Caplin Point Laboratories Limited Chennai
Report on the Audit of the Standalone Financial Statements
We have audited the accompanying standalone financial Caplin Point Laboratories Limited("the Company") which comprise the Balance Sheet as at 31st March 2021theStatement Profitand Loss (including other comprehensive income) the Statementof Changes in Equity and the Statement of Cash Flows for the year then ended andstatements including a summary of the significant notesto thefinancial accountingpolicies and other explanatory information.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 ("Act") in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in Indiaincluding Indian Accounting Standards (Ind AS) specified under Section 133 ofthe Act of the state of affairs of the Company as at 31st March 2021 and itsprofit total comprehensive income the 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) specifiedunder Section 143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditors Responsibilities for the Audit of the Standalone FinancialStatements section of our report. We are independent of the Company in accordance with theCode of statements of Ethics issued by the Institute of Chartered Accountants of India(ICAI) together with the ethical requirements that are relevant to our auditof the standalone financial rules thereunder and we have fulfilled our other ethicalresponsibilities accordance with these requirements and the Code of Ethics.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone financial statements.
Key audit matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone financial statements of the current period.These matters were addressed in the context of our audit of the standalone financialstatements as a and in forming our opinion thereon and we do not provide a separateopinion on these matters.
We have determined the following to be the key audit matters to be communicated in ourreport.
|Key audit matter ||How was the matter addressed in our audit |
|1. Accuracy of recognition measurement Presentation and disclosures of revenues and other related balances in accordance with Ind AS 115 "Revenue from Contracts with Customers" (revenue recognition standard) ||Principal Audit Procedures |
|The application of the revenue accounting standard involves certain key judgements relating to identification of distinct performance obligations determination of transaction price of the identified performance obligations the appropriateness of the basis used to measure revenue recognized over a period. Additionally revenue accounting standard contains disclosures which involves collation of information in respect of disaggregated revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. ||We assessed the Companys process to identify the impact of the revenue accounting standard. |
|Impact of Covid-19 pandemic on the Companys operations ||Our audit approach consisted testing of the design and operating effectiveness of the internal controls and substantive testing as follows: |
| ||Evaluated the design of internal controls relating to implementation of the new revenue accounting standard. |
| ||Selected a sample of continuing and new contracts and tested the operating effectiveness of the internal control relating to identification of the distinct performance obligations and determination of transaction price. We carried out a combination of procedures involving enquiry and observation re-performance and inspection of evidence in respect of operation of these controls. |
| ||Tested the relevant information technology systems access and change management controls relating to contracts and related information used in recording and disclosing revenue in accordance with the new revenue accounting standard. |
| ||We assessed the Companys process to identify assess and respond to risks of material misstatement considering the uncertainties and the impact of Covid-19 pandemic on the Companys operations and results for the year under consideration. We have designed planned and performed audit procedures including verification of the source and completeness of data provided for audit. We have considered managements adjustments or disclosures which includes the impact of the changes in the environment on the recognition and measurement of account balances and transactions in the financial statements or other specific disclosures. |
Information other than the financial statements and Auditors Report thereon
The Companys Board of Directors is responsible for the other information. Theother information comprises the information included in the Management Discussion andAnalysis Boards Report including Annexures to Boards Report BusinessResponsibility Report Corporate Governance and Shareholders Information but doesnot include the Standalone financial statements and our Auditors report thereon.
Our opinion on the financial statements does not cover the other information and we donot express any form of assurance and conclusion thereon.
In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the standalone financial statements or our knowledge obtainedduring the course of our audit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.
Managements Responsibility for the Standalone Financial Statements
The Companys board of directors is responsible for the matters stated in section134 (5) of the Act with respect to the preparation of thesence financial statements thatgive a true and fair view of the financial position financialperformance including othercomprehensive income cash flows and changes in equity of the Company in accordance withthe Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act read withthe Companies (Indian Accounting Standards) Rules 2015 and Companies (Indian AccountingStandards) Rules 2016 as amended from time to time and other accounting principlesgenerally accepted in India.
This responsibility also includes maintenance of adequate accounting records inaccordance 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 financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.
In preparing the standalone financial statements management is responsible forassessing the Companys 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 responsible for overseeing the Companys financialreporting process.
Auditors Responsibilities for the Audit of the Standalone Financial statements
Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an Auditors report that includes our opinion. Reasonableassurance is a high level of assurance but is not a guarantee that an audit conducted inaccordance with Standards on Auditing 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 influe the economic decisions of usersreasonably be expected to taken on the basis of these standalone financial statements.
As part of an audit in accordance with Standards on Auditing we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the standalone financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud 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 theAct we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls system in place and the operating effectiveness ofsuch controls.
Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
Conclude on the appropriateness of managements use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or Companys ability to conditions that may cast significantcontinue as a going concern. If we conclude that a material uncertainty exists we arerequired to draw attention in our Auditors report to the related disclosures in thestandalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourAuditors report. However future events or conditions may cause the Company to ceaseto continue as a going concern.
Evaluate the overall presentation structure and content of the standalone financialstatements including the disclosures and whether the standalone financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.
