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Alstone Textiles (India) Ltd.

BSE: 539277 Sector: Others
NSE: N.A. ISIN Code: INE184S01016
BSE 05:30 | 01 Jan Alstone Textiles (India) Ltd
NSE 05:30 | 01 Jan Alstone Textiles (India) Ltd

Alstone Textiles (India) Ltd. (ALSTONETEXTILES) - Auditors Report

Company auditors report

ANNEXURE-VI

INDEPENDENT AUDITORS' REPORT

To

The Members of Alstone Textiles (India) Limited

Report on the Audit of the Financial statements Opinion

We have audited the financial statements of Alstone Textiles (India) Limited ("theCompany") which comprise the balance sheet as at March 31 2020 and the statementof profit and loss (including other comprehensive income) the statement of changes inequity and the 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 (‘Act') in the manner so required and give a true and fair viewin conformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at March 31 2020 its loss Amount of Rs. 1891247/- and cashout flows for the year ended on that date.

Basis for opinion

We conducted our audit in accordance with the standards on auditing specified undersection 143 (10) of the Companies Act 2013. Our responsibilities under those Standardsare further described in the auditor's responsibilities for the audit of the financialstatements section of our report. We are independent of the Company in accordance with thecode of ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the financial statements under theprovisions of the Act and the rules there under and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the code of ethics.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our opinion.

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 the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31stMarch 2020 its profit/loss statement and its cash flows statement for the year ended onthat date.

EMPHASIS OF MATTER

We draw your attention to serial no. 23 Note which describes the impact of Pandemic(Covid-19) on financial position of the Company. Our opinion is not modified in respect ofthis matter.

Key audit matters

In addition to the matter described in the Material Uncertainty Related to GoingConcern section we have determined the matters described below to be the key auditmatters to be communicated in our report.

(A) Adoption of new revenue recognition standard Ind AS 115 (This is added only forillustrative purposes and the auditor has to decide the most significant matter and modifythis section accordingly)

Details of the Key Audit Matter

The Company adopted IND AS 115 "Revenue from Contracts with Customers" witheffect from April 1 2019. The application of the new revenue accounting standard involvescertain key judgments relating to identification of distinct performance obligationsdetermination of transaction price of the identified performance obligations and point ofrecognition of revenue. Ind AS 115 also requires extensive disclosures.

Auditors' Response to the Key Audit Matter

We assessed the Company's process to identify the impact of adoption of the new revenueaccounting standard (IND AS 115). Our audit approach consisted testing of the design andoperating effectiveness of the internal controls and substantive testing as follows:

  1. Evaluated the design of internal controls relating to implementation of the new revenue accounting standard.
  2. Selected a sample of continuing and new contracts and tested the operating effectiveness of the internal control relating to identification of the distinct performance obligations and determination of transaction price.

(c) Selected a sample of continuing and new contracts and performed the followingprocedures:

• Read analysed and identified the distinct performance obligations in thesecontracts.

• Compared these performance obligations with that identified and recorded by theCompany.

• Considered the terms of the contracts to determine the transaction priceincluding any variable consideration to verify the transaction price used to computerevenue and to test the basis of estimation of the variable consideration.

• Performed analytical procedures for reasonableness of revenue recognition as perIND AS 115.

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 ManagementDiscussion and Analysis Board's Report including Annexure to Board's Report BusinessResponsibility Report Corporate Governance and Shareholder's

Information but does not include the financial statements and our auditor's reportthereon. Our opinion on the financial statements does not cover the other information andwe do not express any form of assurance conclusion thereon. In connection with our auditof the financial statements our responsibility is to read the other information and indoing so consider whether the other information is materially inconsistent with thestandalone financial statements or our knowledge obtained during the course of our auditor otherwise appears to be materially misstated. If based on the work we have performedwe conclude that there is a material misstatement of this other information; we arerequired to report that fact. We have nothing to report in this regard.

Management's responsibility for the financial statements

The Company's board of directors is responsible for the matters stated inSection-134(5) of the Act with respect to the preparation of these financial statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income cash flows and changes in equity of the Company in accordancewith the Indian Accounting Standards (IND AS) prescribed under section 133 of the Act readwith the Companies (Indian Accounting Standards) Rules 2015 and Companies (IndianAccounting Standards) Rules 2016 as amended from time to time and other accountingprinciples generally accepted in India.

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 financial statement that give a true and fair view and are free from materialmisstatement whether due to fraud or error. In preparing the financial statementsmanagement is responsible for assessing the

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.

The Boards 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 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 control.

• Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Companies Act 2013 we are also responsible for expressing our opinion on whetherthe company has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made 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 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 financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation. Wecommunicate with those charged with governance regarding among other matters the plannedscope and timing of the audit and significant audit findings including any significantdeficiencies 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. From the matters communicated withthose charged with governance we determine those matters that were of most significancein the audit of the financial statements of the current period and are therefore the keyaudit matters. We describe these matters in our auditor's report unless law or regulationprecludes public disclosure about the matter or when in extremely rare circumstances wedetermine that a matter should not be communicated in our report because the adverseconsequences of doing so would reasonably be expected to outweigh the public interestbenefits of such communication.

Report on other legal and regulatory requirements

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 Companies Act 2013 we give in Annexure "A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order.

