TO THE MEMBERS OF AJANTA SOYA LIMITED
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31st MARCH 2021
1. We have audited the accompanying Ind AS financial statements of Ajanta Soya Limited("the Company") which comprise the Balance Sheet as at 31st March 2021 theStatement of Profit and Loss (including Other Comprehensive Income) the Cash FlowStatement and the Statement of Changes in Equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information.
2. In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS financial statements give the information required bythe Act in the manner so required and give a true and fair view in conformity with the IndAS and other accounting principles generally accepted in India of the state of affairs ofthe Company as at 31st March 2021 and its profit(including other comprehensive income)its cash flows and the changes in equity for the year ended on that date.
Basis for Opinion
3. We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
4. Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters. Wehave determined the matters described below to be the key audit matters to be communicatedin our report.
|Sr. No. Key Audit Matter ||Auditor's Response |
|1. Revenue Recognition ||Principal Audit Procedure |
|Revenue is recognised when the significant risk and rewards of the ownership have been transferred to the buyer and recovery of consideration is probable the associated cost and possible return of goods can be measured reliably there is no continuing effective control/managerial involvement in respect of the goods and the amount of revenue can be measured reliably. The timing of the transfer of control varies depending on the individual terms of the sale. || We assessed the appropriateness of the revenue recognition accounting policies by comparing with applicable accounting standards. |
|Revenue from sale of goods in the course of ordinary activities is measured at the Fair Value of the consideration received or receivables net of returns trade discount and taxes and duties on behalf of government. Revenue is only recognised to the extent that it is highly probable a significant reversal will not occur. || We tested the design implementation and operating effectiveness of the managements system of IT Controls and key application controls and interfaces between the system control and key manual internal controls over the revenue recognition to assess the completeness of the revenue entries being recorded in the general accounting system. |
|There is a risk of revenue being overstated due to fraud including through manipulation of rebates and discounts resulting from pressure the management may feel to achieve performance targets at the reporting period end. || We performed substantive testing by selecting the samples Key parties were taken care of while selecting the sample by verifying the underlying documents which included purchaseorder/bargain management's control over dispatch of goodsdelivery challan and the recovery of consideration within the credit limit as per the terms of the contract. |
| || We performed substantive testing by selecting samples of rebate and discount transactions recorded during the year and comparing with the terms and conditions defined in the customer contract. |
| || We performed cut-off testing for samples of revenue transactions recorded before and after the financial year end date by comparing with relevant underlying documentation which included goods dispatch notes to assess whether the revenue is recognized as per policy. |
| || Reviewed the disclosures included in the notes to the accompanying financial statements. |
|2. Provision for taxation litigation and other significant provisions& contingencies ||Principal Audit Procedure |
|Accrual for tax and other contingencies requires the management to make judgements and estimates in relation to the issues and exposures arising from a range of matters relating to direct / indirect tax claims general legal proceedings and other eventualities arising in the regular course of business. || We tested the effectiveness of controls around recording and re-assessment/ review of the contingent liabilities. |
|The key judgement lies in the estimation of provisions where they may differ from the future obligations. By nature provision is difficult to estimate and includes many variables. Additionally depending on timing there is a risk that costs could be provided inappropriately that are not yet committed. || We used our professional judgement and experience to assess the value of material contingent liabilities in light of the nature of exposures applicable regulations and related correspondence with the authorities. |
|Refer Note No. 31(I) to the financial statement. || We discussed the status and potential exposures in respect of significant litigation and claims with the company's management including their views on the likely outcome of each litigation and claim and the magnitude of potential exposure. and sighted any relevant opinions given by the advisors. |
| || We assessed the adequacy of disclosures made. We performed retrospective review of management judgements relating to accounting estimate included in the financial statement of prior year and compared with the outcome. |
Information Other than the Financial Statements and Auditor's Report Thereon
5. The Company's Board of Directors are responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexures to Board's Report BusinessResponsibility Report Corporate Governance and Shareholder's Information but does notinclude the financial statements and our auditor's report thereon.
The information included in the Management Discussion and Analysis Board's Reportincluding Annexures to Board's Report Business Responsibility Report CorporateGovernance and Shareholder's Information are expected to be made available to us after thedate of this auditor's report.
Our opinion on the financial statements does not cover the other information and we donot express any form of assurance or conclusion thereon unless separately reported.
