To the Members of Dhanlaxmi Cotex Limited
Report on the Audit of the Standalone Financial Statements
We have audited the accompanying Statement of quarterly and year todate financial results of Dhanlaxmi Cotex Limited ("the Company") for the yearended March 31 2021 and the year to date results for the period from 1st April 2020 to31st March 2021 attached herewith by the company pursuant to the requirement of Regulation33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulation 2015 asamended ("Listing Regulations").
In our opinion and to the best of our information and according to theexplanations given to us except for the NBFC criteria referred to in the Basis forqualified opinion paragraph the standalone financial results:
a. Are presented in accordance with the requirements of Regulation 33of the Listing Regulations in this regard; and b. Give a true and fair view in conformitywith the recognition and measurement principles laid down in the applicable
Indian Accounting Standards and other accounting principles generallyaccepted in India of the net profit and other comprehensive income and other financialinformation for the year ended 31 March 2021.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing('SAs') specified under section 143 (10) of the Companies Act 2013 ('the Act'). Ourresponsibilities under those SAs are further described in the Auditor's Responsibilitiesfor the Audit of the Standalone Financial Statements section of our report. We areindependent of the Company in accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethical requirements that are relevantto our audit 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 on thestandalone annual financial results.
Basis for Qualified opinion:
During the course of our audit we have examined that theCompany's principal business activity is buying and selling of Quoted shares in anactive market. In our opinion the Company fulfills the criteria for qualifying to beregistered as Investment NBFC as its Financial assets constitutes more than 50% of itstotal assets and income from such financial assets constitutes more than 50% of grossincome.
Management's Responsibility for the Standalone FinancialStatements
These standalone annual financial results have been prepared on thebasis of the standalone financial statements which is the responsibility of the Managementand the Board of Directors
The Company's Management and Board of Directors are responsiblefor the preparation and presentation of these standalone annual financial results thatgive a true and fair view of the net profit/loss and other comprehensive income and otherfinancial information in accordance with the recognition and measurement principles laiddown in Indian Accounting Standards prescribed under Section 133 of the Act and otheraccounting principles generally accepted in India and in compliance with Regulation 33 ofthe Listing Regulations. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding of 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 the design implementation and maintenanceof adequate internal financial controls that were operating effectively for ensuringaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the standalone annual financial results that give a true and fair view andare free from material misstatement whether due to fraud or error.
In preparing the standalone annual financial results Management andthe Board of Directors are responsible for assessing the Company's ability to continue asa going concern disclosing as applicable matters related to going concern and using thegoing concern basis of accounting unless the Board of Directors either intends toliquidate the Company or to cease operations or has no realistic alternative but to doso.
The Board of Directors is responsible for overseeing the Company'sfinancial reporting process.
Auditor's Responsibilities for the audit of the Standalone AnnualFinancial Results
Our objectives are to obtain reasonable assurance about whether thestandalone annual financial results as a whole are free from material misstatementwhether due to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs 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 standalone annual financialresults.
As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of thestandalone annual financial results whether due to fraud or error design and performaudit procedures responsive to those risks and obtain audit evidence that is sufficientand appropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof Internal control.
Obtain an understanding of internal control relevant to theaudit in order to design audit procedures that arc appropriate in the circumstances. UnderSection 143(3) (i) of the Act we are also responsible for expressing our opinion througha separate report on the complete set of financial statements on whether the Company hasadequate internal financial controls with reference to financial statements in place andthe operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures in the standalone financialresults made by Management and Board of Directors.
Conclude on the appropriateness of Management and Board ofDirectors use of the going concern basis of accounting and based on the audit evidenceobtained whether a material uncertainty exists related to events or conditions that maycast significant doubt on the appropriateness of this assumption. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor's report tothe related disclosures in the standalone annual financial results or if such disclosuresare inadequate 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 conditions maycause the Company to cease to continue as a going concern.
Evaluate the overall presentation structure and content of thestandalone annual financial results including the disclosures and whether the standaloneannual financial results represent the underlying transactions and events in a manner thatachieves fair presentation.
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
We also provide those charged with governance with a statement that wehave 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.
