INDEPENDENT AUDITOR''S REPORT
To the Members of
NCC Limited
Report on the Standalone Ind AS financial statements
We have audited the accompanying standalone Ind AS financial statements of NCC Limited (the Company),
which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss (including Other
Comprehensive Income), Cash Flow Statement and the Statement of Changes in Equity for the year then ended,
and a summary of significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Ind AS financial statements
The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the
Companies Act, 2013 (the Act) with respect to the preparation of these standalone Ind AS financial statements
that give a true and fair view of the financial position, financial performance including other comprehensive
income, cash flows and changes in equity of the Company in accordance with accounting principles generally
accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act,
read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. This responsibility also
includes maintenance of adequate accounting records in accordance with the provisions of the Act for
safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities;
selection and application of appropriate accounting policies; making judgments and estimates that are
reasonable and prudent; and the design, implementation and maintenance of adequate internal financial control
that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant
to the preparation and presentation of the Ind AS financial statements that give a true and fair view and are
free from material misstatement, whether due to fraud or error.
Auditor''s Responsibility
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 there under. We conducted our audit of the standalone Ind AS financial statements in accordance with the
Standards on Auditing issued by the Institute of Chartered Accountants of India, as specified under Section
143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the
audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
standalone Ind AS financial statements. The procedures selected depend on the auditor''s 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 Company''s preparation of the standalone Ind AS financial statements that give a true and
fair view in order to design audit procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting
estimates made by the Company''s Directors, as well as evaluating the overall presentation of the standalone
Ind AS financial statements. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, and
based on the consideration of reports of the branch auditors and other auditors on separate financial
statements of branches and jointly controlled operations referred to in the Other Matters paragraph below,
the 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, of the
state of affairs of the Company as at March 31, 2018, its profit and its cash flows for the year ended on that
date.
Other Matters
a) We did not audit the financial statements and other financial information of 5 branches and 11 jointly
controlled operation included in the accompanying standalone Ind AS financial statements of the Company whose
financial statements reflect total assets of '' 2542.87 million as at March 31, 2018, total revenues of ''
354.56 million for the year ended on that date. These financial statements and other financial information of
these branches and jointly controlled operations have been audited by the branch auditors and other auditors
whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and
disclosures included in respect of these branches and jointly controlled operations and our report in terms
of subsection (3) of Section 143 of the Act, in so far as it relates to the aforesaid branches and jointly
controlled operations, is based solely on the report of such branch auditors and other auditors.
Of these 1 branch is located outside India whose financial statement and other financial information have
been prepared in accordance with accounting principles generally accepted in its country and which have been
audited by other auditor under generally accepted auditing standards applicable in its country. The
Company''s management has converted the financial statement of such branch located outside India from
accounting principles generally accepted in its country to accounting principles generally accepted in India.
We have audited these conversion adjustments made by the Company''s management. Our opinion in so far as it
relates to the balances and affairs of such branch located outside India is based on the report of other
auditor and the conversion adjustments prepared by the management of the Company and audited by us.
b) The comparative financial information of the Company for the year ended March 31, 2017, included in
these standalone Ind AS financial statements, have been audited by the predecessor auditor. The report of the
predecessor auditor on the comparative financial information dated May 23, 2017 expressed an unmodified
opinion.
Our opinion on the standalone Ind AS financial statements and our report on Other Legal and Regulatory
Requirements below is not modified in respect of these matters.
Report on Other Legal and Regulatory Requirements
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 of the Act, we give in the Annexure 1 a
statement on the matters specified in paragraphs 3 and 4 of the Order.
