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BGR Energy Systems Ltd.

BSE: 532930 Sector: Engineering
NSE: BGRENERGY ISIN Code: INE661I01014
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VOLUME 11092
52-Week high 105.25
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OPEN 53.00
CLOSE 53.40
VOLUME 11092
52-Week high 105.25
52-Week low 52.15
P/E
Mkt Cap.(Rs cr) 387
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

BGR Energy Systems Ltd. (BGRENERGY) - Auditors Report

Company auditors report

To the Members of BGR ENERGY SYSTEMS LIMITED REPORT ON THE AUDIT OF THESTANDALONE IND AS FINANCIAL STATEMENTS

OPINION

We have audited the accompanying standalone Ind AS financial statementsof BGR ENERGY SYSTEMS LIMITED ("the Company") which comprise the Balance Sheetas at 31-March-2022 the Statement of Profit and Loss (including Other ComprehensiveIncome) the Statement of Changes in equity and the Statement of cash flows for the yearthen ended and notes to the standalone Ind AS financial statements including a summaryof significant accounting policies and other explanatory information.

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 Companies Act 2013 (the "Act") in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of their state of affairs of the Company as at 31-March-2022the Loss and total comprehensive income changes in equity and its cash flows for the yearended 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 forthe Audit 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.

We have determined the matters described below to be the Key Auditmatters to be communicated in our report.

Key Audit Matters Response to Key Audit Matters
1 Appropriateness of estimation/revision of budgeted cost and contract value including non- cash consideration: Principal Audit procedures:
The Company recognizes revenue from contracts with customers on percentage completion method as specified under Indian Accounting Standards (Ind AS) 115 – Revenue from contracts with customers. Recognition of Revenue under IND AS 115 involves key judgements relating to We have performed the following audit procedures:
a. identification of performance obligations a) We have reviewed the cost estimates including
b. determination and allocation of transaction price including non-cash consideration to performance obligation b) We have reviewed the controls placed over the preparation of all relevant information for the purpose of revenue recognition.
d. presentation and disclosures of all relevant items in the financial statements. Determination of revenue requires estimation of total contract costs which involves exercise of significant judgment by the management making forecasts and assumptions. c) Verified the required documents provisions made etc. for the actual costs incurred up to the year-end date.
d) Discussed the status of the projects with the company?s project management team and evaluated the reasonableness of estimates made by the management on cost to be incurred for completion of the respective projects.
e) We have reviewed the workings provided by the management with reference to revision in the contract value or budgeted cost of all projects along with approvals.
Key Audit Matters Response to Key Audit Matters
Due to the large variety and complexity of contractual terms significant judgements are required to estimate the amount applied. Accordingly considering the with revenue recognition in significant accordance with terms of Ind AS 115 ‘Revenue from contracts with customers? it has been determined a key audit matter in our audit. f) We further verified the billings made to customers which are in line with the revised contract values.
2 Provision for Receivables: Principal Audit procedures:
The Company has trade receivable (net) of Rs.127100 lakhs and contract asset (net) of Rs.234009 lakhs as at March 31 2022. The Company follows the practice of creating life-time expected credit loss (ECL) allowance on the overall trade receivables and contract assets. We have assessed the Company?s review mechanism guidelines and policies relating to trade receivables and contract assets.
We have reviewed the ageing of trade receivables and contract assets. We have analyzed the past trend of the trade receivables written off by the company and verified the adequacy of the provisions for loss of trade receivable and contract assets.

INFORMATION OTHER THAN THE STANDALONE IND AS FINANCIAL STATEMENTS ANDAUDITOR?S REPORT THEREON

The Company?s Board of Directors is responsible for the otherinformation. The other information comprises the information included in the Board?sReport including Annexures thereto but does not include the standalone Ind AS financialstatements and our auditor?s report thereon. 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 standalone Ind AS financialstatements our responsibility is to read the other information identified above and indoing so consider whether the other information is materially inconsistent with thestandalone Ind AS financial statements or our knowledge obtained in the audit orotherwise appears to be materially misstated. If based on the work we performed weconclude that there is a material misstatement of this other information we are requiredto report the fact. We have nothing to report in this regard.