The standalone annual financial results include the results for thequarter ended 31 March 2021 being the balancing figure between the audited figures inrespect of the full financial year and the unaudited year to date figures up to the thirdquarter of the current financial year which were subject to limited review by us.
Report on Other Legal and Regulatory Requirements
As required by the Companies (Auditor's Report) Order 2016("the Order") issued by the Central Government of India in terms of sub-section(11) of section 143 of the Companies Act 2013 we give in the Annexure "A" astatement on the matters specified in paragraphs 3 and 4 of the Order to the extentapplicable.
As required by Section 143(3) of the Act we report that:
a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit;
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 balance sheet the standalone statement of profit andloss (including comprehensive income) the standalone statement of changes in equity andthe standalone cash flow statement dealt with by this report are in agreement with thebooks of account;
d) In our opinion the aforesaid financial statements comply with theaccounting standards specified under section 133 of the Act read with rule 7 of theCompanies (Accounts) Rules 2014;
e) On the basis of the written representations received from thedirectors as on March 31 2021 taken on record by the board of directors none of thedirectors is disqualified as on March 31 2021 from being appointed as a director in termsof Section 164 (2) of the Act;
f) With respect to the adequacy of the internal financial controls withreference to financial statements of the Company and the operating effectiveness of suchcontrols refer to our separate Report in Annexure B'; and g) With respect tothe other matters to be included in the Auditor's Report in accordance with Rule 11of the Companies (Audit and Auditors) Rules 2014 in our opinion and to the best of ourinformation and according to the explanations given to us;
a. The Company does not have any pending litigations which would impactits financial position;
b. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses; and
c. There has been no delay in transferring amounts required to betransferred to the Investor Education and
Protection Fund by the Company
ANNEXURE A TO THE AUDITORS' REPORT
(Referred to in paragraph 1 under Report on other legal andregulatory requirements' section of our report to the members of Fortune IntegratedFinance Limited of even date)
1. In respect of the Company's fixed assets:
a) The Company has maintained proper records showing full particularsincluding quantitative details and situation of fixed assets. b) The fixed assets of theCompany were physically verified in full by the management during the year. According tothe information and explanations given to us and as examined by us no materialdiscrepancies were noticed on such verification. c) According to the information andexplanations given to us the records examined by us we report that the Company does nothold any freehold are held in the name of the Company as at the balance sheet date. Inrespect of immovable properties of land and building that have been taken on lease anddisclosed as fixed assets in the financial statements the lease agreements are in thename of the Company.
2. The Company is a Non-Banking Finance Company primarily engaged inthe business of finance against security of vehicles on short medium and long-term basis.Accordingly Paragraph 3(ii) of the order is not applicable.
3. The Company has granted unsecured loans to Companies covered underin the register maintained under section 189 of the Act.
a) In our opinion the rate of interest and other terms and conditionson which the loans had been granted to the Companies listed in the register maintainedunder section 189 of the Act were not prima facie prejudicial to the interest of theCompany. b) In the case of the loans granted to the Companies listed in the registermaintained under section 189 of the Act the borrowers have been regular in the payment ofthe principal and interest as stipulated. c) There are no overdue amounts in respect ofthe loans granted to the Companies listed in the register maintained under section 189 ofthe Act.
4. The Company has not granted any loan or provided any guarantee orsecurity in connection with any loan taken by any parties covered under section 185 of theAct. In our opinion and according to information and explanation given to us the Companyhas complied with the provisions of section 186 of the Act with respect to grant of loansmaking investments and providing guarantees and securities as applicable.
5. In our opinion and according to the information and explanationsgiven to us the company has not accepted any deposits and accordingly paragraph 3 (v) ofthe order is not applicable.
6. The Central Government of India has not prescribed the maintenanceof cost records under sub-section (1) of section 148 of the Act for any of the activitiesof the company and accordingly paragraph 3 (vi) of the order is not applicable.
7. In respect of statutory dues: a) According to the information andexplanations given to us and on the basis of our examination of the records of the
Company amounts deducted/ accrued in the books of account in respectof undisputed statutory dues including provident fund employees' state insuranceincome-tax sales- tax service tax goods and service tax duty of customs duty ofexcise value added tax cess and other material statutory dues have been generallyregularly deposited during the year by the company with the appropriate authorities.
