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ABM Knowledgeware Ltd.

BSE: 531161 Sector: IT
NSE: N.A. ISIN Code: INE850B01026
BSE 00:00 | 24 Jun 123.10 1.00
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NSE 05:30 | 01 Jan ABM Knowledgeware Ltd
OPEN 122.10
PREVIOUS CLOSE 122.10
VOLUME 17902
52-Week high 145.45
52-Week low 43.20
P/E 11.28
Mkt Cap.(Rs cr) 246
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 122.10
CLOSE 122.10
VOLUME 17902
52-Week high 145.45
52-Week low 43.20
P/E 11.28
Mkt Cap.(Rs cr) 246
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

ABM Knowledgeware Ltd. (ABMKNOWLEDGE) - Auditors Report

Company auditors report

TOTHE MEMBERS OF ABM KNOWLEDGEWARE LIMITED

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying Standalone Financial Statements of ABM KNOWLEDGEWARELIMITED ("the Company") which comprise the Balance Sheet as at March 312020the Statement of Profit and Loss (including Other Comprehensive Income) the Statement ofChanges in Equity and Statement of Cash Flows for the year then ended and notes to theStandalone Financial Statements including a summary of significant accounting policiesand other explanatory information (hereinafter referred to as "the StandaloneFinancial Statements").

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Standalone Financial Statements give the information requiredby the Companies Act 2013 as amended ("the Act") in the manner so requiredand give a true and fair view in conformity with the Indian Accounting Standardsprescribed under section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended ("Ind AS") and other accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 312020its profit including other comprehensive income changes in equity and its cash flows forthe year ended on that date.

Basis for Opinion

We conducted our audit of the Standalone Financial Statements in accordance with theStandards on Auditing (SAs) as specified under Section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the 'Auditor'sResponsibilities for the Audit of the Standalone Financial Statements' section of ourreport. We are independent of the Company in accordance with the 'Code of Ethics' issuedby the Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of the Standalone Financial statements under the provisionsof the Act and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the ICAI's Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the Standalone Financial Statements.

Key Audit Matter

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Standalone Financial Statements for the financial yearended March 312020. These matters were addressed in the context of our audit of theStandalone Financial Statements as a whole and in forming our opinion thereon and we donot provide a separate opinion on these matters. We have determined the matters describedbelow to be the key audit matters to be communicated in our reports.

1. Recognition and Measurement of Deferred Tax

The recognition and measurement of deferred tax items requires at the level of the taxentity the complete determination of all differences between the recognition and themeasurement of assets and liabilities in accordance with the respective local taxprovisions and financial reporting in accordance with IND AS as well as the calculation oftax loss carry forwards. This requires the significant calculation on account of carryforwards of losses Mat Credit entitlement and identification of temporary differences.Furthermore the assessment of the ability to use deferred tax assets is based on theexpectations of the management regarding the Company economic development which isinfluenced by the cu rrent market environment Co-ventu re support and the assessment offutu re market development (Domestic and Overseas) and thus requires the use of judgment.

Deferred Tax disclosed in Note 2.18 of the Standalone Financial Statement of Companyfor year ended include Deferred tax liability created on temporary differences of Rs 70490(in '000'). In light of this the recognition and measurement of deferred taxes was a keyaudit matter.

Principal Audit Procedure

In assessing the recognition and measurement of deferred taxes for the Company amongother procedures we analysed the underlying processes for the complete capture andmeasurement of deferred taxes and examined the controls implemented to prevent or detectand correct errors.

Current tax laws allow to carry forward unused tax loss for 8 assessment years and fromthe assessment year in which such tax loss was incurred.

During The Year Taxation Laws (Amendment) Ordinance 2019 promulgated by President ofIndia which was published in Gazette of India in September 2019. The Ordinance has broughtsignificance changes to Corporate Income Tax Rates. The Ordinance provides an option todomestic Companies to pay Income Tax at lower Rate (22%) instead of Normal Rate 30%.

We have been informed by the Company's Management Company has exercised Option ofLower Tax rate for FinancialYear 2019-20 i.e. AssessmentYear 2020-21

We have referred Ind AS Technical Facilitation Group (ITFG -Formed by ICAI)Clarification given in Bulletin 23 regarding effect to lower tax rate as per ordinancewhile determining current tax and deferred tax asset or liabilities for the purpose ofpresenting financial statements as on March 312020.

Para 46 and 47 of Ind AS 12 Income Taxes State as follows:

Current tax liabilities (assets) for the current and prior periods shall be measured atthe amount expected to be paid to (recovered from) the taxation authorities using the taxrates (and tax laws) that have been enacted or substantively enacted by the end of thereporting period.

Deferred tax assets and liabilities shall be measured at the tax rates that areexpected to apply to the period when the asset is realised or the liability is settledbased on tax rates (and tax laws) that have been enacted or substantively enacted by theend of the reporting period.

