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AVSL Industries Ltd.

BSE: 538373 Sector: Industrials
NSE: AVSL ISIN Code: INE522V01011
BSE 05:30 | 01 Jan AVSL Industries Ltd
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AVSL Industries Ltd. (AVSL) - Auditors Report

Company auditors report

Report on the Standalone Financial Statements

OPINION

We have audited the accompanying financial statements of AVSL INDUSTRIES LIMITED(‘the Company') which comprise the balance sheet as at 31st March 2022the statement of profit and loss and the Statement of Cash Flows for the year ended on 31stMarch 2022 and a summary of significant accounting policies and other explanatoryinformation.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by theCompanies Act 2013 (“the Act”) in the manner so required and give a true andfair view in the conformity with the accounting principles generally accepted in India ofthe State of Affairs of the Company as at 31st March 2022 and profit and totalcomprehensive income 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 Act (SAs). Our responsibilities under those SAs 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 theethical requirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules made thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the Code of Ethics.

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

KEY AUDIT MATTERS:

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.

INFORMATION OTHER THAN THE FINANCIAL STATEMENTS AND AUDITOR'S REPORT THEREON

The Company's Board of Directors are responsible for the preparation of other'sinformation. The other information comprises the information included in the Board'sreport but does not include the financial statements and our Auditors' 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 financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the standalone financial statements or our knowledge obtainedin the 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 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 financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Act read with the Companies (Accounts) Rules 2014 as amended.

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 financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.

The Board of Directors are also responsible for overseeing the Company's financialreporting process.

AUDITOR'S RESPONSIBILITY

Our objective are to obtain reasonable assurance about whether the financial statementsas a whole are free from material misstatement whether due to fraud or error and to issuean auditor's report that includes our opinion. Reasonable assurance is a high level ofassurance but is not a guarantee than the audit conducted in accordance with the SAs willalways detect a material misstatement when it exists. Misstatement can arise from fraud orerror and are considered material if individually or in the aggregate they couldreasonably be expected to influence the economic decisions of users taken on the basis ofthese 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 financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under Section 143(3)(i) of theAct we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls with reference to financial statements in place andthe operating effectiveness of such controls.

Evaluate the appropriateness of the accounting policies used and the reasonableness ofthe accounting estimates and related disclosures made by management.

Evaluate the overall presentation structure and content of the financial statementsincluding the disclosures and whether the financial statements represent the underlyingtransactions and events in a manner that achieves 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.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditor's Report) Order 2020 (“the Order”)issued by the Central Government of India in terms of Section 143 (11) of the CompaniesAct 2013 we enclose in the "Annexure A" hereto a statement on the mattersspecified in the paragraph 3 and 4 of the Order to the extent applicable to the Company.

2. As required by Section 143 (3) of the Act based on our audit we report to theextent applicable 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 said books;

(c) The Balance Sheet the Statement of Profit and Loss and the Cash Flow Statementdealt with by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid financial statements comply with the AccountingStandards prescribed under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014 except non provision of retiring benefits of employees required asper accounting standard 15;

(e) on the basis of the written representations received from the directors as on 31stMarch 2022 taken on record by the Board of Directors none of the directors isdisqualified as on 31 st March 2022 from being appointed as a director in termsof Section 164 (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” to this report;

(a) 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 does not have any pending litigations as at 31st March 2022which would materially impact its financial position.

(ii) The Company did not have any long-term contracts including derivative contracts asat 31st March 2022.

(iii) As at 31st March 2022 there were no amounts which were required to betransferred to the Investor Education and Protection Fund by the Company.

(b) With respect to the matter to be included in the Auditors' Report under Section197(16) of the Act:

In our opinion and according to the information and explanations given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of Section 197 of the Act read with schedule V in terms of requisiteapprovals obtained as mandate therein and is not in excess of the limit.

FOR & ON BEHALF OF MAMRAJ & CO. CHARTERED ACCOUNTANTS FRN NO. 006396N Sd/- CAPRAVEEN GUPTA PARTNER

M.No:093403 Place: Delhi Date: 28th May 2022 UDIN: 22093403AJVFYG7712

ANNEXURE “A “TO THE INDEPENDENT AUDITORS' REPORT

In terms of the information and explanations sought by us and given to us by themanagement of the company and on the basis of such checks of the books and records of thecompany during the course of audit and to the best of our knowledge and belief we furtherreport that:

1. In respect of the fixed assets:

a) According to the information and explanations given to us the company hasmaintained proper records of property plant & equipment and Capital Work-in-Progressshowing full particulars including quantitative details and situation of property plant& equipment and Capital Work-in-Progress.