Materiality is the magnitude of misstatements in the standalone financial statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of We consider the standalone financial statements may beinfluenced. quantitative materiality and qualitative factors in
(i) planning the scope of our audit work and in evaluating the results of our work; and
(ii) to evaluate the effect of any identified misstatements in the standalone financialstatements.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards. From the matters communicated withthose charged with governance we determine those matters that were of most significancein the audit of the standalone financial statements of the current period and aretherefore the key audit matters. We describe these matters in our Auditors reportunless law or regulation precludes public disclosure about the matter or when inextremely rare circumstances we determine that a matter should not be communicated in ourreport because the adverse consequences of doing so would reasonably be expected tooutweigh the public interest benefits of such communication.
report on other Legal and regulatory requirements
1. As required by Section 143(3) of the Act based on our audit 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 purpose 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 Balance Sheet the Statement of Profit and Loss and the Cash Flow Statementdealt with by this report are in agreement with the books of account;
d) In our opinion the aforesaid standalone financial statements comply with the Ind ASspecified under section 133 of the Act read with rule 7 of the Companies (Accounts)Rules 2015;
e) On the basis of the written representations received from the directors and taken onrecord by the Board of Directors none of the directors is disqualified as on 31 March2021 from being appointed as a director in terms of Section 164(2) of the Act;
f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure A". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Companys internal financial controlsover financial reporting.
g) With respect to the other matters to be included in the Auditors 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
h) With respect to the other matters to be included in the Auditors Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 (as amended) inour opinion and to the best of our information and according to the explanations given tous:
i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone 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. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.
2. As required by the Companies (Auditors Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of Section 143(11) of theAct we give in the "Annexure B" a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.
| ||for M/s CNGSN & ASSOCIATES LLP |
| ||CHARTERED ACCOUNTANTS |
| ||Firm Registration No: 004915S/S200036 |
| ||B. Ramakrishnan |
| ||Partner |
|Place: Chennai ||Membership No: 201023 |
|Date: 06/05/2021 ||UDIN: 21201023AAAAAE3738 |
Annexure "A" To The Independent Auditors Report on the StandaloneFinancial Statements of Caplin Point Laboratories Limited for the year ended 31 march 2021
Report on the internal financialcontrols over Financial Reporting under section 143(3)(i) of the Companies Act 2013 ("the Act") reporting Wehave audited theinternal financial controls over financial of Caplin Point Laboratories Limited("the Company") as of 31 March 2021 in conjunction with our audit of thestandalone financial statements of the Company for the year ended on that date.
Managements Responsibility for Internal Financial Controls
The Companys management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financialreporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants of controlover financial 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 Companys business includingadherence to Companys policies the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial information as required under theCompanies Act2013.
Our responsibility is to express an opinion on the Companys internal financialcontrols with reference to financial statements based on audit. We conducted our audit inaccordance with the Guidance Note and Standards on Auditing prescribed under Section143(10) of the Act to the extent applicable to an audit of internal financial controlswith reference to financial statements. 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 controls with reference to financialstatements were established and maintained and whether such controls operated effectivelyin all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to financial statements and their operatingeffectiveness. Our audit of internal financial controls with reference to financialstatements included obtaining an understanding of internal financial controls withreference to financial statements assessing the risk that a material weakness exists andtesting and evaluating the design and operating effectiveness of internal control based onthe assessed risk. The procedures selected depend on the Auditors judgmentincluding the assessment of the risks of material misstatement of the standalone financialstatements 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 Companys internal financial controlssystem over financial reporting.
Meaning of Internal Financial Controls with reference to financial statements
A Companys internal financial reporting is a process designed to providereasonable assurance regarding the reliability of financial reporting and the preparationof financial purposes in accordance with generally accepted accounting principles.
A Companys internal financial controls with statements includes those policiesand procedures that
(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the Company;
(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements with generally accepted accounting principles andthat receipts 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 Companys assets that could havea material effect on the financial statements.
Inherent Limitations of Internal Financial Controls with reference to financialstatements
Because of the inherent limitations of internal financial controls with reference tofinancial statements 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 withreference to financial statements to future periods are subject to the risk that internalfinancial controls with reference to financial statements may become inadequate because ofchanges in conditions or that the degree of compliance with the policies or proceduresmay deteriorate.
In our opinion to the best of our information and according to the explanation givento us the Company has in all material respects an and such adequate internal financialinternal financial controls were operating based on the internal financial controlestablished by the Company considering the essential components of internal controlsstated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India (the "GuidanceNote").
