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Competent Automobiles Company Ltd.

BSE: 531041 Sector: Others
NSE: N.A. ISIN Code: INE823B01015
BSE 00:00 | 25 Nov 192.00 7.20
(3.90%)
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NSE 05:30 | 01 Jan Competent Automobiles Company Ltd
OPEN 196.75
PREVIOUS CLOSE 184.80
VOLUME 641
52-Week high 214.00
52-Week low 140.00
P/E 5.55
Mkt Cap.(Rs cr) 118
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 196.75
CLOSE 184.80
VOLUME 641
52-Week high 214.00
52-Week low 140.00
P/E 5.55
Mkt Cap.(Rs cr) 118
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Competent Automobiles Company Ltd. (COMPETENTAUTO) - Auditors Report

Company auditors report

To the Members of

Competent Automobiles Co. Ltd.

Report on the Audit of the Financial Statements

Opinion

We have audited the financial statements of Competent Automobiles Co. Ltd.("the Company") which comprise the Balance Sheet as at 31st March 2022 and theStatement of Profit and Loss and Statement of Cash Flows for the year then ended andnotes to the financial statements including a summary of significant accounting policiesand other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31stMarch 2022 its profit statement of 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 Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the 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.

1. Key Audit Matter

IND AS-116- Leases (Accounting for rent concession arrangements)

The company has INR 6755.19 Lakhs (previous year INR 7983.82 lacs) of Right of Use(RoV) assets and INR 6606.37 Lakhs (previous year INR 7620.33) of Lease Liabilitiesrecognized under IND AS-116 pertaining leased by the Company.

During the year considering the impact of COVID-19 pandemic on its business. TheCompany negotiated rent concessions with its lessors for its showrooms and workshops andother leased premises The Ministry of Corporate Affairs vide notification dated 24 July2020 issued an amendment to Ind AS 116 - Leases by inserting a practical expedientw.r.t. "Covid-19- Related Rent Concessions" effective from the period beginningon or after 01 April 2020. Pursuant to the above amendment the Company has applied thepractical expedient with effect from 01 April 2020. Accordingly the Company accountedunconditional rent concessions of INR 138.11 Lacs (previous year INR 377.09 Lacs) duringthe year in "Other income" in the Statement of Profit and Loss not consideringas a lease modification. Accounting of rent concessions pursuant to amendment to Ind AS116 is considered as a key audit matter considering the number of lease arrangements theassessment of whether individual rent concession arrangements meet the criteria of thepractical expedient under Ind AS 116 and the amounts involved.

How auditor assessed the Key audit matter

Our audit procedures included the following:

• Assessing the Company's accounting policy with respect to recognition of leasesand for assessing compliance with Ind AS 116 including accounting for rent concessionarrangements.

• Obtained an understanding evaluated the design and tested the operatingeffectiveness of controls that the Company has in relation to accounting of rentconcession arrangements under Ind AS 116.

• Tested on a sample basis the rent concessions accounted by the Company toagreed rent concession arrangements/ underlying documents calculations and assessed theterms of the same against the requirements of the practical expedient under Ind AS 116.

• Assessed the Company's disclosures made in accordance with the requirements ofInd AS 116 in this matter.

Information other than the financial statements and auditors' report thereon

The Company's Board of Directors & Management are responsible for the preparationof the other information. The other information comprises the information included in theManagement Discussion and Analysis Board's Report including Annexures to Board's ReportBusiness Responsibility Report Corporate Governance and Shareholder's Information butdoes not include the financial statements and our auditor's report thereon. Our opinion onthe financial statements does not cover the other information and we do not express anyform of assurance 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 financial statements or our knowledge obtained during thecourse of our audit or otherwise appears to be materially misstated. If based on the workwe have performed we conclude that there is a material misstatement of this otherinformation; we are required to report that fact. We have nothing to report in thisregard.

