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AMD Industries Ltd.

BSE: 532828 Sector: Industrials
NSE: AMDIND ISIN Code: INE005I01014
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VOLUME 3541
52-Week high 33.60
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P/E 43.79
Mkt Cap.(Rs cr) 59
Buy Price 0.00
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OPEN 31.35
CLOSE 31.30
VOLUME 3541
52-Week high 33.60
52-Week low 15.00
P/E 43.79
Mkt Cap.(Rs cr) 59
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

AMD Industries Ltd. (AMDIND) - Auditors Report

Company auditors report

To the Members of AMD Industries Limited

Report on the Standalone Ind AS financial Statements

Opinion

We have audited the accompanying standalone Ind AS financial statements of AMDIndustries Limited ("the Company") which comprises the Balance Sheet as at March31 2020 the Statement of Profit and Loss (including Other Comprehensive Income)Statement of Changes in Equity and Statement of Cash Flows for the year then ended andnotes to the financial statements including a summary of significant accounting policiesand other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the Ind AS and accounting principles generally accepted in India of the state ofaffairs of the Company as at March 31 2020 and profit total comprehensive income thechanges in equity and its cash flows for the year ended on that date.

Basis for Opinion

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 thestandalone Ind AS financial statements under the provisions of the Companies Act 2013 andthe 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 ouropinion.

Key Audit Matters

Key Audit Matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone Ind AS financial statements of the currentperiod. These matters were addressed in the context of our audit of the Standalone Ind ASfinancial statements as a whole and informing our opinion thereon and we do not providea separate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report

