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Capri Global Capital Ltd.

BSE: 531595 Sector: Financials
NSE: CGCL ISIN Code: INE180C01026
BSE 09:41 | 04 Jul 688.05 0.60
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687.15

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692.05

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685.00

NSE 09:29 | 04 Jul 686.00 1.10
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688.35

HIGH

693.95

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OPEN 687.15
PREVIOUS CLOSE 687.45
VOLUME 879
52-Week high 805.50
52-Week low 451.00
P/E 74.71
Mkt Cap.(Rs cr) 12,092
Buy Price 685.05
Buy Qty 4.00
Sell Price 686.40
Sell Qty 42.00
OPEN 687.15
CLOSE 687.45
VOLUME 879
52-Week high 805.50
52-Week low 451.00
P/E 74.71
Mkt Cap.(Rs cr) 12,092
Buy Price 685.05
Buy Qty 4.00
Sell Price 686.40
Sell Qty 42.00

Capri Global Capital Ltd. (CGCL) - Auditors Report

Company auditors report

To

the Members of

Capri Global Capital Limited

Report on the audit of the standalone financial statements

Opinion

We have audited the accompanying standalone financial statements of Capri GlobalCapital Limited ("the Company") which comprise the Balance Sheet as at 31 March2021 and the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Cash Flows and the Statement of Changes in Equity for the year then endedand a summary of significant accounting policies and other explanatory information (the"standalone financial statements").

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 ("the Act") in the manner so required and give a trueand fair view in conformity with the Indian Accounting Standards prescribed under section133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015 asamended ("Ind AS")and other accounting principles generally accepted in Indiaof the state of affairs of the Company as at 31 March 2021 and its profit totalcomprehensive income its cash flows and the changes in equity for the year ended on thatdate.

Basis for opinion

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing specified under section 143(10) of the Act (SAs). Ourresponsibilities under those Standards are further described in the Auditor'sResponsibility for the Audit of the Standalone Financial Statements section of our report.We are independent of the Company in accordance with the Code of Ethics issued by theInstitute of Chartered Accountants of India (ICAI) together with the ethical requirementsthat are relevant to our audit of the standalone financial statements under the provisionsof the Act and the Rules made thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the ICAI's Code of Ethics. Webelieve that the audit evidence obtained by us is sufficient and appropriate to provide abasis for our audit opinion on the standalone financial statements.

Emphasis of matter

We draw your attention to Note 33 to the Statement which describes the continuinguncertainty arising from the COVID-19 Pandemic of the Company's financial statements.

Our opinion is not modified in respect of this matter.

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 whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report.

Key audit matter description

As at March 31 2021 loan assets aggregating to Rs.356421 Lakhs constituting 79.01%of the Company's total assets and the related impairment provisions amounting toRs.9999.20 Lakhs including macro-economic overlays on account of COVID. Since the loansand advances form a major portion of the Company's assets and due to the significance ofthe judgments used in classifying loans and advances into various stages as stipulated inIND AS 109 and determining related impairment provision requirements this is consideredto be the area that had a greater focus of our overall audit of the Company and a keyaudit matter.

As part of our risk assessment we determined that the allowance for ECL on loan assets(including undisbursed commitments) has a high degree of estimation uncertainty with apotential range of reasonable outcomes for the financial statements.

Management estimates impairment provision using Expected Credit loss model for the loanexposure. Measurement of loan impairment involves application of significant judgement bythe management. The most significant judgements are:

• Timely identification and classification of the impaired loans and

• Determination of probability of defaults (PD) and estimation of loss givendefaults (LGD) based on the value of collaterals and relevant factors

The estimation of Expected Credit Loss (ECL) on financial instruments involvesignificant judgements and estimates. Following are points with increased level of auditfocus:

• Classification of assets to stage 1 2 or 3 using criteria in accordance withInd AS 109 which also include considering the impact RBI circulars including COVID-19Regulatory package.

• Accounting interpretations modelling assumptions and data used to build and runthe models;

• Measurement of individual borrowers' provisions including Covid-19 impactassessment of multiple economic scenarios;

• Inputs and Judgements used in determination of management overlay at variousasset stages considering the current uncertain economic environment with the range ofpossible effects unknown to the country arising out of the COVID 19 Pandemic and

• The disclosures made in financial statements for ECL especially in relation tojudgements and estimates by the Management in determination of the ECL.

How the key audit matter was addressed in the audit

The audit procedures performed by us included the following:

We examined Board Policy approving methodologies for computation of ECL that addresspolicies procedures and controls for assessing and measuring credit risk on all lendingexposures commensurate with the size complexity and risk profile specific to theCompany. The parameters and assumptions used and their rationale and basis are clearlydocumented.