Responsibilities of Management and Those Charged with Governance for the StandaloneFinancial Statements

The Company's Board of Directors & Management are responsible for the mattersstated in section 134(5) of the Companies Act 2013 ("the Act") with respect tothe preparation of these financial statements that give a true and fair view of thefinancial position financial performance and Cash Flows of the Company in accordance withthe accounting principles generally accepted in India including the Accounting Standardsspecified under section 133 of the Act. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingof the assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error. In preparing thefinancial statements management is responsible for assessing the Company's ability tocontinue as a going concern disclosing as applicable matters related to going concernand using the going concern basis of accounting unless management either intends toliquidate the Company or to cease operations or has no realistic alternative but to doso.

Those Board of Directors & Management are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a 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.

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.

Materiality is the magnitude of misstatements in the financial statements thatindividually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the financial statements.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We 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.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2020 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the ‘Annexure - A' a statement on thematters specified in paragraphs 3 and 4 of the Order to the extent applicable.

2. As required by Section 143 (3) of the Act we report that: a) We have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purposes of our audit. b) In our opinion proper books ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books. c) The Balance Sheet the Statement of Profit and Loss theCash Flow Statement and Statement of Changes in Equity dealt with by this Report are inagreement with the books of account. d) In our opinion the aforesaid financial statementscomply with the Accounting Standards specified under Section 133 of the Act read withRule 7 of the Companies (Accounts) Rules 2014.

e) On the basis of the written representations received from the directors as on 31stMarch 2022 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2022 from being appointed as a director in terms of Section164 (2) of the Act. f) With respect to the adequacy of the internal financial controlswith reference to financial statements of the Company and the operating effectiveness ofsuch controls refer to our separate Report in ‘Annexure - B'. g) With respect to thematter to be included in the Auditor's Report under section 197(16) In our opinion andaccording to the information and explanations given to us the remuneration paid by theCompany to its directors during the current year is in accordance with the provisions ofsection 197 of the Act. The remuneration paid to any director is not in excess of thelimit laid down under section 197 of the Act. The Ministry of Corporate Affairs has notprescribed other details under section 197(16) which are required to be commented upon byus. 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. TheCompany does not have any pending litigations which would impact its financial position.ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses. iii. There has been no delay intransferring amounts as required to be transferred to the Investor Education andProtection Fund by the Company. iv. (a) The management has represented that to the bestof it's knowledge and belief no funds have been advanced or loaned or invested (eitherfrom borrowed funds or share premium or any other sources or kind of funds) by the companyto or in any other person(s) or entity(ies) including foreign entities("Intermediaries") with the understanding whether recorded in writing orotherwise that the Intermediary shall whether directly or indirectly lend or invest inother persons or entities identified in any manner whatsoever by or on behalf of thecompany ("Ultimate Beneficiaries") or provide any guarantee security or thelike on behalf of the Ultimate Beneficiaries;

(b) The management has represented that to the best of it's knowledge and belief nofunds have been received by the company from any person(s) or entity(ies) includingforeign entities ("Funding Parties") with the understanding whether recordedin writing or otherwise that the company shall whether directly or indirectly lend orinvest in other persons or entities identified in any manner whatsoever by or on behalf ofthe Funding Party ("Ultimate Beneficiaries") or provide any guarantee securityor the like on behalf of the Ultimate Beneficiaries; and (c) Based on such auditprocedures that have been considered reasonable and appropriate in the circumstancesnothing has come to our notice that has caused us to believe that the representationsunder sub-clause (i) and (ii) of Rule 11(e) as provided under (a) and (b) above containany material mis-statement.

v. The dividend declared or paid during the year by the company is in compliance withsection 123 of the Companies Act 2013.

For Ambani & Associates LLP
Chartered Accountants
Firm Regn. No. - 016923N
Hitesh Ambani
Designated Partner
Place - New Delhi M.No. – 506267
Dated – 23rd May 2022 UDIN - 22506267AMNHVT7997

The Annexure referred to in paragraph 1 of Our Report on "Other Legal andRegulatory Requirements".