(i) Revenue Recognition
(As described in note 2.17 of the standalone Ind AS financial statements)
For the year ended March 31 2020 the Company has recognized revenue from contracts with customers amounting to Rs.17454.57 lakhs. Our audit procedures included the following:
Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The Company has generally concluded that as principal it typically controls the goods or services before transferring them to the customer. • Assessed the Company's revenue recognition policy prepared as per Ind AS 115 ‘Revenue from contracts with customers'.
• Assessed the design and tested the operating effectiveness of internal controls related to revenue recognition discounts and rebates.
The variety of terms that define when control are transferred to the customer as well as the high value of the transactions give rise to the risk that revenue is not recognized in the correct period. • Performed sample tests of individual sales transaction and traced to sales invoices and other related documents. Further in respect of the samples checked that the revenue has been recognized as per the agreed terms.
Revenue is measured net of net of returns and allowances and trade discounts. • To test cut off selected sample of sales transactions made pre- and post-year end agreeing the period of revenue recognition to third party support such as transporter invoice and customer confirmation of receipt of goods.
Revenue is also an important element of how the Company measures its performance. The Company focuses on revenue as a key performance measure which could create an incentive for revenue to be recognized before the risk and rewards have been transferred.
Accordingly due to the significant risk associated with revenue recognition in accordance with terms of Ind AS 115 ‘Revenue from contracts with customers' it was determined to be a key audit matter in our audit of the standalone Ind AS financial statements. • Tested the calculations related to discounts by agreeing a sample of amounts recognized to underlying arrangements with customers and other supporting documents.
• Performed monthly analytical procedures of revenue by streams to identify any unusual trends.
• Obtained confirmations from customers on sample basis to support existence of trade receivables and assessed the relevant disclosures made in the financial statements; to ensure revenue from contracts with customers are in accordance with the requirements of relevant accounting standards.
(ii) Contingent Liability under Tax and other Laws
(As described in note 43 of the standalone Ind AS financial statements)
As at March 31 2020 there is a contingent liability of Rs.950962/- in respect of Local Sales Tax raised for F.Y. 1999-2000 to 2006-07 under section 4A of the Act. The department levied tax on Goods under modernization certificate on base production. The case is pending with Supreme Court of India. Our audit procedures include the following substantive procedures:
• Obtained an understanding of Key Tax Matters;
As at March 31 2020 there is a contingent liability of Rs.3118745/- in respect of Central Sales Tax raised for F.Y. 1999-2000 to 2006-07 under section 4A of the Act. The department levied tax on Goods under modernization certificate on base production. The case is pending with Supreme Court of India. • Read and analysed selected key correspondences external legal opinions/ consultations obtained by the company for Key Tax Matters.
As at March 31 2020 there is a contingent liability of Rs.358400/- in respect of demand raised for the F.Y. 2003-04 by Sales Tax Authority on account of non-submission of Concessional Forms. The case is pending with Tribunal Court Ghaziabad. • Assessed and challenged the company's estimate of the possible outcome of the disputed cases by considering legal precedence; and
As at March 31 2020 there is a contingent liability of Rs.1145102/- in respect of entry tax raised for the F.Y. 2001-02 by Sales Tax Authority. The case is pending with Tribunal Court Gahziabad. • Assessed and tested the presentation and disclosures relating to taxes.
As at March 31 2020 there is a contingent liability of Rs.1140307/- in respect of entry tax raised for the F.Y. 2002-03 by Sales Tax Authority. The case is pending with Supreme Court of India.
As at March 31 2020 there is a contingent liability of Rs.1637643/- in respect of entry tax raised for the F.Y. 2004-05 by Sales Tax Authority. The case is pending with Allahabad High Court.
As at March 31 2020 there is a contingent liability of Rs.447623/- in respect of Sales Tax Demand raised for F.Y. 2005-06 for non-filing of export certificates at the time of assessment.The case is pending with Addl. Commissioner Appeal (Trade Tax) – I Ghaziabad
As at March 31 2020 there is a contingent liability of Rs.220397/- in respect of Entry tax raised for the F.Y. 2005-06 by UP trade tax Authorities.The case is pending before the Supreme Court of India
As at March 31 2020 there is a contingent liability of Rs.3809702/- for the F.Y. 2007-08 in respect of UP Vat charged on Preform @ 5% as classified item under the Act by the company but department denied and raised the demand @ 13.50%.The case is pending before the Allahabad High Court.
As at March 31 2020 there is a contingent liability of Rs.29718848/- for the F.Y. 2008-09 and F.Y.2009-10 in respect of UP Vat charged on Preform @ 5% as classified item under the Act by the company but department denied and raised the demand @ 13.50%.The case is pending before the Tribunal Court Ghaziabad.
As at March 31 2020 there is a contingent liability of Rs.200000/- on Accident Claim made by Worker under Industrial Dispute Act1947. The case is pending before the Labour Court-I Ghaziabad.
As at March 31 2020 there is a contingent liability of Rs.1142960/- against income tax demand for F.Y.2013-14.The case is pending beofore Assessing Officer to give appeal effect for the decision given in favour of company by CIT (Appeal).
As at March 31 2020 there is a contingent liability of Rs.174380/- against income tax demand F.Y.2014-15.The case is pending beofore ITAT New Delhi.
(iii) Bad Debts and Allowance for Doubtful Debts
(As described in note 55 of the standalone Ind AS financial statements)
As mentioned in note no. 11 to the standalone financial statements trade receivable were outstanding aggregating to Rs.4850.39 Lakhs as on 31st March 2020. Our audit procedures included the following:
• We selected a sample of the larger trade receivable balances where a bad debts of trade receivables has been recognized.
The collectability of the Company's trade receivables and the valuation of allowance for impairment of trade receivables require significant management judgment. Management considers specific factors including the age of the balance existence of disputes recent historical payment patterns increase in competition on account of rates parity in the market and any other available information concerning the creditworthiness of counterparties. Management uses this information to determine whether a provision for impairment is required either for a specific transaction or for a customer's balance overall. Accordingly the management identified such factors and it's assessment results into bad debts of trade receivables of Rs. 616.91 Lakhs and which has been accounted as Bad Debts under the Note "Other expenses"(Refer note no.35).In some cases chances of recovery are doubtful therefore management has made allowance for bad and doubtful debts for Rs.72.06 Lakhs (Refer note no. 11). • We assessed the ageing of trade receivables the customer's historical payment patterns and whether any post year-end payments has been received up to the date of completing our audit procedures.
• We also obtained corroborative evidence of any disputes between the parties involved attempts by management to recover the amounts outstanding and on the credit status of significant counterparties wherever available.
• Read and analysed selected key correspondences external legal opinions/ consultations obtained by the company.
Accordingly it has been determined as a key audit matter. • In assessing the appropriateness of the overall bad debts we considered the management's application of policy for recognizing provisions.
• Further in addition to the above process a forward-looking expected loss impairment model as prescribed in IND AS 109 "Financial Instruments" was also applied by the Company. This involves judgment as the expected credit losses must reflect information about past events current conditions and forecasts of future conditions.
• We assessed the Company's provisioning policy which included assessing whether the calculation was in accordance with IND AS 109 and comparing the Company's provisioning rates against historical collection data.
(iv) Sale of Factory Land and Building
The Company has sold its factory land and building situated at C-4 Site-III Meerut Road Industrial Area Ghaziabad U.P. during the F.Y.2019-20 for Rs.675.00 Lakhs which has resulted into profit of Rs.574.09 Lakh and the same is included under note no. 36 "Exceptional Items". • Considered the completeness and accuracy of the disclosures Our audit procedures include the following substantive procedures:
The company has also entered into agreement for sale of its factory land and building situated at C-5 Site-III Meerut Road Industrial Area Ghaziabad U.P. • Assessed the Company's policy regarding assets held for sale prepared as per Ind AS 105 ‘Non-current assets held for sale and discontinued operations'.
During the F.Y.2019-20 for Rs.650.00 Lakhs and received capital advance of Rs.425.00 Lakh during the F.Y.2019-20 which has been shown as Capital Advance under note no. 26 "Other current liabilities". • Read and analysed sale agreement correspondences and assessed circle rates of property sold.
• Review of Fixed Assets register of the company
• Gain arising on sale of immovable properties classified as held for sale meet the definition of discontued operation and is shown as exceptional items. and
• Assessed and tested the presentation and disclosures relating to sale of properties.

