To the Members of Dollar Industries Limited
REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS
We have audited the accompanying standalone financial statements of DollarIndustries Limited ("the Company") which comprise the Standalone Balancesheet as at March 31 2021 the Standalone Statement of Profit and Loss (including OtherComprehensive Income) the Statement of Cash Flow and the Standalone Statement of Changesin Equity for the year then ended and notestotheStandalonefinancial statements includinga summary of significant accounting policies and other explanatory information(hereinafterreferred to as "the standalone financial statements").
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 ("the Act") in the manner so required and give a trueand fair view in conformity with the Indian Accounting Standards prescribed under section133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015 asamended and other accounting principles generally accepted in India of the state ofaffairs (financial position) of the Company as at March 31 2021 its profit (financialperformance including other comprehensive income) its cash flows and the changes in forthe year ended on that date.
Basis for Opinion
We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing (SAs) specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Standalone Financial Statements' section of ourreport. We are independent of the Company in accordance with the Code of Ethics'issued by the Institute of Chartered Accountants (ICAI) of India together with the ethicalrequirements that are relevant to our audit of the standalone financial statements underthe provisions of the Act and the Rules there under and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the standalone financial statements.
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. For each matter below our description of how our auditaddressed the matter is provided in that context.
|Key audit matter ||How our audit addressed the key audit matter |
|1. Estimation of rebates discounts and sales returns ||Our procedures included but was not limited to the following: |
|(Refer Note 3.10 to the consolidated financial statements) The Company sells its products through various channels like distributors retailers e-commerce etc. and recognizes liabilities related to rebates discounts and sales returns. ||Obtained a detailed understanding from the management with regard to controls relating to recording of rebates discounts sales returns and period end provisions relating to estimation of revenue and tested the operating effectiveness of such controls; |
|As per the accounting policy of the Company the revenue is recognised upon transfer of control of goods to the customer and thus requires an estimation of the revenue taking into consideration the rebates discounts and sales returns as per the terms of the contracts. With regard to the determination of revenue the management is required to make significant following: the rebates/ discounts linked to sales which will be given to the customers pursuant to schemes offered by the Company; provision for sales returns where the customer has the right to return the goods to the Company; and compensation (discounts) offered by the customers to the ultimate consumers at the behest of the Company. The matter has been determined to be a key audit matter in view of the involvement of significantestimates by the management. || |
| || Tested the inputs used in the estimation of revenue in context of rebates discounts and sales returns to source data; |
| ||Assessed the underlying assumptions used for determination of rebates discounts and sales returns; |
| ||Ensured the completeness of liabilities recognised by evaluating the parameters for sample schemes; estimates in respect of Performed look-back analysis for past trends by comparing recent actuals with the estimates of earlier periods and assessed subsequent events; |
| || Tested credit notes issued to customers and payments made to them during the year and subsequent to the yearend along with the terms of the related schemes. |
| ||Our Conclusion : |
| ||Based on theaboveprocedureswedidnotidentifyanysignificantdeviation to the assessment made by management in respect estimation of rebates discounts and sales returns. |
|2. Recoverability of trade receivables || |
|(Refer Note 3.4.a and 16 to the Consolidated financial statements) The Company has trade receivables amounting to Rs.33092.28 Lakhs (net of provision for expected credit losses of Rs.330.48 lakhs) as at March 31 2021 as detailed in Notes 16 to the consolidated financial statements. ||Evaluated and tested the controls relating to credit control and approval process and assessing the recoverability of overdue receivables by comparing management's views of recoverability of overdue receivables to historical patterns of receipts in conjunction with reviewing receipts subsequent to the financial year end for its effect in reducing overdue receivables at the financial |
|Due to the inherent subjectivity that is involved in making judgments in relation to credit risk exposures to determine the recoverability of trade receivables and significant by the management for provision for loss allowance under expected credit loss model. Based on above the matter has been considered to be a key audit matter. ||Checked on sample basis balance confirmations from customers to test whether trade receivables as per books are acknowledged by estimatesandjudgmentsmade them. |
| ||Reviewed at the adequacy of the management judgements and estimates on the sufficiency detailed analyses of ageing of receivables and assessing the adequacy of disclosures in respect of credit risk. |
| ||Our Conclusion : |
| ||Based on theaboveprocedureswedidnotidentifyanysignificantdeviation to the assessment made by management in respect recoverability of trade receivables. |
|3. Inventories valuation and existence: ||Our procedures included but was not limited to the following: |
