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Apollo Sindoori Hotels Ltd.

BSE: 532752 Sector: Services
NSE: APOLSINHOT ISIN Code: INE451F01024
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Apollo Sindoori Hotels Ltd. (APOLSINHOT) - Auditors Report

Company auditors report

FOR THE YEAR ENDED 31st MARCH 2021

TO

THE MEMBERS OF

APOLLO SINDOORI HOTELS LIMITED

Report on the audit of the standalone financial statements

Opinion

We have audited the standalone financial statements of Apollo SindooriHotels Limited ("the Company") which comprise the Balance Sheet as at 31stMarch 2021 and the Statement of Profit and Loss (including Other Comprehensive Income)Statement 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 the SignificantAccounting Policies and other explanatory information (hereinafter referred to as"the Standalone Financial Statements").

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid Standalone Financial Statements give theinformation required by the Companies Act2013 ("the Act") in the manner sorequired and give a true and fair view in conformity with the Indian Accounting Standardsprescribed under Section 133 of the Act read with the Companies (Indian AccountingStandards) Rules2015 as amended ("Ind AS") and other accounting principlesgenerally accepted in India of the state of affairs of the Company as at 31stMarch 2021 the Profit (including Other Comprehensive Income) the changes in Equity andits cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing("SAs") specified under Section 143(10) of the Act. Our responsibilities underthose Standards are further described in the "Auditor's Responsibilities for theAudit of the Standalone Financial Statements" section of our report. We areindependent of the Company in accordance with the Code of Ethics as amended issued bythe Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of the Standalone Financial Statements under the provisionsof the Act and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics as amended.We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our opinion on the Standalone Financial Statements.

Emphasis of Matter

We draw attention to Note 39 to the standalone annual financialresults which describes the possible effect of COVID-19 pandemic on the Company'sfinancial performance as assessed by the management.

Our opinion on the Financial Statements is not modified in respect ofthe above matter.

Key Audit Matters

Key audit matters 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 be the key auditmatters to be communicated in our report.

S No Key Audit Matter Response to Key Audit Matter
1 Cash sales
About 20% of the food and beverage sale is by way of cash sale at the food counters at various locations. Our audit procedures included:
Hence this is considered significant as there are chances of under-booking of sales delayed deposit of cash or misappropriation of cash. • Assessment of checks and balances available - concurrent audit system in place and periodical rotation of cashiers.
• Assessment of controls over billing - software used as against hand-held devices.
• Assessment of controls over banking of cash collections - Bank representative picks up the cash on a daily basis.
• Assessment of controls over periodical stock-take and the related procedures.

Information other than the Standalone Financial Statements andAuditor's report thereon

The Company's Board of Directors is responsible for thepreparation of the other information. The other information comprises the informationincluded in the Management Discussion and Analysis Board's Report includingAnnexures to Board's Report Corporate Governance Report and Shareholders'Information but does not include the Standalone Financial Statements and ourauditor's report thereon.

Our opinion on the Standalone Financial Statements does not cover theother information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Financial Statementsour responsibility is to read the other information and in doing so consider whetherthe other information is materially inconsistent with the Standalone Financial Statementsor our knowledge obtained during the course of our audit or otherwise appears to bematerially misstated.

If based on the work we have performed we conclude that there is amaterial misstatement of this other information we are required to report that fact. Wehave nothing to report in this regard.

Management's responsibility for the Standalone FinancialStatements

The Company's Board of Directors is responsible for the mattersstated in Section 134(5) of the Act with respect to the preparation of these StandaloneFinancial Statements that give a true and fair view of the financial position financialperformance changes in equity and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the accounting standardsspecified under Section 133 of the Act. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate 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 Financial Statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.

In preparing the Standalone Financial Statements Management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

The Board of Directors is also responsible for overseeing theCompany's financial reporting process.

Auditor's responsibilities for the audit of the StandaloneFinancial Statements

Our objectives are to obtain reasonable assurance about whether theStandalone Financial Statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these Standalone Financial Statements.

As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit.

We also:

Identify and assess the risks of material misstatement of theStandalone Financial Statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control.

Obtain an understanding of internal controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under Section143(3)(i) of the Companies Act2013 we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls with reference to financialstatements in place and the operating effectiveness of such controls.

Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by Management.

Conclude on the appropriateness of Management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the Standalone Financial Statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditionsmay cause the Company to cease to continue as a going concern.

Evaluate the overall presentation structure and content of theStandalone Financial Statements including the disclosures and whether the StandaloneFinancial Statements represent the underlying transactions and events in a manner thatachieves fair presentation.