We have determined that there are no other key audit matters to communicate in ourreport.

Information Other than the Standalone Ind AS financial Statements and Auditor's ReportThereon

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Management Discussion and AnalysisBoard's Report including Annexures to Board's Report Business Responsibility ReportCorporate Governance and Shareholder's Information but does not include the standaloneInd AS financial statements and our auditor's report thereon.

Our opinion on the standalone Ind AS financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone Ind AS financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone Ind AS financialstatements or our knowledge obtained in the audit or otherwise appears to be materiallymisstated. 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 Responsibility for the Standalone Ind AS financial Statements

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 standalone Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income changesin equity and cash flows of the Company in accordance with accounting principles generallyaccepted in India including Indian Accounting Standards (Ind AS) prescribed under section133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015 asamended. 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 implementation and maintenance of accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the standalone Ind AS financial statement that give a trueand fair view and are free from material misstatement whether due to fraud or error.

In preparing the standalone Ind AS financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so. The Board of Directors are also responsible foroverseeing the company's financial reporting process.

Auditor's Responsibilities for the Audit of Standalone Ind AS financial Statement

Our objectives are to obtain reasonable assurance about whether the Standalone Ind ASfinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone Ind AS 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 standalone Ind ASfinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal 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 internal financial controls with reference to Financial Statements inplace and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures 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 standalone Ind AS financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.

• Evaluate the overall presentation structure and content of the standalone IndAS financial statements including the disclosures and whether the standalone Ind ASfinancial statements represent the underlying transactions and events in a manner thatachieves 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.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone Ind AS financialstatements for the financial year ended March 31 2020 and are therefore the key auditmatters. 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

1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the "Annexure A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

2. 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 our examination of those books.

c) The Balance Sheet the Statement of Profit and Loss including the Statement of OtherComprehensive Income the Cash Flow Statement and Statement of Changes in Equity dealtwith by this Report are in agreement with the books of account.

d) In our opinion the aforesaid standalone Ind AS financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended.

