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Ashiana Housing Ltd.

BSE: 523716 Sector: Infrastructure
NSE: ASHIANA ISIN Code: INE365D01021
BSE 00:00 | 17 Jan 168.90 -2.15
(-1.26%)
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172.60

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172.60

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167.00

NSE 00:00 | 17 Jan 169.20 -2.10
(-1.23%)
OPEN

172.00

HIGH

173.90

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OPEN 172.60
PREVIOUS CLOSE 171.05
VOLUME 6624
52-Week high 209.95
52-Week low 93.10
P/E
Mkt Cap.(Rs cr) 1,729
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 172.60
CLOSE 171.05
VOLUME 6624
52-Week high 209.95
52-Week low 93.10
P/E
Mkt Cap.(Rs cr) 1,729
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Ashiana Housing Ltd. (ASHIANA) - Auditors Report

Company auditors report

To the Members of Ashiana Housing Limited

Report on the Standalone Financial Statements Opinion

We have audited the accompanying standalone financial statements of Ashiana HousingLimited (‘the Company’) which comprise the Balance Sheet as at 31 March 2021the Statement of Profit and Loss (including Other Comprehensive Income) Statement ofChanges in Equity and Statement of Cash Flow for the year then ended and Notes to thefinancial statements including a summary of significant accounting policies and otherexplanatory information.

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 fairview in conformity with the accounting principles generally accepted in India includingIndian Accounting Standards (‘Ind AS’) specified under section 133 of the Actof the state of affairs (financial position) of the Company as at March 31 2021 andprofit (financial performance including other comprehensive income) its cash flows andthe changes in equity 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 Act. Our responsibilities under those Standards are furtherdescribed in the Auditor’s Responsibilities for the Audit of the Financial Statementssection of our report. We are independent of the Company in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India (‘ICAI’)together with the ethical requirements that are relevant to our audit of the standalonefinancial statements under the provisions of the Companies Act 2013 and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone financial statements of the current period.These matters were addressed in the context of our audit of the standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. For each matter below our description of how our auditaddressed the matter is provided in that context

We have determined the matters described below to be the key audit matters to becommunicated in our report. We have fulfilled the responsibilities described in theAuditor’s responsibilities for the audit of the standalone Ind AS financialstatements section of our report including in relation to these matters. Accordingly ouraudit included the performance of procedures designed to respond to our assessment of therisks of material misstatement of the standalone Ind AS financial statements.

The results of our audit procedures including the procedures performed to address thematters below provide the basis for our audit opinion on the accompanying standalone IndAS financial statements.

Revenue recognition (refer note 8.1 to the standalone financial statements)

Key Audit Matter How the matter was addressed in our audit
Revenue from sale of residential units represents 98.55% of the total revenue from operations of the Company. Our audit procedures on Revenue recognition included the following:
Revenue is recognised upon transfer of control of residential units to customers for an amount that reflects the consideration which the Company expects to receive in exchange for those units. The trigger for revenue recognition is normally upon satisfaction of performance obligation and the control thereof is transferred from the company to the buyer upon possession or upon issuance of letter for offer of possession ("deemed date of possession"). • Evaluating that the Company’s revenue recognition accounting policies are in line with the applicable accounting standards and their application to the key customer contracts including consistent application;
Revenue recognition prior to completion of the project • Sales cut-off procedures for determination of revenue in the correct reporting period;
Due to the Company’s projects being spread across different regions within the country and the competitive business environment there is a risk that revenue could be overstated (for example through premature revenue recognition i.e. recording revenue without receipt of approval from authorities or its intimation to the customers) or understated (for example through improperly shifting revenues to a later period) in order to present consistent financial results. Since revenue recognition has direct impact on the Company’s profitability the element of management bias is likely to be involved. • Scrutinising all the revenue journal entries raised throughout the reporting period and comparing details of a sample of these journals which met certain risk-based criteria with relevant underlying documentation;
• Conducting site visits during the year for selected projects to understand the scope and nature of the projects and to assess the progress of the projects; and
• Considered the adequacy of the disclosures in note 2.24 to the standalone financial statements in respect of the judgments taken in recognising revenue for residential units.
In addition we have the performed the following procedures:
• Discussing and challenging key management judgments in interpreting contractual terms including obtaining in house legal interpretations;
• Testing sample sales of units for projects with the underlying contracts completion status and proceeds received from customers; and
• Identified and tested operating effectiveness of key controls around approvals of contracts milestone billing intimation of possession letters / intimation of receipt of occupation certificate and controls over collection from customers;

