To the Members of Ador Multi products Limited
Report on the Audit of the Standalone Ind AS Financial statements
We have audited the accompanying Standalone Financial Statements of Ador Multi ProductsLimited (the Company') which comprise the Balance Sheet as at March 31 2021 theStatement of Profit and Loss (including Other Comprehensive Income) the Statement ofChanges in Equity and the Statement of Cash Flows for the year ended on that date and asummary of significant accounting policies and other explanatory information (hereinafterreferred to as the Standalone Financial 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 (the Act') in the manner so required and give a true andfair view in conformity with the Indian Accounting Standards prescribed under Section 133of the Actread with the Companies (Indian Accounting Standards) Rules 2015 as amended(Ind AS') and other accounting principles generally accepted in India of the stateof affairs of the Company as at March 312021 the profit total comprehensive incomechanges 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 theStandards on Auditing specified under Section 143(10) of the Act (SAs). 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 issued bythe Institute of Chartered Accountants of India (ICAI) together with the independencerequirements that are relevant to our audit of the Standalone Financial Statements underthe provisions of the Act and the Rules made there under and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto 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 judgement were of mostsignificance 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 FinancialStatements as a whole and in forming our opinion thereon and we do not provide a separateopinion on these matters. We have determined the matters described below to be the keyaudit matters to be communicated in our report.
|Key Audit Matters ||Auditor's Response |
|Disclosure of revenue ||Principal Audit Procedures |
|Accuracy of recognition measurement presentation and disclosures of revenues and other related balances inview of adoption of Ind-AS 115 Revenue from Contracts with Customers' ||We assessed the Company's process to identify the impact of adoption of the new revenue accounting standard. |
| ||Our audit approach consisted testing of the design and operating effectiveness of the internal controls and substantive testing as follows: |
| || Evaluated the design of internal controls relating to implementation of the new revenue accounting standard. |
| || Selected a sample of continuing and new contracts and testec the operating effectiveness of the internal control relating tc identification of the distinct performance obligations and determination of transaction price. |
| ||We carried out a combination of procedures involving enquiry and observation reperformance and inspection of evidence in respect of operation of these controls. |
| || Tested the relevant information technology systems' access and change management controls relating to contracts and related information used in recording and disclosing revenue in accordance with the new revenue accounting standard. |
| || Selected a sample of continuing as well as new contracts and performed the following procedures: |
| ||- Read analysed and identified the distinct performance obligations in these contracts. |
| ||- Compared these performance obligations with that identified and recorded by the Company. |
| ||- Considered the terms of the contracts to determine the transaction price including any variable consideration to verify the transaction price used to compute revenue and to test the basis of estimation of the variable consideration. |
| ||- Samples in respect of revenue recorded for time and material contracts were tested using a combination of approved time sheets including customer acceptances subsequent invoicing and historical trend of collections and disputes. |
| ||- In respect of samples relating to fixed price contracts progress towards satisfaction of performance obligation used to compute recorded revenue was verified with actual and estimated efforts from the time recording and budgeting systems. |
| ||We also tested the access and change management controls relating to these systems. |
| ||- Sample of revenues disaggregated by type and service offerings was tested with the performance obligations specified in the underlying contracts. |
| ||- Performed analytical procedures for reasonableness of revenues disclosed by type and service offerings. |
| ||We reviewed the collation of information and the logic of report generated from the budgeting system used to prepare the disclosure relating to the periods over which the remaining performance obligations will be satisfied subsequent to the Balance Sheet date. |
|Non Current Investment || |
|Investment in subsidiaries and its impairment ||Principal Audit Procedures |
| ||The company has made equity and debt investment in a few Companies. |
| ||The Subsidiaries Companies has been incurring losses since inception and has incurred losses during the current financial year. |
| ||However the impairment in the value of the investment has not been determined and given effect to in the Standalone Financial Statements. |
| ||Refer Note 2.2 to the Standalone Financial Statements. |
| ||Our audit approach included review of audited financial statements of subsidiaries |
| ||Testing the design and operating effectiveness of relevant key controls around the Company's assessment of impairment of investments in the subsidiaries. |
| ||Testing reasonability of the projections used by the subsidiaries related to its sales growth operating costs cash flow forecasts etc. |
| ||Testing whether the Management analysis about the sensitivity of the outcome w.r.t. impairment assessment with possible changes in the key assumptions reflect the risks inherent in the valuation including the possible impact of COVID-19 pandemic. |
|Disposal of land & building ||Principal Audit Procedures |
| ||The Company during the period under review has disposed off its land and building at Bangalore and the shifted the entire operations its branch at Puducherry |
| ||Our audit approach included Review whether the Management analysis about the operating efficiency envisaged has been achieved by the management on shifting the operations to Puducherry. |
| ||Based on the aforesaid testing evaluation and explanations given by the Management we concluded that there are no apparent operating efficiency that was achieved as on March 31 2021 |
Information other than the Standalone Financial Statements and Auditor's Report thereon
The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information consists of details included in the Board's Reportincluding annexures to the Board's report comprising Management Discussion and AnalysisReport Corporate Governance Shareholders' information etc. but does not include theStandalone Financial Statements and our Auditors' report thereon.
