To the Members of
Delta Corp Limited
Report on the Audit of the Standalone Financial Statements Opinion
1. We have audited the accompanying standalone financial statements ofDelta Corp Limited (the Company') which comprise the Balance Sheet as at 31stMarch 2022 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Cash Flow and the Statement of Changes in Equity for the year then ended anda summary of the significant accounting policies and other explanatory information.
2. In our opinion and to the best of our information and according tothe explanations given to us the aforesaid standalone financial statements give theinformation required by the Companies Act 2013 (the Act') in the manner sorequired and give a true and fair view in conformity with the Indian Accounting Standards(Ind AS') specified under section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 and other accounting principles generallyaccepted in India of the state of affairs of the Company as at 31st March2022 and its profit (including other comprehensive income) its cash flows and thechanges in equity for the year ended on that date.
Basis for Opinion
3. We conducted our audit in accordance with the Standards on Auditingspecified under section 143(10) of the Act. Our responsibilities under those standards arefurther described in the Auditor's Responsibilities for the Audit of the StandaloneFinancial 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 (ICAI') together with the ethical requirements that are relevant to ouraudit of the financial statements under the provisions of the Act 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.
Emphasis of Matter COVID -19 Impact
4. We draw attention to Note 50 to the accompanying standalonefinancial statements with respect to COVID-19 pandemic outbreak and management'sevaluation of its impact on the operations of the Company and on the accompanyingstandalone financial statements. Our opinion is not modified in respect of this matter.
Key Audit Matters
5. Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of the standalone financial statements ofthe current period. These matters were addressed in the context of our audit of thefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters.
6. We have determined the matters described below to be the key auditmatters to be communicated in our report.
|Key audit matter ||How our audit addressed the key audit matter |
|1) Recoverability of the carrying value of investment in Subsidiary ||Our audit procedures included but were not limited to the following: |
|(refer note 3 of the standalone financial statements) ||Obtained an understanding of management's processes and controls for determining the fair valuation of investments; |
|The Company has investment in Daman Hospitality Private Limited (Subsidiary) carried at cost in accordance with Ind AS 27 Separate Financial Statements. Considering the existence of impairment indicator in the current year the Company assessed the recoverable amount of the investments by comparing the fair value (less costs of disposal) and carrying amount of the investments as on the reporting date. ||Evaluated the design and tested the operating effectiveness of key controls implemented by the management around fair valuation of investments including for cash flow projections use of estimates involved and review of valuation performed |
|The recoverability of the investments in subsidiary was assessed by the management using discounted cash flow model with the assistance of a management appointed valuation specialist. The valuation method involves significant estimates made by the management including discount rate and business and cash flow projections during explicit period of five years based on revenue growth rates projected operating margins and terminal growth rate at the end of five years. The management also considered the impact of lockdown in India due to COVID-19 in preparing the projections ||Tested the accuracy of the input data provided by the management to the valuation specialist by reconciling the projected cash flows to approved business plans. Tested the reasonableness of key assumptions including revenue and profit growth or decline discounting rate operating margins including comparison of assumptions with industry and economic forecasts and potential impact of COVID-19. |
|Accordingly considering the materiality of the carrying amounts complexity and significance of judgement involved impairment assessment of aforesaid investments has been considered to be a key audit matter for current year's audit. ||Evaluated the appropriateness of disclosures made in the financial statement in relation to such investments and their fair valuation as required by applicable accounting standards. |
2) Revenue recognition
|(Refer note 1(i) for the accounting policy on revenue recognition note 26 of the standalone financial statement for revenue recognized during the year and note 54 for disaggregate revenue information under Ind AS 115) |
|The Company has recognized Rs 359.06 crores as revenue from physical casinos and hospitality business which requires processing of a large number of transactions each day. Further a high number of sale transactions in hospitality and casino business get settled in cash which requires the auditor to put significant additional effort and procedures to obtain comfort on those transactions. |
|Standards on Auditing prescribe a presumed risk of fraud in revenue recognition that revenue may be misstated through improper recognition. Given this inherent risk we identified the occurrence of revenue as a significant risk of material misstatement. |
|Considering the amounts involved large number of transactions and significant management judgement involved revenue recognition was considered as a key audit matter for the current year audit. |
|Our audit procedures included but were not limited to the following: |
|Obtained and updated our understanding of the revenue business process. |
Evaluated the design and tested the operating effectiveness of key controls over the recognition and measurement of revenue. For hospitality business - Involved our information technology specialists to test information technology related general controls and information technology application controls relevant for revenue recognition.
Conducted cash counts at the year end as well as during the quarterly reviews.