We examined on a sample basis the identification and quantification of differencesbetween the recognition and measurement of assets and liabilities according to taxregulations and financial reporting pursuant to IND AS. We also reperformed thecalculation of deferred taxes.

Since Company has intended to opt for Lower Tax rate as per Ordinance Company hasgiven effect while determining the current tax and deferred tax asset or liabilities forthe purpose of presenting financial statement for the year ending March 2020.

We have also focused on adequacy of the Company's disclosures on deferred income taxpositions and assumption used.

Our audit procedures did not lead to any reservations regarding the recognition andmeasurement of deferred taxes. Reference to related disclosures

The Company has provided information on the recognition and measurement of deferredtaxes in the Note 2.18 and 2.30 of the Standalone Financial Statements.

Information Other than the Financial Statements and Auditor's Report Thereon

The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the AnnualReport including Annexures to Board's Report but does not include the StandaloneFinancial Statements and our auditor's report thereon. The Annual report is expected to bemade available to us after the date of this our auditor's report

Our opinion on the Standalone Financial Statements does not cover the other informationand we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Financial Statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the Standalone Financial Statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated.

When we read Annual Report if we conclude that there is a material misstatementtherein we are required to communicate the matter to those charges with governance.

Management's Responsibilities for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Act with respect to the preparation of these Standalone Financial Statementsthat give a true and fair view of the financial position financial performance totalcomprehensive income changes in equity and cash flows of the Company in accordance withthe Ind AS and other accounting principles generally accepted in India. 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 Standalone FinancialStatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the Standalone Financial Statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

The Board of Directors are responsible for overseeing the Company's financial reportingprocess.

Auditor's Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the StandaloneFinancial Statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these Standalone Financial Statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the StandaloneFinancial Statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal financial control relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls with reference to financial statements inplace and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures in the Standalone Financial Statementsmade by management.

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe Standalone Financial Statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.

• Evaluate the overall presentation structure and content of the StandaloneFinancial Statements including the disclosure and whether the Standalone FinancialStatement represent the underlying transaction and the events in a manner that achievefair presentation.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including any othersignificant deficiencies in internal control that we identify during the audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the Standalone Financial Statementsfor the financial year ended March 312020 and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.

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 ofthe Act we give in the "Annexure A" a statement on the matters specified inparagraphs 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 bestof our knowledge and belief were necessary for the purposes of our audit of the aforesaidStandalone Financial Statements.

b. In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.

c. The Balance Sheet the Statement of Profit and Loss including Other ComprehensiveIncome the Statement of Changes in Equity and the Cash Flow Statement dealt with by thisReport are in agreement with the books of account.

d. In our opinion the aforesaid Standalone Financial Statements comply with the Ind ASspecified under Section 133 of the Act read with Companies (Indian Accounting Standards)Rules 2015 as amended.

e. On the basis of the written representations received from the directors as on March312020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 312020 from being appointed as a director in terms of Section 164(2) of theAct.

f. With respect to the adequacy of the internal financial controls over financialreporting of the Company with reference to these Standalone Financial Statements and theoperating effectiveness of such controls refer to our separate Report in "AnnexureB". Our report expresses an unmodified opinion on the adequacy and operatingeffectiveness of the Company's Internal Financial Controls over the financial reporting.

g. In our opinion the managerial remuneration for the year ended March 312020 hasbeen paid/provided by the Company to its directors in accordance with the provisions ofSection 197 read with Schedule V to the Act;

h. With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations as at March 312020 onits financial position in its Standalone Financial Statements. Refer Note 2.31 to theStandalone Financial Statements.

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

iii. There has been no delay in transferring amount required to be transferred to theInvestor Education and Protection Fund by the Company.

For Borkar & Muzumdar
Chartered Accountants
Firm Reg. No. 101569W
Date: 22nd July 2020 Deepak Jain Partner
Place: Mumbai (M.No. 154390)
UDIN:20154390AAAAGE9642

ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements'section of our report to the Members of ABM KNOWLEDGE WARE LIMITED)

The Annexure referred to in Independent Auditor's Report to the members of the Companyon the Standalone Financial Statements for the year ended March 312020 we report that:

i. Property Plant and Equipment

a. The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

b. The Company has a program of verification to cover all the item of fixed assets in aphased manner which in our opinion is reasonable having regard to the size of theCompany and nature of its assets. Pursuant to program certain fixed assets werephysically verified by the management during the year. According to the information andexplanation given to us no material discrepancies were noticed on such verification.

c. According to the information and explanations given to us the records examined byus and based on the examination of the conveyance deeds / registered sale deed provided tous we report that the title deeds comprising all the immovable properties of land andbuildings which are freehold are held in the name of the Company as at the balance sheetdate.