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
it appears from our examination of those books and proper returns adequate for the purposes of our audit have
been received from branches not visited by us;
(c) The reports on the accounts of the branch offices of the Company audited under section 143 (8) of
the Act by branch auditor has been sent to us and have been properly dealt by us in preparing this
report;
(d) The Balance Sheet, Statement of Profit and Loss including the Statement of Other Comprehensive
Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement
with the books of account and with the returns received from branches not visited by us;
(e) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Accounting
Standards specified under section 133 of the Act, read with the Companies (Indian Accounting Standards)
Rules, 2015, as amended;
(f) On the basis of written representations received from the directors as on March 31, 2018, and
taken on record by the Board of Directors, 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 Act;
(g) With respect to the adequacy of the internal financial controls over financial reporting of the
Company with reference to these standalone Ind AS financial statements and the operating effectiveness of
such controls, refer to our separate Report dated May 24, 2018 in Annexure 2 to this report;
(h) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule
11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its
standalone Ind AS financial statements - Refer Notes 36 and 45 to the standalone Ind AS financial
statements;
ii. The Company has made provision, as required under the applicable law or accounting standards, for
material foreseeable losses, if any, on long-term contracts including derivative contracts;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor
Education and Protection Fund by the Company.
Re: NCC Limited (''The Company'')
(i)(a) The Company has maintained proper records showing full particulars, including quantitative details
and situation of fixed assets.
(i)(b) A major portion of fixed assets have been physically verified by the management in accordance with
the programme of verification, which, in our opinion, provides for physical verification of all fixed assets
at reasonable interval having regard to the size of the Company and nature of its assets. According to the
information and explanations given to us, the discrepancies noticed on such verification were not material
and have been properly dealt with in the books of account.
(i)(c) According to the information and explanations given by the management, the title deeds of
immovable properties included in property, plant and equipment/ fixed assets are held in the name of the
company.
(ii) The management has conducted physical verification of inventory at reasonable intervals during
the year and no material discrepancies were noticed on such physical verification.
(iii)(a) The Company has granted loans to Companies covered in the register maintained under section
189 of the Companies Act, 2013. In our opinion and according to the information and explanations given to us,
the terms and conditions of the grant of such loans are not prejudicial to the company''s interest.
(iii)(b) The Company has granted loans to Companies covered in the register maintained under section 189
of the Companies Act, 2013. The schedule of repayment of principal and payment of interest has been
stipulated for the loans granted and the repayment/receipts are regular.
(iii)(c) There are no amounts of loans granted to companies, firms or other parties listed in the
register maintained under section 189 of the Companies Act, 2013 which are overdue for more than ninety
days.
(iv) In our opinion and according to the information and explanations given to us, provisions of
section 185 and 186 of the Companies Act 2013 in respect of loans to directors including entities in which
they are interested and in respect of loans and advances given, investments made and, guarantees, and
securities given have been complied with by the Company.
(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and
the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v)
of the Order are not applicable.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules
made by the Central Government for the maintenance of cost records under section 148(1) of the Companies Act,
2013, related to the Construction services, and are of the opinion that prima facie, the specified accounts
and records have been made and maintained. We have not, however, made a detailed examination of the same.
(vii)(a) The Company is generally regular in depositing with appropriate authorities undisputed
statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax,
customs duty, excise duty, value added tax, cess and other material statutory dues applicable to it.
(vii)(b) According to the information and explanations given to us, no undisputed amounts payable in
respect of provident fund, employees'' state insurance, income-tax, service tax, sales-tax, custom duty,
excise duty, value added tax, cess and other material statutory dues were outstanding, at the year end, for a
period of more than six months from the date they became payable.
