To the Members of Batliboi Limited
Report on the Audit of the Standalone Ind AS Financial Statements
We have audited the Standalone Ind AS financial statements of Batliboi Limited("the Company") which comprise the Balance Sheet as at 31st March2020 and the Statement of Profit and Loss (including Other Comprehensive Income)Statement of Changes in Equity and Statement of Cash Flows for the year then ended andnotes to the Standalone Ind AS financial statements including a summary of significantaccounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Standalone Ind AS financial statements give the informationrequired by the Companies Act 2013 ("the Act) in the manner so required and give atrue and fair view in conformity with the Indian Accounting Standards prescribed underSection 133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015as amended ("Ind AS") and other accounting principles generally accepted inIndia of the state of affairs of the Company as at 31st March 2020 the lossand total other comprehensive income changes in equity and its cash flows for the yearended on that date.
2. Basis for Opinion
WeconductedourauditinaccordancewiththeStandardsonAuditingspecifiedundersection143(10)oftheCompaniesAct 2013. Our responsibilities under those Standards are further described in theAuditor's Responsibilities for the Audit of the Standalone Ind AS 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 together with the ethicalrequirements that are relevant to our audit of the Standalone Ind AS financial statementsunder the provisions of the Companies Act 2013 and the Rules there under and we havefulfilled our other ethical responsibilities in accordance with these requirements and theCode of Ethics. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion on Standalone Ind AS financial statements.
3. Emphasis of Matter
We draw attention to Note 37 of the standalone financial statement as regards themanagement's assessment of the financial impact due to restrictions and conditions relatedto COVID-19 pandemic situation for which a definitive assessment of the impact in thesubsequent period is highly dependent upon circumstances as they evolve.
Our Opinion is not modified in respect of this matter.
4. Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone Ind AS financial statements of the currentyear. These matters were addressed in the context of our audit of the standalone Ind ASfinancial 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 audit matters to becommunicated in our report.
|Sr. No. Key Audit Matter ||Auditor's Response |
|1. Evaluation of Impairment of Investment made in Subsidiary ||We have followed the following audit procedures to test the impairment of investment and checked the recognition measurement and disclosure in respect of the same |
|The Company has made investment in equity and preference shares of its wholly owned subsidiary Queen Project Mauritius Limited. ||a) Focused our testing on the impairment of investment in subsidiary and the key assumptions and estimates made by management. |
|It had impaired the investment in the subsidiary on the date of transition to Ind AS in view of the losses in its subsidiaries. The management has tested the impairment of its investment in subsidiaries as per Ind AS 109 -Financial Instruments as on 31st March 2020. Based on internal analysis and estimation of the projected cash flow. The Company has not made any further impairment to the carrying amount of the investment value as on 31st March 2020. ||b) Audit procedures included an assessment of the controls over the impairment assessment process evaluated the design of internal controls relating to the testing of impairment of assets and also tested the operating effectiveness of the aforesaid controls. |
| ||c) Obtained understanding of management's estimation of recoverable amount of investment in subsidiary which have been determined by value in use. |
| ||d) Verified and tested the future projected cash flow estimated by management to determine the value in use and recoverable amounts including assessment of the key cash flow assumptions based on historical performance and industry information. |
| ||e) Assessed the appropriateness of the recognition measurement and related disclosures of investment in Queens Projects Mauritius Limited. |
|2) Physical Inventory verification at year end During the year the management of the Company has done physical verification of the inventory and as on 31st March 2020 the physical verification of inventory was carried out subsequent to year end due to restrictions and lockdown imposed amid outbreak of COVID -19. ||We have followed the following audit procedures: |
| ||a) We have performed alternative procedures which includes reviewing the reports of cyclical counts performed by the management during the year roll forward procedures checking the documentation with respect to purchase consumption and sale of inventory if any to audit the existence of Inventory as per the guidance provided in SA-501 "Audit Evidence Specific Consideration for Selected Items" and have obtained sufficient audit evidence. |
| ||b) During the year the management of the Company had carried out physical verification of inventory and for inventory as on 31st March 2020 verification was carried out subsequent to the year end. We have relied on the physical verification reports shared by the management for all the locations where the physical verification was conducted subsequent to the year end. |
| ||c) We have also performed analytical procedures for reasonableness of the value of stock at the year end. |
|3) Evaluation of Contingent Liabilities ||We have followed the following audit procedures: |
|The Company has disclosed the contingent liability on account of sales tax excise duty TDS and claims not acknowledged as debts made in courts against the company relating to various business operations and human resource cases. The management has applied significant judgment to determine the possible outcome of these disputes and no provision relating to these liabilities has been taken in the financial statement as on 31st March 2020. ||a) Evaluated the design and tested the operating effectiveness of the relevant controls through combination of procedures involving inquiry and observation reperformance and inspection of evidence in respect of operation of these controls to assess how the Company monitors the disputed tax liabilities court cases related developments and their assessment of the potential impact on the Company. |
|Refer note 24 of the Standalone Ind AS Financial Statements for disclosure of Contingent Liabilities. ||b) For uncertain disputed taxes and court cases obtained details of tax assessments appeal order court status court orders and demands from management. |
| ||c) Evaluated the management's underlying assumptions of the validity and adequacy of provisions for uncertain disputed taxes court cases and evaluating the basis of determination of the possible outcome of the disputes. |
| ||Also considered legal precedence and other rulings and read where applicable external advice sought by the Company for these uncertain disputed taxes court cases and reviewed related correspondence in evaluating management's position on these uncertain disputed taxes and court cases. |
5. Information other than the Standalone Ind AS financial statements and Auditor'sreport thereon
The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Directors Report CorporateGovernance Report and Management Discussion and Analysis but does not include theStandalone Ind AS financial statements and our auditor's report thereon. The Annual reportis expected to be made available to us after the date of this auditor's report.
