TO THE MEMBERS OF BLISS GVS PHARMA LIMITED
Report on the Audit of the Standalone Ind AS Financial Statements
Opinion statements of We have audited the accompanying standalone Ind AS financialstatements of Bliss GVS Pharma Limited (the Company) which comprises theBalance Sheet as at March 31 2020 the Statement of Profit and Loss (including OtherComprehensive Income) Statement of Changes in Equity and Statement of Cash Flows for theyear then ended and notes to the financialstatements 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 andgive a true and fair view in conformity with the accounting principles generally acceptedin India of the state of affairs of the Company as at March 31 2020 and its profit andtotal comprehensive income changes in equity and its cash flows for the year ended onthat date.
Basis for Opinion
We conducted our audit of the standalone IndASfinancialstatements in accordance withthe Standards on Auditing (SAs) specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Standalone Ind AS Financial Statements section ofour report. We are independent of the Company in accordance with the Code of Ethics issuedby the Institute of Chartered Accountants of India (the ICAI) together withthe ethical requirements that are relevant to our audit under the provisionsofthestandalone Ind AS financial of the Act and the Rules made thereunder and we havefulfilled our other ethical responsibilities in accordance with these requirements and theICAI's Code of Ethics. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our opinion.
Emphasis of Matters
We draw attention to Note No. 3 11 and 39 to the Standalone Ind AS financialstatementsin respect of our reliance on the management representation in respect of therecoverability of the Company's investment in loans given interest accrued and tradereceivable to two of its subsidiaries and two step- down subsidiaries aggregating to `7478.55 Lakh.
Our opinion is not modified in respect of this matters.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the current period. These matters IndAS financial wereaddressed in the context of our audit of the standalone Ind AS financial statements as awhole and in forming our opinion thereon and we do not provide a separate opinion onthese matters.
We have determined the matters described below to be the key audit matters to becommunicated in our report.
|Key Audit Matter Description ||How the scope of our audit addressed the Key Audit Matter |
|1. Business Development Expenses ||Our procedures included: |
|The Company agrees to incur the cost and expenses in connection with customer marketing and advertising taking into consideration such factors as the assistance provided by agent. Third party service providers and other such factor that the Company might reasonably in determining whether to allocate resources to that agent or Third party. ||We have reviewed the business development expenses as per Standard of Auditing (SA)540 Auditing accounting estimates including fair value accounting estimates and related disclosures. |
| ||Tests of controls: |
|For the above the Company has provided for marketing expenses for distribution which is having impact to the profit and loss of the Company to the tune of ` 395.68 lakh. ||We have evaluated the design implementation and operating ectiveness eff of key controls over monitoring of business development expenses. |
| ||Tests of details: |
| ||We have reviewed the Company's Policy in regard with Business Development Expenses We have verified the expenditure incurred/claimed with relevant supporting for the same. We have compared provision for business development expenses against the expenditure incurred/claimed till the date. |
|2. Information Technology General Controls || |
|A significant part of the company's financial reporting process is heavily reliant on IT systems with automated processes and controls over the capture storage and extraction of information. A fundamental component of these processes and controls is ensuring appropriate user access and change management protocols exist and being adhered to. These protocols are important because they ensure that access and changes to IT systems and related data are made and authorized in an appropriate manner. As our audit sought to place a high level of reliance on IT systems and application controls related to financial reporting high proportion of ort was in eff the overall audit Information Technology (IT) Systems and Controls. We focused our audit on those IT systems and controls that are significant to the Company's financial reporting process. ||Our procedures included: We focused our audit on those IT systems and controls that are significant to the Company's financial reporting process. |
As audit procedures over IT Systems and controls require specific expertise we involved our IT specialist.
We assessed the design and tested the operating effectiveness of the Company's IT controls including those over user access and change management as well as data reliability
. In a limited number of cases we adjusted our planned approach as follows: -
we extended our testing to identify whether there had been unauthorized or inappropriate access or changes made to critical IT systems and related data;
- where automated procedures were supported by systems with identified deficiencies we extended our procedures to identify and test alternative controls; and
- where required we performed a greater level of testing to validate the integrity and reliability of associated data and reporting.
