To the Members of ALKALI METALS LIMITED
Report on the Audit of the Financial Statements
We have audited the accompanying financial statements of ALKALI METALS LIMITED ("theCompany") which comprise the Balance Sheet as at March 31 2021 the Statement ofProfit and Loss (including Other Comprehensive Income) the Statement of Changes in Equityand statement of Cash Flows for the year then ended and Notes to the FinancialStatements including a summary of significant accounting policies and other explanatoryinformation.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by theCompanies Act 2013 in the manner so required and give a true and fair view in conformitywith the Indian Accounting Standards prescribed under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended ("Ind AS") andother accounting principles generally accepted in India of the state of affairs of theCompany as at March 31 2021 and its Loss and other comprehensive income changes inequity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the financial statements in accordance with the Standards onAuditing (SAs) specified under section 143(10) of the Companies Act 2013. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Financial Statements section of our report. We areindependent of the Company in accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethical requirements that are relevantto our audit of the financial statements under the provisions of the Companies Act 2013and the Rules thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the Code of Ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for our auditopinion on the financial statements.
Key Audit Matters
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 that there are no key audit matters to communicate in our report.
The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information obtained at the date of this auditor's report comprisesthe information included in the Management Discussion and Analysis Board's Reportincluding Annexures to Board's Report and Shareholder's Information but does not includethe financial statements and our auditor's report thereon. Our opinion on the financialstatements does not cover the other information and we do not express any form ofassurance conclusion thereon.
In connection with our audit of the financial statements our responsibility is to readthe other information and
in doing so consider whether the other information is materially inconsistent with thefinancial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated.
If based on the work we have performed on the other information obtained prior to thedate of this auditor's report we conclude that there is a material misstatement of thisother information we are required to report that fact. We have nothing to report in thisregard.
Responsibilities of Management and Those Charged with Governance for the FinancialStatements
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 financial statements that give a true and fair view of the financial positionfinancial performance total comprehensive income changes in equity and cash flows of theCompany in accordance with the accounting principles generally accepted in Indiaincluding the Ind AS specified under section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation 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 financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.
In preparing the financial statements the management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless themanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the company's financialreporting process.
Auditor's Responsibilities for the Audit of the Financial Statements
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.
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 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.
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.
Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
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.
Evaluate the overall presentation structure and content of the financial statementsincluding the disclosures and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation.
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 themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.
Report on Other Legal and Regulatory Requirements
1. 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 (hereinafterreferred to the "Order") and on the basis of such checks of the books andrecords of the Company as we considered appropriate and according to the information andexplanations given to us we give in the Annexure-1 a statement on the matters specifiedin paragraphs 3 and 4 of the Order.
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 purpose 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 statement of cash flows and the statement of changes in equity dealt with bythis Report are in agreement with the books of account.
d) In our opinion the aforesaid said financial statements comply with the Ind ASspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014.
e) On the basis of written representations received from the Directors as on March 312021 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2021 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 and the operating effectiveness of such controls refer to ourseparate Report in "Annexure -2".
g) 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 we report thatthe remuneration paid by the Company to its directors during the year in our opinion andto the best of our information and according to the explanations given to us is inaccordance with the provisions of section 197 of the Act." h) With respect to theother matters to be included in the Auditor's Report in accordance with Rule 11 of theCompanies (Audit and Auditors) 2014 in our opinion and to the best of our informationand according to the explanations given to us;
i. The Company has disclosed the impact of pending litigations on its financialposition in its Ind AS financial statements.
ii. In our opinion and as per the information and explanations provides to us theCompany has not entered into any long-term contracts including derivative contractsrequiring provision under applicable laws or accounting standards for materialforeseeable losses and
iii. There has been no delay in transferring the amounts required to be transferredto the Investor Education and Protection Fund by the Company.
ANNEXURE - 1 TO THE INDEPENDENT AUDITORS' REPORT:
(Referred to in Paragraph 1 under section Report on Other Legal and RegulatoryRequirements'
of our report of even date)
1.1. According to the information and explanations given to us the Company ismaintaining proper records showing full particulars including quantitative details andsituation of fixed assets.
1.2. According to the information and explanations given to us all the fixed assetshave been physically verified by the management at reasonable intervals and no materialdiscrepancies were noticed on such verification.
