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Mumbai Cricket Association FROM THE DESK OF THE TREASURER I take pleasure to present before you the audited financial reports comprising Balance Sheet as at 31st March 2014 and the income and expenditure for the year 2013-14 together with schedules and notes to accounts. The annual accounts for this year come to you almost within one year after presenting the audited accounts for the previous year. The year had witnessed certain remarkable events briefly listed below, 1. The Association has restructured various local tournaments with effect from the Cricket season of 2013-14. Dr H. D. Kanga Elite and Plate League matches were played during the period from September 2013 to March 2014. 2. Prize and awards for the period from 2008 to 2013 were distributed during a function held in May 2013 after a gap of six years. 3. A test match was hosted between India and West Indies during November 2013 which was 200th Test Match of legendary Cricketer Shri. Sachin Tendulkar who retired from playing Cricket amidst a great gathering of VIPs and spectators. 4. The prestigious Sports and Recreation Centre at Mahavirnagar (Kandivali) was inaugurated on 3rd December 2013 which is named as Sachin Tendulkar Gymkhana. As regards the financial position, salient features are as under: JThe financial year 2013-14 has posted a deficit of Rs. 75.11 lacs after depreciation of Rs.32.70 Cr. and reversal of income of Rs. 83.87 lacs booked earlier as monthly compensation receivable from Garware Club House due to pendency of an agreement between MCA and GCH. JThe Association has earned net surplus of Rs.1.90 Cr. from hosting a Test Match between India and West Indies after providing for financial assistance, benevolent fund, maidan improvement and umpires benevolent fund. JThe total expenditure incurred on Dr.H.D.Kanga Elite and Kanga League tournament was Rs.1.32 Cr. This was mainly due to increase in Ground Charges to Rs.3,000 per day, honorarium to Umpires Rs.1,200 per person per day and Rs. 750 per day to the Scorer. JThe expenditure on administration has gone up by Rs.3.41 Cr. mainly on account of Employees Cost(including bonus/ex-gratia) gone up by Rs.1.13 Cr. pursuant to Wage Settlement with the Union, legal fees Rs.1.40 Cr. Function expenses Rs.0.62 Cr and electricity, telephone, travelling etc. Rs.0.16 Cr. JThe depreciation for the year is lower by Rs.3.72 Cr. over the last year. JThe financial assistance for F.Y.2012-13 and 2013-14 and Tournament & Kit Subsidy for F.Y.2013-14 due to the members is being remitted through RTGS/NEFT and cheques. These must have reached all the members in December 2014. Members are requested to provide/update details of bank account if not done earlier for easy transfer of funds immediately to avoid any delay on the part of the Association. Let us have a look to the financial health in terms of assets and liabilities. The salient features are briefly as under; 48 Mumbai Cricket Association O The fixed assets after depreciation now stand at Rs. 281Cr O The current assets are higher by Rs. 31.48 Cr. mainly due to increase in Fixed Deposits by Rs.23.50 Cr. Accrued Interest by Rs.1.59 Cr, Income Tax paid under protest Rs.12.73 Cr (and reduction by Rs.7.25 Cr. in BCCI a/c) OThe liabilities are less by Rs.6.28 Cr. which is due to appropriation of AC Box income against advance received. OThe net worth is finally higher by Rs.6.18 Cr and stood at Rs.265.43 Cr as on the end of March 2014. As reported earlier, the pressure of payment of Income Tax demand continued in this year too. The Association was compelled to pay further amount of Rs.12.73 Cr despite having appeals pending at various levels. The total Income Tax demands till Assessment Year 2012-13 stood at Rs.74.27 Cr out of which Rs.17.24 have been paid. I thank office bearers and members of the managing committee, the members of MCA, and staff members for their support and co-operation. Mumbai Vinod Deshpande 4th December 2014 Honorary Treasurer 49 Mumbai Cricket Association AUDITORS’ REPORT INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MUMBAI CRICKET ASSOCIATION Report on the Financial Statements We have audited the accompanying financial statements of MUMBAI CRICKET ASSOCIATION (“the Association”) which comprise the Balance Sheet as at 31st March, 2014, the Income and Expenditure Account for the year then ended, and a summary of the significant accounting policies and other explanatory information. Management's Responsibility for the Financial Statements The Association's Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position and financial performance of the Association in accordance with the Accounting Standards and in accordance with the accounting principles generally accepted in India. 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. Auditors' 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 the 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 Association'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 Association's internal control. An audit also includes evaluating the appropriateness of the 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 qualified audit opinion. Basis for Qualified Opinion 1. Certain matters which were reported in our audit report of the previous year, and which continue to remain unresolved as at 31st March, 2014 are summarised as under: a) Attention is invited to Note 5 of Schedule 20 to the financial statements, regarding a contract entered into with Shirke Infrastructure ('Contractor') to develop Indoor Cricket Academy ('ICA') and related facilities ('ICA Facilities'). The sums received under the contract as well as the capitalised amount of ICA and ICA Facilities are credited to corpus of the Association. The Association has taken a view that the same is eligible for income tax exemption and no provision for tax is required. b) Attention is invited to Note 10(c) of Schedule 20 to the financial statements, regarding the non- provision of the tax, which is based on legal opinion obtained by the Association. c) Attention is invited to Note 7 of Schedule 20 to the financial statements, regarding allotment of Air- conditioned boxes. The Association has accounted for certain transactions on the basis of the Association's current understanding/ assessment/ available information in the absence of signed 50 Mumbai Cricket Association contracts/ agreements/ confirmation from the counter parties/ all the required documentation, in respect of following matters: i. it has received amount of `8,000,000 in year ended 31st March, 2011, from existing donors towards Air-conditioned boxes at Wankhede Stadium and accordingly the amount is added to the Building Fund. ii. the Association is of the view that there are no other indirect taxes applicable on the transactions. In the absence of complete information, we are unable to form an opinion on the correctness/ completeness/validity of the above income/expenditure/asset/liability recognised in the financial statements for the year ended 31st March, 2014. 2. Attention is invited to Note 3 of Schedule 20 to the financial statements, as provided in the Settlement agreement, the Association has agreed to make available to Garware Club House (“GCH”) additional Floor Space Index (“FSI”) of 100,000 sq. ft. for additional constructions of GCH. The Settlement Agreement provides such new/additional construction shall vest with the Association. According to the information and explanations given to us, the construction of Phase I and II have been completed in the previous years and that of Phase III is in progress as on 31st March, 2014. These transactions have not been recorded in the books of the Association. Till the year ended 31st March, 2013, the Association had recognised income from GCH “under protest”. The Association, in the current year has decided not to recognise the income from GCH (net of TDS), till the time the settlement agreement is signed. Accordingly, the income aggregating to `8,138,880 has been reversed and `602,880 is recognized as income based on TDS certificate received in the current year. In the absence of information, we are unable to comment on the same. 3. Attention is invited to Note 5 (E) of Schedule 20 to the financial statements regarding amount of `70,000,000 received from Shirke Infrastructure.