According to the information and explanations given to us the company has maintainedproper records showing full particulars of intangible assets.

b) As explained to us the property plant & equipment and Capital work-in-progresshave been physically verified by the management at reasonable intervals during the year.To the best of our knowledge no material discrepancies have been noticed on suchverification or have been reported to us.

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 (otherthan properties where the company is the lessee and the lease agreements are duly executedin favour of the lessee) disclosed in the financial statements.

d) The Company has not revalued any of its property plant and equipment and intangibleassets during the year.

e) According to the information and explanations given to us no proceedings have beeninitiated during the year or are pending against the Company as at March 31 2022 forholding any benami property under the Benami Transactions (Prohibition) Act 1988 (asamended in 2016) and rules made thereunder.

2. In respect of the inventories:

a) The inventories have been physical verified by the management of the Company duringthe year at a reasonable intervals. In our opinion the frequency of variation coverageand procedure of such verification is reasonable and appropriate. No materialdiscrepancies were noticed on such verification.

b) According to the information and explanations given to us the Company has beensanctioned working capital limits in excess of Rs. 5 crores in aggregate from banks orfinancial institutions on the basis of security of current assets. The variation inquarterly statements filed with such banks and financial institution with books ofaccounts has been suitably explained in note no. 11 of financial statements annexed withthis report

3. Investments/Guarantee/Security/Loans/Advances Granted:

According to information and explanations given to us during the year the company hasnot made any investments in provided any guarantee or security or granted or provided anyloans or advances in the nature of loans to any Company Firms Limited LiabilityPartnerships or Other Parties hence other matters related thereto referred to in clauseiii of The Companies (Auditor's Report) Order 2020 are not applicable.

4. In our opinion and according to the information and explanations given to us theCompany has not either directly or indirectly granted any loan to any of its directors orto any other person in whom the director is interested in accordance with the provisionsof section 185 of the Act and the Company has not made investments through more than twolayers of investment companies in accordance with the provisions of section 186 of theAct. Accordingly provisions stated in paragraph 3(iv) of the Order are not applicable tothe Company.

5. According to the information and explanations given to us the Company has notaccepted any deposits from the public within the meaning of Sections 73 74 75 and 76 ofthe Act and the rules framed there under.

6. As per information and explanations given to us the company is not required to makeand maintain the cost records and accounts as prescribed by The Central Government underSection 148(1) of the Companies Act 2013.

7. In respect of Statutory dues:-

a) According to the information and explanations furnished to us in our opinion thecompany is generally regular in depositing with appropriate authorities undisputedstatutory dues T.D.S. GST Employee Provident Fund ESIC and other material statutorydues applicable to it. There has been no outstanding as at 31st March 2022 ofundisputed liabilities outstanding for more than six months.

b) According to the information and explanations furnished to us and so far as appearsfrom our examination of books of account there were no statutory dues outstanding as at31 st March 2022 which have not been deposited on account of any dispute.

8. According to the information and explanations given to us and so far as appears fromour examination of books of account and other records as applicable there were notransactions relating to previously unrecorded income that were surrendered or disclosedas income in the tax assessments under the Income Tax Act 1961 (43 of 1961) during theyear.

9. In respect of Loans & Other Borrowings:

a) According to the information and explanations given to us the company has repaidthe principal amount and made payment of interest on loans or borrowings taken by it frombanks.

b) According to the information and explanations given to us so far as appears from ourexamination of relevant records we are of the opinion that the company has not beendeclared willful defaulter by any bank or financial institution or any other lender.

c) In our opinion and according to the information and explanations given to us thecompany has applied the term loans during the year have been applied for the purpose forwhich they were raised.

d) According to the information and explanations given to us and the audit proceduresperformed by us and on an overall examination of the financial statements of the companyfor the year we are of the opinion that funds raised on short-term basis have primafacie not been used during the year for long term purposes by the company.

e) According to the information and explanations given to us and on an overallexamination of the financial statements of the company we report that the company has nottaken any funds during the year from any entity or person on account of or to meet theobligations of its subsidiaries associates or joint ventures if any and hence reportingunder clause 3(ix)(e) of the Order is not applicable.

f) According to the information and explanations given to us and audit proceduresperformed by us we report that the company has not raised any loan during the year on thepledge of securities held in its subsidiaries joint ventures or associate companies ifany and hence reporting under clause 3(ix)(f) of the Order is not applicable.

10. In respect of moneys raised by issue of securities:

a) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not raised any moneys by way ofinitial public offer or further public offer (including debt instruments) during the yearand hence reporting under clause 3(x)(a) of the Order is not applicable.

b) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or convertible debentures (fully partially oroptionally convertible) during the year and hence reporting under clause 3(x)(b) of theOrder is not applicable.