|(Refer Note 3.7 and 15 to the consolidated financial statements) The Company has Inventories of Rs.33394.70 Lakhs as at March 31 2021 as detailed in Notes 15 to the consolidated financial statements. ||Obtained a detailed understanding and evaluated the design and implementation of controls that the Company has established in relation to inventory valuation and existence. |
|Inventories valuation and existence has been determined to be a key audit matter as inventories may be held for long periods of time before being sold making it vulnerable to obsolescence. This could result in an overstatement of the value of the inventories if the cost is higher than the net realisable value. Furthermore the assessment and application of inventories provisions are subject to significant management judgment. ||Observed the physical verification year end and assessed the adequacy of controls over the existence of inventories. |
| ||Obtained assurance over the appropriateness of management's assumptions applied in calculating the gross profit margin and discounts to be deducted from sales price to arrive at cost of goods. |
| ||Evaluated management judgment with regards to the application of provisions to the inventories. |
| ||Our Conclusion : |
| ||Based on the above procedures we did not identify any significant deviation to the assessment made by management in respect Inventories valuation and existence. |
Information Other than the Standalone Financial Statements and Auditor's Report Thereon
The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexures to Board's Report BusinessResponsibility Report Corporate Governance and Shareholder's Information but does notinclude the Standalone financial statements and our auditor's report thereon.
Our opinion on the Standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.
In connection with our audit of the Standalone financial statements our responsibilityis to read the other information and in doing so consider whether such other informationis materially inconsistent with the Standalone financial statements or our knowledgeobtained during the course of our audit or otherwise appears to be materially misstated.If based on the work we have performed we conclude that there is a material misstatementof this other information; we are required to report that fact. We have nothing to reportin this regard.
Responsibility of Management and Those Charged with Governance for the StandaloneFinancial Statements
The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these standalone financial statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income cash flows and changes in equity of the Company in accordancewith the accounting principles generally accepted in India including the IndianAccounting Standards (Ind AS) specified under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding the assets of the Company and for preventing and detecting fraudsand other irregularities; selection and application of appropriate accounting policies;making judgments and estimates that are reasonable and prudent; and the designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the Standalone financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.
In preparing the Standalone financial statements management and 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 management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so. Those charged with governanceare also responsible for overseeing the Company's financial reporting process. nancialstatements thatfi
Auditor's Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith Standards on Auditing will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these standalone financial statements.
As part of an audit in accordance with Standards on Auditing we exercise professionaljudgment and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.
Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Act we are also responsible for expressing our opinion 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 the reasonablenessof accounting estimates and related disclosures made by management and Board of Directors.
Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe standalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.
Evaluate the overall presentation structure and content of the standalonefinancial statements including the disclosures and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.
Materiality is the magnitude of misstatements in the standalone individually or inaggregate makes it probable that the economic decisions of a reasonably knowledgeableuser of the financial statements may be influenced. We consider quantitative materialityand qualitative factors in (i) planning the scope of our audit work and in evaluating theresults of our work; and (ii) to evaluate the effect of any identified misstatements inthe financial statements.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.
From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by 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 ofthe Act we give in the "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.
2. As required by section 143 (3) of the Act based on our audit we report that:
(a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit;
(b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books;
(c) The Standalone Balance Sheet the Standalone Statement of Profit and Loss(including Other Comprehensive Income) the Standalone Statement of Cash Flow andStandalone Statement of Changes in Equity dealt with by this Report are in agreement withthe books of account;
(d) In our opinion the aforesaid standalone financial statements comply with theIndian Accounting Standards specified under Section 133 of the Act read with Companies(Indian Accounting Standards) Rules 2015 as amended from time to time;
(e) On the basis of the written representations received from the directors as on March31 2021 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2021 from being appointed as a director in terms of Section 164(2) of theAct;
(f) With respect to the adequacy of the internal controls with reference to standalonefinancial statement of the Company and the operating effectiveness of such controls referto our separate Report in "Annexure B" of this report.