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 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 materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.
Management's Responsibility 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 the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgements 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 the 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 can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these Standalone Financial Statements.
As part of an audit in accordance with SAs we exercise professional judgement andmaintain professional scepticism throughout the audit. We also:
-Identify and assess the risks of material misstatement of the Standalone FinancialStatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal controls.
-Obtain an understanding of internal financial controls relevant to the audit in orderto 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 system in place and the operatingeffectiveness of such controls.
-Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by the Management.
-Conclude on the appropriateness of the Management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertainty existsrelated to events or conditions that may cast significant doubt on the Company's abilityto continue as a going concern. If we conclude that a material uncertainty exists we arerequired to draw attention in our Auditor's report to the related disclosures in theStandalone 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 ourAuditors' 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 Standalone FinancialStatements including the disclosures and whether the Standalone Financial Statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.
Materiality is the magnitude of misstatements in the Standalone Financial Statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in
(i) planning the scope of our audit work and in evaluating the results of our work; and
(ii) to evaluate the effect of any identified misstatements in the financialstatements.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with them allrelationships 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 Statementsof the current period and are therefore the key audit matters.
We describe these matters in our Auditor's Report unless law or regulation precludespublic disclosure about the matter or when in extremely rare circumstances we determinethat a matter should not be communicated in our report because the adverse consequences ofdoing so would reasonably be expected to outweigh the public interest benefits of suchcommunication.
Other Matter Provision for Gratuity
As per the provisions of Payment of Gratuity Act1972 every employer liable forpayment of gratuity should get his liability covered by an insurance. Otherwise theemployer can maintain an approved fund (herein referred as "Plan Asset") for thepurpose of payment of gratuity. However it is observed that the company has madeprovisions in the financial statement for payment of gratuity based on actuarialvaluation report but has not got it covered by an insurance nor has maintained anapproved fund
Report on Other Legal and Regulatory Requirements
As required by Section 143(3) of the Act based on our audit we report that:
i. 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.
ii. 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.
iii. The Balance Sheet the Statement of Profit and Loss including Other ComprehensiveIncome Statement of Changes in Equity and the Statement of Cash Flow dealt with by thisReport are in agreement with the relevant books of account.
iv. In our opinion the aforesaid Standalone Financial Statements comply with theInd-AS specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014.
v. On the basis of written representations received from the Directors as on March312021 and taken on record by the Board of Directors none of the Directors isdisqualified as on March 31 2021 from being appointed as a Director in terms of Section164(2) of the Act.
vi. 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 A'. Our report expresses an unmodified opinion on theadequacy and operating effectiveness of the Company's internal financial controls overfinancials.
vii. With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of Section 197(16) of the Act as amended:
In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its Directors during the year is inaccordance with the provisions of Section 197 of the Act.
viii. 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:
a. The Company has disclosed the impact of pending litigations on its financialposition in its Standalone Financial Statements.
b. The Company has made provisions as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts.
c. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company.
As required by the Companies (Auditor's Report) Order 2016 (the Order') issuedby the Central Government in terms of Section 143(11) of the Act we give intheAnnexure B' a statement on the matters specified in paragraphs 3 and 4 of theorder.
| ||For Praveen & Madan |
| ||Chartered Accountants |
| ||(Formerly Srinivas & Subbalakshmi) |
|Bengaluru ||Praveen Kumar Nagarajan |
|May 282021 ||Partner (Membership No: 225884) |
| ||Firm Registration no.:011350S |
| ||UDIN: 21225884AAAADX9897 |
TO INDEPENDENT AUDITOR'S REPORT
(Referred to in paragraph 1(f) under Report on Other Legal and RegulatoryRequirements' section of our report to the Members of AdorMultiproducts Limited of evendate)
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 (the Act')
We have audited the internal financial controls over financial reporting of Ador MultiProducts Limited (the Company') as of March 31 2021 in conjunction with our auditof the Standalone Financial Statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on internal controls 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. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring orderly and efficient conduct of its businessincluding adherence to the Company's policies safeguarding of its assets prevention anddetection of frauds errors accuracy and completeness of the accounting records timelypreparation of reliable financial information as required under the Companies Act 2013.
Our responsibility is to express an opinion on the internal financial controls overfinancial reporting of the Company based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the Guidance Note') issued by the Institute of Chartered Accountants ofIndia and the Standards on Auditing prescribed under Section 143(10) of the Companies Act2013 to the extent applicable to an audit of internal financial controls. Those Standardsand the Guidance Note require that we comply with ethical requirements; plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting were established maintained and if such controlsoperated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofinternal financial control 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; testing and evaluating the design andoperating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the Auditor's judgement including the assessment of risks of materialmisstatement of the financial statements whether due to fraud or error.
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 system overfinancial reporting of the Company.
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 of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of the Management and Directors of the company and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.
Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to risk that the internal financial control overfinancial reporting may become inadequate because of changes in conditions or that thedegree of compliance with policies or procedures may deteriorate.