The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Director's Report ManagementDiscussion & Analysis Report Corporate Governance Report and Business Responsibilitystatements Report but does not include the standalone Ind AS financial and our auditor'sreport thereon. The Other information is expected to be made available to us after thedate of this auditor's report.
Our doesopinion on the standalone Ind AS financial not cover the other information andwe will 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 this other information if we conclude that there is a materialmisstatement therein we are required to communicate the matter to those charged withgovernance and review the steps taken by the management to communicate to those in receiptof the other information if previously issued to inform them of the revision.
Responsibilities of Management and Those Charged with Governance for the Standalone IndAS Financial Statements
The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Act with respect to the preparation of these standalone Ind AS financialstatements that give a true and fair view of the financial position the financialperformance total comprehensive income changes in equity and cash flows of the Companyin accordance with the accounting principles generally accepted in India including theIndian Accounting Standards (Ind AS) prescribed under section 133 of the Act.
This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing the standalone Ind AS financial management is responsible for assessingthe Company's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless themanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the statements includingthe Company's financial reporting process.
Auditor's Responsibilities for the Audit of the standalone Ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether statements may 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 ant 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 judgment andmaintain 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 statements of the risks and obtain audit evidence that issufficientand appropriate to provide a basis for our opinion. The risk of not detecting amaterial misstatement resulting from fraud is higher than for one resulting from error asfraud may involve collusion forgery intentional omissions misrepresentations or theoverride of internal control.
Obtain an understanding of internal financial controls relevant to the audit in orderto design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial system in place and the operating effectiveness ofsuch controls.
Evaluate the appropriateness of accounting policies used and the in paragraphsreasonableness of accounting 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 the standalone Ind AS financial inadequate to modify our opinion. Our conclusions arebased on the audit evidence obtained up to the date of our auditor's report. Howeverfuture events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation structure and content of the standalone Ind ASfinancial disclosures and whether the standalone Ind AS financial statements representthe underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the financial statements thatindividually or in aggregate makes it probable that the economic decisions of the usersof the financial be influenced. We consider quantitative materiality and qualitativefactors in (i) planning the scope of our audit work and in evaluating the results of ourwork; and (ii) to evaluate the effect of any identified misstatements in the financialstatements.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and signific in significant audi findingsincludingany 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 financialperiod 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
controls 1. As required by the Companies (Auditor's Report) Order 2016 (theOrder) issued by the Central Government in terms of Section 143(11) of the Act wegive in Annexure A a statement 3 and 4 of on the Order to mattersspecified 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 explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.
c) The Standalone Balance Sheet the Standalone Statement of Profit and Loss includingOther Comprehensive Income Standalone Statement of Changes in Equity and the StandaloneStatement of Cash Flow dealt with by this Report are in agreement with the relevant booksof account.
d) In our opinion the aforesaid standalone Ind AS financial statements comply with theIndian Accounting Standards prescribed under section 133 of the Act.
e) On the basis of the written representations received from the directors as on March31 2020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2020 from being appointed as a director in terms of Section 164(2) of theAct.
f) With respect to the adequacy of the internal financial controls with reference tofinancial statements of the Company and the operating effectiveness of such controlsrefer to our separate 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 opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its directors during the year is inaccordance with the 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. The Company has disclosed the impact of pending litigations on its standalonefinancial standalone Ind AS financial 37 to the standalone Ind AS financial statements.
ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts.
iii. Following are the instances of delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company: refer to ourseparate Report in Annexure B.
|Sr. No. Dividend Amount ||Particulars ||Due Date of transfer ||Date of Transfer ||Delay in days |
|a) In respect of dividend amount: || || || || |
|1 1244182 ||Final Dividend 11-12 ||September 16 2019 ||November 04 2019 ||49 |
|2 2019014 ||Final Dividend 17-18 ||September 23 2018 ||Not yet transferred (*) ||Not yet transferred (*) |
|b) In respect of equity shares: || || || || |
|Sr. No. Equity Shares ||Particulars ||Due Date of transfer ||Date of Transfer ||Delay in days |
|1 52561 ||Equity Shares 11-12 ||September 16 2019 ||November 28 2019 ||73 |
(*) Ministry of Corporate Affairs vide General Circular No. 16/2020 dated April 132020 has allowed transferring of equity shares without additional fees till September 302020.