(g) In our opinion the managerial remuneration for the year ended March 31 2021 hasbeen paid/ provided by the Company to its directors in accordance with the provisions ofsection 197 read with Schedule V to the Act; and
(h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:
I. The Company has disclosed the impact of pending litigations on its financialposition in its Standalone financial statements Refer Note 39;
II. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
III. There was no amount which was required to be transferred to the Investor Educationand Protection Fund by the Company.
ANNEXURE A' TO THE INDEPENDENT AUDITOR'S REPORT
(Referred to in paragraph 1 under Report on Other Legal and RegulatoryRequirements' section of our report to the Members of Dollar Industries Limited of evendate)
We report that:
I. In respect of its Fixed Assets:
(a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets which is in the process of furtherupdation.
(b) The Company has a program of verification of property plant and equipment to coverall the items in a phased manner over a period of three years which in our opinion isreasonable having regard to the size of the Company and the nature of its assets. Pursuantto the program certain property plant and equipment were physically verified by themanagement during the year. According to the information and explanations given to us nomaterial discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.
II. In respect of inventories (excluding stocks with third parties) physicalverification has been conducted at reasonable intervals during the year by the managementand in our opinion the frequency of verification is reasonable According to theinformation and explanation given to us no material discrepancies were noticed onphysical verification of inventories as compared to the book records. Inventories lyingwith third parties have been confirmed by them at the year end.
III. The Company has not granted any loan to parties covered in the register maintainedunder section 189 of the Companies Act 2013. Accordingly the provisions of Clause 3(iii)of the Order are not applicable.
IV. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Act with respectto the loans and investments made guarantees and security provided by it as applicable.
V. According to information and explanations given to us the Company has not accepteddeposits from public within the meaning of Section 73 to 76 of the Act and the Companies(Acceptance of Deposits) Rules 2014 (as amended) during the year. Accordingly theprovisions of Clause 3(v) of the Order are not applicable.
VI. To the best of our knowledge and according to information and explanations given tous the Government has not specified maintenance of the cost records under Section 148(1)of the Companies Act 2013 in regard to the activities of the Company.
VII. According to the information and explanations given to us and on the basis of ourexamination of the records of the Company:
a. The Company is regular in depositing undisputed statutory dues including providentfund employee's state insurance income tax sales tax service tax duty of customsvalue added tax cess Goods and Service tax and other statutory dues with the appropriateauthorities. According to the information and explanations given to us no undisputedamounts payable in respect of provident fund employees' . state insurance income taxsales tax service tax duty of customs value added tax Goods and Service tax cess andother material statutory dues were in arrears as at March 31 2021 for a period of morethan six months from the date they became payable.
b. According to the information and explanations given to us the details of disputeddues of sales tax income tax customs duty Goods & Service Tax service tax andCess as at 31st March 2021 are as follows:
|Name of the Statute ||Nature of Dues ||Amount (Rs.in lakhs) ||Period to which the Amount relates Assessment Year ||Forum where dispute is pending |
|Income Tax Act 1961 ||Tax and Interest ||1.49 ||2009-10 ||DCIT |
|Income Tax Act 1961 ||Tax and Interest ||4.54 ||2010-11 ||CIT(A) |
|Income Tax Act 1961 ||Tax and Interest ||78.02 ||2012-13 ||CIT(A) |
|Income Tax Act 1961 ||Tax and Interest ||4.05 ||2014-15 ||CIT(A) |
|Income Tax Act 1961 ||Tax and Interest ||23.50 ||2015-16 ||CPC |
|Central Excise Act 1944 ||Tax and Interest ||3.06 ||1st April 2003 to July 2004 ||CESTAT |
VIII. Based on our audit procedures and according to information and explanations givento us we are of the opinion that the Company has not defaulted in repayment of dues tofinancial institutions and banks. There were no debentures outstanding at any time duringthe year.