We report that:

(i) (a) (A) The company is maintaining proper records showing full particularsincluding quantitative details and situation of Property Plant and Equipment; (B) Thecompany is maintaining proper records showing full particulars of intangible assets; (b)As explained to us Property Plant and Equipment have been physically verified by themanagement at reasonable intervals; no material discrepancies were noticed on suchverification; (c) The title deeds of all the immovable properties (other than propertieswhere the company is the lessee and the lease agreements are duly executed in favour ofthe lessee) disclosed in the financial statements are held in the name of the company.

(d) The company has not revalued its Property Plant and Equipment (including Right ofUse assets) or intangible assets or both during the year.

(e) As explained to us no proceedings have been initiated or are pending against thecompany for holding any benami property under the Benami Transactions (Prohibition) Act1988 (45 of 1988) and rules made thereunder.

(ii) (a) As explained to us physical verification of inventory has been conducted atreasonable intervals by the management. In our opinion the coverage and procedure of suchverification by the management is appropriate. No discrepancy of 10% or more in theaggregate for each class of inventory were noticed on physical verification of stocks bythe management as compared to book records.

(b) The company has been sanctioned during the year working capital limits in excessof five crore rupees in aggregate from banks or financial institutions on the basis ofsecurity of inventories and returns/ statements filed on quarterly basis are in agreementof books of accounts.

(iii) As per information and explanation given to us the Company has not madeInvestment in provide any guarantee or security or granted any loan or advances in thenature of Loans Secured or Unsecured to Companies Firms Limited Partnerships or anyother party. Accordingly clause 3(iii)(a)3(iii)(b) 3(iii)(c) 3(iii)(d) 3(iii)(e) and3(iii)(f) of the order are not applicable to the Company.

(iv) In our opinion and according to the information and explanation given to us theCompany has complied with the provision of section 85 and 186 of the Act with respect tothe loan and investment guarantee and securities. (v) As per information and explanationgiven to us the company has not accepted any deposits and accordingly directives issuedby Reserve Bank of India and the provisions of section 73 to 76 or any other relevantprovision of Act and the Rules framed thereunder could not apply. Accordingly para 3(v)of the order is not applicable. (vi) As per information & explanation given by themanagement maintenance of cost records has not been specified by the Central Governmentunder sub-section (1) of section 148 of the Companies Act. Accordingly para 3(vi) of theorder is not applicable.

(vii) (a) According to the records made available to us company is regular indepositing undisputed statutory dues including Goods and Services Tax provident fundemployees state insurance income-tax sales-tax service tax duty of customs duty ofexcise value added tax cess and any other statutory dues to the appropriate authorities.According to the information and explanation given to us there were no outstandingstatutory dues as on 31st of March 2022 for a period of more than six months from thedate they became payable. (b) According to the information and explanation given to usthere are no statutory dues which have not been deposited with the appropriate authorityon account of any dispute.

(viii) According to the information and explanations given by the management notransactions not recorded in the books of account have been surrendered or disclosed asincome during the year in the tax assessments under the Income Tax Act 1961.

(ix) (a) In our opinion and according to the information and explanations given by themanagement we are of the opinion that the company has not defaulted in repayment of loansor other borrowings or in the payment of interest thereon to any lender.

(b) According to the information and explanations given by the management the companyis not declared willful defaulter by any bank or financial institution or any otherlender; (c) In our opinion and according to the information and explanations given by themanagement the Company has utilized the money obtained by way of term loans during theyear for the purposes for which they were obtained.

(d) In our opinion and according to the information and explanations given by themanagement funds raised on short term basis have not been utilized for long termpurposes.

(e) In our opinion and according to the information and explanations given by themanagement the company has not taken any funds from any entity or person on account of orto meet the obligations of its subsidiaries associates or joint ventures (f) In ouropinion and according to the information and explanations given by the management thecompany has not raised loans during the year on the pledge of securities held in itssubsidiaries joint ventures or associate companies.

(x) (a) The company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments) during the year.

(b) The company has not made any preferential allotment or private placement of sharesor convertible debentures (fully partially or optionally convertible) during the year.