| ||for M/s CNGSN & ASSOCIATES LLP |
| ||CHARTERED ACCOUNTANTS |
| ||Firm Registration No: 004915S/S200036 |
|Place: Chennai ||B. Ramakrishnan |
|effectively as at 31 March 2021 ||Partner |
|Date: 06/05/2021 ||Membership No: 201023 |
|financial reporting criteria ||UDIN: 21201023AAAAAE3738 |
Annexure "B " To The Independent Auditors Report on the StandaloneFinancial Statements of Caplin Point Laboratories Limited for the year ended 31 march 2021
(Referred to in paragraph 2 under Report On Other Legal and RegulatoryRequirements section of our report to the Members of Caplin Point LaboratoriesLimited of even date)
i. In respect of the Companys fixed assets:
a. The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
b. of The Company has a regular program of physical verification its fixed assets bywhich all fixed assets are verified manner which in our opinion is reasonable havingregard to the Size of the company and the nature of its assets. Pursuant to the programcertain fixed assets were physically verified the management during the year and nomaterial discrepancies were noticed on such verification. According to the information andexplanations given to us no material discrepancies were noticed on such verification
c. The title deed so fim movable properties included infixed assets are held in thename of the Company except for a land and building for Rs. 17.38 Crores purchased by theCompany during the financial the SARFAESI Act 2002 and rules thereof for which thetransfer of title is in progress . In respect of immovable properties taken on lease anddisclosed as property plant and equipment in the standalone Ind AS financial statementsthe lease agreements are in the name of the Company.
ii. The inventory has been physically verified by the management during the year. Inour opinion the frequency of such verification is reasonable. The Company has maintainedproper records of between the inventory. The discrepancies noticed on verificationphysical stock and the book records were not material.
iii. According to the information and explanation given to us the Company has notgranted any loans secured or unsecured to companies firms limited liabilitypartnerships or other parties covered in the register maintained under section 189 of theAct 2013. Accordingly the provisions of clause 3(iii) (a) (b) and (c) of the Order isnot applicable to the Company.
iv. In our opinion and according to information and explanation given to us in respectof loans investments guarantees and security the Company has complied with theprovisions of sections 185 and section 186 of the Companies Act 2013.
v. In our opinion and according to information and explanation given to us the Companyhas not accepted any deposits from the public within the meaning of the directives issuedby the Reserve Bank of India provisions of Section 73 to 76 of the Act any otherrelevant provisions of the Act and the relevant rules framed thereunder. Accordinglyparagraph 3(v) of the Order is not applicable to the Company. in a phased
vi. We have broadly reviewed the books of account maintained by the Company pursuant tothe rules made by the Central Government for the maintenance of cost records under section148 of the Actby and are of the opinion that prima facie the prescribed accounts andrecords have been made and maintained.
vii. a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted/ accrued in the books ofaccount in respect of undisputed statutory dues including provident fund employeesstate insurance income-tax sales- tax service tax year 2020-21 through e-auction fromBank under goods and service tax duty of customs duty of excise value added tax cessand other material statutory dues have been generally regularly deposited during the yearby the company with the appropriate Authorities.
According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees state insurance income-tax sales-tax service tax goods and service tax duty of customs duty of excise value added taxcess and other material statutory dues were in arrears as at March 31 2021 for a periodof more than six months from the date they became payable.
b) There are no dues of Income-tax or Sales tax or Service tax or Goods and Servicestax or duty of Customs or duty of Excise or Value added tax which have not been depositedby the Company on account of disputes except for the following:
|s.no Name of the statute ||Nature of dues ||as at 31/3/2021 (Rs. In lakhs) ||as at 31/3/2020 (Rs. In lakhs) ||Forum where dispute is pending |
|1. Income Tax Act 1961 ||Income Tax ||85.32 ||25.83 ||Income Tax Appellate Tribunal/ CIT Appeals |
viii. In our opinion and according to the information and explanations given to us thecompany has no outstanding dues to any financial institutions or banks or any governmentor any debenture holders during the year. Accordingly paragraph 3 (viii) of the order isnot applicable.
ix. Company has not raised any money by way of initial public offer or further publicoffer (including debt instruments) and term loans during the year. Accordingly theprovisions of Clause 3(ix) of the Order is not applicable to the Company.
x. In our opinion and according to the information and explanation given to us nomaterial fraud by the Company or on the Company by its officers or employees has beennoticed or reported during the course of our audit.
xi. In our opinion and according to the information and explanations given to us theCompany has paid/ provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the Act.
xii. The Company is not a Nidhi Company and accordingly paragraph 3 (xii) of the orderis not applicable to the Company.
xiii. According to the information and explanations given to us and based on ourexamination of the records of the company transactions with the related parties are incompliance with section 177 and 188 of the Act. Where applicable the details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.
xiv. According to the information and explanations 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. Accordingly paragraph 3(xiv) of the order is not applicable.
xv. According to the information and explanations given to us and based on ourexamination of the records of the company the company has not entered into non-cashtransactions with directors or persons connected with them. Accordingly paragraph 3(xv)of the order is not applicable.
xvi. According to the information and explanations given to us and based on ourexamination of the records of the company the company is not required to be registeredunder section 45-IA of the Reserve Bank of India Act 1934.
| ||for M/s CNGSN & ASSOCIATES LLP |
| ||CHARTERED ACCOUNTANTS |
| ||Firm Registration No: 004915S/S200036 |
| ||B. Ramakrishnan |
|Place: Chennai ||Partner |
|Date: 06/05/2021 ||Membership No: 201023 |
| ||UDIN: 21201023AAAAAE3738 |