According to the information and explanations given to us noundisputed amounts payable in respect of provident fund employees' state insuranceincome-tax sales- tax service tax goods and service tax duty of customs duty ofexcise value added tax cess and other material statutory dues were in arrears as atMarch 31 2021 for a period of more than six months from the date they became payable
b) According to the information and explanations given to us and therecords of the company examined by us there are no dues of income-tax sales- taxservice tax goods and service tax duty of customs duty of excise and value added taxwhich have not been deposited on account of any dispute.
8. In our opinion and according to the information and explanationsgiven to us the company has not defaulted in repayment of any dues to the bank and hasnot issued any debentures. The Company did not have any outstanding dues to financialinstitutions.
9. The Company has not raised any money by way of initial public offeror further public offer (including debt instruments) and has not taken any term loansduring the year. Accordingly paragraph 3 (ix) of the order is not applicable.
10. To the best of our knowledge and according to the information andexplanations given to us no fraud by the Company or no material fraud on the Company byits officers or employees has been noticed or reported during the year.
11. According to the information and explanations given to us and basedon our examination of the records of the Company the
Company has paid/provided for managerial remuneration in accordancewith the required approvals mandated by the provisions of section 197 read with Schedule Vof the Act.
12. The Company is not a Nidhi Company and accordingly paragraph 3(xii) of the order is not applicable to the Company.
13. According to the information and explanations given to us and basedon our examination of the records of the company transactions with the related partiesare in compliance with section 177 and 188 of the Act. Where applicable the details ofsuch transactions have been disclosed in the financial statements as required by theapplicable accounting standards.
14. According to the information and explanations given to us and basedon our examination of the records of the company the company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the year. Accordingly paragraph 3(xiv) of the order is not applicable.
15. According to the information and explanations given to us and basedon our examination of the records of the company the company has not entered intonon-cash transactions with directors or persons connected with them. Accordinglyparagraph 3(xv) of the order is not applicable.
16. According to the information and explanations given to us and basedon our examination of the records of the company the
Company is required to be register under section 45-IA of the ReserveBank of India Act 1934 and the registration for the same has not been obtained.
ANNEXURE B TO THE AUDITORS' REPORT
Referred to in paragraph 2 (f) under Report on other legal andregulatory requirements' section of our report to the Members of Fortune IntegratedFinance Limited of even date)
Report on the internal financial controls over financial reportingunder clause (i) of sub section 3 of section 143 of the
Companies Act 2013 ("the Act")
We have audited the internal financial controls over financialreporting of Fortune Integrated Finance Limited ("the Company") as at March 312021 in conjunction with our audit of the financial statements of the Company for theyear ended on that date.
Management's responsibility for internal financial controls
The board of directors of the Company is responsible for establishingand maintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.
Our responsibility is to express an opinion on the internal financialcontrols over financial reporting of the Company based on our audit. We conducted ouraudit in accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial
Reporting (the "Guidance Note") issued by the Institute ofChartered Accountants of India and the standards on auditing prescribed under Section 143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls. Those standards and the guidance note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls over financial reporting were established andmaintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk.
The procedures selected depend on the auditor's judgementincluding the assessment of the risks of material misstatement in the financialstatements whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internalfinancial control system over financial reporting.
Meaning of internal financial controls over financial reporting
A company's internal financial control over financial reporting isa process designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles.
A company's internal financial control over financial reportingincludes those policies and procedures that
(i) pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany;
(ii) 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
(iii) provide reasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or disposition of the company's assetsthat could have a material effect on the financial statements.
Limitations of internal financial controls over financial reporting
Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper management ofoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.
In our opinion and according to the information and explanations givento us the Company has in all material respects an adequate internal financial controlsystem 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 on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.
|For M/s. Gohel and Associates LLP. |
|Chartered Accountants |
|FRN: W100162 |
|Abhay M. Gohel |
|Membership Number: 152864 |
|UDIN: 21152864AAAACZ1421 |
|Place: Mumbai |
|Date: 26/06/2021 |