MANAGEMENT?S RESPONSIBILITY FOR THE STANDALONE IND AS FINANCIALSTATEMENTS

The Company?s Board of Directors is responsible for the mattersstated in section 134(5) of the Companies Act 2013 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 accounting principles generally accepted in

India including the accounting standards specified under section 133of the Act. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding of the assets of the Companyand 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 isresponsible for assessing the ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

The Board of Directors are also responsible for overseeing thecompany?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 ouropinion. Reasonable assurance is a high level of assurance but is not a guarantee that anaudit conducted 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. We also:

• 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 in placeand the operating effectiveness of such controls.

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

• Conclude on the appropriateness of management?s use of thegoing concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the Company?s ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor?sreport to the related disclosures in the standalone Ind AS financial statements or ifsuch disclosures are inadequate to modify our opinion. Our conclusions are based on theaudit evidence obtained up to the date of our Auditor?s report. However futureevents or conditions may cause 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 any significant deficiencies in internal control that we identify during ouraudit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards. From the matterscommunicated with those charged with governance we determine those matters that were ofmost significance in the audit of the standalone Ind AS financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor?s report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

As required by the Companies (Auditor?s Report) Order 2020("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.

As required by Section 143(3) of the Act we report that: (a) We havesought and obtained all the information and explanations which to the best of ourknowledge and belief were necessary for the purposes of our audit. (b) In our opinionproper books of account as required by law have been kept by the Company so far as itappears from our examination of those books. (c) The Balance Sheet the Statement ofProfit and Loss (including other comprehensive income) the Statement of Changes in Equityand the Cash Flow Statement dealt with by this Report are in agreement with the books ofaccount.

(d) In our opinion the aforesaid standalone Ind AS financialstatements comply with the 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 thedirectors as on 31-March-2022 taken on record by the Board of Directors none of thedirectors is disqualified as on 31-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 controlsover financial reporting of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure B".

(g) With respect to the matters to be included in the Auditor?sReport in accordance with the requirements of section 197(16) of the Act as amended: Inour opinion and to the best of our information and according to the explanations given tous the remuneration paid by the Company to its directors during the year is in accordancewith the provisions of section 197 of the Act.

(h) With respect to the other matters to be included in theAuditor?s Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 in our opinion and to the best of our information and according to theexplanations given to us: i. The Company has disclosed the impact of pending litigationson its financial position in its standalone Ind AS financial statements – Refer Notenos. 36 to the standalone Ind AS financial statements; ii. The Company has made provisionas required under the applicable law or accounting standards for material foreseeablelosses if any on long-term contracts. - Refer Note 41 to the standalone Ind AS financialstatements; The Company did not enter into any derivative contracts; and iii. There hasbeen no delay in transferring amounts required to be transferred to the InvestorEducation and Protection Fund by the Company. iv. (a) The Management has represented thatto the best of its knowledge and belief no funds (which are material either individuallyor in the aggregate) have been advanced or loaned or invested (either from borrowed fundsor share premium or any other sources or kind of funds) by the Company to or in any otherperson or entity including foreign entity ("Intermediaries") with theunderstanding whether recorded in writing or otherwise that the Intermediary shallwhether directly or indirectly lend or invest in other persons or entities identified inany manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries")or provide any guarantee security or the like on behalf of the Ultimate Beneficiaries;(b) The Management has represented that to the best of its knowledge and belief nofunds (which are material either individually or in the aggregate) have been received bythe Company from any person or entity including foreign entity ("FundingParties") with the understanding whether recorded in writing or otherwise that theCompany shall whether directly or indirectly lend or invest in other persons orentities identified in any manner whatsoever by or on behalf of the Funding Party("Ultimate Beneficiaries") or provide any guarantee security or the like onbehalf of the Ultimate Beneficiaries; (c) Based on the audit procedures that have beenconsidered reasonable and appropriate in the circumstances nothing has come to our noticethat has caused us to believe that the representations under iv(a) and iv(b) as providedabove contain any material misstatement. v. The Company has not declared or paid anydividend during the year ended 31-March-2022.