As required by Section 143(3) of the Act 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 my examination of those books;

(c) The balance sheet the statement of profit and loss and the cash flow statementdealt with by this report are in agreement with the books of account;

(d) In our opinion the aforesaid financial statements comply with the accountingstandards specified under section 133 of the Act read with rule 7 of the Companies(Accounts) Rules 2014;

(e) On the basis of the written representations received from the directors as on March31 2020 taken on record by the board of directors none of the directors is disqualifiedas on March 31 2020 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 B". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting;

(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 in ouropinion and to the best of our information and according to the explanations given to ourthe remuneration paid by the Company to its directors during the year is in accordancewith the provisions of section 197 of the Act; and

(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 in our opinionand to the best of our information and according to the explanations given to our;

a. The Company does not have any pending litigations which would impact its financialposition;

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

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

FOR MAK & COMPANY
(CHARTERED ACCOUNTANT)
FIRM REGN NO: 028454N
CA. SAMEEM AHMED
(PARTNER)
M.NO : 533849
PLACE: NEW DELHI
DATE: 17.06.2020
UDIN: 20533849AAAAAJ4196

Annexure "A" to the Independent Auditor's Report*

(Referred to in paragraph 1 under ‘Report on other legal and regulatoryrequirements' section of our report to the members of Alstone Textiles (India) Limited ofeven date)

1. In respect of the Company's fixed assets:

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

(b) The fixed assets of the Company were physically verified in full by the managementduring the year. According to the information and explanations given to us and as examinedby us no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us the records examined byus we report that the Company does not hold any freehold are held in the name of theCompany as at the balance sheet date. In respect of immovable properties of land andbuilding that have been taken on lease and disclosed as fixed assets in the financialstatements the lease agreements are in the name of the Company.

2. The inventory has been physically verified by the management during the year. In ouropinion the frequency of such verification is reasonable. According to the informationand explanations given to us and as examined by us no material discrepancies were noticedon such verification.

3. According to information and explanation given to us the company has grantedinterest bearing loan unsecured to companies firms limited liability partnerships orother parties covered in the register required under section 179 of the Companies Act2013. Accordingly paragraph 3 (iii) of the order is not applicable.

4. In our opinion and according to information and explanation given to us the companygranted any loans or provided any guarantees or given any security or made any investmentsto which the provision of section 185 and 186 of the Companies Act 2013. Accordinglyparagraph 3 (iv) of the order is not applicable.

5. In our opinion and according to the information and explanations given to us thecompany has not accepted any deposits and accordingly paragraph 3 (v) of the order is notapplicable.

6. The Central Government of India has not prescribed the maintenance of cost recordsunder sub-section (1) of section 148 of the Act for any of the activities of the companyand accordingly paragraph 3 (vi) of the order is not applicable.

7. In respect of 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 employees' stateinsurance income-tax sales- tax service tax goods and service tax duty of customsduty of excise value added tax cess and other material statutory dues have beengenerally regularly deposited during the year by the company with the appropriateauthorities.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income-tax sales- taxservice tax goods and service tax duty of customs duty of excise value added tax cessand other material statutory dues were in arrears as at March 31 2020 for a period ofmore than six months from the date they became payable

(b) According to the information and explanations given to us and the records of thecompany examined by us there are no dues of income-tax sales- tax service tax goodsand service tax duty of customs duty of excise and value added tax which have not beendeposited on account of any dispute.

8 In our opinion and according to the information and explanations given to us thecompany has no outstanding dues to any financial institutions or banks or any governmentor any debenture holders during the year. Accordingly paragraph 3 (viii) of the order isnot applicable.

9. The Company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments) and has not taken any term loans during theyear. Accordingly paragraph 3 (ix) of the order is not applicable.

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 not 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 accordingly paragraph 3 (xii) of the orderis not applicable to the Company.

13. 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 section 177 and 188 of the Act. Where applicable the details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

14 According to 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. Accordingly paragraph 3(xiv) of the order is not applicable.

15 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 them. Accordingly paragraph 3(xv)of the order is not applicable.

16 According to the information and explanations given to us and based on ourexamination of the records of the company the company is not required to be registeredunder section 45-IA of the Reserve Bank of India Act 1934.

FOR MAK & COMPANY
(CHARTERED ACCOUNTANT)
FIRM REGN NO: 028454N
CA. SAMEEM AHMED
(PARTNER)
M.NO : 533849
PLACE: NEW DELHI
DATE: 17.06.2020
UDIN: 20533849AAAAAJ4196

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 Alstone Textiles (India) Limited ofeven date)

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 haveaudited the internal financial controls over financial reporting of Alstone

Textiles (India) Limited ("the Company") as at March 31 2020 in conjunctionwith our audit of the 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 the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

Auditors' responsibility

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 Accountantsof India and the standards on auditing prescribed under Section 143 (10) of the CompaniesAct 2013 to the extent applicable to an audit of internal financial controls. Thosestandards and the guidance note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting were established and maintained and if suchcontrols operated effectively in all material respects. Our audit involves performingprocedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal control based on the assessed risk. The procedures selected depend on theauditor's judgement including the assessment of the risks of material misstatement in thefinancial statements whether due to fraud or error. Our believe that the audit evidencewe have obtained is sufficient and appropriate to provide a basis for our audit opinionon the Company's internal financial control system over 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 (i) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (ii) 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 authorizations ofmanagement and directors of the company; and (iii) 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.

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 of 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.

Opinion

In our opinion and according to the information and explanations given to us theCompany has in all material respects an adequate internal financial control system overfinancial reporting and such internal financial controls over financial reporting wereoperating effectively as at March 31 2020 based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India.

FOR MAK & COMPANY
(CHARTERED ACCOUNTANT)
FIRM REGN NO: 028454N
CA. SAMEEM AHMED
(PARTNER)
M.NO : 533849
PLACE: NEW DELHI
DATE: 17.06.2020
UDIN: 20533849AAAAAJ4196

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