To the Members of BF Investment Limited
Report on the Audit of the Standalone Indian Accounting Standards (IndAS) Financial Statements
We have audited the standalone Ind AS financial statements of BFInvestment 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 statement of cash flows for the year then ended andnotes to the financial statements including a summary of significant accounting policiesand other explanatory information hereinafter referred to as 'the standalone Ind ASfinancial statements'.
In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone Ind AS financial statements give theinformation required by the Act in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India of the standalonestate of affairs of the Company as at 31st March 2021 and its standalone profit(including Other Comprehensive Income) standalone changes in equity and itsstandalone 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 Companies Act 2013. Our responsibilitiesunder those Standards are further described in the Auditor's Responsibilities for theAudit of the Standalone Ind AS Financial Statements section of our report. We areindependent of the Company in accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethical requirements that are relevantto our audit of the Standalone Ind AS financial statements under the provisions of theCompanies Act 2013 and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our opinion.
Key Audit Matters
Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the Standalone Ind AS financial statements ofthe current period. These matters were addressed in the context of our audit of theStandalone Ind AS financial statements as a whole and in forming our opinion thereon andwe do not provide a separate opinion on these matters.
Key Audit Matter :
Valuation of investments
At the balance sheet date the value of investments amounted to Rs.13812.06 millions. Investments have been considered as key audit matter due to the sizeof the balance various recognition and subsequent measurement principles. Refer note 1A.(h) to (k) to the Standalone Financial Statements for its accounting policy.
Principle Audit Procedures
i. We have obtained independent external confirmations of all materialcurrent investments in order to test the assertion of existence accuracy valuation andcompleteness.
ii. We have independently evaluated the fair values of listed andquoted investments.
iii. We have evaluated the fair value of unquoted investments adoptedby the management.
iv. We have evaluated the process of the management to identifyimpairment (if any) for the investments measured at amortised cost.
v. We have assessed the compliance of the recognition and subsequentmeasurement principles as specified in the accounting policy adopted by the company.
The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the DirectorsReport to the members & Annexures thereto and the Corporate Governance Report butdoes not include the standalone Ind AS financial statements and our auditor's reportthereon. These reports are yet to be made available to us and are expected to be madeavailable to us after the date of our audit report. Our opinion on the standalone Ind ASfinancial statements does not cover the other information and we do not express any formof assurance conclusion thereon.
In connection with our audit of the 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.
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.
When we read the said reports after they are made available to us ifwe conclude that there is a material misstatement therein we are required to communicatethe matter to those charged with governance.
Responsibilities of Management and Those Charged with Governance forthe Standalone Ind AS Financial Statements
The Company's Board of Directors is responsible for the matters statedin section 134(5) of the Companies Act 2013 ("the Act") with respect to thepreparation of these standalone Ind AS financial statements that give a true and fair viewof the standalone Ind AS financial position standalone Ind AS financial performancestandalone Ind AS changes in equity and standalone Ind AS cash flows of the Company inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards specified in the Companies (Indian Accounting Standards)Rules 2015 (as amended) under section 133 of the Act. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities 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 standalone Ind AS financial statements that give atrue and fair view and are free from material misstatement whether due to fraud or error.
In preparing the standalone Ind AS 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 alsoresponsible for overseeing the Company's financial reporting process.
Auditor's Responsibilities for the Audit of the Standalone Ind ASFinancial Statements
Our objectives are to obtain reasonable assurance about whether thestandalone Ind AS financial statements as a whole are free from material misstatementwhether due 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 Ind AS financialstatements. As part of an audit in accordance with SAs we exercise professional judgmentand maintain professional skepticism throughout the audit.
Identify and assess the risks of material misstatement of thestandalone Ind AS financial statements whether due to fraud or error design and performaudit procedures responsive to those risks and obtain audit evidence that is sufficientand appropriate 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 control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. Undersection 143(3)(i) of the Companies act 2013 we are also responsible for expressing ouropinion on whether the company has adequate internal financial controls system withreference to financial statements in place and the operating effectiveness of suchcontrols.
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 Ind AS financial statements or if such disclosuresare inadequate 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 conditions maycause the Company to cease to continue as a going concern.
Evaluate the overall presentation structure and content of thestandalone Ind AS financial statements including the disclosures and whether thestandalone Ind AS financial statements represent the underlying transactions and events ina manner that achieves fair presentation.