ForKALYANIWALLA & MISTRY LLP
Firm Registration No. 104607W / W100166
Sai Venkata Ramana Damarla
Membership. No. 107017
Dated: June 16 2020
TO THE INDEPENDENT AUDITOR'S REPORT
Referred to in in Para 1 Report on Other Legal and Regulatory Requirements' inour Independent Auditors' Report to the members of the Company on the standalone Ind ASfinancial statements for year ended March 31 2020.
Statement on Matters specified in paragraphs 3 & 4 of the
Companies (Auditor's Report) Order 2016:
i. a. The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
b. As explained to us the Fixed Asset are physically verified by the managementaccording to a phased programme designed to cover all the items over a period of threeyears which the frequency of which in our opinion is reasonable having regard to thesize of the Company and nature of its assets. Pursuant to the programme the fixed assetsof the Company have been physically verified the management. The discrepancies noticed onsuch with in the books of account.
c. According to the information and explanations given to us and on the basis ofexamination of the records of the company the title deeds of immovable properties areheld in the name of the Company.
ii. The inventory including stocks with certain third parties have been physicallyverified by the management during the year Confirmations have been obtained for otherinventories with third parties. The discrepancies noticed on physical verification ofinventory as compared to book records were not material and have been properly dealt inthe books of account.
iii. According to the information and explanations given to us and to the best of ourknowledge and belief the company has granted unsecured loans to companies covered inthe register maintained under section 189 of the Act aggregating to `4681.63 lakh as atMarch 31 2020.
a. The aforesaid loans have been made to its subsidiaries. According to the informationand explanations given to us and having regards to the management's representation thatthe loans are to these subsidiaries of the company in the interest of the company'sbusiness the rate of interest and other terms and conditions of such loans are not primafacie prejudicial to the interest of the company.
b. According to the information and explanations given to us and to the best of ourknowledge no schedule of repayment of principal and payment of interest has beenstipulated in respect of loan and hence it is not possible to comment on the regularity ofpayment of principal and interest.
c. In respect of these loans in view of no specific stipulation as to payment ofprincipal and interest we are unable to comment on the overdue amount if any on suchloans.
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 Companies Act2013 and the Rules framed thereunder in respect of loans to investments in guarantees andother securities given by the Company.
v. In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public and hence the directives issued bythe Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevantprovisions of the Act and the Rules framed there under are not applicable.
vi. the The Central Government of India has not specified maintenance the of costrecords under sub-section (1) of section 148 of the Act for any of the products of thecompany. Accordingly the provision of para 3(vi) of the order are not applicableto the company.
vii. (a) According to the information and explanations given to us and the recordsexamined by us the Company is generally regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income Tax Sales Tax Service TaxGoods and Service Tax Duty of Customs Duty of Excise Value Added Tax Cess and othermaterial statutory dues with the appropriate authorities. lying According to theinformation and explanations given to us there are no arrears of outstanding statutorydues in respect of above as on the last day of the financial year for a period of morethan six months from the date they became payable.
(b) According to the information and explanation given to us and the records examinedby us there are no material dues of Income Tax Sales Tax Service Tax Goods and ServiceTax Duty of Customs Duty of Excise Value added tax and Cess which have not beendeposited on account of any dispute other than the following:
|Sr. Name of No. the Statute ||Assessment Year to which the amount relates ||Amount (` in Lakh) ||Forum where dispute is pending |
|1 Income Tax Act 1961 ||2014-15 ||7.39 ||Commissioner of Income Tax (Appeals) |
|2 Income Tax Act 1961 ||2015-16 ||5.55 ||Commissioner of Income Tax (Appeals) |
3 Income Tax 2016-17 33.10 Commissioner Act 1961 of Income Tax (Appeals)
viii. According to information and explanation given to us and based on examination ofthe records the Company has not defaulted in repayment of loans or borrowings to anyfinancial institution and banks during the year. The Company does not have any loans orborrowings from government or debenture holders. The company has not issued anydebentures.