In connection with our audit of the financial statements our responsibility is to readthe other information identified above and in doing so consider whether the otherinformation is materially inconsistent with the 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 material misstatementof this other information we are required to report that fact.
As of date no such other information has yet been provided to us and thus we havenothing to report in this regard. Management's Responsibility for the Ind AS FinancialStatements
6. The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese Ind AS financial statements that give a true and fair view of the financialposition financial performance (including other comprehensive income) cash flows andstatement of changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including Indian Accounting Standards (Ind AS) prescribedunder section 133 of the Act read with the Companies (Indian Accounting Standards) Rules2015 as amended.
This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing theInd AS financial statements management is responsible for assessingthe Company's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.
Those Board of Directors are also responsible for overseeing the Company's financialreporting process.
7. Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.
8. As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional scepticism throughout the audit. We also:
a. Identify and assess the risks of material misstatement of the financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.
b. Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theCompanies Act 2013 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.
c. Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
d. Conclude on the appropriateness of management's use of the going concern basis ofaccounting 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 financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.
e. Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.
9. Materiality is the magnitude of misstatements in the financial statements thatindividually 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 auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the financial statements.
10. We communicate with those charged with governance regarding among other mattersthe planned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
11. We also provide those charged with governance with a statement that we havecomplied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may reasonably be thought to bear onour independence and where applicable related safeguards.
12. From the matters communicated with those charged with governance we determinethose matters that were of most significance in the audit of the financial statements ofthe current period and are therefore the key audit matters. We describe these matters inour auditor's report unless law or regulation precludes public disclosure about the matteror when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
13. 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.
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 Cash Flow Statement and the Statement of Changes in equity dealt with by thisReport are in agreement with the relevant books of account.
d) In our opinion the aforesaid Ind AS financial statements comply with the IndianAccounting Standards prescribed under Section 133 of the Actread with Companies (IndianAccounting Standards) Rules 2015 as amended.
e) On the basis of the written representations received from the directors of theCompany as on 31st March 2021 taken on record by the Board of Directors none of thedirectors is disqualified as on 31st March 2021 from being appointed as a director interms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in Annexure "A". Our report expresses an unmodifiedopinion on the adequacy and operating effectiveness of the Company's internal financialcontrols over financial reporting.
g) In our opinion the managerial remuneration for the year ended March 31 2021 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 on its financialposition in its Ind AS financial statements- Refer Note No. 31;
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses during the year ended 31st March 2021;
iii. There were no amounts required to be transferred to the Investor Education andProtection Fund by the Company during the year ended on 31st March 2021.
14. As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of India in terms of sub-section (11) of section 143 of the Act ("theOrder") and on the basis of such checks of the books and records of the Company aswe considered appropriate and according to the information and explanations given to uswe give in the Annexure "B" a statement on the matters specified inparagraphs 3 and 4 of the Order.
TO THE INDEPENDENT AUDITOR'S REPORT
REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) OF SUB-SECTION 3 OF SECTION
143 OF THE ACT
[Referred to in paragraph 13(f) of the Independent Auditors' Report of even date to themembers of Ajanta Soya Limited
on the Ind AS financial statements for the year ended 31st March 2021]
1. We have audited the internal financial controls over financial reporting of AjantaSoya Limited ("the Company") as of 31st March 2021 in conjunction with ouraudit of the Ind AS financial statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
2. 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.
3. 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 deemed to be prescribedunder section 143(10) of the Act 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.
4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the 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 financial statements whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
6. A company's internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company's internal financial control overfinancial reporting 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 authorizations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
7. 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 the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.
8. In our opinion to the best of our information and according to the explanationsgiven to us the Company has in all material respects an adequate internal financialcontrols system over financial reporting and such internal financial controls overfinancial reporting were operating effectively as at 31st March 2021 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.
TO THE INDEPENDENT AUDITOR'S REPORT
REPORT UNDER THE COMPANIES (AUDITORS REPORT) ORDER 2016 (CARO)
[Referred to in paragraph 14 of the Independent Auditors' Report of even date to themembers of Ajanta Soya Limited on the Ind AS financial statements for theyear ended 31st March 2021]
i. (a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets(property plant and equipment).
