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GI Engineering Solutions Ltd.

BSE: 533048 Sector: IT
NSE: GISOLUTION ISIN Code: INE065J01016
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OPEN 6.17
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VOLUME 921
52-Week high 6.17
52-Week low 2.69
P/E
Mkt Cap.(Rs cr) 5
Buy Price 0.00
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Sell Price 0.00
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OPEN 6.17
CLOSE 6.17
VOLUME 921
52-Week high 6.17
52-Week low 2.69
P/E
Mkt Cap.(Rs cr) 5
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

GI Engineering Solutions Ltd. (GISOLUTION) - Auditors Report

Company auditors report

To the Members of

GI ENGINEERING SOLUTIONS LIMITED Report on the Audit of Financial Statements Opinion

We have audited the accompanying financial statements of GI ENGINEERING SOLUTIONSLIMITED ("the Company") which comprise the Balance Sheet as at 31st March2021 the statement of Profit and Loss (including Other Comprehensive Income) Statementof Changes in Equity and statement of cash flows for the year then ended and notes to thefinancial statements including a summary of significant accounting policies and otherexplanatory information (hereinafter referred to as "the financial statements").

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 theCompanies Act 2013 (‘the Act') in the manner so required and give a true and fairview in conformity with the accounting principles generally accepted in India includingIndian Accounting Standards (Ind AS) specified under section 133 of the Act of the stateof affairs of the Company as at March 31 2021 and its loss total comprehensive incomethe changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of 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 and we have fulfilled our other ethical responsibilities in accordance with theprovisions of the Act. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our opinion.

Emphasis of Matter

We draw your attention to Note 32 to the financial statements which explain theuncertainties and management's assessment of the financial impact due to the lockdown andother restrictions imposed by the Government and condition related to the COVID-19pandemic situation for which de nitive assessment of the impact would highly depend uponcircumstances as they evolve in the subsequent period. Our opinion is not modified inrespect of this matter.

We also draw your attention to Note 26 to the financial statements wherein the Companyhas given loans to other body corporates for business purposes standing to the tune of Rs.4.38 crores outstanding as on the Balance Sheet date for which no interest provision ismade in the Company's books and the same are recoverable in future as certified by themanagement.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.

Loans to other body corporate given for business purpose as referred to in thefinancial statements were written off to the tune of Rs. 1.75 crores during the previousyear as certified by the management.

In view of the lockdown imposed pursuant to the second wave of Covid-19 outbreak inIndia our audit team have conducted the major part of the audit from remote location. Asa result we have relied completely on digital or electronic evidence as a part of ouraudit process effective from 19th April 2021 till the date of this report. Had we beenphysically present at the Company premises we would have otherwise verified the physicalcopies of critical documents and we would have collected the audit evidence in physicalcopies.

We have carried out the validation of the digital / electronic evidence provided by themanagement by understanding the process implemented by the management to convert physicaldocuments into digital / electronic version and by getting representations from themanagement wherever necessary.

Other Information

The Company's management and Board of Directors are responsible for the otherinformation. The other information comprises the information included in Board's reportincluding annexures of Board's report but does not include the financial statements andour auditors' report thereon.

Our opinion on the financial statements does not cover the other information and we donot express any form of assurance conclusion thereon.

Responsibilities of Management and those charged with governance for the financialstatements

The Company's management and Board of Directors are responsible for the matters statedin section 134(5) of the Companies Act 2013 with respect to the preparation of thesefinancial statements that give a true and fair view of the financial position financialperformance including other comprehensive income changes in equity and cash flows of theCompany in accordance with the accounting principles generally accepted in Indiaincluding Indian Accounting Standards (Ind AS) prescribed under section 133 of the Actread with the Companies (Indian Accounting Standards) Rules 2015 as amended. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateimplementation and maintenance of accounting policies; making judgments and estimates thatare reasonable and prudent; and design implementation and maintenance of adequateinternal financial 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 materialmisstatements whether due to fraud or error.

In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so. Those Board of Directors are also responsible for overseeing 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 financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theCompanies Act 2013 we are also responsible for expressing our opinion on whether thecompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.

Conclude on the appropriateness of management's use of the going concern basis ofaccounting 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 financial statementsincluding the disclosures and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation.

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

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

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 subsection (11) of Section 143 of theAct (hereinafter referred to as the "Order") and on the basis of such checks ofthe books and records of the Company as we considered appropriate and subject to theinformation and explanations given to us we give in the "Annexure A" statementon the matters specified in paragraphs 3 and 4 of the Order; to the extent applicable.

2. Further to our comments in Annexure A as required by Section 143 (3) of the Act wereport 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 Balance Sheet the Statement of Profit and Loss the Cash Flow Statement andthe Statement of Changes in Equity dealt with by this Report are in agreement with therelevant books of account.

(d) In our opinion the aforesaid financial statements comply with the AccountingStandards prescribed under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014.

