The Members of Apollo Micro Systems Limited
Report on the Audit of the Standalone Financial Statements
We have audited the accompanying standalone financial statements of Apollo MicroSystems Limited (the Company') which comprise the Balance Sheet as at March 312021 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Changes in Equity and the Statement of Cash Flows for the year then endedand notes to the standalone financial statements including a summary of significantaccounting policies and other explanatory information (hereinafter referred to asthe standalone financial statements').
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 (the Act') in the manner so required and give a true andfair view in conformity with the Indian Accounting Standards prescribed under section 133of the Act read with the Companies (Indian Accounting Standards) Rules 2015 as amended(Ind AS') and other accounting principles generally accepted in India of the stateof affairs of the Company as at March 31 2021 and profit (including other comprehensiveincome) changes in equity and its cash flows for the year ended on that date.
Basis for opinion
We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing (SAs) specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Standalone Financial Statements section of ourreport. We are independent of the Company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India (ICAI) together with the independencerequirements that are relevant to our audit of the standalone financial statements underthe provisions of the Act and the Rules made thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the standalone financial statements.
Key audit matters
Key audit matters (KAM') are those matters that in our professional judgmentwere of most significance in our audit of the standalone financial statements of thecurrent period. These matters were addressed in the context of our audit of the standalonefinancial statements as a whole and in forming 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.
|Key Audit Matters: || |
|Key Audit Matter ||Auditor's Response |
|Contingent liabilities and provisions ||Principal Audit Procedures |
|Probable Liability for Import Duty for Non fulfilment of Export Obligation under Zero Duty EPCG Scheme ||We evaluated and tested key controls in respect of this contingent liability and regulatory procedures which are found to be satisfactory for audit |
|The Company had availed import duty exemption of Rs.1.61 crores in financial year 2014-15 under Zero Duty EPCG Scheme (the Scheme). As per this scheme the company has export obligation equal to Six times of the duty exemption availed. The Company has obtained approval from the Concern Authorities for fulfilling the export obligations. This is a Contingent Liability which depends on performance of the export obligation by the company with in the time period permitted. || |
| ||Our procedure included the following: |
| || We have perused the terms of Export Obligation under Zero Duty EPCG Scheme |
| || We have verified the amount of duty exemption availed under the scheme |
| || We have also verified the value and the period with in which export obligation to be fulfilled and extension of period approved by the Regulatory Authority |
|The probability or provision for the contingent liability involves high degree of judgment and estimates by the management and hence the contingent liability is considered as a key audit matter Refer Note-29(ii)(b) to the Financial Statements || We have also evaluated the significant judgment made by the management in its ability to perform the export obligations with in the period permitted for making provision as per requirement. |
| || The management expressed their proposals to have a quarterly review from next financial year for any likelihood and magnitude of any liability to be provided. |
| || The management also agreed to review and provide for during next financial year |
Information Other than the Standalone Financial Statements and Auditor's Report Thereon
The Company's management and Board of Directors are responsible for the preparation ofthe other information. The other information comprises the information included in theManagement Discussion and Analysis Board's Report including Annexures to Board's ReportBusiness Responsibility Report Corporate Governance and Shareholder's Information butdoes not include the standalone financial statements and our auditor's report thereon.
Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained during the course of our audit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.
Management's Responsibility for the Standalone Financial Statements
The Company's management and Board of Directors are responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these standalone financialstatements that give a true and fair view of the financial position financialperformance total comprehensive income changes in equity and cash flows of the Companyin accordance with the Indian Accounting Standards(Ind AS') and other accountingprinciples generally accepted in India including Ind AS specified under section 133 ofthe Act. This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalonefinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing the standalone 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 responsible for overseeing the Company's financial reportingprocess.
Auditor's Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements 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 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 standalonefinancial 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 internalcontrols.
Obtain an understanding of internal financial controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls with reference to standalone financialstatements in place and the operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and reasonableness ofaccounting 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 financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's Report. However future events or conditions may cause the Company to cease tocontinue as a going concern.
Evaluate the overall presentation structure and content of the standalonefinancial statements including the disclosures and whether the standalone financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.