In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlsystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2021 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.
| ||For Praveen & Madan Chartered Accountants (Formerly Srinivas & Subbalakshmi) |
|Bengaluru ||Praveen Kumar Nagarajan |
|May 282021 ||Partner (Membership No: 225884) Firm Registration no.:011350S UDIN: 21225884AAAADX9897 |
TO THE INDEPENDENT AUDITOR'S REPORT
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013
(Referred to in the Report on Other Legal and Regulatory Requirements' of ourreport to the Members of Ador Multi Products Limited of even date)
1. In respect of the Company's fixed assets:
1. The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
ii. The Company has a program of verification to cover all the items of fixed assets ina phased manner which in our opinion is reasonable having regard to the size of theCompany and the nature of its assets. Pursuant to the program certain fixed assets werephysically verified by the Management during the year. According to the information andexplanations given to us no material discrepancies were noticed on such verification.
iii. According to the information and explanations given to us the records examined byus and based on the examination of conveyance deeds/registered sale deeds provided to uswe report that the title deeds comprising all immovable properties of land and buildingswhich are freehold are held in the name of the Company as at the Balance Sheet date.Inrespect of immovable properties of land and building that have been taken on lease anddisclosed as fixed assets in the Standalone Financial Statements the lease agreements arein the name of the Company.
2. i. We are informed that inventories have been physically verified by the Managementduring the year and also at the end of the year. In our opinion the frequency ofverification is reasonable.
ii. In our opinion and according to the explanations given to us the procedures ofphysical verification of inventories followed by the Management are reasonable andadequate in relation to the size of the Company and the nature of its business.
iii. In our opinion and according to the information and explanations given to us theCompany is maintaining proper records of inventories. The discrepancies noticed onverification between physical stocks and book records were not material and have beenproperly dealt with in the books of accounts.
3. According to the information and explanations given to us the Company has grantedunsecured loans to two bodies corporate covered in the register maintained under Section189 of the Companies Act 2013 in respect of which:
i. The terms and conditions of the grant of such loans are in our opinion prima facienot prejudicial to the interest of the Company.
ii. The schedule of repayment of principal and payment of interest have been stipulatedand repayments or receipts of principal amounts and interest have been regular as perstipulations.
iii. There is no overdue amount remaining outstanding as at the year-end.
4. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Act in respect ofgrant of loans making investments and providing guarantees and securities as applicable.
5. The Company has not accepted deposits during the year and does not have anyunclaimed deposits as at March 31 2021 and therefore provisions of clause 3 (v) of theOrder are not applicable to the Company.
6. The maintenance of cost records have 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.
7. According to the information and explanations given to us in respect of statutorydues:
i. The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income Tax Goods and Service TaxCustoms Duty Cess and other material statutory dues applicable to it with the appropriateauthorities.
ii. There were no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income Tax Goods and Service Tax Customs Duty Cess and other materialstatutory dues in arrears as at March 312021 for a period of more than six months fromthe date they became payable.
iii. Details of dues of Income Tax Sales Tax Service Tax Excise Duty and Value AddedTax which have not been deposited as at March 31 2021 on account of dispute are givenbelow :
Rs. In lakhs
|Nature of Statute ||Nature of dues relates ||Forum where pending dispute is ||Period to which amount ||Amount |
|Sales Tax/ Value ||Value ||Sales Tax || || |
|Added Tax ||Added Tax ||Chennai ||2018-2019 ||22.93 |
8. The Company has not taken any loans or borrowings from financial institutions banksand government or has not issued any debentures. Hence reporting under clause 3 (viii) ofthe Order is not applicable to the Company.
9. The Company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments) or term loans and hence reporting under clause 3 (ix)of the Order is not applicable to the Company.
10. To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company or no material fraud on the Company by its officersor employees has been noticed or reported during the year.
11. In our opinion and according to the information and explanations given 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.
12. The Company is not a Nidhi Company and hence reporting under clause 3 (xii) of theOrder is not applicable to the Company.
13. In our opinion and according to the information and explanations given to us theCompany is in compliance with Section 177 and 188 of the Companies Act 2013 whereverapplicable for all transactions with related parties and details of related partytransactions have been disclosed in the Standalone Financial Statements as required by theapplicable accounting standards.
14. During the year the Company has made preferential allotment / private placement ofequity shares. In our opinion the Company has complied with the requirement of Section 42of the Act and the Rules framed there under. Further in our opinion the amounts soraised have been used for the purposes for which the funds were raised. During the yearthe Company did not make preferential allotment/ private placement of fully/ partlyconvertible debentures.
15. In our opinion and according to the information and explanations given to usduring the year the Company has not entered in to any non-cash transactions with itsDirectors or persons connected with the Directors and hence provisions of Section 192 ofthe Companies Act 2013 are not applicable to the Company.
16. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.
| ||For Praveen & Madan Chartered Accountants (Formerly Srinivas & Subbalakshmi) |
|Bengaluru ||Praveen Kumar Nagarajan |
|May 282021 ||Partner (Membership No: 225884) Firm Registration no.:011350S UDIN: 21225884AAAADX9897 |