IX. In our opinion and according to the information and explanations given to us theCompany did not raise any money by way of initial public offer or further public offer(including debt instruments) however term loans raised during the year have been utilisedfor the purposes for which they were raised.
X. According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported theyear.
XI. According to the information and explanations given to us and based on ourexamination of the records of the
Company the Company has paid/provided for managerial remuneration in accordance withthe requisite approvals mandated by the provisions of section 197 read with Schedule V tothe Act.
XII. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly the provisions of Clause 3(xii) of the Orderare not applicable.
XIII. According to the information and explanations given to us and based on ourexamination of the records of the
Company transactions with the related parties are in compliance with sections 177 and188 of the Act where applicable and details of such transactions have been disclosed inthe Standalone financial statements as required by the applicable Indian AccountingStandards.
XIV. According to the information and explanations given to us during the year theCompany has not made any preferential allotment or private placement of shares or fully orpartly paid convertible debentures during the year and hence reporting under Clause 3(xiv)of the Order are not applicable to the Company.
XV. According to the information and explanations given to us and as represented to usby the management and based on our examination of the records of the Company the Companyhas not entered into non-cash transactions with duringdirectors or persons connected withhim. Accordingly the provisions of Clause 3(xv) of the Order are not applicable.
XVI. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934. Accordingly the provisions of Clause 3(xvi) of the Order are notapplicable.
ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT
(Referred to in paragraph 2 (f) under Report on Other Legal and RegulatoryRequirements' section of our report to the Members of Dollar Industries Limited ofeven date)
REPORT ON THE INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO STANDALONE FINANCIALSTATEMENT UNDER CLAUSE (I) OF SUB-SECTION 3 OF SECTION 143 OF THE COMPANIES ACT 2013("THE ACT")
1. We have audited the internal financial controls with reference to Standalonefinancial statements of Dollar Industries Limited ("the Company") as ofMarch 31 2021 in conjunction with our audit of the standalone financial statements of theCompany for the year ended on that date.
MANAGEMENT'S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
2. The Company's management is responsible for establishing and maintaining internalfinancial controls based on internal control with reference to financial statementscriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountants of India (ICAI'). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to Company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.
3. Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to standalone financial statements based on our audit. Weconducted our audit in accordance with the Guidance Note on Audit of Internal FinancialControls over Financial Reporting (the "Guidance Note") and the Standards onAuditing issued by ICAI and prescribed under section 143(10) of the Companies Act 2013to the extent applicable to an audit of internal financial controls both applicable to anaudit of Internal Financial Controls with reference to standalone financial statement andboth issued by the Institute of Chartered Accountants of India. Those Standards and theGuidance
Note require that we comply with ethical requirements and plan and perform the audit toobtain reasonable assurance about whether adequate internal financial controls withreference to financial statements was established and maintained and if such controlsoperated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the internal financial controls with reference to financial statements and theiroperating effectiveness. Our audit of internal financial controls with reference tostandalone financial statements included obtaining an understanding of internal financialcontrols with reference to financial statements assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal control based on the assessed risk. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thestandalone financial statements whether due to fraud the or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls withreference to standalone financial statements.
MEANING OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO FINANCIAL STATEMENTS
6. A company's internal financial control with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of standalone financial statements for external purposes inaccordance with generally accepted accounting principles. A Company's internal financialcontrol with reference to financial statements includes those policies and procedures that(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the Company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation ofstandalone financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the Company are being made only inaccordance with authorizations of management and directors of the Company; and (3) providereasonable assurance regarding prevention or timely detection of unauthorized acquisitionuse or disposition of the Company's assets that could have a material effect on thestandalone financial statements.
INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO FINANCIALSTATEMENTS
7. Because of the inherent limitations of internal financial controls with reference tofinancial statements including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls withreference to financial statements to future periods are subject to the risk that theinternal financial control with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.
reference to financial statements and such internal financial controls with referenceto standalone financial statements were operating effectively as at March 31 2021 basedon the internal control with reference to financial statements criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India.
8. In our opinion and to the best of the information and explainations given to us theCompany has in all material respects an adequate internal financial controls with
For Singhi & Co.
Firm Registration No.302049E
Membership No. 063769
Dated: May 29 2021