ANNEXURE A TO THE INDEPENDENT AUDITORS? REPORT ON THE STANDALONEIND AS FINANCIAL STATEMENTS

The Annexure referred to in paragraph 1 under the heading "Reporton Other Legal and Regulatory Requirements" of our Independent Auditors? Reportto the members of

M/s BGR ENERGY SYSTEMS LIMITED for the year ended March 31 2022 wereport that: (i) (a) (A) The Company has maintained proper records showing fullparticulars including quantitative details and situation of Property Plant and Equipmentand relevant details of right-of-use assets; (B) The Company has maintained proper recordsshowing full particulars of intangible assets. (b) The Company has a regular program ofphysical verification of its fixed assets by which fixed assets are verified in a phasedmanner on a rotational basis and in our opinion this periodicity of physical verificationis reasonable having regard to the size of the Company and the nature of its assets.According to the information and explanations given to us and on the basis of ourexamination of the records of the Company no material discrepancies were noticed on suchverification.

(c) Based on our examination of the property tax receipts and leaseagreement for land on which building is constructed registered sale deed / transfer deed/ conveyance deed provided to us we report that the title in respect of self-constructedbuildings and title deeds of all other immovable properties (other than properties wherethe company is the lessee and the lease agreements are duly executed in favour of thelessee) disclosed in the financial statements included under Property Plant andEquipment are held in the name of the Company as at the balance sheet date.

(d) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company has not revaluedany of its Property Plant and Equipment (including right of-use assets) and intangibleassets during the year.

(e) According to the information and explanations given to us and onthe basis of our examination of the records of the Company 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.

(ii) (a) According to the information and explanations given to us andon the basis of our examination of the records of the Company the management hasconducted the physical verification of inventory and we are of the opinion that thefrequency of such verification is reasonable. There are no material discrepancies noticedbetween book stock and physical stock on physical verification conducted by themanagement.

(b) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company has beensanctioned working capital limits in excess of five crore rupees in aggregate from bankson the basis of security of current assets. In our opinion the quarterly returns orstatements filed by the company with banks or financial institutions are in agreement withthe books of account of the Company.

(iii) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company has not made anyinvestments provided guarantee or security or granted any advances in the nature ofloans secured or unsecured to companies firms limited liability partnerships or anyother parties during the year. Accordingly paragraph 3(iii)(a) (b) (c) (d) (e) and(f) of the Order is not applicable.

(iv) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the company has not grantedloans or provided any guarantees or security to any parties covered under Section 185 ofthe Act. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 186 of the Act.

(v) The Company has not accepted any deposits from the public withinthe meaning of sections 73 to 76 of the Act and the rules framed there under to the extentnotified. Therefore the provisions of clause 3 (v) of the Companies (Auditors?Report) Order 2020 are not applicable to the Company.

(vi) We have broadly reviewed the books of account maintained by thecompany pursuant to the Rules made by the Central Government for the maintenance of costrecords under section 148 of the Act and are of the opinion that prima facie theprescribed accounts and records have been made and maintained. We have however not madea detailed examination of the cost records with a view to determine whether they areaccurate or complete.