ix. The Company has not raised money through initial public offer or further publicoffer (including debt instruments). In our opinion and according to the information andexplanations given to us and based on the documents and records examined by us on anoverall basis the term loans obtained by the Company were applied for the purpose forwhich the loans were obtained.
x. During the course of our examination of the books of account and records of theCompany and according to the information and explanation given to us and representationsmade by the Management no material fraud by or on the Company by its officers oremployees has been noticed or reported during the year nor have we been informed of anysuch case by the management.
xi. According to the information and explanation given to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with requisite approvals mandated by the provisions of Section197 read with Schedule V to the Act.
xii. In our opinion and according to the information and explanation given to us theCompany is not a Nidhi Company. Accordingly provisions of paragraph 3(xii) of the Orderare not applicable.
xiii. According to the information and explanation given to us and based on ourexamination of the records of the Company transactions with related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the standalone Ind AS statements as required by theapplicable accounting financial standards.
xiv. According to the information and explanation given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year.
xv. According to the information and explanation given to us and based on ourexamination of the records of the Company the Company has not entered into non- cashtransactions with the directors or persons connected with him. Hence the provisions ofSection 192 of the Act are not applicable.
xvi. The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934 hence the provisions of paragraph 3 (xvi) of the Order are notapplicable.
ForKALYANIWALLA & MISTRY LLP
Firm Registration No. 104607W / W100166
Sai Venkata Ramana Damarla
Membership. No. 107017
Dated: June 16 2020
TO THE INDEPENDENT AUDITOR'S REPORT
Referred to in Para 2
(f) Report on Other Legal and Regulatory Requirements' in our IndependentAuditor's Report to the members of the Company on the standalone Ind AS financialstatements for the year ended March 31 2020.
Report on the Internal Financial Controls with reference to financial statements underClause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 (theAct)
We have audited the internal financial controls with reference to financial statementsof Bliss GVS Pharma Ltd (the Company) as March 31 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 to 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 Reporting (theGuidance Note) 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 the Company's business including company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013(the Act).
Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to Financial Statement based on our audit. We conducted our auditin accordance with the Guidance Note and the Standards on Auditing issued by ICAI anddeemed to be prescribed under section 143(10) of the Act to the extent applicable to anaudit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the ICAI. Those Standards and the Guidance Note require thatwe comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial reference to financial Statement wereestablished and maintained and if such controls operated effectively in all materialrespects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system with reference to financial statement and theiroperating effectiveness.
Our audit of internal financial controls with reference to financial Statement includedobtaining an understanding of internal financial controls with reference to financialstatement assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgment including the assessment of therisks of material 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 systemwith reference to financial statements.
Meaning of Internal Financial Controls with reference to Financial Statement
A Company's internal financial control with reference to financial statement is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of Ind AS financial statements for external purposes inaccordance with generally accepted accounting principles. A company's internal financialcontrol with reference to financial statements includes those policies and proceduresthat:
(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 Ind AS financial statements accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorizations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial effect on the standalone Ind AS financial statements. adherenceto InherentLimitations of Internal Financial Controls with reference to Financial Statement
Because of the inherent limitations of internal financial controls with reference tofinancial statement including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections controls with reference to of any evaluation of the internalfinancial financial statements to future periods are subject to the risk that the internalfinancial control with respect to financial statement may become inadequate because ofchanges in conditions or that the degree of compliance with the policies or proceduresmay deteriorate.
In our opinion the Company has in all material respects an adequate internalfinancial control with reference to financial statements and controls with such internalfinancial controls with reference to financial statement were operating effectively as atMarch 31 2020 based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note issued by the ICAI.
ForKALYANIWALLA & MISTRY LLP
Firm Registration No. 104607W / W100166
Sai Venkata Ramana Damarla
Membership. No. 107017
Dated: June 16 2020