Our opinion on the Standalone Ind AS financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.
In connection with our audit of the Standalone Ind AS financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the Standalone Ind AS financialstatements or our knowledge obtained in the audit or otherwise appears to be materiallymisstated.
When we read the other information included in the above reports if we conclude thatthere is material misstatement therein we are required to communicate the matter to thosecharged with governance and determine the actions under the applicable laws andregulations.
6. Responsibilities of Management and Those Charged with Governance for theStandalone Ind AS Financial Statements
The Company's Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese Standalone Ind AS financial statements that give a true and fair view of thefinancial position financial performance changes in equity and cash flows of the Companyin accordance with the Ind AS and accounting principles generally accepted in India. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the
Company and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Standalone Ind AS financial statements that give a true and fair view and are freefrom material misstatement whether due to fraud or error.
In preparing the standalone Ind AS financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.
The Board of Directors are also responsible for overseeing the Company's financialreporting process.
7. Auditor's Responsibilities for the Audit of the Standalone Ind AS FinancialStatements
Our objectives are to obtain reasonable assurance about whether the Standalone Ind ASfinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith Standard on Auditing will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these Standalone Ind AS financial statements.
As part of an audit in accordance with Standard on Auditing we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the Standalone Ind ASfinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.
Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theCompanies Act 2013 we are also responsible for expressing our opinion on whether thecompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe Standalone Ind AS financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.
Evaluate the overall presentation structure and content of the Standalone Ind ASfinancial statements including the disclosures and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.
From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the Standalone Ind AS financialstatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.
8. Report on Other Legal and Regulatory Requirements
i) As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the Annexure A' a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.
ii) 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 of Standalone IndAS financial statements.
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 the Statement of Cash Flow and Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account.
d) In our opinion the aforesaid Standalone Ind AS financial statements comply with theIndian Accounting Standards specified under Section 133 of the Act read with Rule 7 ofthe Companies (Accounts) Rules 2014.
e) On the basis of the written representations received from the directors as on 31stMarch 2020 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2020 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".
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 opinionand to the best of our information and according to the explanations given to us theremuneration paid by the Company to its directors during the year is in accordance withthe 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 in our opinionand to the best of our information and according to the explanations given to us: i. TheCompany has disclosed the impact of pending litigations on its financial position in itsstandalone Ind AS financial statements Refer Note 24 to the standalone Ind ASfinancial statements;
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses; and
iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
Annexure A to the Independent Auditor's Report
Annexure referred to in para 8(i) of the Independent Auditors' Report of even date tothe members of Batliboi Limited on the Standalone Ind AS financial statements for the yearended 31st March 2020 we report that;
i) a) As per information and explanations given to us the Company has maintainedproper Fixed Assets Register including quantitative details and situation of fixedassets.
b) As per information and explanations given to us the Fixed Assets have beenphysically verified by the management at reasonable intervals. In our opinion thefrequency of verification is reasonable having regard to the size of the operations of theCompany and on the basis of explanations received no material discrepancies were noticedduring the verification.
c) According to the information and explanation given to us and the records ofimmovable properties of land and building verified by us we report that title deed ofimmovable property are held in the name of Company.