Materiality is the magnitude of misstatements in the standalone financial statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the standalone financial statements.
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 financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or 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
1. As required by the Companies (Auditor's Report) Order 2016 (the Order')issued by the Central Government of India in terms of Section 143(11) of the Act we givein Annexure-A' a statement on the matters specified in paragraphs 3 and 4 of theOrder to the extent applicable.
2. As required by Section 143(3) of the Act based on our audit we report that : a. Wehave sought and obtained all the information and explanations which to the best of ourknowledge and belief were necessary for the purposes of our audit. b. In our opinionproper books of account as required by law have been kept by the Company so far as itappears from our examination of those books. c. the Balance Sheet the Statement of Profitand Loss (including Other Comprehensive Income) the Statement of Changes in Equity andthe Statement of Cash Flow dealt with by this Report are in agreement with the relevantbooks of account. d. In our opinion the aforesaid standalone financial statements complywith the Ind AS specified under Section 133 of the Act. e. On the basis of the writtenrepresentations received from the directors as on March 31 2021 taken on record by theBoard of Directors none of the directors is disqualified as on March 31 2021 from beingappointed as a director in terms of Section 164 (2) of the Act. f. With respect to theadequacy of the internal financial controls over financial reporting of the Company andthe operating effectiveness of such controls refer to our separate Report inAnnexure-B'.
3. 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 standalone financial
ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts.
iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the company.
4. With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of amendments to section 197(16) of the Act:
In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its directors during the year is inaccordance with the provisions of section 197 of the Act read with provisions of SectionII of Part-II of Schedule-III of the Act. The remuneration paid to any director is withinthe limit laid down under Section 197 of the Act and relevant provisions of Schedule IIIto the Act. The Ministry of Corporate Affairs has not prescribed other details underSection 197(16) of the Act which are required to be commented upon by us.
| ||for S.T.Mohite & Co |
| ||Chartered Accountants |
| ||ICAI Firm Registration Number: 011410S |
|Place: Hyderabad ||Sreenivasa Rao T Mohite Partner |
| ||Membership No.: 015635 |
|Date: 29th June 2021 ||UDIN:21015635AAAADE1997 |
Annexure A to the Independent Auditors' Report
With reference to Annexure A as referred to in paragraph 1 under Report on OtherLegal and Regulatory Requirements' section of our report to the Members of the company onthe standalone financial statement for the year ended 31 March 2021 we report thefollowing:
|Ref to CARO ||Report by Independent Auditors |
|1 3(i) ||Fixed Assets |
|3(i)(a) ||The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets on the basis of available information. |
|3(i)(b) ||The Company has a regular program of physical verification of its fixed assets by which all fixed assets are verified on annual basis. In our opinion the periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program all fixed assets were physically verified during the year. According to the information and explanation given to us no material discrepancies were noticed on such verification. |
|3(i)(c) ||According to the information and explanations given to us and the records examined by us and based on the examination of sale deeds conveyance deeds encumbrance certificates verified by us we report that the title deeds comprising all the immovable properties of lands buildings which are free hold are in the name of the company as at the balance sheet date. |
|2 3(ii) ||Inventories |
| ||As explained to us the inventories has been physically verified by the management during the year. In our opinion the frequency of such verification is reasonable. The Company has maintained proper records of inventory. There were no material discrepancies noticed on verification between the physical stock and the book records. |
|3 3(iii) ||Loans to parties covered by Sec.189 of the Companies Act2013 (the Act' ) |
| ||According to the information and explanation given to us the Company has not granted any loans secured or unsecured to body corporate firms Limited Liability Firms or other parties covered in the register required to be maintained under section 189 of the Act. Accordingly the provisions of the clause 3 (iii) of the Order are not applicable to the Company for the year under review. |
|4 3(iv) ||Loans guarantees securities to and investments in other companies |
| ||In our opinion and according to the information and explanation given to us the company has no transactions for compliance as per the provisions of Sections 185 and 186 of the Act. |
|5 3(v) ||Acceptance of deposits |
