TO THE MEMBERS OF BHATIA COMMUNICATIONS & RETAIL (INDIA) LIMITED
Report on the Audit of Standalone Financial Statements:
We have audited the accompanying standalone Ind AS financial statements of BHATIACOMMUNICATIONS & RETAIL (INDIA) LIMITED ("The Company") which comprisesthe Balance Sheet as on 31st March 2021 the Statement of Profit and Loss(Including Other Comprehensive Income) the Statement of Change in Equity and the CashFlow statement for the year then ended and notes to financial statements including asummary of significant accounting policies and other explanatory information. In ouropinion and to the best of our information and according to the explanations given to usthe aforesaid standalone financial statements give the information required by theCompanies Act 2013 ("the Act") in the manner so required and give a true andfair view in conformity with the Companies (Indian Accounting Standards)
Rules 2015 as amended ("Ind As") and other accounting principles generallyaccepted in India of the state of affairs of the company as at 31st March 2021 andits profit and total comprehensive income and change in equity and its cash flows for theyear ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder Section 143(10) of the Companies Act 2013. Our responsibilities under thosestandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the entity in accordancewith the Code of Ethics issued by the Institute of Chartered Accountants of India togetherwith the ethical requirements that are relevant to our audit of the financial statementsunder the provisions of the Companies Act 2013 and the rules thereunder 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.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters. Wehave determined the matters described below to be the key audit matters to be communicatedin our report.
Branches and Franchise
The company has many franchises and branches and the company receives advances/securitydeposit from its various franchises and the same is adjusted against the amount due fromthem as on the balance sheet date. The company also receives deposit from branch partnertowards security deposit against stock provided to them and same is shown in balance sheetas long term liability.
We get the complete list of franchise and branches from the management and check thatthere is no deviation in the security deposit received and stock provided to them. We alsocheck the agreement made with the branch partner and check whether proper disclosure ismade regarding advances received from branch partner and term and conditions of theagreement.
Management's Responsibility for the Standalone 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 preparationand presentation of these standalone financial statements that give a true and fair viewof the financial position financial performance and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theAccounting Standards specified under Section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding the assets of the Company and for preventing and detecting fraudsand other irregularities; selection and application of appropriate accounting policies;making judgments and estimates that are reasonable and prudent; and design implementationand maintenance of adequate internal financial controls that were operating effectivelyfor ensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.
In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so. The Board of Directors are also responsible for overseeing thecompany's financial reporting process.
Auditor's Responsibility for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand 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 reasonably be expected to influence the economicdecisions of users taken on the basis of these financial statements.
As part of an audit in accordance with SAs We exercises professional judgment andmaintain professional scepticism throughout the audit. We also:
??Identify and assess the risks of material misstatement of the financial statementswhether due to fraud or error; to design and perform audit procedures responsive to thoserisks; and to obtain audit evidence that is sufficient and appropriate to provide a basisfor the auditor's opinion. The risk of not detecting a material misstatement resultingfrom fraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.
??Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theCompanies Act2013we are responsible for expressing our opinion on whether the companyhas adequate internal financial controls system in place and the operating effectivenessof 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 financial statements or if such disclosures are inadequate to modify the opinion.
Our conclusions are based on the audit evidence obtained up to the date of theauditor's report. However future events or conditions may cause an entity to cease tocontinue as a going concern.
??Evaluate the overall presentation structure and content of the financial statementsincluding the disclosures and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the standalone financial statementsthat individually or in aggregate makes it probable that the economics decisions of areasonably knowledgeable user of the financial statement may be influenced. We considerquantitative materiality and qualitative factor in (i) planning the scope of our auditwork and in evaluating the result of our work and (ii) to evaluate the effect of anyidentified misstatements in the financial statements.
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 alsoprovide those charged with governance with a statement that we have complied with relevantethical requirements regarding independence and communicate with them all relationshipsand other matters that may reasonably be thought to bear on our independence and whereapplicable related safeguards.