Materiality is the magnitude of misstatements in the StandaloneFinancial Statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the Standalone FinancialStatements may be influenced. We consider quantitative materiality and qualitative factors(i) in planning the scope of our audit and in evaluating the results of our work; and (ii)to evaluate the effect of any identified misstatements in the Standalone Financialstatements.

We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the StandaloneFinancial Statements of the current period and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludespublic disclosure about the matter or when in extremely rare circumstances we determinethat a matter should not be communicated in our report because the adverse consequences ofdoing so would reasonably be expected to outweigh the public interest benefits of suchcommunication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order2016("the Order") issued by the Central Government in terms of Section 143(11) ofthe Act we give in Annexure-A a statement on the matters specified in paragraphs 3 and 4of 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 explanationswhich to the best of our knowledge and belief were necessary for the purposes of our auditof the Standalone Financial Statements.

b. In our opinion proper books of account as required by law have beenkept by the Company so far as it appears from our examination of those books.

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

d. In our opinion the aforesaid Standalone Financial Statements complywith the Accounting Standards specified under Section 133 of the Act read with Rule 7 ofthe Companies (Accounts) Rules2014.

e. On the basis of the written representations received from theDirectors as on 31st March 2021 taken on record by the Board of Directors noneof the Directors is disqualified as on 31st March 2021 from being appointed asa Director in terms of Section 164(2) of the Act.

f. With respect to the adequacy of internal financial controls withreference to financial statements of the Company and the operating effectiveness of suchcontrols refer to our separate report in Annexure-B. Our report expresses an unmodifiedopinion on the adequacy and operating effectiveness of the Company's internalfinancial controls with reference to financial statements.

g. With respect to the other matters to be included in theAuditor's Report in accordance with the requirements of Section 197(16) of the Actas amended:

In our opinion and to the best of our information and according to theexplanations given to us the remuneration paid by the Company to its Directors during theyear is in accordance with the provisions of Section 197 of the Act.

h. With respect to the other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules2014 in our opinion and to the best of our information and according to theexplanations given to us:

i. The Company has disclosed the impact of pending litigations on itsfinancial position in its Standalone Financial Statements.

ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses.

iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.

ANNEXURE-A TO THE INDEPENDENT AUDITOR'S REPORT FOR THE YEAR ENDED31st MARCH 2021

(Referred to in paragraph 1 under "Report on Other Legal andRegulatory Requirements" section of our report to the Members of Apollo SindooriHotels Limited of even date)

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

a. The Company has maintained proper records showing full particularsincluding quantitative details and situation of fixed assets.

b. As explained to us these fixed assets have been physically verifiedby the Management at regular intervals; as informed to us no material discrepancies werenoticed on such verification.

c. The Company did not have any immovable property during the year.

2. According to the information and explanations given to us theManagement has conducted physical verification of inventory at reasonable intervals and nomaterial discrepancies were noticed.

3. According to the information and explanations given to us and on thebasis of our examination of the books of account the Company has granted unsecurednon-interest bearing advances aggregating to Rs 688.23 lakh (Balance outstanding as at 31stMarch 2020: Rs 904.36 lakh) to its wholly-owned subsidiary covered in the registermaintained under Section 189 of the Companies Act 2013 in respect of which:

a. The terms and conditions of the grant of such advance are in ouropinion prima facie not prejudicial to the Company's interest except that theadvances given are interest-free and no schedule of repayment has been stipulated.

b. As no schedule of repayment of principal has been stipulated we areunable to make specific comment on the regularity of repayment of principal.

c. As no schedule of repayment of principal has been stipulatedquestion of amount being overdue as at 31st March 2021 does not arise.

4. In our opinion and according to the information and explanationsgiven to us the Company has complied with the provisions of Section 185 and 186 of theCompanies Act2013 in respect of grant of loans making investments and providingguarantees or securities as applicable.

5. The Company has not accepted any deposits from public.

6. According to the information and explanations given to us theCompany is not required to maintain cost records pursuant to the Rules prescribed by theCentral Government for maintenance of cost records under Section 148(1) of the CompaniesAct2013.