(vii) (a) In our opinion and according to the information andexplanations given to us and on the basis of our examination of the records of theCompany amounts deducted / accrued in the books of account in respect of undisputedstatutory dues including Provident Fund Employees? State Insurance ProfessionalTax Income-tax Customs Duty Goods and Service tax Cess and other statutory dues havegenerally been regularly deposited during the year by the company with the appropriateauthorities. According to the information and explanations given to us and on the basis ofour examination of the records of the Company no undisputed amounts payable in respect ofProvident Fund Employees? State Insurance Professional Tax Income-tax CustomsDuty Goods and Service tax Cess were in arrears as at March 31 2022 for a period ofmore than six months from the date they became payable; and (b) As per the information andexplanations given to us the following are the details of statutory dues which have notbeen deposited by the Company on account of disputes:

Name of the Statute Nature of Due Disputed Tax Amount (INR Lakhs) Financial Year Forum in which dispute is lying in
Central Sales Tax Act 1956 Central Sales Tax 4.20 1997-98 The Honourable High Court Andhra Pradesh
Central Sales Tax Act 1956 Central Sales Tax 35.03 1997-98 The Honourable High Court Andhra Pradesh
Andhra Pradesh Value Added Tax Act 2005 Andhra Pradesh Sales Tax 0.12 1998-99 Commercial Tax Officer Andhra Pradesh
Tamil Nadu General Sales Tax Act 1959 Tamil Nadu Sales Tax 0.11 1999-00 Commercial Tax Officer Tamil Nadu
Central Sales Tax Act 1956 Central Sales Tax 5.58(3) 2004-05 Sales Tax Appellate Tribunal Vishakhapatnam Andhra Pradesh.
Andhra Pradesh Value Added Tax Act 2005 Andhra Pradesh Sales Tax (Penalty) 2.59(3) 2006-07 Sales Tax Appellate Tribunal Vishakhapatnam Andhra Pradesh.
Kerala Value Added Tax Act 2003 Kerala Sales Tax 2.65(3) 2006-07 The Deputy Commissioner (Appeals) Ernakulum Kerala
Andhra Pradesh Value Added Tax Act 2005 Andhra Pradesh Sales Tax (Penalty) 7.43(3) 2007-08 Sales Tax Appellate Tribunal Vishakhapatnam Andhra Pradesh.
The Rajasthan Value Added Tax 2003 Rajasthan Sales Tax 9865.96(3) 2009-10 High Court of Judicature at Jaipur
The Rajasthan Value Added Tax 2003 Rajasthan Sales Tax 9541.31(3) 2010-11 High Court of Judicature at Jaipur
The Rajasthan Value Added Tax 2003 Rajasthan Sales Tax 4333.66(3) 2011-12 High Court of Judicature at Jaipur
Central Sales Tax Act 1956 Maharashtra Value Added Tax 53.85(3) 2013-14 The Joint Commissioner of Sales Tax Appeal VII Mumbai
Tamil Nadu Value Added Tax Act2006 Tamil Nadu Value Added Tax 31.80(1) Disputed 2011-12 Financial The Honourable High Court Madras. Forum in which dispute is
Tamil Nadu Value Added Tax Act2006 Tamil Nadu Value Added Tax 14.36(1) 2012-13 The Honourable High Court Madras.
Chapter V of Finance Act 1994 Service Tax 24482(1) 2007-08 to 2014-15 CESTAT Chennai Tamilnadu.
Chapter V of Finance Act 1994 Service Tax 11798.95(1) 2014-15 to 2017-18 CESTAT Chennai Tamilnadu.
Chapter V of Finance Act 1994 Service Tax 306.45(1) 2007-08 to 2014-15 CESTAT Chennai Tamilnadu.
Chapter V of Finance Act 1994 Service Tax 77.72(1) 2015-16 to 2017-18 CESTAT Chennai Tamilnadu.
Chapter V of Finance Act 1994 Service Tax 2.50 2017-18 The Deputy Commissioner of Goods and Services Tax(GST) & Central Excise
Odisha Value added Tax Act Value Added Tax 40.77 2015-16 to 2017 -18 The Joint Commissioner Commercial Tax Bhubaneswar Range
Central Sales Tax Act 1956 Central Sales Tax 0.23 2015-16 to 2017 -18 The Joint Commissioner Commercial Tax Bhubaneswar Range
Central Sales Tax Act1956 Maharashtra Value Added Tax 16.89 2014-15 The Joint Commissioner of Sales Tax Appeal VII Mumbai
Andhra Pradesh Value Added Tax Act 2005 Value Added Tax 408.97(3) 2011-12 Appellate Deputy Commissioner Tirupathi
Central Sales Tax Act 1956 Central Sales Tax 109.83(3) 2016-17 Appellate Deputy Commissioner Tirupathi
The Employee Provident Fund & Miscellaneous Provisions Act 1952 Provident Fund 521.15(3) 2006-2010 The Honourable High Court Hyderabad
Income-tax Act 1961 Income Tax 137.65(2) 2006-07 The Honourable High Court Andhra Pradesh
Income-tax Act 1961 Income Tax 141.55(2) 2007-08 The Honourable High Court Andhra Pradesh
Income-tax Act 1961 Income Tax 192.15(2) 2008-09 The Honourable High Court Andhra Pradesh
Income-tax Act 1961 Income Tax 101.16(2) 2009-10 The Honourable High Court Madras.
Income-tax Act 1961 Income Tax 112.79(2)(3) 2010-11 The Honourable High Court Madras.
Income-tax Act 1961 Income Tax 83.20(2) 2011-12 The Honourable High Court Madras.
Income-tax Act 1961 Income Tax 76.35(2) 2012-13 The Honourable High Court Madras.
Income-tax Act 1961 Income Tax 100.07(2) 2013-14 The Honourable High Court Madras.
Income-tax Act 1961 Income Tax 37.83(2) 2013-14 Income Tax Appellate Tribunal
Income-tax Act 1961 Income Tax 1468.05(2) 2007-08 to 2013-14 The Honourable High Court Madras.
Income-tax Act 1961 Income Tax 67.65(2) 2017-18 Commissioner of Income Tax (Appeals - 19) Chennai
Income-tax Act 1961 Income Tax 377.34 2015-16 Income Tax Appellate Tribunal
Income-tax Act 1961 Income Tax 84.95(2) 2016-17 Income Tax Appellate Tribunal