(e) On the basis of the written representations received from the directors as on 31March 2021 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2021 from being appointed as a director in terms of Section164 (2) of the Act.

(f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in "Annexure B"; and

(g) 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 financial statements Refer Note 21 to the financial statements.

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company during the year ended March 31 2021.

iv. The reporting on disclosures relating to Speci ed Bank Notes have not been made inthese financial statements since they do not pertain to the financial year ended March 312021.

ANNEXURE - A

TO THE INDEPENDENT AUDITORS' REPORT

Based on the audit procedures performed for the purpose of reporting a true and fairview on the financial statements of the Company and taking into consideration theinformation and explanations given to us and the books of account and other recordsexamined by us in the normal course of audit and to the best of our knowledge and beliefwe report that:

(i) (a) The Company has maintained proper records of its xed assets.

(b) On the basis of our examination of the records of the Company since No physicalassets exist as on the Balance Sheet date this clause is not applicable.

(c) On the basis of our examination of the records of the Company since No physicalassets exist as on the Balance Sheet date this clause is not applicable.

(ii) The Company is a service company primarily rendering Information Technology basedEngineering services. Accordingly it does not hold any physical inventories. Thusparagraph 3(ii) of the Order is not applicable to the Company.

(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms limited liabilitypartnerships or other parties covered in the register to be maintained under section 189of the Companies Act 2013 (‘the Act'). Accordingly paragraph 3(iii)(a)(b) and (c)of the Order are not applicable to the Company.

(iv) The Company has not granted any loans or made any investments or provided anyguarantees or securities to the parties covered under section 185 and 186 of the Act.Therefore the provision of Clause 3(iv) of the said Order are not applicable to theCompany.

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted deposits as per the directives issued by the Reserve Bank ofIndia under the provisions of Section 73 to 76 or any other relevant provisions of the Actand the Rules framed there under .Accordingly the provisions of paragraph 3(v) of theOrder are not applicable to the Company.

(vi) The Central Government has not prescribed the maintenance of cost records undersection 148(1) of the Act for any of the services rendered by the Company. Therefore theprovisions of paragraph 3(vi) of the Order are not applicable to the company.

(vii) In respect of statutory dues:

(a) According to the explanations given to us and records of the Company producedundisputed statutory dues including provident fund employees' state insuranceincome-tax goods and service tax sales-tax service tax duty of customs duty ofexcise value added tax cess and any other statutory dues have been generally regularlydeposited with appropriate authorities. Based on the information and explanations given tous and records of the company examined by us no undisputed amounts payable in respect ofthe aforesaid dues were outstanding as at 31st March 2021 for a period of more than sixmonths from the date they become payable.

(b) According to the information and explanation given to us there are no duesoutstanding of income tax sales tax service tax goods and service tax customs dutyexcise duty or cess which have not been deposited by the Company on account of anydispute.

(viii) According to the information and explanations given to us the Company does nothave any borrowing from any financial institutions banks and government nor has it issuedany debentures as at balance sheet date the provisions of Clause 3(viii) of the Order arenot applicable to the Company.

(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) during the year under consideration. Accordingto the information and explanation given to us and based on our examination of therecords The company has not raised any term loans accordingly the provision of Clause3(ix) of the Order are not applicable to the Company.

(x) According to the information and explanations given to us and based on our auditwe have not come across any material fraud by the Company or on the Company by itsOfficers or employees has been noticed or reported during the year.

(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company No Managerial remuneration has been paid orprovided during the year accordingly the provision of Clause 3(xi) of the Order are notapplicable to the Company.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly paragraph 3(xii) of the Order is notapplicable.

(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableAccounting Standards.

(xiv) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. Accordingly paragraph 3(xiv) of the Order is not applicable.

(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

(xvi) In our opinion and according to information and explanations given to us theCompany is not required to be registered under section 45-IA of the Reserve Bank of IndiaAct 1934.

ANNEXURE - B

TO THE INDEPENDENT AUDITORS' REPORT

(Referred to in paragraph 2(f) under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date)

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 GIEngineering Solutions Limited ("the Company") as of 31 March 2021 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's 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") issued by the Institute of Chartered Accountants of Indiaand the Standards on Auditing prescribed under Section 143(10) of the Companies Act 2013to the extent applicable to an audit of internal financial controls. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated 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 judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

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 systemover financial 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 of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised 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 to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively 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 during ourreview when the period of second phase of Covid-19 lockdown was prevailing in India wehave relied upon the information and explanations provided to us and the report receivedfrom the Company's Internal Audit department which has speci cally covered thetransactions and controls implemented.

For SACHIN PHADKE & ASSOCIATES
Chartered Accountants
Firm Registration No 133898W
Sachin Phadke
Proprietor
Place : Mumbai Membership No.117084
Date: 29 June 2021 UDIN: 21117084AAAABI4552

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