The Members of CHEMCRUX ENTERPRISES LIMITED
Report on the Standalone Financial Statements
We have audited the accompanying Financial Statements of CHEMCRUX ENTERPRISES LIMITED("the Company") which comprise the Balance sheet as at 31st March2020 the Statement of Profit & Loss and Statement of Cash Flows for the year thenended and notes to the financial statements 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 financial statements give the information requiredby the Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2020 and profit and its cash flows for the year 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 theFinanciai Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountantsof India together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rules thereunder and we have fulfilled our other ethical responsibilities in accordance with theserequirements and the Code of Ethics. We believe that the audit evidence we have obtainedis sufficient and appropriate to provide a basis for our opinion.
Emphasis of Matter
We draw your attention to Note 46 to the financial results which explain themanagement's assessment of the financial impact due to lock- downs and other restrictionsand conditions related to COVID-19 pandemic situation.
Our opinion is not modified in respect of this matter.
Management's Responsibility for the 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 financial statements that give a true and fair view of thefinancial position financial performance and cash flows of the Company in accordancewith the accounting principles generally accepted in India including the AccountingStandards specified under Section 133 of the Companies Act 2013 read with Rule 7 of theCompanies (Account) Rules 2014. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting frauds and other irregularities;selection and application of appropriate accounting policies; making judgments andestimates that are reasonable and prudent; and design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial 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.
Those Board of Directors are also responsible for overseeing the Company's financialreporting process.
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 highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.
A further description of the auditor's responsibilities for the audit of the financialstatements is located in Appendix A. This description forms part of our auditor's report.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order 2016 ("the order")issued by the Central Government in terms of section 143 (11) of the Companies Act2013 we enclose in the Annexure-A a statement on the matters specified inparagraph 3 & 4 of the said Order to 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 purpose of our Audit;
b) In our opinion proper books of accounts as required by the law have been kept bythe Company so far as appears from our examination of the said books;
c) The Balance Sheet Statement of Profit & Loss and Cash Flow Statement dealt withby this report are in agreement with the books of accounts of the Company;
d) In our opinion the aforesaid Financial Statements comply with the AccountingStandards specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014.
e) On the basis of written representations received from the directors as on 31stMarch2020 and taken on record by the Board of Directors we report that none of the directorsis disqualified as on 31st March 2020 from being appointed as a director ofthe Company in terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financialreporting and the operating effectiveness of such controls; refer to our separate reportin Annexure - B attached herewith.
g) The remuneration paid by company to its directors is in accordance with theprovisions of section 197 of the companies Act 2013 read with Schedule V and is not inexcess of the limits specified therein
h) With respect to the other matters to be included in our Report in accordance withRule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to the bestof our information and according to the explanations given to us:
(i) The Company has no pending litigation as on the balance sheet date.
(ii) There are no long term contracts for which provision is required.
10. There has been no delay in transferring amounts required to be transferred to theInvestor Protection Fund by the Company.
Appendix A to Independent Auditor's Report Further description of Auditor'sresponsibilities for audit of 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 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 todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Companies Act 2013 we are also responsible for expressing our opinion on whetherthe company 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 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 financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.
Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.
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 financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen 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.
"ANNEXURE - A" TO THE INDEPENDENT AUDITORS' REPORT
(Referred to in paragraph 1 under Report on Other Legal and RegulatoryRequirements' section of our report of even date for the year ended 31st March2020 of Chemcrux Enterprises Limited)
(i) (a) The Company has maintained proper records of Fixed Assets purchases. Howeveras informed to us the Company is in the process of updating its old records andFixed Assets Register showing full particulars including quantitative details and thesituation of Fixed Assets.
(b) The Company has a regular program of physical verification of its Fixed Assets bywhich the Fixed Assets are verified in phased manner over a period of time. In accordancewith its program certain Fixed Assets were verified during the year and as informed tous no material discrepancies were noticed on such verification. In our opinion theprogram of verification is reasonable having regard to the size of the Company and thenature its Assets.
(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the company the title deeds of immovable properties areheld in the name of the Company.
(ii) In our opinion and to the best of our knowledge the physical verification ofinventories has been conducted at reasonable intervals by the management of the Company.On the basis of our examination of the records of inventory we are of the opinion thatthe discrepancies noticed on verification between the physical stocks and the book recordswere not material and have been properly dealt with in the books of accounts.
(iii) The Company has not granted any loan secured or unsecured to Companies Firmsor Other Parties covered in the register maintained u/s. 189 of the Companies Act 2013during the year under report. Consequently no comments are necessary on Para (iii) (a)(b) & (c) of CARO 2016.
(iv) The Company has not granted any loans or advances or has not given any guaranteeor has not acquired securities of any other body corporate exceeding sixty percent of itspaid up share capital free reserves and securities premium account or one hundred percentof its free reserves and securities premium account whichever is more and hence thequestion of compliance of Section 185 and 186 of Companies Act 2013 doesn't arise.
(v) The Company has not accepted any deposits within the meaning of Section 2(31) ofthe Companies Act 2013 read with the Companies (Acceptance of Deposits) Rules 2014 andhence the compliance to the directives issued by the Reserve Bank of India and theprovisions of Sections 73 to 76 or any other relevant provisions of the Companies Act andthe Rules framed there under are not applicable. No order has been passed by Company LawTribunal or Reserve Bank of India or any court or any other tribunal.
(vi) We have broadly reviewed the cost records maintained by the company for itsproducts pursuant to the Companies (Cost Records and Audit) Rules 2014 prescribed by theCentral Government for the maintenance of cost records under Section 148(1) of theCompanies Act 2013 and we are of the opinion that prima facie the prescribed cost recordshave been made and maintained. However we have not made a detailed examination of theserecords with a view to determine whether they are accurate or complete.
(vii) (a) According to the records of the Company the Company is regular in depositingwith appropriate authorities undisputed statutory dues including Provident FundEmployees' State Insurance Income Tax Goods and Service Tax Custom Duty and othermaterial statutory dues applicable to it.
According to the information and explanations given to us no undisputed amountspayable in respect of Income Tax Goods and Service Tax Customs Duty Cess and othermaterial statutory dues applicable to the Company were outstanding as at 31stMarch2020 for a period of more than six months from the date they became payable.
(b) According to the records of the company there are no dues of Sales Tax IncomeTax Service Tax Customs Duty Excise Duty Value Added Tax or Goods and Service Taxwhich have not been deposited on account of any dispute.
(viii) Based on our audit procedures and on the information and explanations given bythe management we are of the opinion that the company has not defaulted in repayment ofdues to financial institutions or banks. The Company has not issued any debentures.
(ix) The Term Loans raised during the year has been applied for the purpose for whichit was raised. During the year under audit the company has not raised moneys by way ofpublic offer
(x) During the course of our audit we have not noticed any fraud done by the Companyor any fraud on the Company by its officers or employees.
(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.
(xii) In our opinion and according to the information and explanations given to us theCompany is not a nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable.
(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 sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.
(xiv) According to the information and explanations give 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 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) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.
| ||FOR R J SHAH & ASSOCIATES |
| ||CHARTERED ACCOUNTANTS |
| ||(F.R.N. 109752W) |
| ||Sd/- |
| ||CA ROHIT SHAH |
|Date:16/06/2020 ||PARTNER |
|Place: Vadodara ||(M R N : 034139) UDIN : 20034139AAAAAP8155 |