Additionally we have confirmed that adjustments to the output of the ECL Model isconsistent with the documented rationale and basis for such adjustments and that theamount of adjustment has been approved by the Audit Committee of the Board of Directors

• Testing the design and effectiveness of internal controls over the:

- completeness and accuracy of the Exposure at Default ("EAD") and theclassification thereof into stages consistent with the definitions applied in accordancewith the policy approved by the Board of Directors including the appropriateness of thequalitative factors to be applied.

- Accuracy of PD and LGD computed based on Company's past history.

- where relevant we used Information System specialists to gain comfort on dataintegrity and completeness of the aging report based on which the Staging of the loans isdone into Stage 12 and 3

- computation of the ECL including methodology used to determine macro-economicoverlays and adjustments to the output of the ECL Model.

• Also on a sample basis tested:

- Accuracy of the Days past due computation and the staging thereon.

- completeness and accuracy of information used in the estimation of the PD and LGD forthe different stages depending on the nature of the portfolio.

- Computation of the PD and LGD based on the underlying data.

- for exposures determined to be individually impaired we tested a sample of loans andadvances and examined management's estimate of LGD by comparing actual recoveries post theloan asset becoming credit impaired with estimates of LGD.

- we tested computation of provision for expected credit loss by using PD and LGD(EAD*PD*LGD*) to ensure the correctness of the Company's working.

• We performed an overall assessment of the ECL provision levels at each stage andreasonableness of the management's overlays on account of Covid-19 taking intoconsideration the Company's portfolio risk profile credit risk management practices andthe macroeconomic environment.

• We also assessed the disclosures made in relation to the ECL allowance toconfirm compliance with the provisions of Ind AS 107.

Information other than the financial statements and auditor's report thereon

• The Company's Board of Directors is responsible for the other information. Theother information comprises the information included in the Director's report ManagementDiscussion and Analysis and Corporate Governance report but does not include thestandalone financial statements and our auditor's report thereon. The Director's reportManagement Discussion and Analysis and Corporate Governance report is expected to be madeavailable to us after the date of this auditor's report.

• Our opinion on the standalone financial statements does not cover the otherinformation and we will not express any form of assurance conclusion thereon.

• In connection with our audit of the standalone financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone financial statements orour knowledge obtained during the course of our audit or otherwise appears to bematerially 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.

• When we read the Director's report Management Discussion and Analysis andCorporate Governance report if we conclude that there is a material misstatement thereinwe are required to communicate the matter to those charged with governance as requiredunder SA 720 'The Auditor's responsibilities Relating to Other Information.

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 Act with respect to the preparation of these standalone financial statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income cash flows and changes in equity of the Company in accordancewith the Ind AS and other accounting principles generally accepted in India. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone financialstatement that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement 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 Company's financialreporting process.

Auditor's responsibility 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 auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone financial statements.

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 standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal financial control relevant to the audit inorder to 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 controls system in place and the operatingeffectiveness of such controls.

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

• Conclude on the appropriateness of management's use of the going concern basisof accounting 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 standalone 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 ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.

• Evaluate the overall presentation structure and content of the standalonefinancial statements including the disclosures and whether the standalone financialstatements represent 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 the standalone financial statements may be influenced. Weconsider quantitative materiality and qualitative factors in (i) planning the scope of ouraudit work and in evaluating the results of our work; and (ii) to evaluate the effect ofany identified misstatements in the standalone 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 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 financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor'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

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 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 Balance Sheet the Statement of Profit and Loss including Other ComprehensiveIncome the Statement of Cash Flows and Statement of Changes in Equity dealt with by thisReport 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.

e) On the basis of the written representations received from the directors as on 31March 2021 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2021 from being appointed as a director in terms of Section164(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 Company's internal financial controls overfinancial reporting.

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 opinionand to the best of our information and according to the explanations given to us theremuneration paid by the Company to its directors during the year is in accordance withthe 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 as amended inour opinion and to the best of our information and according to the explanations given tous:

• The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements;

• The Company did not have any long-term contracts including derivative contractsfor which there were any material foreseeable losses

• There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company

!. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"Annexure B" a statement on the matters specified in paragraphs 3 and 4 of theOrder.

Report on Internal Financial Controls Over Financial Reporting

Annexure "A" to the independent auditors' report (Referred to in paragraph1(f) under 'Report on Other Legal and Regulatory Requirements' section of our report ofeven date)

Report on the internal financial controls over financial reporting under clause (i) ofsub-section 3 of section 143 of the act.