Deferred Tax Assets (refer note 3.7 to the standalone financial statements)

Key Audit Matter How the matter was addressed in our audit
The carrying amount of the deferred tax assets represents 0.77% of the Company’s total assets. Our audit procedures included:
Recognition and measurement of deferred tax assets • Through discussions with management we understood the Company’s process for recording deferred tax assets;
The Company has deferred tax assets in respect of brought forward losses and other temporary differences as set out in note 3.7. • We have obtained the approved business plans projected profitability statements for the existing projects and the future projects which are confirmed through definitive agreements;
The recognition of deferred tax assets involves judgment regarding the likelihood of the reasonable certainty of realisation of these assets in particular whether there will be taxable profits in future periods that support recognition of these assets. • We have performed sensitivity analysis and inquired into the basis of the projections for the reasonable certainty of utilisation of the brought forward business losses and therefore recognition of deferred tax assets; and
Management records deferred tax assets in respect of carried forward business losses in cases where it is reasonably certain based on the projected profitability determined on the basis of approved business plans that sufficient taxable income will be available to absorb the carried forward business loss. • We tested the underlying data for the key deferred tax and tax provision calculations.

Information other than the Financial Statements and Auditor’s Report thereon

The Company’s Board of Directors is responsible for the other information. Theother information comprises the information included in the Annual Report but does notinclude the standalone financial statements and our auditor’s report thereon.

Our opinion on the financial statements does not cover the other information and we donot 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 financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those charged with Governance for the StandaloneFinancial Statements

The Company’s Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these financial statements that givea true and fair view of the state of affairs (financial position) profit or loss(financial performance including other comprehensive income) changes in equity and cashflows of the Company in accordance with the accounting principles generally accepted inIndia including the Ind AS specified under section 133 of the Act. This responsibilityalso includes maintenance of adequate accounting records in accordance with the provisionsof the Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate implementationand maintenance of accounting policies; making judgments and estimates that are reasonableand prudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness of theaccounting records relevant to the preparation and presentation of the financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the financial statements the Board of Directors is responsible forassessing the Company’s ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless the Board of Directors either intends to liquidate the Company or tocease operations or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the company’sfinancial reporting process.

Auditor’s Responsibilities for the Audit of 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. Reasonableassurance is a high level of assurance but is not a guarantee that an audit conducted inaccordance with Standards on Auditing 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 financial statements.

As part of an audit in accordance with Standards on Auditing we exercise professionaljudgment and maintain 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 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 concernbasis 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 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 theCompany to cease to continue as a 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.

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 audit work and in evaluating the results of our work; and

(ii) to evaluate the effect of any identified misstatements in the financialstatements.

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 aboutthe matter or when in extremely rare circumstances we determine that a matter should notbe communicated in our report because the adverse consequences of doing so wouldreasonably be 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 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the Annexure A a statement on the matters specified inthe paragraph 3 and 4 of the order.

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 Other ComprehensiveIncome) Statement of change in Equity and the Cash Flow Statement dealt with by thisReport are in agreement with the books of account;

(d) in our opinion the aforesaid standalone financial statements comply with theIndian Accounting Standards specified under Section 133 of the Act;

(e) on the basis of the written representations received from the directors as on 31March 2021 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2021 from being appointed as a director in terms of Section164 (2) of the Act;

(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";

(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 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

(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 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. the Company has to the extent ascertainable disclosed the impact of pendinglitigations on its financial position in its financial statements – Refer clause (d)(e) and (f) of Note 12 to the financial statements;

ii. the Company does not have any material foreseeable losses on long term contractsincluding derivative contracts which would impact its financial position;

iii. there has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

For VMSS & ASSOCIATES
Chartered Accountants
Firm Registration No. 328952E
Mahendra Jain
Place: New Delhi Partner
Date: 26th June 2021 Membership No. 413904

Annexure - A to the Auditors’ Report

The Annexure referred to in Independent Auditors’ Report to the members of theCompany on the standalone financial statements for the year ended 31 March 2021 we reportthat:

(i) (a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) According to the information and explanations given to us all the assets have notbeen physically verified by the management during the year but there is a regular programof physical verification of its property plant and equipment to cover all the items ofproperty plant and equipment in a phased manner which in our opinion is reasonablehaving regard to the size of the Company and the nature of its property plant andequipment. According to the information and explanations given to us no materialdiscrepancies were noticed on such verification.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company except the below property:

Description of property Gross carrying value (J in Crores) Net carrying value (J in Crores) Remarks (if Any)
Office Space at Saket New Delhi 3.46 3.09

(ii) According to the information and explanations given to us the management hasconducted physical verification of inventory at reasonable intervals during the yearwhich in our opinion is reasonable having regard to the size of the company and natureof its business. No material discrepancies were noticed on such verification.

(iii) The Company has not granted secured/unsecured loans to companies firms LimitedLiability Partnerships or other parties covered in the register maintained under section189 of the Companies Act 2013 (‘the Act’).

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Companies Act 2013in respect of loans investments guarantees and securities made by the company.

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits within the meaning of Sections 73 to 76 of theCompanies Act 2013 Act and the Companies (Acceptance of Deposits) Rules 2014 (asamended).

(vi) As certified by a Cost Accountant the company has maintained cost records for theyear under review as prescribed under sub-section (1) of Section 148 to the extentapplicable to the company. We have however not made a detailed examination of suchrecords.

(vii) (a) According to the records of the company the company is generally regular indepositing with appropriate authorities undisputed statutory dues including providentfund employees’ state insurance income-tax Goods and Service Tax duty of customsCess and other material statutory dues as applicable and no such statutory dues wereoutstanding as at the last day of the financial year under review for a period of morethan six months from the date they became payable.

(b) According to the information and explanations given to us there are no dues ofincome-tax Goods and Service Tax duty of customs and cess as applicable which have notbeen deposited on account of any dispute except the following:

Particulars Amount (J in lacs) Relating to the year Forum where dispute pending
Income Tax Act 1961 40.12 2015-16 Commissioner (Appeals)
Income Tax Act 1961 68.37 2016-17 Commissioner (Appeals)
Income Tax Act 1961 1025.72 2017-18 Assistant Commissioner of Income Tax
Tamil Nadu VAT Act 2006 9.34 2016-17 Assistant Commissioner
Tamil Nadu VAT Act 2006 21.61 2015-16 Deputy Commissioner (Appeals Commercial Tax
Rajasthan Tax on Entry of Goods into Local Area Act 1999 10.23 2017-18 Appellate Authority

(viii) In our opinion and according to the information and explanations given to usthe company has not defaulted in repayment of loans or borrowing to financial institutionbank Government or dues to debenture holders.

(ix) In our opinion and according to the information and explanation given to us theCompany did not raise any money by way of initial public offer or further public offer(including debt instruments) during the year under review. Further term loans have beenapplied for the purposes for which those were raised.

(x) According to the information and explanations given to us no fraud by the Companyor on the Company by its officers or employees have been noticed or reported during theyear.

(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a nidhi company.

(xiii) 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 sections 177 and 188 of the Act and the details of such transactions havebeen disclosed in the financial statements as required by the applicable accountingstandards.

(xiv) According to the information and explanations given to us and on an overallexamination of Balance Sheet of Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year under review and hence reporting requirements under clause 3(xiv) are notapplicable to the company and not commented upon.

(xv) 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 him.

(xvi) In our opinion the Company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934.

For VMSS & ASSOCIATES
Chartered Accountants
Firm Registration No. 328952E
Mahendra Jain
Place: New Delhi Partner
Date: 26th June 2021 Membership No. 413904

Annexure - B to the Auditors’ Report

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

We have audited the internal financial controls over financial reporting of AshianaHousing Limited ("the Company") as of 31st March 2021 in conjunction with ouraudit of the standalone 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 safeguardingof its 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 judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company’s internal financial controlssystem over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company’s internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company’s internal financial control overfinancial reporting 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 havea material 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 31 March 2021 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For VMSS & ASSOCIATES
Chartered Accountants
Firm Registration No. 328952E
Mahendra Jain
Place: New Delhi Partner
Date: 26th June 2021 Membership No. 413904

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