11. In respect of Frauds and Whistle Blower Complaints:

a) According to the information and explanations given to us and to the best of ourknowledge no material fraud by the Company or on the Company has been noticed or reportedto us during the year.

b) No report under sub-section (12) of Section 143 of the Companies Act has been filedin form AOC-4 as prescribed under rule 13 of the Companies (Audit and Auditors) Rules2014 with the Central Government during the year.According to the information andexplanations given to us the Company during the course of audit of the financialstatement for the year ended 31st March 2022 the order is not applicableduring the year.

c) As per section 177 of the Act the Company established vigil mechanism. Hence thereare no whistle blower complaints were received by the Company during the year.

12. The company is not a Nidhi Company; therefore the provisions of Nidhi companies arenot applicable on the company.

13. According to the information and explanations given to us the Company is incompliance with the provisions of section 177 and 188 of the Companies Act 2013 whereapplicable for the related party transactions and the details of related partytransactions have been disclosed in the notes of the financial statements in accordancewith the applicable Accounting Standards.

14. In respect of Internal Audit:

a) In our opinion the Company has an adequate internal audit system commensurate withthe size and the nature of its business.

b) We have held discussions with the internal auditor of the Company for the year underaudit and considered their opinion in determining the nature timing and extent of ouraudit procedure.

15. According to the information and explanations given to us the Company has notentered into non-cash transactions with directors or persons connected with him.Accordingly paragraph 3(xv) of the Order is not applicable.

16. In respect of Registration under Section 45-IA of the Reserve Bank of India Act1934/CIC-

a) As the company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934 (2 of 1934) clause (xvi)(a) of paragraph 3 of The Companies(Auditor's Report) Order 2020 is not applicable to it.

b) According to the information and explanations given to us the Company has notconducted any Non-Banking Financial or Housing Finance activities during the year andclause (xvi)(b) of paragraph 3 of The Companies (Auditor's Report) Order 2020 is notapplicable to it.

c) As the company is not a Core Investment Company (CIC) as defined in the regulationsmade by the Reserve Bank of India clause (xvi)(c) of paragraph 3 of The Companies(Auditor's Report) Order 2020 is not applicable to it.

d) According to the information and explanations given to us the company has no CoreInvestment Company (CIC) as part of its group clause (xvi)(c) of paragraph 3 of TheCompanies (Auditor's Report) Order 2020 is not applicable to it.

17. The Company has not incurred cash losses in the financial year covered by ouraudit.

18. There has been no resignation of the statutory auditors of the Company during theyear and hence reporting under clause (xviii) of paragraph 3 of The Companies (Auditor'sReport) Order 2020 is not applicable.

19. According to the information and explanations given to us and on the basis of thefinancial ratios ageing and expected dates of realisation of financial assets and paymentof financial liabilities other information accompanying the financial statements ourknowledge of the Board of Directors and management plans and based on our examination ofthe evidence supporting the assumptions nothing has come to our attention which causesus to believe that any material uncertainty exists as on the date of the audit report thatthe Company is not capable of meeting its liabilities existing at the date of balancesheet as and when they fall due within a period of one year from the balance sheet date.We however state that this is not an assurance as to the future viability of theCompany. We further state that our reporting is based on the facts up to the date of theaudit report and we neither give any guarantee nor any assurance that all liabilitiesfalling due within a period of one year from the balance sheet date will get dischargedby the Company as and when they fall due.

20. According to the information and explanations given to us the provisions ofsection 135 of the Act are applicable to the Company. The Company has made the requiredcontributions during the year and there are no unspent amounts which are required to betransferred to the special account as on the date of our audit report. Accordingly theprovisions of paragraph (xx)(a) to (b) of the Order are not applicable to the Company.

FOR & ON BEHALF OF MAMRAJ & CO. CHARTERED ACCOUNTANTS FRN NO. 006396N

Sd/-

CA PRAVEEN GUPTA PARTNER M.No: 093403

Place: Delhi Date: 28th May 2022 UDIN: 22093403AJVFYG7712

“ANNEXURE B” TO THE INDEPENDENT AUDITOR'S 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 AVSLINDUSTRIES LIMITED ('the Company') as on 31st March 2022 in conjunction withour audit of the financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountants of India (‘ICAI').

These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information 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 prescribed under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate 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.

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 authorizations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized 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 and the best of our information and according the information andexplanations given to us the Company has in all material respects an adequate financialcontrols system over financial reporting and such internal financial controls overfinancial reporting were commensurate with the nature of the business of the Company andoperating effectively as at March 31 2022 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 ICAI.

FOR & ON BEHALF OF MAMRAJ & CO. CHARTERED ACCOUNTANTS FRN NO. 006396N

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