We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding significant deficiencies if any in internal control that we identify duringour audit. We also provide those charged with governance with a statement that we havecomplied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may reasonably be thought to bear onour independence and where applicable related safeguards. From the matters communicatedwith those charged with governance we determine those matters that were of mostsignificance in the audit of the standalone Ind AS financial statements of the currentperiod and are therefore the key audit matters. We describe these matters in our auditor'sreport unless law or regulation precludes public disclosure about the matter or when inextremely rare circumstances we determine that a matter should not be communicated in ourreport because the adverse consequences of doing so would reasonably be expected tooutweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2016("the Order") issued by the Central Government of India in terms of sub-section(11) of section 143 of the Companies Act 2013 we give in the Annexure A a statement onthe matters specified in paragraphs 3 and 4 of 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 ouraudit.
(b) In our opinion proper books of account as required by law havebeen kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet the Statement of Profit and Loss (includingOther Comprehensive Income) statement of changes in equity 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 theIndian Accounting Standards specified under Section 133 of the Act read with Companies(Indian Accounting Standards) Rules 2015 as amended.
(e) On the basis of the written representations received from thedirectors as on 31st March 2021 taken on record by the Board of Directors none of thedirectors is disqualified as on 31st March 2021 from being appointed as a director interms of Section 164 (2) of the Act.
(f) With respect to the adequacy of the internal financial controlswith reference to financial statements of the Company and the operating effectiveness ofsuch controls refer to our separate Report in "Annexure B".
(g) As required by section 197 (16) of the Act; in our opinion andaccording to information and explanation provided to us the remuneration paid by thecompany to its directors is in accordance with the provisions of section 197 of the Actand remuneration paid to directors is not in excess of the limit laid down under thissection.
(h) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 inour opinion and to the best of our information and according to the explanations given tous:
I. The Company has disclosed the impact of pending litigations on itsfinancial position in its financial statements - Refer Note 45 to the financialstatements;
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 AUDITORS' REPORT
ANNEXURE A TO THE AUDITORS' REPORT
(Referred to in our above Independent Auditor's Report of even date tothe members of BF Investment Limited on the financial statements for the year ended March31 2021)
(i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets.
(b) As explained to us the fixed assets have been physically verifiedby the Management at reasonable intervals. The frequency of such verification isreasonable. According to the information and explanations given to us no discrepancieswere noticed on such physical verification of the fixed assets.
(c) According to the information and explanations given to us and onthe basis of our examination of the records of the company the title deeds of theimmovable properties as disclosed in Note No. 9 to the standalone Ind AS financialstatements are held in the name of the company except for the buildings regardingwhich as informed to us the title is as yet being obtained in the name of the company asthe process of completing the required legal formalities is in progress.
(ii) As explained to us the Company did not hold any physicalinventories during the financial year covered by this report. Thus paragraph 3(ii) of theOrder is not applicable to the Company.
(iii) As informed to us the Company has not granted any loans securedor unsecured to companies firms limited liability partnerships or other parties coveredin the register maintained under Section 189 of the Companies Act 2013 except a ICDgiven during the year amounting to Rs. 22.5 millions
(a) As informed to us the terms and conditions of the grant of suchloan during the year are not prejudicial to the company's interest;
(b) As informed to us the schedule of repayment of principal andpayment of interest has been stipulated and the repayment / payment are as per thestipulation ;
(c) As informed to us the amount is not overdue ;
(iv) In our opinion and according to the information and explanationsgiven to us the Company has not made any investments or granted any guarantees orsecurity during the year to which the provisions of sections 185 and 186 of the CompaniesAct 2013 are attracted. In our opinion and according to the information and explanationsgiven to us in respect of the loan (ICD) as above granted by the company during theyear the Company has complied with the provisions of Section 185 and 186 of the Act.
(v) The Company has not accepted deposits from the public within themeaning of Sections 73 to 76 or any other relevant provisions of the Companies Act 2013and the rules framed thereunder. As informed to us there is no Order from RBI orTribunal.
(vi) Requirement to maintain cost records under sub-section (1) ofSection 148 of the Companies Act 2013 does not apply to the Company.