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 Control with reference toFinancial Statements of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure B". 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 2020 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 in our opinionand to the best of our information and according to the explanations given to us:

(i) The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements – Refer Note 58 to theStandalone Ind AS financial statements;

(ii) The Company did not have any long-term contracts including derivative contractsfor which there were any material foreseeable losses;

(iii) There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.

For Goyal Nagpal & Co.
Chartered Accountants
(Firm's Registration No. 018289C)
Sd/-
CA Virender Nagpal
Place: New Delhi Partner
Date: July 25 2020 (Membership No. 416004)

Annexure A to the Independent Auditors' Report

The Annexure referred to in our Independent Auditors' Report to the members of theCompany on the standalone Ind AS financial statements for the year ended March 31 2020we report that:

i. a) The Company has maintained proper records showing full particulars includingquantitative details and situation of property plant and equipment.

b) The Company has a regular program of physical verification of its fixed assets bywhich property plant and equipments are verified in a phased manner. In accordance withthis program certain property plant and equipments were verified during the year and nomaterial discrepancies were noticed on such verification. In our opinion this periodicityof physical verification is reasonable having regard to the size of the Company and thenature of its assets.

c) According to the information and explanation given to us and on the basis of ourexamination of the records of the company the title deeds of the immovable propertiesincluded in property plant and equipment are held in the name of the company.

ii. a) The management of the Company has conducted the physical verification ofinventory at reasonable intervals during the year.

b) The procedure of physical verification of inventory followed by the management isreasonable and adequate in relation to the size of the Company and nature of its business.

c) The Company has maintained the proper records of inventory and no materialdiscrepancies were noticed on physical verification.

iii. The Company has not granted any loans to companies firms or other parties coveredin the register maintained under section 189 of the Companies Act 2013 (‘the Act').Therefore provisions of clause 3(a) (b) and (c) are not applicable to the company.

iv. In our opinion and according to the information and explanations given to usprovisions of section 185 and 186 of the Companies Act 2013 in respect of loans todirectors including entities in which they are interested and in respect of loans andadvances given investments made and guarantees and securities given have been compliedwith by the company.

v. The Company has not accepted any deposits within the meaning of sections 73 to 76 ofthe act and the Companies (Acceptance of Deposits) Rules 2014 (as amended). Accordinglythe provisions of clause 3(v) of the order are not applicable.

vi. To the best of our knowledge and as explained the Central Government has notspecified the maintenance of cost records under clause 148(1) of the Companies Act 2013for the products/services of the Company.

vii. a) The Company is generally regular in depositing with appropriate authoritiesundisputed statutory dues including provident fund income-tax employees' stateinsurance goods and service tax cess and other statutory dues applicable to it with aslight delay in few cases. The provisions relating to duty of excise are not applicable tothe Company.

b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund income-tax employees' state insurance goods andservice tax cess and other statutory dues were outstanding at the year end for a periodof more than six months from the date they became payable

c) According to the records of the company the dues outstanding of provident fundincome-tax employees' state insurance goods and service tax cess and other statutorydues on account of any dispute are as follows:

Name of Statute Nature of Dues Amount (in Rs.) Period to which the amount Relate Forum where dispute is pending
The U.P.Trade Tax Act1948 Local Sales Tax raised under section 4A of the Act. The department levied tax on Goods under modernization certificate on base production Rs.950962/- F.Y. 1999-2000 to 2006-07 Supreme Court
The Central Sales Tax Act 1956 Central Sales Tax raised under section 4A of the Act. The department levied tax on Goods under modernization certificate on base production Rs.3118745/- F.Y. 1999-2000 to 2006-07 Supreme Court
The Central Sales Tax Act 1956 Demand raised by Sales Tax Authority on account of non-submission of Concessional Forms Rs.358400/- F.Y. 2003-04 Tribunal Court Ghaziabad
The U.P. Tax on entry of Goods into Local Area Act2007 Entry tax raised by UP Trade Tax Authorities Rs.1145102/- F.Y. 2001-02 Tribunal Court Ghaziabad
The U.P. Tax on entry of Goods into Local Area Act2007 Entry tax raised by UP trade tax Authorities. Rs.1140307/- F.Y. 2002-03 Supreme Court
The U.P. Tax on entry of Goods into Local Area Act2007 Entry tax raised by UP trade tax Authorities. Rs.1637643/- FY 2004-05 Allahabad High Court
Industrial Dispute Act1947 Accident Claim made by Worker Rs.200000/- F Y 2001-02 Labour Court-I Ghaziabad
The U.P. Tax on entry of Goods into Local Area Act2007 Sales Tax Demand raised for non-filing of export certificates at the time of assessment Rs.447623/- F.Y. 2005-06 Addl. Commissioner Appeal (Trade Tax)-I Ghaziabad
The U.P. Tax on entry of Goods into Local Area Act2007 Entry tax raised by UP trade tax Authorities. Rs.220397/- F. Y 2005-2006 Supreme Court
The U.P. Value Added Tax Act2008 The company charged UP Vat on Preform @ 5% as classified item under the Act but department denied and raised the demand @ 13.50% Rs.3809702/- F.Y 2007-2008 Hon'ble High Court Allahabad
The U.P. Value Added Tax Act2008 The company charged UP Vat on Preform @ 5% as classified item under the Act but department denied and raised the demand @ 13.50% Rs. 29718848/- 2008-09 & 2009-10 Tribunal court Ghaziabad
The Income Tax Act 1961 Demand on Regular Tax Assessment Rs. 1142960/- F.Y.2013-14 Assessing Officer to give appeal effect for the decision given in favour of company by CIT (Appeal)
The Income Tax Act 1961 Demand on Regular Tax Assessment Rs.174380/- F.Y.2014-15 ITAT New Delhi.

viii. In our opinion and according to the information and explanations given by themanagement the Company has not defaulted in repayment of loans or borrowing to afinancial institution bank or Government.

ix. In our opinion and according to the information and explanations given by themanagement the Company has utilized the monies raised by way of term loans for thepurposes for which they were obtained. The Company has not raised any money by way ofinitial public offer / further public offer / debt instruments during the year. Hencereporting under clause (ix) is not applicable to the Company and hence not commented upon.

x. Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the company or no material fraud onthe company by the officers and employees of the Company has been noticed or reportedduring the year. In our opinion no material fraud by the company or on the Company by itsofficers or employees has been noticed or reported during the course of our audit.

xi. In our opinion and according to the information and the explanations given to usand based on examination of records of the company the company has paid/provided formanagerial remuneration in accordance with the requisite approvals mandated by theprovisions of section 197 read with Schedule V to the Companies Act 2013.

xii. In our opinion the Company is not a nidhi company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.

xiii. In our opinion and according to the information and the explanations given to usand based on our examination of the records of the company all transactions with therelated parties are in compliance with sections 177 and 188 of the Companies Act 2013where ever applicable and the details of such transactions have been disclosed in theFinancial Statements as required by the applicable accounting standards.

xiv. According to the information and explanations given to us and on an overallexamination of the balance sheet the company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder review and hence reporting requirements under clause 3(xiv) are not applicable tothe company and not commented upon.

xv. According to the information and the explanations given to us the company has notentered into any non-cash transactions with directors or persons connected with him underthe provisions of section 192 of the Companies Act 2013.

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

For Goyal Nagpal & Co.
Chartered Accountants
(Firm's Registration No. 018289C)
Sd/-
CA Virender Nagpal
Place: New Delhi Partner
Date: July 25 2020 (Membership No. 416004)

Annexure - B to the Independent Auditor's Report of even date on the Standalone Ind ASfinancial statements of AMD Industries Limited

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

We have audited the internal financial controls over financial reporting of AMDIndustries Limited (‘the company') as of March 31 2020 in conjunction with our auditof the standalone Ind AS financial statements of the Company for the year ended on thatdate.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on "the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India (‘ICAI'). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgement 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 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 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.

Opinion

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 2020 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 Goyal Nagpal & Co.
Chartered Accountants
(Firm's Registration No. 018289C)
Sd/-
CA Virender Nagpal
Place: New Delhi Partner
Date: July 25 2020 (Membership No. 416004)

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