ii) As per information and explanations given to us during the year the management ofthe Company has carried out physical verification of inventory. For inventory as on 31stMarch 2020 the management was unable to carry out physical verification of inventory on 31stMarch 2020 due to restrictions imposed amid outbreak of COVID -19. The management hadcarried out the physical verification of inventory as on 31st March 2020subsequent to year end. In our opinion the frequency of verification is reasonable havingregard to the size of the Company and nature of its business. As informed to us thediscrepancies noticed on verification between the physical stocks and the book recordswere not material and have been appropriately dealt with.
iii) According to the information and explanations given to us the Company has notgranted any loans or advances secured or unsecured to companies firms or other partiescovered in the register maintained under section 189 of the Act. Accordingly the clause3(iii) (a) (b) and (c) of the Order are not applicable to the Company and hence notcommented upon.
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 Act in respect ofloans investments guarantees and security.
v) The Company has not accepted any deposits from the public within the meaning of thedirectives issued by the Reserve Bank of India and the provisions of sections 73 to 76 orany other relevant provisions of the Act and the rules framed there under.
vi) We have broadly reviewed the cost records maintained by the Company pursuant to theCompanies (Cost Records and Audit) Rules 2014 prescribed by the Central Government underSection 148(1) (d) of the Companies Act 2013 and are of the opinion that prima faciethe prescribed accounts and cost records have been maintained. We have however not madea detailed examination of the cost records with a view to determine whether they areaccurate or complete.
vii) a) According to the records of the Company during the year there have been delayson several occasions in depositing undisputed statutory dues such as provident fundinvestor education and protection fund employee's state insurance income tax goods andservice tax duty of customs cess and other statutory dues applicable to the Company withthe appropriate authorities for certain part of the year. There were no undisputed amountspayable which are outstanding as on 31st March 2020 for a period of more thansix months from the date they became payable.
b) There are no dues of income tax sales tax service tax and duty of excise whichhave not been deposited on account of any dispute except the amount mentioned in the tablegiven below :
|Name of the Statute ||Nature of Dues ||Disputed Amount (In Lakhs) ||Period to which it pertains ||Forum where pending |
|Sales Tax Act of various states (Refer Note Below) ||Sales Tax ||65.23 ||F.Y. 1987 to F.Y. 2000 ||Sales Tax Appellate/ Revisiona Authority-up to Commissioner Level |
| ||Sales Tax ||53.08 ||" ||Sales Tax Appellate Tribunal |
|Central Excise Act 1941 (Refer Note Below) ||Excise Duty ||2.47 ||F.Y 1995-97 ||Central Excise Appellate Tribunal |
|Income Tax Act 1961 ||TDS ||115.36 ||Prior to F.Y. 2015- 16 to F.Y. 2019-20 ||Reflecting on TDS CPC website |
|Total Rs || ||236.14 || || |
Note - The Company has filed appeals against the respective order and has paid Rs.40.40 Lakhs against the dispute.
viii) According to the records of the Company examined by us and information andexplanations given to us the Company has not defaulted in repayment of loans orborrowings to any financial institution or bank.
ix) The Company has not raised any money from public and also has not taken any termloan during the year.
x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the Standalone Ind AS financial statements and according to the informationand explanations given by the management we report that no fraud by the company or nofraud on the Company by the officers and employees of the Company has been noticed orreported during the year.
xi) According to the information and explanations given to us and based on verificationof records the Company has paid/provided managerial remuneration in accordance with therequisite approvals mandated by the provisions of section 197 read with Schedule V to theAct.
xii) As the company is not a Nidhi company clause 3(xii) of the Order are notapplicable to the 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 Section 177 and 188 of the Act and details of such transactions have beendisclosed in the standalone Ind AS financial statements as required by the applicableaccounting standards.
xiv) The company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year.
xv) According to the records of the Company examined by us and information andexplanations given to us the company has not entered into non cash transactions with thedirectors or persons connected with them.
xvi) The company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.
Annexure B to the Independent Auditor's Report
Annexure referred to in para 8(ii)(f) to the Independent Auditor's Report of even dateto the members of Batliboi Limited on the Standalone Ind AS financial statements for theyear ended 31st March 2020.
Report on the Internal Financial Control 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 BatliboiLimited ("the Company") as of 31st March 2020 in conjunction withour audit of the Standalone Ind AS financial statements of the Company for the year endedon that date.
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. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.
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 Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the Institute of Chartered Accountants of India. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated 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 Standalone Ind AS financial statements whether due to fraudor 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 Standalone Ind AS financial statements for external purposes in accordancewith generally 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 Standalone Ind AS 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
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the Standalone Ind AS 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.
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 31st March 2020based 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.