(vii) (a) According to the records of the Company the Company wasfound to be regular in depositing undisputed statutory dues applicable to it includingincome tax GST service tax cess and any other statutory dues to the appropriateauthorities. As explained to us by the Management the provisions of the Employees' StateInsurance Act 1948 and the Employees' Provident Fund and Miscellaneous Provisions Act1952 do not apply to the Company. According to the information and explanations given tous no undisputed amounts payable in respect of income tax service tax GST and any otherstatutory dues were outstanding as at 31st March 2021 for a period of more than sixmonths from the date those became payable.
(b) According to the records of the Company there are no dues ofincome tax or service tax or GST which have not been deposited on account of any dispute.
(viii) The Company does not have any loans or borrowings from anyfinancial institution banks government or debenture holders. Accordingly paragraph3(viii) of the Order is not applicable.
(ix) The Company did not raise any money by way of initial public offeror further public offer (including debt instruments) and term loans during the year.Accordingly paragraph 3 (ix) of the Order is not applicable.
(x) Based upon the audit procedures performed and the information andexplanations given by the Management we report that no fraud by the Company or no fraudon the Company by its officers or employees has been noticed or reported during the year.
(xi) Managerial remuneration for the year has been paid or provided inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Companies Act;
(xii) In our opinion and according to the information and explanationsgiven to us the Company is not a nidhi company. Accordingly paragraph 3 (xii) of theOrder is not applicable.
(xiii) According to the records of the Company and according to theinformation and explanations given to us transactions with the related parties are incompliance with Sections 177 and 188 of the Companies Act 2013 wherever applicable andthe details have been disclosed in the Financial Statements as required by the applicableaccounting standards.
(xiv) According to the information and explanations given to us andbased on our examination of the records of the Company the Company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the year. Accordingly paragraph 3(xiv) of the Order is not applicable.
(xv) According to the information and explanations given to us andbased on our examination of the records of the Company the Company has not entered intoany non-cash transactions with directors or persons connected with them. Accordinglyparagraph 3(xv) of the Order is not applicable.
(xvi) As informed to us the company is not required to obtainCertificate of Registration under Section 45-IA of the Reserve Bank of India Act 1934.
"ANNEXURE B" TO AUDITORS' REPORT
Referred to in paragraph 2 (f) under the heading "Report on Otherlegal and Regulatory Requirements" of our report on even date:
Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls with reference tofinancial statements of BF Investment Limited ("the Company") as of 31st March2021 in conjunction with our audit of the standalone financial statements of the Companyfor 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 with reference tofinancial statements criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls over Financial Reporting issued by the Institute of Chartered Accountants ofIndia ('ICAI'). These responsibilities include the design implementation and maintenanceof adequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to Company's policiesthe safeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation of reliablefinancial information as required under the Companies Act 2013.
Our responsibility is to express an opinion on the Company's internalfinancial controls with reference to financial statements based on our audit. We conductedour audit in accordance with the Guidance Note on Audit of Internal Financial ControlsOver Financial Reporting (the "Guidance Note") and the Standards on Auditingissued by ICAI and deemed to be prescribed under Section 143(10) of the Companies Act2013 to the extent applicable to an audit of internal financial controls both applicableto an audit of Internal Financial Controls and both issued by the Institute of CharteredAccountants of India. 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 with reference to financial statements wereestablished and maintained and if such controls operated effectively in all materialrespects.
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 weakness existsand testing and evaluating the design and operating effectiveness of internal controlbased on the assessed risk. The procedures selected depend on the auditor's judgmentincluding the assessment of the risks of material misstatement of the financialstatements 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 internal financialcontrols with reference to financial statements.
Meaning of Internal Financial Controls with reference to financialstatements
A Company's internal financial control with reference to financialstatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposesin accordance with generally accepted accounting principles. A Company's internalfinancial control with reference to financial statements includes those policies andprocedures that
(1) pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of theCompany;
(2) 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 are beingmade only in accordance with authorisations of management and directors of the Company;and
(3) provide reasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or disposition of the Company's assets thatcould 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 control with reference to financial statements may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.
In our opinion the Company has in all material respects an adequateinternal financial controls with reference to financial statements and such internalfinancial controls with reference to financial statements were operating effectively as at31st March 2021 based on the internal control with reference to financial statementscriteria 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.
| ||For P.G. BHAGWAT LLP |
| ||Chartered Accountants |
| ||FRN : 101118W / W100682 |
| ||Sanjay Athavale |
| ||Partner |
| ||Membership No. 83374 |
|Pune : 14 June 2021 ||UDIN : 21083374AAAADA4617 |