We have audited the internal financial controls over financial reporting of CapriGlobal Capital Limited (the "Company") as at March 31 2021 in conjunction withour audit of the Ind AS standalone 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 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 (the "Guidance Note").These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting of the Company based on our audit. We conducted ouraudit in accordance with the Guidance Note and the Standards on Auditing prescribed underSection 143(10) of the Act to the extent applicable to an audit of internal financialcontrols. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material 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 auditors' judgement 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 the 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 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 in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial 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.

Opinion

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2021 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note.

Annexure "B" to the independent auditors' report (Referred to in paragraph 2under 'Report on Other Legal and Regulatory Requirements' section of our report of evendate)

(i) (a) According to the information and explanations given to us the Company hasmaintained proper records showing full particulars including quantitative details andsituation of fixed assets.

(b) The fixed assets were physically verified by the Management in accordance with aregular programme of verification which in our opinion provides for physicalverification of all the fixed assets at reasonable intervals. According to the informationand explanation given to us no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and the records examinedby us and based on the examination of the registered sale deed / transfer deed /conveyance deed provided to us we report that the title deeds comprising of theimmovable property of the Buildings is held in the name of the Company as at the balancesheet date. In respect of immovable properties of buildings that have been taken on leaseand disclosed as fixed asset in the standalone financial statements the lease agreementsare in the name of the Company where the Company is the lessee in the agreement.

(ii) To the best of our knowledge and according to the information and explanationsgiven to us the Company does not have any inventory and hence reporting under clause3(ii) of the Order is not applicable.

(iii) To the best of our knowledge and according to the information and explanationsgiven to us the Company has not granted any loans secured or unsecured to companiesfirms limited liability partnerships or other parties covered in the register maintainedunder section 189 of the Act.

(iv) To the best of our knowledge and according to the information and explanationsgiven to us the Company has not granted any loans made investments or provide guaranteesunder the provisions of Sections 185 and 186 of the Act and hence reporting under clause3(iv) of the Order is not applicable.

(v) To the best of our knowledge and according to the information and explanationsgiven to us the Company has not accepted any public deposit during the year and no orderin this respect has been passed by the Company Law Board or National Company Law Tribunalor the Reserve Bank of India or any Court or any other Tribunals in regards to theCompany.

(vi) To the best of our knowledge and according to the information and explanationsgiven to us the Central Government has not prescribed the maintenance of cost recordsunder section 148(1) of the Act in respect of the services rendered by the Company.

(vii) To the best of our knowledge and according to the information and explanationsgiven to us in respect of statutory dues:

(a) The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income tax Goods and Service Taxand cess to the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income tax Goods and Service Tax and cess as at 31st March 2021 for aperiod of more than six months from the date they became payable.

(c) Details of dues of Income tax which has not been deposited as on 31st March 2021 onaccount of disputes are given below:-

Name of Statute Nature of Dues Forum where Dispute is Pending Period to which the Amount Relates Amount (?)
Income Tax Act 1961 Regular Assessment u/s 143(3) of the Act CIT (Appeals) AY 2017-18 2901192

There are no dues of Provident Fund Employees' state insurance and Goods and ServiceTax as on 31st March 2021 on account of disputes.

(viii) To the best of our knowledge and according to the information and explanationsgiven to us the Company has not defaulted in the repayment of loans or borrowings tobanks financial institution and dues to debenture holders. The Company has not taken anyloan from government.

(ix) To the best of our knowledge and according to the information and explanationsgiven to us the money raised by way of the term loans have been applied by the Companyduring the year for the purposes for which they were raised other than temporarydeployment pending application of proceeds. The Company has not raised moneys by way ofinitial public offer/ further public offer (including debt instruments).

(x) To the best of our knowledge and according to the information and explanation givento us no fraud by the Company and no material fraud on the Company by its officers oremployees has been noticed or reported during the year.

(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 hence reporting under clause (xii) of theOrder is not applicable.

(xiii) To the best of our knowledge and according to the information and explanationsgiven to us the Company is in compliance with Sections 188 and 177 of the Act whereapplicable for all transactions with the related parties and the details of related partytransactions have been disclosed in the standalone financial statements as required by theapplicable accounting standards.

(xiv) During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures and hence reporting underclause 3(xiv) of the Order is not applicable to the Company.

(xv) To the best of our knowledge and according to the information and explanationsgiven to us during the year the Company has not entered into any non-cash transactionswith its directors or persons connected with them and hence provisions of section 192 ofthe Act are not applicable.

(xvi) The Company is required to be registered under section 45-IA of the Reserve Bankof India Act 1934 and it has obtained the registration.

For Deloitte Haskins & Sells LLP Chartered Accountants
(Firm's Registration No. 117366W/W- 100018)
Sd/-
Anjum A. Qazi Partner
Place: Mumbai (Membership No. 104968)
Date: June 17 2021 (UDIN: 21104968AAAAE E3815)

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