company has not entered into non-cash transactions with directors or personsconnected with him and hence provisions of section 192 of the Act are not applicable.
xv. The company is required to be registered under section 45-IA of the Reserve Bank ofIndia Act 1934 and the registration has been obtained.
We have audited the internal financial controls over financial reporting of CONTINENTALSECURITIES LIMITED ("the Company") as of March 31 2018 in conjunction with ouraudit of the financial statements of the Company for the year ended on that date.
policies or procedures may deteriorate.
In our opinion on the achievement of the objectives of the control criteria theCompany has maintained in all material respects adequate internal financial controlsover financial reporting and such internal financial controls over financial reportingwere operating effectively as at March 31 2018 based on the internal control overfinancial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note. We have considered thematerial weaknesses identified and reported above in determining the nature timing andextent of audit tests applied in our audit of the March 31 2018 financial statements ofthe Company and these material weaknesses does not affect our opinion on the financialstatements of the Company.
REPORT ON COMPLIANCE WITH THE NON-BANKING FINANCIAL COMPANIES AUDITOR'S REPORT (RESERVEBANK) DIRECTIONS2008.
Pursuant to the Non-Banking Financial Companies Auditor's Report (Reserve Bank)Directions 2008(the "Directions"). We have examined the matters specified inthe Directions in respect of Continental Securities Limited (the "Company") forthe year ended March 312018.
The Management is responsible for the design and implementation of the internalprocedures systems processes and controls to ensure compliance with the Directions on anongoing basis. This responsibility also includes reporting non-compliances if any to theReserve Bank of India Board of the Company and its Audit Committee.
Our responsibility is to report on the matters specified in the Directions based on ouraudit. We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India(ICAI).Those Standards require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether there are any identified non-compliances. An audit involves performingprocedures to obtain audit evidence about the compliance with the Directions. Theprocedures selected depend on the Auditor's Judgment including the assessment of therisks of material misstatement of the information and records whether due to fraud orerror . In making those risk assessments the Auditor considers internal controls relevantto the Company's compliance with the Directions in order to design audit procedures thatare appropriate in the circumstances. We believe that the audit evidence we have obtainedis sufficient and appropriate to provide a basis for our certificate. We conducted ourexamination in accordance with the Guidance Note on Special Purpose Audit Reports andCertificates issued by the Institute of Chartered Accountants of India.
1. The Company is engaged in the Business of non-banking financial institution and hasobtained a Certificate Of Registration (COR) No. 10.00022 dated march 3 1998 from theReserve Bank Of India ("the Bank") Department of Non-Banking Supervision JaipurRegional Office.
2. The Company is entitled to continue to hold such COR in terms of its asset/incomepattern as on 31st March 2018.
3. The Company during the year is not an Asset Finance Company (AFC) as defined inNon-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions1998.
4. The Company during the year is not a Non-Banking Financial Company - Micro FinanceInstitutions (NBFC-MFI) as defined in Non-Banking Financial Company Micro FinanceInstitutions (Reserve Bank) Direction 2011 dated December 02 2011 (MFI Directions).
5. The Board of Directors has passed a resolution for non-acceptance of publicdeposits.
6. The Company has not accepted any public deposits during the year ended 31st March2018.
7. The Company has complied with the prudential norms relating to income recognition accounting standards asset classification and provisioning for bad and doubtful debts asapplicable to it in terms of Systematically Important Non-Banking Financial(Non-DepositAccepting or Holding) Companies Prudential Norms(Reserve Bank)Directions2015.
8. The annual statement of Capital funds risk assets/exposures and risk asset ratio(NBS-7) has been furnished to the Bank within the stipulated period based on theun-audited books of account. The Company had correctly arrived at and disclosed thecapital adequacy ratio based on the un-audited books of account in the return submittedto the Bank in Form NBS-7 and such ratio is in compliance with the minimum CRAR prescribedby the Bank.
This report is issued pursuant to our obligations under Non-Banking Financial CompaniesAuditor's Report (Reserve Bank) Directions 2008 to Reserve Bank of India and should notbe used by any other person or for any other purpose. B.L DUSAD & CO. neither acceptsnor assumes any duty or liability for any other purpose or to any other party to whom ourreport is shown or into whose hands it may come without our prior consent in written.
(i) a. The Company is in the process of compiling fixed assets records to show fullparticulars including quantitative details and situation of fixed assets.
b. We were informed that all major items of fixed assets were physically verified bythe management at the end of the year and that no discrepancy was notified on suchverification which on account of proper records being still under compilation could notbe verified.
ii. The Company has not granted any loans secured or unsecured to companies firms orother parties covered in the register maintained under section 189 of the CompaniesAct2013. Accordingly the clause 3(iii)(a) and 3 (iii)(b) of the Order are not applicableto the Company.
iii. a. In our opinion and according to information and explanation given to us; thereis adequate internal control system commensurate with the size of the Company and thenature of its business fixed assets and with regard to loans given. Further on the basisof our examination of books and records of the Company and according to the informationand explanations given to us we have not observed any continuing failure to correct majorweaknesses in the aforesaid internal control system.
iv. According to information and explanation given to us the central government hasnot prescribed maintenance of cast records under section (1) one of section 148 of thecompany's act 2013.
a. According to the information and explanation given to us the company has nodisputed outstanding statutory dues as at 31st march 2018.
b. According to the information and explanation given to us the amounts which werereacquired to be transferred to the investor Education and Protection fund and accordancewith the relevant provision of the company's Act 2013 and rules there under has beentransferred to such funds within time.
vi. The company does not have any accumulated losses at the end of the financial yearand has not incurred cash losses during the financial year end in the immediatelypreceding financial year.
viii. According to the information and explanation given to us the Company has notgiven any guarantee for loans taken by others from bank or financial intuitions during theyear.
ix. According to the information and explanation given to us the Company has appliedterm loans for the purpose for which the loans were obtained.
x. According to the information and explanation given to us no fraud on or by theCompany has been noticed or reported during the year review.