Report on Other Legal and Regulatory Requirements:
1. As required by the Companies (Auditor's Report) Order 2016 (order dated29.03.2016) issued by the Central
Government of India in terms of section 143(11) of the Companies Act 2013 (hereinafterreferred to as
order') and on the basis of test check as we considered appropriate andaccording to information and explanation provided to us we enclose in the Annexure"A" statement on the matters specified in paragraphs
3 and 4 of the said Order.
2. As required by section 143(3) of the Act we report that:
2.1 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
2.2 In our opinion proper books of account as required by law have been kept by thecompany as far as appears from our examination of those books.
2.3 The Balance Sheet Profit and Loss statement (Including Other ComprehensiveIncome) Cash Flow Statement and the statement of Change in Equity dealt with by thisreport are in agreement with the books of account.
2.4 In our opinion the aforesaid financial statements comply with the Ind As specifiedunder section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.
2.5 On the basis of written representations received from the directors as on March31 2021 taken on record by the Board of directors none of the directors aredisqualified as on March 31 2021 from being appointed as a director under section 164(2)of the Act
2.6 With respect to the adequacy of financial controls over financial reporting of thecompany and the operative effectiveness of such controls refer to our separate report in"Annexure B".
2.7 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 ouropinion and to the best of our information and according to the explanations given to usthe remuneration paid by the Company to its directors during the year is in accordancewith the provisions of section 197 of the Act; and
2.8 With respect to the others 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) There were no pending litigations which would impact the financial position of thecompany.
(ii) The company did not have any material foreseeable losses on long term contractsincluding derivative contracts.
(iii) There were no amounts which were required to be transferred to the InvestorEducation and Protection fund by the company.
(Referred to in of our report of even date to the members of BHATIA COMMUNICATIONS& RETAIL (INDIA) LTD as on the financial statements for the year ended March 31 2021)
On the basis of such checks as we considered appropriate and according to theinformation and explanations given to us during the course of audit we state that:
Fixed Assets 1
|(a) Whether the company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets; ||YES |
|(b) Whether these fixed assets have been physically verified by the management at reasonable intervals; whether any material discrepancies were noticed on such verification and if so whether the same have been properly dealt with in the books of account; ||The management conducted physical verification of certain fixed assets in accordance with its policy of physical verification in a phased manner. In our opinion such frequency is reasonable having regard to the size of the Company and the nature of its fixed assets. As explained to us the discrepancies noticed on physical verification as compared to book records maintained were not material and have been properly dealt with in the books of account. |
|(c) Whether title deeds of immovable properties are held in the name of the company. If not provide details thereof. ||NA |
|Inventories || |
|Whether physical verification of inventory has been conducted at reasonable intervals by the management and whether any material discrepancies were noticed and if so how they have been dealt with in the books of account; ||The management conducted physical verification of inventory in accordance with its policy of physical verification in a phased manner. In our opinion such frequency is reasonable having regard to the size of the Company and the nature of its inventory. As explained to us the discrepancies noticed on physical verification as compared to book records maintained were not material and have been properly dealt with in the books of account. |
|Loan Granted || |
|Whether the company has granted any loans secured or unsecured to companies firms LLPs or other parties covered in the register maintained u/s 189 of the Companies Act 2013. If so ||NO |
|(a) Whether the terms and conditions of the grant of such loans are not prejudicial to the company's interest; ||NA |
|(b) Whether receipt of the principal amount and interest are regular. If not provide details thereof; and ||NA |
|(c) If overdue amount is more than rupees five lakhs whether reasonable steps have been taken by the company for recovery of the principal and interest; ||NIL |
|4 Loans Investments and gurantees || |
|In respect of loans investments and guarantees whether provisions of Section 185 and 186 of the Companies Act 2013 have been complied with. If not provide details thereof. ||Yes |
|5 Deposit || |
|In case the company has accepted deposits whether the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act 2013 and the rules framed thereunder where applicable have been complied with? If not the nature of such contraventions be stated; If an order has been passed by Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal whether the same has been complied with or not? ||NA |