(vii)(c) According to the records of the Company, the dues outstanding of income-tax, sales-tax, service
tax, custom duty, excise duty, Goods and Service tax , value added tax and cess on account of any dispute,
are as follows:
(Rs,
in million)
|
Statute
|
Nature of the dues
|
Forum where dispute is pending
|
Period to which the amount relates
|
Disputed
Amount
|
Amount paid under protest
|
|
Central Sales Tax Act (CST) and
Sales Tax Acts (VAT) of various States
|
CST
|
Appellate Authority, Bhopal
|
2011-15
|
8.00
|
4.77
|
|
CST
|
Commissioner of Commercial Taxes, Ranchi, Jharkhand
|
2014-15
|
3.12
|
-
|
|
CST
|
Sales Tax Tribunal, Mumbai
|
2010-12
&
2013-14
|
101.83
|
4.75
|
|
VAT
|
Additional Commissioner, Andhra Pradesh
|
2012-13
|
131.39
|
56.88
|
|
VAT
|
Additional Commissioner, Grade-2 (Appeals), Commercial Tax, Range-5 Lucknow
|
2006-07
|
15.52
|
1.55
|
|
VAT
|
Additional Commissioner (CT), West Bengal
|
2010-11
|
217.66
|
14.46
|
|
VAT
|
Commissioner of Sales Tax, New Delhi
|
2009-11
&
2012-14
|
129.99
|
47.35
|
|
VAT
|
Appellate Deputy Commissioner, Kerala
|
2008-09
|
3.14
|
0.50
|
|
VAT
|
Additional Commissioner, West Bengal
|
2014-15
|
74.97
|
20.94
|
|
VAT
|
Commisioner of Sales Tax, Kerala
|
2013-14
|
13.14
|
-
|
|
VAT
|
Commissioner of Commercial Taxes, Ranchi, Jharkhand
|
2010-15
|
73.68
|
6.34
|
|
VAT
|
Deputy Commissioner of Sales tax (Appeals), Assam
|
2005-07
|
184.10
|
-
|
|
VAT
|
High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh
|
2005-06
|
14.52
|
-
|
|
Central Sales Tax Act (CST) and
Sales Tax Acts (VAT) of various States
|
VAT
|
Hon''ble High Court of Odisha
|
2007-13
|
100.00
|
33.76
|
|
VAT
|
Hon''ble High Court of Tamil Nadu
|
2006-07
|
4.36
|
-
|
|
VAT
|
Sales Tax Appellate Tribunal, Andhra Pradesh
|
2003-04
&
2005-07
|
176.31
|
127.74
|
|
VAT
|
Sales Tax Tribunal, Mumbai.
|
2010-14
|
209.67
|
49.81
|
|
VAT
|
Sr.Joint Commissioner (Appeals), West Bengal
|
2008-10
&
2011-13
|
343.33
|
33.46
|
|
VAT
|
Sr.Joint Commissioner, Commercial Tax, West Bengal
|
2013-14
|
139.30
|
48.59
|
|
VAT
|
Appellate Deputy Commissioner, Hyderabad
|
2007-12
|
460.59
|
460.59
|
|
VAT
|
Commercial Tax Officer, Jodhpur
|
2014-15
|
1.09
|
1.09
|
|
VAT
|
Joint Commissioner, Lucknow
|
2011-14
|
64.20
|
64.20
|
|
VAT
|
Sales Tax Tribunal, Lucknow
|
2010-11
|
18.75
|
18.75
|
|
Entry Tax
|
High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh
|
2012-13
|
9.90
|
4.95
|
|
Entry Tax
|
Hon''ble High Court of Odisha
|
2007-13
|
7.36
|
-
|
|
Sales Tax
|
High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh
|
1994-95
|
4.35
|
2.68
|
|
Sales Tax
|
Sales Tax Appellate Tribunal, Andhra Pradesh
|
1999-01
&
2002-03
|
12.12
|
3.59
|
|
Statute
|
Nature of the dues
|
Forum where dispute is pending
|
Period to which the amount relates
|
Disputed
Amount
|
Amount paid under protest
|
|
Central Excise Act, 1944
|
Excise
Duty
|
CESTAT, Bangalore
|
2007-08
|
4.55
|
1.00
|
| |
Service
Tax
|
CESTAT, Bangalore
|
2005-12
|
750.30
|
4.63
|
| |
Service
Tax
|
CESTAT, Hyderabad
|
2010-15
|
78.69
|
-
|
|
Finance Act 1994
|
Service
Tax
|
Commissioner (Appeals), Service Tax
|
2005-08
|
3.94
|
0.99
|
| |
Service
Tax
|
High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh
|
2007-09
|
130.21
|
-
|
(viii) In our opinion and according to information and explanations given by the management, the
Company has not defaulted in repayment of dues to a financial institution and banks. The Company has not
issued any debentures.