ii. The Company is in the business of providing software services and does not have aphysical inventory. Accordingly reporting under Clause 3 (ii) of the Order is notapplicable to the Company.

iii. The Company has not granted any loan secured or unsecured to companies firmsLimited Liability Partnerships (LLPs) or other parties covered in the register maintainedunder Section 189 of the Act.

iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of the Section 185 and 186 of the Act withRespect to the loans securities guarantee and investment made.

v. In our opinion the Company has not accepted any deposits within the meaning ofSections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules 2014 (asamended). Accordingly the provisions of clause 3(v) of the Order are not applicable tothe Company.

vi. The maintenance of cost records has not been specified by the Central Governmentunder section 148(1) of the Companies Act 2013 for the business activities carried out bythe Company. Thus reporting under clause 3(vi) of the order is not applicable to theCompany.

vii. Statutory Dues

a. According to the information and explanations given to us and on the basis of ourexamination of the records of the Company amounts deducted/ accrued in the books ofaccount in respect of undisputed statutory dues including provident fund income-taxsales tax employees' state insurance value added tax goods and service tax duty ofcustoms service tax cess and other material statutory dues have been regularly depositedduring the year by the Company with the appropriate authorities.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund income-tax sales tax employees' state insurancevalue added tax goods and service tax duty of customs service tax cess and othermaterial statutory dues were in arrears as at March 312020 for a period of more than sixmonths from the date they became payable.

b. According to the information and explanations given to us there are no dues of dutyof customs goods and service tax and Income tax which have not been deposited with theappropriate authorities on account of any dispute. However according to information andexplanations given to us the following dues of Service Tax have not been deposited by theCompany on account of disputes:

Name of the statute Name of Dues F.Y. to which the matter pertains Amount *(1) (in Rs. 000's) Forum where dispute is pending
Finance Act 1994 Service Tax F.Y. 2014-17 489.13 Assistant Comm. Of ST

* (1) Net of Amount paid under Protest.

viii. The Company has not defaulted in repayment of loans or borrowings to any bank orfinancial institution or government during the year. The Company did not have anyoutstanding debentures during the year.

ix. The Company did not raise moneys by way of initial public offer or further publicoffer (including debt instruments) and did not have any term loans outstanding during theyear. Accordingly the provisions of clause 3(ix) of the Order are not applicable.

x. According to the information and explanations given to us no fraud by the Companyor on the Company by its officers or employees has been noticed or reported during theyear.

xi. In our opinion and according to the information and explanations give to us theCompany has paid /provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of Section 197 read with Schedule V to the Act.

xii. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly Clause 3(xii) of the Order is not applicable.

xiii. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with the Section 177 and 188 of the Act where applicable and the detailtransactions with the related parties have been disclosed in the Standalone Financialstatements as required by applicable Indian Accounting Standard.

xiv. According the information and explanations given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year under review and hence reporting requirements under clause 3(xiv) of the Orderare not applicable to the Company and not commented upon.

xv. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him as referred to in Section 192 ofthe Act.

xvi. According to the information and explanations provided to us the provisions ofSection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.

For Borkar & Muzumdar
Chartered Accountants
Firm Reg. No. 101569W
Date: 22nd July 2020 Deepak Jain Partner
Place: Mumbai (M.No. 154390)
UDIN: 20154390AAAAGE9642

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2(f) under 'Report on Other Legal and RegulatoryRequirements' section of our report to the Members of ABM KNOWLEDGEWARE LIMITED of evendate)

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of ABMKNOWLEDGEWARE LIMITED ("the Company") as of March 312020 in conjunction withour audit of the Standalone Financial Statements of the Company for the year ended on thatdate.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India (ICAI). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls over Financial Reporting(the "Guidance Note") and the Standards on Auditing prescribed under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the Standalone Financial Statements whether due to fraud orerror.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the internal financial controls over financialreporting with reference to these Standalone Financial Statements.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the Company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the Company are being made only in accordance with authorisations ofmanagement and directors of the Company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of theCompany's 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 financialreporting with reference to these Standalone Financial Statements including thepossibility of collusion or improper management override of controls materialmisstatements due to error or fraud may occur and not be detected. Also projections ofany evaluation of the internal financial controls over financial reporting with referenceto these Standalone Financial Statements to future periods are subject to the risk thatthe internal financial control over financial reporting with reference to these StandaloneFinancial Statements may become inadequate because of changes in conditions or that thedegree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects adequate internal financialcontrols over financial reporting with reference to these Standalone Financial Statementsand such internal financial controls over financial reporting with reference to theseStandalone Financial Statements were operating effectively as at March 312020 based onthe internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.

For Borkar & Muzumdar
Chartered Accountants
Firm Reg. No. 101569W
Date: 22nd July 2020 Deepak Jain Partner
Place: Mumbai (M.No. 154390)
UDIN: 20154390AAAAGE9642