(1) Excludes Interest and penalty.

(2) Excludes Interest and penalty which are not ascertainable.

(3) Represents gross tax liability. Out of total a sum of INR 1399.27lakhs was paid as deposit.

(viii) There were no transactions relating to previously unrecordedincome that have been surrendered or disclosed as income during the year in the taxassessments under the Income Tax Act 1961 (43 of 1961).

(ix) (a) According to the information and explanations given to us andon the basis of our examination of the books of account the Company has not defaulted inrepayment of loans or other borrowings or in the payment of interest thereon to anyfinancial institutions or banks (b) According to the information and explanations given tous and on the basis of our examination of the books of account the Company has not beendeclared a wilful defaulter by any bank or financial institution or government or anygovernment authority.

(c) The Company has not taken any term loan during the year and thereare no outstanding term loans at the beginning of the year and hence reporting underclause 3(ix)(c) of the Order is not applicable. (d) According to the information andexplanations given to us and the procedures performed by us and on an overallexamination of the financial statements of the company we report that no funds raised onshort-term basis have been used for long-term purposes by the company.

(e) On an overall examination of the financial statements of theCompany the Company has not taken any funds from any entity or person on account of or tomeet the obligations of its subsidiaries.

(f) According to the information and explanations given to us andprocedures performed by us we report that the company has not raised loans during theyear on the pledge of securities held in its subsidiaries joint ventures or associatecompanies.

(x) (a) The Company has not raised moneys by way of initial publicoffer or further public offer (including debt instruments). Accordingly paragraph 3(x)(a)of the order is not applicable.

(b) During the year the Company has not made any preferentialallotment or private placement of shares or convertible debentures (fully or partly oroptionally) and hence reporting under clause 3(x)(b) of the Order is not applicable (xi)(a) To the best of our knowledge and according to the information and explanations givento us we report that no fraud by the Company or on the Company by its officers oremployees has been noticed or reported during the year.

(b) According to the information and explanations given to us noreport under sub-section (12) of section 143 of the Companies Act has been filed in FormADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules 2014 with theCentral Government during the year and upto the date of this report.