1.3. All the title deeds of the immovable properties are held in the name of theCompany.
2. According to the information and explanations given to us the inventories have beenphysically verified at reasonable intervals by the management except the stock lying inthe bonded ware house and no material discrepancies were noticed on such verification.
3. According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under Section 189 of theCompanies Act 2013. Accordingly the sub-clauses (a) (b) and (c) are not applicable tothe company.
4. According to the information and explanations given to us the Company has notgranted any loans nor has it made any investments or given any guarantee or security whichare covered under the provisions of Section 185 and 186 of the Companies Act 2013.
5. According to the information and explanations given to us the Company has notaccepted any deposits in terms of the directives issued by Reserve Bank of India and theprovisions of Sections 73 to 76 or any other relevant provisions of the Companies Act2013 and the rules framed there under.
6. We have broadly reviewed the cost records maintained by the Company pursuantsub-section (1) of Section 148 of the Companies Act 2013 and are of the opinion thatprima facie the prescribed accounts and records have been made and maintained.
7.1 According to the information and explanations given to us the company is generallyregular in depositing undisputed statutory dues including provident fund employees stateinsurance income tax sales tax service tax duty of customs duty of excise valueadded tax goods and service tax cess and other statutory dues as are applicable withthe appropriate authorities.
According to the information and explanations given to us there are no arrears ofoutstanding statutory dues as at the last day of the financial year under audit for aperiod of more than six months from the date they became payable.
7.2 According to the information and explanations given to us there are no dues ofincome tax or sales tax or service tax or duty of customs or duty of excise or value addedtax which have not been deposited on account of dispute.
8. According to the information and explanations given to us the Company has notdefaulted in repayment of loans or borrowings to a financial institution or bank.
9. According to the information and explanations given to us during the year underreview the Company has not raised any money by way of initial public offer furtherpublic offer. However Money raised by way of term loans were applied for the purposes forwhich those are raised.
10. According to the information and explanations given to us and based upon the auditprocedures performed by us no fraud by the Company or on the Company committed by itsofficers or employees has been noticed or reported during the year.
11. According to the information and explanations given to us the managerialremuneration paid during the year is in compliance with the provisions of Section 197 readwith Schedule V of the Companies Act 2013.
12. As the Company is not a Nidhi Company in terms of the provisions of the CompaniesAct 2013 read with Nidhi Rules 2014 the matters to be reported under clause (xii) arenot applicable.
13. According to the information and explanations given to us in respect of thetransactions with the related parties the Company has complied with the provisions ofSection 177 and 188 of the Companies Act. 2013 wherever applicable. In our opinion thedetails as required by the applicable accounting standards have been disclosed in thefinancial statements for the year under review.
14. According to the information and explanations given to us the Company has not madeany preferential allotment or private placement of shares or fully or partly convertibledebentures during the year under review. Hence reporting requirement on compliance withSection 42 of the Companies Act 2013 and purpose of application of the funds so raised isnot applicable.
15. According to the information and explanations given to us the Company has notentered into any non-cash transactions with directors or persons connected with him andhence reporting requirement on compliance with the provisions of Section 192 of theCompanies Act 2013 is not applicable.
16. According to the information and explanations given to us and in our opinion thecompany is not required to be registered under section 45-IA of the Reserve Bank of IndiaAct 1934.
ANNEXURE 2 TO THE INDEPENDENT AUDITOR'S REPORT: Report on the Internal FinancialControls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013("the Act"):
We have audited the internal financial controls over financial reporting of ALKALIMETALS LIMITED ("the Company") as of March 31 2021 in conjunction with ouraudit of the financial statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Company's management is responsible for establishing and maintaining 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. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.
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 accordance with the Guidance Note on Audit of InternalFinancial Controls over Financial Reporting (the "Guidance Note") and theStandards on Auditing issued by ICAI and deemed to be prescribed under section 143(10) ofthe Companies Act 2013 to the extent applicable to an audit of internal financialcontrols both applicable to an audit of Internal Financial Controls and both issued bythe Institute of Chartered Accountants of India. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in allmaterial 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 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 Company's internal financial controls systemover financial reporting.
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 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.
Inherent 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 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.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 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.
For G NAGENDRASUNDARAM & CO
Place : Hyderabad
Date : June 10 2021