(b) The Company has a regular programme of physical verification of its fixed assets bywhich fixed assets are verified in a phased manner over a period of three years. Inaccordance with that plan certain fixed assets were verified during the year and nomaterial discrepancies were noticed on such verification.^ our opinion this periodicityof physical verification is reasonable having regard to the size of the company and natureof its fixed assets.
(c) The title deeds of immovable properties as disclosed in Note 2 property plant& equipment to the financial statements are held in the name of the Company.
ii. The physical verification of inventory (excluding stocks in transit) has beenconducted at year end by the Management. In respect of stock in transit these havesubstantially been confirmed and reconciled by the company. The discrepancies noticed onphysical verification of inventory as compared to book records were not material.
iii. The Company has not granted any loans secured or unsecured to companies firmslimited liability partnerships or other parties covered in the register maintained underSection 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 Section 185 and 186 of the Companies Act 2013in respect of the loans and investments made and guarantees and security provided by it.
v. The Company has not accepted any deposits from public.
vi. Pursuant to the rules made by the Central Government of India the Company isrequired to maintain cost records as specified under Section 148(1) of the Act in respectof its products. We have broadly reviewed the same and are of the opinion that primafacie the prescribed accounts and records have been made and maintained. We have nothowever made a detailed examination of the records with a view to determine whether theyare accurate or complete.
vii. (a) According to the records of the Company and information and explanations givento us and the records of the Company examined by us the Company has been regular indepositing the undisputed statutory dues including provident fund employees stateinsurance income tax Investor education and protection fund goods and service taxsales tax service tax customs duty excise duty cess and other material statutory duesapplicable to it with the appropriate authorities except aggregate demand of Rs. 2.45 lacsraised under Sales Tax for AY 2012-13 2013-14 2015-16 and 2016-17 which was outstandingfor more than six months as at end of the year.
(b) According to the information and explanations given to us and the records of theCompany examined by us the particulars of dues of Income Tax goods and service taxservice tax value added tax/ sales tax entry tax customs duty and excise duty as at31st March 2021 which have not been deposited on account of a dispute are as follows:
|Name of the Statute ||Nature of the Dues ||Amount (Rs In lacs) ||Amount deposited under protest (Rs In lacs) ||Period to which the amount relates ||Forum where dispute is pending |
|Central/State Sales Tax ||Entry Tax ||28.95 ||20.90 ||AY 2014-15 ||Rajasthan Tax Board Ajmer |
|FSSAI ||Penalty ||4.00 ||2.00 ||FY 2018-19 ||Food Safety appellate tribunal |
|Custom Duty Act ||Custom Duty ||215.62 ||7.89 ||AY 2017-18 ||CESTAT-Delhi |
viii. According to the records of the Company examined by us and the information andexplanation given to us the Company has not defaulted in repayment of loans or borrowingsto any financial institution or bank or Government or dues to debenture holders as at thebalance sheet date.
ix. The Company has not raised any moneys by way of initial public offer furtherpublic offer (including debt instruments). Term loans have been applied for the purposesfor which they were obtained.
x. During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.
xi. The Company has paid/ provided for managerial remuneration in accordance with therequisite approvals mandated by the provisions of Section 197 read with Schedule V to theAct.
xii. As the Company is not a Nidhi Company and the Nidhi Rules 2014 are not applicableto it the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii. The Company has entered into transactions with related parties in compliance withthe provisions of Sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the financial statements as required under IndianAccounting Standard (Ind AS) 24 Related Party Disclosures specified under Section 133 ofthe Act read with Rule 7 of the Companies (Accounts) Rules 2014.
xiv. During the period under review the company has not made any preferential allotmentor private placement of shares or fully or partly paid convertible debentures and hencereporting under clause 3 (xiv) is not applicable to the company.
xv. The Company has not entered into any non-cash transactions with its directors orpersons connected with him. Accordingly the provisions of Clause 3(xv) of the Order arenot applicable to the Company.
xvi. The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934. Accordingly the provisions of Clause 3(xvi) of the Order are notapplicable to the Company.
|For PAWAN SHUBHAM & CO |
|Chartered Accountants |
|Firm Registration Number: 011573C |
|CA Pawan Kumar Agarwal |
|Membership Number:092345 |
|UDIN: 21092345AAAACZ3445 |
|Place of signature : New Delhi |
|Date: 25th June 2021 |