(ix) In our opinion and according to the information and explanations given by the management, the
Company has not raised the monies by way of further public offer (including debt instruments). In our opinion
and according to the information and explanations given by the management, the Company has utilized the monies
raised by way of term loans for the purposes for which they were raised.
(x) Based upon the audit procedures performed for the purpose of reporting the true and fair view of
the financial statements and as per the information and explanations given by the management, we report that
no material fraud on or by the Company has been noticed or reported during the year.
(xi) According to the information and explanations given by the management, the managerial
remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions
of section 197 read with Schedule V to the Companies Act, 2013.
(xii) In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3(xii)
of the order are not applicable to the Company and hence not commented upon.
(xiii) According to the information and explanations given by the management, transactions with the
related parties are in compliance with section 177 and 188 of Companies Act, 2013 where applicable and the
details have been disclosed in the notes to the financial statements, as required by the applicable
accounting standards.
(xiv) According to the information and explanations given by the management, the Company has complied
with provisions of section 42 of the Companies Act, 2013 in respect of private placement of shares during the
year. According to the information and explanations given by the management, we report that the amounts
raised, have been used for the purposes for which the funds were raised.
(xv) According to the information and explanations given by the management, the Company has not
entered into any non-cash transactions with directors or persons connected with him as referred to in section
192 of Companies Act, 2013.
(xvi) According to the information and explanations given to us, the provisions of section 45-IA of
the Reserve Bank of India Act, 1934 are not applicable to the Company.
Report on the Internal Financial Controls under Clause (i) of Subsection 3 of Section 143 of the
Companies Act, 2013 (the Act)
We have audited the internal financial controls over financial reporting of NCC Limited (the Company) as
of March 31, 2018 in conjunction with our audit of the standalone Ind AS financial statements of the Company
for the year ended on that date.
Management''s Responsibility for Internal Financial Controls
The Company''s Management is responsible for establishing and maintaining internal financial controls
based on the internal control over financial reporting criteria established by the Company considering the
essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls
Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities
include the design, implementation and maintenance of adequate internal financial controls that were
operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to
the Company''s 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.
Auditor''s Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial
reporting with reference to these standalone Ind AS financial statements based on our audit. We conducted our
audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting
(the Guidance Note) and the Standards on Auditing as specified under section 143(10) of the Companies Act,
2013, to the extent 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 with reference to these standalone Ind AS financial statements
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 over financial reporting with reference to these standalone Ind AS financial statements
and their operating effectiveness. Our audit of internal financial controls over financial reporting included
obtaining an understanding of internal financial controls over financial reporting with reference to these
standalone Ind AS financial statements, 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 auditor''s judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion on the internal financial controls over financial reporting with reference to these
standalone Ind AS financial statements.
Meaning of Internal Financial Controls Over Financial Reporting With Reference to these Financial
Statements
A company''s internal financial control over financial reporting with reference to these standalone Ind
AS financial statements 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 company''s internal financial control over financial reporting
with reference to these standalone Ind AS financial statements 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
company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting With Reference to
these Standalone Ind AS Financial Statements
Because of the inherent limitations of internal financial controls over financial reporting with
reference to these standalone Ind AS financial statements, 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 with
reference to these standalone Ind AS financial statements to future periods are subject to the risk that the
internal financial control over financial reporting with reference to these standalone Ind AS financial
statements may become inadequate because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, adequate internal financial controls over
financial reporting with reference to these standalone Ind AS financial statements and such internal
financial controls over financial reporting with reference to these standalone Ind AS financial statements
were operating effectively as at March 31, 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 S.R. BATLIBOI & ASSOCIATES LLP
Chartered Accountants
ICAI Firm Registration Number: 101049W/E300004
per Navneet Rai Kabra
Partner
Membership Number: 102328
Place of Signature: Hyderabad
Date: May 24, 2018 |
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