| ||In our opinion and according to the information and explanations given to us the Company has not accepted any deposits during the year as per provisions of Section 73 or 76 of the Act and the relevant Rules framed thereunder. Accordingly the provisions of the Para 3 (v) of the Order are not applicable to the Company for the year under review. |
|6 3(vi) ||Maintenance of cost records |
| ||According to the information and explanations given us the maintenance of cost records prescribed by the Central Government under section 148(1) of the Act read with Cost Audit Rules is not applicable to the company. Accordingly Para 3(vi) of the Order is not applicable to the Company for the year under review. |
|7 3(vii) ||Statutory Dues |
|3(vii)(a) ||According to the information and explanations given to us and on the basis of our examination of the records of the Company amounts deducted / accrued in the books of account in respect of undisputed statutory dues including Provident Fund Employee's State Insurance Goods and Service Tax Customs Duty Cess and other material statutory dues have been generally deposited barring some aberrations during the year by the Company with the appropriate authorities. There are delays in remitting Tax deducted amounts from payees and also no payment in respect of tax liability accepted for earlier years. According to the information and explanations given to us total undisputed amounts of Rs. 26438998/- outstanding and payable in respect of income Tax and tax deducted at source in arrears as at March 31 2021 for a period of more than six months from the date they became payable . |
|3(vii)(b) ||According to the information and explanation given to us there are no dues of statutory dues of Income tax sales tax Service tax Goods and Service tax Customs duty Excise duty Value added tax cess and other dues that have not been deposited by the Company on account of any disputes. |
|8 3(viii) ||Defaults in repayments to Financial Institutions/Banks/Debenture holders |
| ||In our opinion and according to the information and explanation given to us the Company has not defaulted in the payment/repayments of loans or borrowings to the banks. |
|9 3(ix) ||Initial public offer/further offer |
| ||In our opinion and according to the information and explanation given to us the company has not made during the year under review any initial public offer or further public offer of securities (including debt instruments) or the term loans during the year and accordingly the provisions of Para 3(ix) of the Order is not applicable for the company. |
|10 3(x) ||Frauds by or on the company |
| ||In our opinion and according to the information and explanation given to us no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit. |
|11 3(xi) ||Managerial Remuneration |
| ||In our opinion and according to the information and explanation given to us based on the examination of the records of the Company the company has paid/provided managerial remuneration which is within the amount permitted under Section II of Part II of Schedule-V of the Act as permitted by provisions of Section 197 of the Act. |
|12 3(xii) ||Nidhi company |
| ||In our opinion and according to the information and explanation given to us the company is not a Nidhi Company as prescribed under Section 406 of the Act and hence paragraph 3(xii) of the Order is not applicable to the |
| ||company. |
|13 3(xiii) ||Transactions with Related parties |
| ||In our opinion and according to the information and explanation given to us and based on our examination of the records of the Company all transactions with related parties are in compliance with provisions of section 177 and section 188 of the Act where applicable and the details of such transactions have been disclosed in the financial statements as required by the applicable Indian Accounting Standards. |
|14 3(xiv) ||Preferential allotment u/s 62 or private placement u/s 42 of the Act |
| ||In our opinion and according to the information and explanation given to us and based on our examination of the records the Company has not made any preferential allotment of equity shares during the year. There is no private placement of shares by the company under section 42 of the Act during the year. |
|15 3(xv) ||Non-cash transactions with directors u/s 192 of the Act |
| ||In our opinion and according to the information and explanation given to us and based on our examination of the records of the Company the company has not entered during the year into any non cash transactions with its Directors or persons connected to its Directors and hence provisions of Sec 192 of the Act and paragraph 3(xv) of the Order are not applicable to the company. |
|16 3(xvi) ||Registration u/s 45-1A of Reserve Bank of India Act1934 |
| ||According to the information and explanation given to us the company is not required to be registered under section 45-1A of the Reserve bank of India Act 1934 and hence paragraph 3(xvi) of the Order is not applicable to the company. |
| ||for S.T.Mohite & Co |
| ||Chartered Accountants |
| ||ICAI Firm Registration Number: 011410S |
|Place: Hyderabad ||Sreenivasa Rao T Mohite Partner |
| ||Membership No.: 015635 |
|Date: 29th June 2021 ||UDIN:21015635AAAADE1997 |