(xi) (a) According to the information and explanations given by the management nofraud by the company or any fraud on the company has been noticed or reported during theyear; (b) No report under sub-section (12) of section 143 of the Companies Act has beenfiled in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules2014 with the Central Government; (c) We have taken into consideration the whistle blowercomplains received by the company during the year while determining the nature timing andextent of our audit procedures.

(xii) The company is not a Nidhi Company. Therefore clause 3 (xii) of the order is notapplicable on the company. (xiii) The company has entered into transactions with relatedparties in compliance with the provision of section 177 and 188 of the Act. The details ofsuch related parties transactions have been disclosed in the Ind AS Financial Statement asrequired under Ind AS 24 Related Party Disclosures specified under section 133 of theAct read with the Rule 7 of the Companies (Accounts) Rules 2014.

(xiv) (a) According to the information and explanations given by the management thecompany has an in house internal audit system commensurate with the size and nature of itsbusiness; (b) We have considered the Internal Audit reports of Internal Auditor appointedby the management till date for the period under audit.

(xv) On the basis of the information and explanations given to us in our opinionduring the year the company has not entered into any non-cash transactions with directorsor persons connected with him.

(xvi) (a) In our Opinion and based on our examination the Company is not required tobe registered under section 45-IA of the Reserve Bank of India Act 1934 (2 of 1934).Accordingly clause 3(xvi)(a) of the order is not applicable.

(b) In our Opinion and based on our examination the Company has not conducted anyNon-Banking Financial or Housing Finance activities without a valid Certificate ofRegistration (CoR) from the Reserve Bank of India as per the Reserve Bank of India Act1934. Accordingly clause 3(xvi)(b) of the order is not applicable.

(c) In our Opinion and based on our examination the Company is not a Core InvestmentCompany (CIC) as defined in the regulations made by the Reserve Bank of India.Accordingly clause 3(xvi)(c) of the order is not applicable.

(d) According to the information and explanations given by the management the Groupdoes not have not more than one CIC as part of the Group. Accordingly clause 3(xvi)(d) ofthe order is not applicable. (xvii) Based on our examination the company has not incurredcash losses in the financial year and in the immediately preceding financial year.

(xviii) There has been no resignation of the statutory auditors during the year.

(xix) On the information obtained from the management and audit procedures performedand on the basis of the financial ratios ageing and expected dates of realization offinancial assets and payment of financial liabilities other information accompanying thefinancial statements the auditor's knowledge of the Board of Directors and managementplans we are of the opinion that no material uncertainty exists as on the date of theaudit report that company is capable of meeting its liabilities existing at the date ofbalance sheet as and when they fall due within a period of one year from the balance sheetdate; (xx) (a) As per information and explanation provided to us and of the basis of ourexamination of books of accounts of company there are no unspent amounts other thanongoing projects which are required to be transfer to a fund as specified in Schedule VIIto the companies act within a period of six months of expiry of the financial year incompliance with second proviso to sub-section (5) of section 135 of the said act.

(b) There are no ongoing projects against which unspent amount is required to betransferred to special account in compliance with the provision of sub-section (6) ofsection 135 of the said act.

For Ambani & Associates LLP
Chartered Accountants
Firm Regn. No. - 016923N
Hitesh Ambani
Designated Partner
M.No. – 506267
UDIN – 22506267AMNHVT7997
Place – New Delhi
Dated – 23rd May 2022

Report on Internal Financials Controls with reference to Financial Statements

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of CompetentAutomobiles Co. Ltd. ("the Company") as of March 31 2022 in conjunctionwith our audit of the financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company & internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. 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 auditor's judgement including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the Company's internal financial controls system overfinancial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that 1. pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; 2. provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorizations ofmanagement 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 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 the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 2022 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For Ambani & Associates LLP
Chartered Accountants
Firm Regn. No. - 016923N
Hitesh Ambani
Designated Partner
M.No. – 506267
UDIN – 22506267AMNHVT7997
Place – New Delhi
Dated – 23rd May 2022

 

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