For samples selected during the year and samples selected from the period before and after year end tested supporting documents for revenue recognition including tracing of customers' cash deposits to bank statements. Tested on a sample basis the appropriateness of journal entries impacting revenue as well as other adjustments made in the preparation of the financial statements with respect to revenue recognition including specific journals posted manually directly to revenue.
Evaluated the appropriateness of disclosures made in the financial statements with respect to revenue recognized during the year as required by applicable accounting standards.
Information other than the Financial Statements and Auditor'sReport thereon
7. The Company's Board of Directors are responsible for the otherinformation. The other information comprises the information included in the AnnualReport but does not include the standalone financial statements and our auditor'sreport thereon. The Annual Report is expected to be made available to us after the date ofthis auditor's report.
Our opinion on the standalone financial statements does not cover theother information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statementsour responsibility is to read the other information identified above when it becomesavailable and in doing so consider whether the other information is materiallyinconsistent with the standalone financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated.
When we read the Annual Report if we conclude that there is a materialmisstatement therein we are required to communicate the matter to those charged withgovernance.
Responsibilities of Management and Those Charged with Governance forthe Standalone Financial Statements
8. The accompanying standalone financial statements have been approvedby the Company's Board of Directors. The Company's Board of Directors areresponsible for the matters stated in section 134(5) of the Act with respect to thepreparation and presentation of these standalone financial statements that give a true andfair view of the financial position financial performance including other comprehensiveincome changes in equity and cash flows of the Company in accordance with the Ind ASspecified under section 133 of the Act and other accounting principles generally acceptedin 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 financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
9. In preparing the financial statements the Board of Directors areresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless the Board of Directors either intend to liquidate the Companyor to cease operations or has no realistic alternative but to do so.
10. Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.
Auditor's Responsibilities for the Audit of the StandaloneFinancial Statements
11. Our objectives are to obtain reasonable assurance about whether thefinancial 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. 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 reasonably be expected to influence theeconomic decisions of users taken on the basis of these financial statements.
12. As part of an audit in accordance with Standards on Auditingspecified under section 143(10) of the Act we exercise professional judgment and maintainprofessional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of thefinancial 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 control relevant to the auditin order to design audit procedures that are appropriate in the circumstances. Undersection 143(3)(i) of the Act we are also responsible for expressing our opinion on whetherthe Company has adequate internal financial controls system with reference to financialstatements in place and the operating effectiveness of such controls;
Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management;
Conclude on the appropriateness of Board of Directors' use ofthe going concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the Company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor'sreport to the related disclosures in the financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditionsmay cause the Company to cease to continue as a going concern;
Evaluate the overall presentation structure and content of thefinancial statements including the disclosures and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation;
13. We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.
14. We also provide those charged with governance with a statement thatwe have complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.
15. From the matters communicated with those charged with governancewe determine those matters that were of most significance in the audit of the financialstatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.
Report on Other Legal and Regulatory Requirements
16. As required by section 197(16) of the Act based on our audit wereport that the Company has paid remuneration to its directors during the year inaccordance with the provisions of and limits laid down under section 197 read withSchedule V to the Act.
17. As required by the Companies (Auditor's Report) Order 2020(the Order') issued by the Central Government of India in terms of section143(11) of the Act we give in the Annexure A a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.
18. Further to our comments in Annexure A as required by section143(3) of the Act based on our audit we report to the extent applicable that:
a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purpose of our auditof the accompanying standalone financial statements;
b) In our opinion proper books of account as required by law have beenkept by the Company so far as it appears from our examination of those books;
c) The standalone financial statements dealt with by this report are inagreement with the books of account;
d) In our opinion the aforesaid standalone financial statements complywith Ind AS specified under section 133 of the Act;
e) On the basis of the written representations received from thedirectors and 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 termsof section 164(2) of the Act; f) With respect to the adequacy of the internal financialcontrols with reference to financial statements of the Company as on 31st March2022 and the operating effectiveness of such controls refer to our separate Report inAnnexure B wherein we have expressed an unmodified opinion; and
g) With respect to the other matters to be included in theAuditor's Report in accordance with rule 11 of the Companies (Audit and Auditors)Rules 2014 (as amended) in our opinion and to the best of our information and accordingto the explanations given to us:
i. The Company as detailed in note 33 to the standalone financialstatements has disclosed the impact of pending litigations on its financial position asat 31st March 2022.
ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses as at 31stMarch 2022;
iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company during the yearended 31st March 2022;
iv. a. The management has represented that to the best of itsknowledge and belief as disclosed in note 57(vi) to the standalone financial statementsno funds have been advanced or loaned or invested (either from borrowed funds orsecurities premium or any other sources or kind of funds) by the Company to or in anyperson(s) or entity(ies) including foreign entities (the intermediaries')with the understanding whether recorded in writing or otherwise that the intermediaryshall whether directly or indirectly lend or invest in other persons or entitiesidentified in any manner whatsoever by or on behalf of the Company (the UltimateBeneficiaries') or provide any guarantee security or the like on behalf the UltimateBeneficiaries;
b. The management has represented that to the best of its knowledgeand belief as disclosed in note 57(vii) to the standalone financial statements no fundshave been received by the Company from any person(s) or entity(ies) including foreignentities (the Funding Parties') with the understanding whether recorded inwriting 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 audit procedures performed as considered reasonableand appropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the management representations under sub-clauses (a) and (b) above containany material misstatement.
v. The Final dividend paid by the Company during the year ended 31stMarch 2022 in respect of such dividend declared for the previous year is in accordancewith section 123 of the Act to the extent it applies to payment of dividend and
As stated in note 42(b) to the accompanying standalone financialstatements the Board of Directors of the Company have proposed final dividend for theyear ended 31st March 2022 which is subject to the approval of the members atthe ensuing Annual General Meeting. The dividend declared is in accordance with section123 of the Act to the extent it applies to declaration of dividend.
For Walker Chandiok & Co LLP
Firm's Registration No.: 001076N/N500013
Khushroo B. Panthaky
Membership No.: 042423
Date: 11th April 2022
referred to in Paragraph 16 of the Independent Auditor's Report ofeven date to the members of Delta Corp Limited on the standalone financial statements forthe year ended 31st March 2022
In terms of the information and explanations sought by us and given bythe Company and the books of account and records examined by us in the normal course ofaudit and to the best of our knowledge and belief we report that:
(i) (a) (A) The Company has maintained properrecordsshowingfullparticularsincluding quantitative details and situation of propertyplant and equipment and right of use assets.
(B) The Company has maintained proper records showing full particularsof intangible assets.
(b) The Company has a regular program of physical verification of itsproperty plant and equipment and right of use assets under which the assets arephysically verified in a phased manner over a period of three years which in our opinionis reasonable having regard to the size of the Company and the nature of its assets. Inaccordance with this program certain property plant and equipment and right of useassets were verified during the year and no material discrepancies were noticed on suchverification.
(c) The title deeds of all the immovable properties held by the Company(other than properties where the Company is the lessee and the lease agreements are dulyexecuted in favour of the lessee) are held in the name of the Company.
(d) The Company has not revalued its Property Plant and Equipment (andRight of Use assets) or intangible assets during the year.
(e) 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. Accordingly reporting under clause 3(i)(e)of the Order is not applicable to the Company.
(ii) (a) The management has conducted a physical verification ofinventory at reasonable intervals during the year. In our opinion the coverage andprocedure of such verification by the management is appropriate and no discrepancies of10% or more in the aggregate for each class of inventory were noticed.
(b) The Company has not been sanctioned working capital limits inexcess of five crore rupees by banks or financial institutions on the basis of security ofcurrent assets during any point of time of the year. Accordingly reporting under clause3(ii)(b) of the Order is not applicable to the Company.
(iii) (a) The Company has provided interest free unsecured loans to 9Subsidiaries during the year as per details given below:
|Particulars ||Loans |
| ||( ` in Crores) |
|Aggregate amount provided/ granted during the year: || |
| Subsidiaries ||185.46 |
|Balance outstanding as at balance sheet date in respect of above cases: || |
| Subsidiaries ||82.13 |
(b) The Company has not provided any guarantee or given any securityduring the year. However the Company has made investment in 7 entities amounting to Rs241.66 crores (year-end balance Rs 1016.40 Crores) and granted loans to 9 entitiesamounting to
Rs 185.46 Crores (year-end balance Rs 82.13 Crores) and in our opinionand according to the information and explanations given to us investments made and termsand conditions of the grant of all loans are prima facie not prejudicial to the interestof the Company.
(c) In respect of loans granted by the Company the schedule ofrepayment of principal has not been stipulated and accordingly we are unable to commentas to whether the repayments of principal are regular. Further no interest is receivableon such loans and advances in the nature of loans.
(d) In the absence of stipulated schedule of repayment of principal weare unable to comment as to whether there is any amount which is overdue for more than 90days. Reasonable steps have been taken by the Company for recovery of such principalamounts.
(e) In respect of loans granted by the Company the schedule ofrepayment of principal has not been stipulated. Further no interest is receivable on suchloans. According to the information and explanation given to us such loans have not beendemanded for repayment as on date.