7. According to the information and explanations given to us in respectof statutory dues:

a. The Company is regular in depositing with the appropriateauthorities the undisputed statutory dues including Provident Fund Employees' StateInsurance Income Tax Goods and Service Tax though there have been delays in few cases.To the best of our knowledge and according to the information and explanations given tous undisputed amounts payable in respect of Service Tax aggregating to Rs 12.68 lakh werein arrears as at 31st March 2021 for a period of more than six months from thedate they become payable.

b. Details of dues of various taxes viz. Income Tax Service Tax notdeposited as on 31st March 2021 on account of disputes are given below:

Name of the Statute Nature of the dues Amount (Rs lakh) Forum where the dispute is pending Period to which the dues belong to
Finance Act Service Tax 570.07 Commissioner (Appeals) Apr 2013 to Jun 2017

8 On the basis of verification of records and according to theinformation and explanations given to us the Company has not defaulted in repayment ofloans or borrowing to a financial institution bank Government or dues to debentureholders.

9. In our opinion and according to the information and explanationsgiven to us the Company has not raised monies by way of initial public offer or furtherpublic offer (including debt instruments) during the year. The term loans availed wereapplied for the purposes for which they were raised.

10. Based upon the audit procedures performed for the purpose ofreporting the true and fair view of the Standalone Financial Statements and as per theinformation and explanations given to us by the Management no fraud by the Company and nofraud on the Company by its officers or employees has been noticed or reported during theyear.

11. In our opinion and according to the information and explanationsgiven to us managerial remuneration paid or provided has been in accordance with therequisite approvals mandated by the provisions of Section 197 read with Schedule V to theCompanies Act2013.

12. The Company is not a Nidhi Company and hence compliance with theprovisions of the Nidhi Rules is not applicable.

13. In our opinion and according to the information and explanationsgiven to us all transactions with related parties are in compliance with Sections 177 and188 of the Companies Act 2013 where applicable and the details have been disclosed in theStandalone Financial Statements as required by the applicable accounting standards.

14. During the year the Company has not made any preferential allotmentor private placement of shares or fully or partly convertible debentures.

15. In our opinion and according to the information and explanationsgiven to us during the year the Company has not entered into any non-cash transactionswith its Directors or persons connected with him which will come under the purview ofSection 192 of the Companies Act 2013.

16. The Company is not required to be registered under Section 45-IA ofthe Reserve Bank of India Act 1934.

ANNEXURE-B TO THE INDEPENDENT AUDITOR'S REPORT

FOR THE YEAR ENDED 31st MARCH 2021

(Referred to in paragraph 2 under "Report on Other Legal andRegulatory Requirements" section of our report to the Members of Apollo SindooriHotels Limited of even date)

Report on the Internal Financial Controls with reference to financialstatements under Section 143(3)(i) of the Companies Act2013 (" the Act")

We have audited the internal financial controls with reference tofinancial statements of Apollo Sindoori Hotels Limited ("the Company") as of 31stMarch 2021 in conjunction with our audit of the Ind AS standalone financial statements ofthe Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing andmaintaining internal financial controls 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("ICAI"). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence toCompany's policies 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 Act2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company'sinternal financial controls with reference to financial statements based on our audit. Weconducted our audit in accordance with the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting ("the Guidance Note") and the Standards onAuditing issued by ICAI and deemed to be prescribed under Section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controlsboth applicable to an audit of Internal Financial Controls and both issued by theInstitute of Chartered Accountants of India. Those Standards and the Guidance Note requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls with reference tofinancial statements were in place and if such controls were operated effectively in allmaterial respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls with reference to financial statements andtheir operating effectiveness. Our audit of internal financial controls with reference tofinancial statements included obtaining an understanding of internal financial controlswith reference to financial statements assessing the risk that a material weaknessexists and testing and evaluating the design and operating effectiveness of internalcontrol based on the assessed risk. The procedures selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the standalonefinancial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internalfinancial controls with reference to financial statements.

Meaning of Internal Financial Controls with reference to FinancialStatements

A company's internal financial controls with reference tofinancial statements are designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles. Acompany's internal financial controls with reference to financial statements includesthose policies and procedures that

• pertain to the maintenance of records that in reasonabledetail accurately and fairly reflect the transactions and dispositions of the assets ofthe company;

• provide reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorisations of management and directors of thecompany; and

• provide reasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or disposition of the company's assetsthat could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls with reference tofinancial statements

Because of the inherent limitations of internal financial controls withreference to financial statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to financial statements to future periods are subject to the riskthat the internal financial controls with reference to financial statements may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects adequateinternal financial controls with reference to the standalone financial statements and suchinternal financial controls were operating effectively as at 31st March 2021based on the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the Institute ofChartered Accountants of India.

Place: Chennai For P.Chandrasekar LLP Chartered Accountants FRN: 000580S/S200066
Date: 29th June 2021 S.Viswanathan Partner
Membership No.: 207632
UDIN: 21207632AAAAAH1840

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