(c) As represented to us by the management there are no whistle blowercomplaints received by the company during the year.

(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 information and explanations given to us andbased on our examination of the records of the Company transactions with the relatedparties are in compliance with sections 177 and 188 of the Act wherever applicable and thedetails of transactions with related parties have been disclosed in the standalone Ind ASfinancial Statements as required by the applicable accounting standards.

(xiv) In our opinion and based on our examination the company has aninternal audit system commensurate with the size and nature of its business. We haveconsidered the internal audit reports of the Company issued till date for the period underaudit.

(xv) According to the information and explanations given to us andbased on our examinations of the records of the Company the Company has not entered intonon-cash transactions with directors or persons connected with them and hence provisionsof section 192 of the Companies Act 2013 are not applicable to the company.

(xvi) (a) In our opinion and according to the information andexplanations given to us the company is not required to be registered under Section 45-IAof the Reserve Bank of India Act 1934. Accordingly clause 3(xvi) (a) of the Order is notapplicable. (b) In our opinion and according to the information and explanations given tous the company is not required to be registered under Section 45-IA of the Reserve Bankof India Act 1934. Accordingly paragraph 3(xvi) (b) of the Order is not applicable. (c)The Company is not a Core Investment Company (CIC) as defined in the regulations made bythe Reserve Bank of India. Accordingly clause 3(xvi) (c) of the Order is not applicable.

(d) According to the information and explanations given to us there is no coreinvestment company within the Group (as defined in the Core Investment Companies (ReserveBank) Directions 2016)and accordingly reporting under clause 3(xvi)(d) of the Order isnot applicable.

(xvii) The Company?s cash losses during the financial year covered by our auditand the immediately preceding financial year are as follows: FY 2021-22 - Rs. 21216 lakhsFY 2020-21 - Rs. 44524 lakhs

(xviii) There has been no resignation of the statutory auditors of the Company duringthe year. Accordingly clause 3(xviii) of the Order is not applicable.

(xix) 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 and 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 reportindicating that Company is not capable of meeting its liabilities existing at the date ofbalance sheet as and when they fall due within a period of one year from the balance sheetdate. We however state that this is not an assurance as to the future viability 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.

(xx) The company has no CSR obligation during the financial year therefore reportingunder clause 3(xx) of the Order is not applicable

ANNEXURE B TO THE INDEPENDENT AUDITOR?S REPORT ON THE STANDALONEIND AS FINANCIAL STATEMENTS

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 over financialreporting of BGR Energy Systems Limited ("the Company") as of 31-March-2022 inconjunction with our audit of the standalone Ind AS 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 over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls overFinancial Reporting issued by the Institute of Chartered Accountants of India("ICAI"). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence tocompany?s policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

AUDITORS? RESPONSIBILITY

Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting ("the Guidance Note") and the Standards on Auditing issued by ICAIand deemed to be prescribed under section 143(10) of the Act to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects. Our audit involves performingprocedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal control based on the assessed risk. The procedures selected depend on theauditors? judgment including the assessment of the risks of material misstatement ofthe standalone Ind AS financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company?s internalfinancial controls system over financial reporting.

MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

A company's internal financial control over financial reporting is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of standalone Ind AS financial statements for externalpurposes in accordance with generally accepted accounting principles. A company's internalfinancial control over financial reporting includes those policies and procedures that:(i) pertain to the maintenance of records that in reasonable details accurately andfairly reflect the transactions and dispositions of the assets of the company; (ii)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 authorizations of management and directors of theCompany; and (iii) provide reasonable assurance regarding prevention or timely detectionof unauthorized 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 FINANCIALREPORTING

Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.

OPINION

In our opinion the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31-March-2022 based onthe internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the

Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India.

For N R Doraiswami & Co
Chartered Accountants
Firm?s Registration No. 000771S
Suguna Ravichandran
Partner
Place : Chennai Membership No.207893
Date : 07.06.2022 UDIN : 22207893AJSSWO4862

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