(f) The Company has granted loans which are repayable on demand as perdetails below:
(Rs in crores)
|Particulars ||All Parties ||Related Parties |
|Aggregate of loans || || |
| Repayable on demand (A) ||185.46 ||185.46 |
| Agreement does not specify any terms or period of repayment (B) ||Nil ||Nil |
|Total (A+B) ||185.46 ||185.46 |
|Percentage of loans to the total loans ||100% ||100% |
(iv) In our opinion and according to the information and explanationsgiven to us the Company has complied with the provisions of sections 185 and 186 of the
Act in respect of loans investments guarantees and security asapplicable.
(v) In our opinion and according to the information and explanationsgiven to us the Company has not accepted any deposits or there is no amount which hasbeen considered as deemed deposit within the meaning of sections 73 to 76 of the Act andthe Companies (Acceptance of Deposits) Rules 2014 (as amended). Accordingly reportingunder clause 3(v) of the Order is not applicable to the Company.
(vi) The Central Government has not specified maintenance of costrecords under sub-section (1) of section 148 of the Act in respect of Company'sproducts/business activity. Accordingly reporting under clause 3(vi) of the Order is notapplicable.
(vii) (a) In our opinion and according to the information andexplanations given to us undisputed statutory dues including goods and services taxprovident fund employees' state Insurance income-tax sales-tax service tax dutyof customs duty of excise value added tax cess and other material statutory dues asapplicable have generally been regularly deposited with the appropriate authorities bythe Company though there have been slight delays in a few cases. Further no undisputedamounts payable in respect thereof were outstanding at the year-end for a period of morethan six months from the date they became payable.
(b) According to the information and explanations given to us thereare no statutory dues referred in sub-clause (a) which have not been deposited with theappropriate authorities on account of any dispute except for the following:
|Name of the statute ||Nature of dues ||Amount ( in Crores) ||Amount paid under Protest ||Period to which the amount relates ||Forum where dispute is pending |
| || || ||( in Crores) || || |
|Income Tax Act1961 ||Income Tax ||1.46 ||Nil ||AY 2007-08 ||CIT(A) |
| ||Income Tax ||1.81 ||Nil ||AY 2016-17 & 2020-21 ||Assessing Officer |
|Custom Act 1962 ||Custom duty ||18.45 ||7.17 ||FY 2010-11 ||CESTAT Bangalore |
| || || ||(Additional bond of 35.81) || || |
(viii) According to the information and explanations given to us notransactions were surrendered or disclosed as income during the year in the taxassessments under the Income Tax Act 1961 (43 of 1961) which have not been recorded inthe books of accounts.
(ix) According to the information and explanations given to us theCompany does not have any term loans or other borrowings from any lender. Accordinglyreporting under clause 3(ix) of the Order is not applicable to the Company.
(x) (a) The Company has not raised any money by way of initial publicoffer or further public offer (including debt instruments) during the year. Accordinglyreporting under clause 3(x)(a) of the Order is not applicable to the Company.
(b) According to the information and explanations given to us theCompany has not made any preferential allotment or private placement of shares or (fullypartially or optionally) convertible debentures during the year. Accordingly reportingunder clause 3(x)(b) of the Order is not applicable to the Company.
(xi) (a) To the best of our knowledge and according to the informationand explanations given to us no fraud by the Company or on the Company has been noticedor reported during the period covered by our audit.
(b) No report under section 143(12) of the Act has been filed with theCentral Government for the period covered by our audit.
(c) According to the information and explanations given to us includingthe representation made to us by the management of the Company there are nowhistle-blower complaints received by the Company during the year.
(xii) The Company is not a Nidhi Company and the Nidhi Rules 2014 arenot applicable to it. Accordingly reporting under clause 3(xii) of the Order is notapplicable to the Company.
(xiii) In our opinion and according to the information and explanationsgiven to us all transactions entered into by the Company with the related parties are incompliance with sections 177 and 188 of the Act where applicable. Further the details ofsuch related party transactions have been disclosed in the standalone financialstatements as required under Indian Accounting Standard (Ind AS) 24 Related PartyDisclosures specified in Companies (Indian Accounting Standards) Rules 2015 as prescribedunder section 133 of the Act.
(xiv) (a) In our opinion and according to the information andexplanations given to us the Company has an internal audit system as required undersection 138 of the Act which is commensurate with the size and nature of its business.
(b) We have considered the reports issued by the Internal Auditors ofthe Company till date for the period under audit.
(xv) According to the information and explanation given to us theCompany has not entered into any non-cash transactions with its directors or personsconnected with them and accordingly provisions of section 192 of the Act are notapplicable to the Company.