|6 Cost Records || |
|Whether maintenance of cost records has been specified by the Central Government under sub-section (1) of section 148 of the Companies Act 2013 and whether such accounts and records have been so made and maintained; ||NA |
|7 Statutory dues || |
|(a) whether the company is regular in depositing undisputed statutory dues including provident fund employees' state insurance income-tax sales-Lax service tax duty of customs duty of excise value added tax and any other statutory dues with the appropriate authorities and if not the extent of the arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable shall be indicated by the auditor. ||According to the information and explanations given to us and the record examined by us the company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund Employee's State Insurance Income tax Sales-tax and other material Statutory Dues applicable to it. There were no arrears as at 31st March 2021 for a period of more than six months from the date they became payable. |
|(b) Where dues of income tax or sales tax or service tax or duty of customs or duty of excise or value added tax have not been deposited on account of any dispute then the amounts involved and the forum where dispute is pending shall be mentioned. (A mere representation to the concerned Department shall not be treated as a dispute). Particulars F.Y. ||NA AMOUNT (In Rs.) STATUS |
|8 Default in Repayment Whether the company has defaulted in repayment of dues to a financial institution or bank or debenture holders? If yes the period and amount of default to be reported (in case of banks and financial institutions lender wise details to be provided). ||NO |
|9 Term Loan/ Money raised || |
|Whether moneys raised by way of public issue/ follow-on offer (including debt instruments) and term loans were applied for the purposes for which those are raised. If not the details together with delays / default and subsequent rectification if any as may be applicable be reported; ||NO |
|10 Fraud || |
|Whether any fraud by the company or any fraud on the Company by its officers/ employees has been noticed or reported during the year; If yes the nature and the amount involved be indicated. ||To the best of our knowledge and according to the information and explanations given to us there have been no cases of fraud on or by the Company noticed or reported during the year under report |
|11 Managerial Remuneration || |
|Whether managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the Companies Act? If not state the amount involved and steps taken by the company for securing refund of the same. ||YES |
|12 Nidhi Company || |
|Whether the Nidhi Company has complied with the Net Owned Fund in the ratio of 1: 20 to meet out the liability and whether the Nidhi Company is maintaining 10% liquid assets to meet out the unencumbered liability. ||NA |
|13 Related Parties Transactions || |
|Whether all transactions with the related parties are in compliance with Section 188 and 177 of Companies Act 2013 where applicable and the details have been disclosed in the Financial Statements etc as required by the accounting standards and Companies Act 2013. ||As per the information and explanation provided to us and records produced before us the company has generally complied with the provisions. |
|14 Preferential allotment / Private placement || |
|Whether the company has made any preferential allotment / private placement of shares or fully or partly convertible debentures during the year under review and if so as to whether the requirement of Section 42 of the Companies Act 2013 have been complied and the amount raised have been used for the purposes for which the funds were raised. If not provide details thereof. ||NA |
|15 Non-cash Transactions || |
|Whether the company has entered into any non-cash transactions with directors or persons connected with him and if so whether provisions of Section 192 of Companies Act 2013 have been complied with. ||NA |
|16 Registration with RBI || |
|Wheteher the company is required to be registered under section 45-IA of the Reserve Bank of India Act 1934 and if so whether the registration is obtained. ||NA |
ANNEXURE - B TO THE AUDITORS' REPORT
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act
2013 ("the Act")
We have audited the internal financial controls over financial reporting of BHATIACOMMUNICATIONS & RETAIL (INDIA) LIMITED ("The Company") as of 31 March2021 in conjunction with our audit of the financial statements of the Company for the yearended on 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 (ICAI'). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.
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 onAuditing issued by ICAI and deemed to be prescribed under section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controlsboth applicable to an audit of Internal Financial Controls and both issued by theInstitute of Chartered Accountants of India. Those Standards and the Guidance Note requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in allmaterial respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31 March 2021 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.
|Date :30.06.2021 ||For R. Kejriwal & Co. |
|Place: Surat ||Chartered Accountants |
| ||FRN No. 133558W |
| ||Sd/- |
| ||Vishal Joshi |
| ||Partner |
| ||Mem No. 427019 |
| ||PAN: AAPFR9048C |