(xvi) The Company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934. Accordingly reporting under clauses 3(xvi)(a)(b) and (c) of the Order are not applicable to the Company.
(xvii) The Company has not incurred any cash loss in the current aswell as the immediately preceding financial year.
(xviii) There has been no resignation of the statutory auditors duringthe year. Accordingly reporting under clause 3(xviii) of the Order is not applicable tothe Company.
(xix) According to the information and explanations given to us and onthe basis of the financial ratios ageing and expected dates of realisation of financialassets and payment of financial liabilities other information accompanying the standalonefinancial statements our knowledge of the plans of the Board of Directors and managementand based on our examination of the evidence supporting the assumptions nothing has cometo our attention which causes us to believe that any material uncertainty exists as onthe date of the audit report that Company is not capable of meeting its liabilitiesexisting at the date of balance sheet as and when they fall due within a period of oneyear from the balance sheet date. We however state that this is not an assurance as tothe future viability of the company. We further state that our reporting is based on thefacts up to the date of the audit report and we neither give any guarantee nor anyassurance that all liabilities falling due within a period of one year from the balancesheet date will get discharged by the company as and when they fall due.
(xx) (a) According to the information and explanations given to usthere is no unspent amount pertaining to other than ongoing projects as at end of thecurrent financial year. Accordingly reporting under clause 3(xx)(a) of the Order is notapplicable to the Company.
(b) The Company has transferred the remaining unspent amount undersub-section (5) of section 135 of the Act in respect of ongoing project within a periodof 30 days from the end of financial year to a special account in compliance with theprovision of sub-section (6) of section 135 of the Act.
(xxi) The reporting under clause 3(xxi) of the Order is not applicablein respect of audit of standalone financial statements of the Company. Accordingly nocomment has been included in respect of said clause under this report.
For Walker Chandiok & Co LLP
Firm's Registration No.: 001076N/N500013
Khushroo B. Panthaky
Membership No.: 042423
Date: 11th April 2022
Independent Auditor's Report on the internal financial controlswith reference to the standalone financial statements under Clause (i) of Sub-section 3 ofSection 143 of the Companies Act 2013 (the Act')
1. In conjunction with our audit of the standalone financial statementsof Delta Corp Limited (the Company') as at and for the year ended 31stMarch 2022 we have audited the internal financial controls with reference to financialstatements of the Company as at that date.
Responsibilities of Management and Those Charged with Governance forInternal Financial Controls
2. The Company's Board of Directors is responsible forestablishing and maintaining internal financial controls based on the internal financialcontrols with reference to financial statements criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the Institute ofChartered Accountants of India. These responsibilities include the design implementationand maintenance of adequate internal financial controls that were operating effectivelyfor ensuring the orderly and efficient conduct of the Company's business includingadherence to the 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 Act.
Auditor's Responsibility for the Audit of the Internal FinancialControls with Reference to Financial Statements
3. Our responsibility is to express an opinion on the Company'sinternal financial controls with reference to financial statements based on our audit. Weconducted our audit in accordance with the Standards on Auditing issued by the Instituteof Chartered Accountants of India (ICAI') prescribed under Section 143(10) ofthe Act to the extent applicable to an audit of internal financial controls withreference to financial statements and the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting (the Guidance Note') issued by the ICAI.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls with reference to financial statements were established and maintainedand if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidenceabout the adequacy of the internal financial controls with reference to financialstatements and their operating effectiveness. Our audit of internal financial controlswith reference to financial statements includes obtaining an understanding of suchinternal financial controls 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 auditor's judgementincluding the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion on the Company's internalfinancial controls with reference to financial statements.
Meaning of Internal Financial Controls with Reference to FinancialStatements
6. A company's internal financial controls with reference tofinancial statements is a process designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles. Acompany's internal financial controls with reference to financial statements includethose policies and procedures that (1) pertain to the maintenance of records that inreasonable detail accurately and fairly reflect the transactions and dispositions of theassets of the company; (2) provide reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorisations of management and directors of thecompany; and (3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could havea material effect on the financial statements.
Inherent Limitations of Internal Financial Controls with Reference toFinancial Statements
7. Because of the inherent limitations of internal financial controlswith reference to financial statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to financial statements to future periods are subject to the riskthat the internal financial controls with reference to financial statements may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.
8. In our opinion the Company has in all material respects adequateinternal financial controls with reference to financial statements and such controls wereoperating effectively as at 31st March 2022 based on the internal financialcontrols with reference to financial statements criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the Institute ofChartered Accountants of India.
For Walker Chandiok & Co LLP
Firm's Registration No.: 001076N/N500013
Khushroo B. Panthaky
Membership No.: 042423
Date: 11th April 2022