To the Members of Gujarat Terce Laboratories Limited
Report on the Audit of the Standalone Financial Statements
We have audited the financial statements of Gujarat Terce LaboratoriesLimited ("the Company") which comprise the balance sheet as at 31st March 2021and the statement of Profit and Loss and statement of cash flows for the year then endedand notes to the financial statements including a summary of significant accountingpolicies and other explanatory information.
In our opinion and to the best of our information and according to theexplanations given to us the aforesaid financial statements give the information requiredby the Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at 31st March 2021 its loss and its cash flows for the year ended on that date.
Basis for Opinion
We have conducted our audit in accordance with the Standards onAuditing (SAs) specified under section 143(10) of the Companies Act 2013. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the 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 Companies Act 2013and the Rules thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the Code of Ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for ouropinion.
Information other than the financial statements and auditors' reportthereon
The Company's board of directors is responsible for the preparation ofthe other information. The other information comprises the information included in theBoard's Report including Annexures to Board's Report but does not include the financialstatements and our auditor's report thereon.
Our opinion on the financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the financial statements or ourknowledge obtained during the course of our audit or otherwise appears to be materiallymisstated.
If based on the work we have performed we conclude that there is amaterial misstatement of this other information we are required to report that fact. Wehave nothing to report in this regard.
Emphasis of Matter
We draw attention to Note 33 to the financial statements whichdescribes the effects of a fire in the Company's facilities. Our opinion is not modifiedin respect of this matter.
Responsibilities of Management and Those Charged with Governance forthe Standalone Financial Statements
The Company's Board of Directors is responsible for the matters statedin section 134(5) of the Companies Act 2013 ("the Act") with respect to thepreparation of these financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Indian AccountingStandards specified under section 133 of the Act read with Companies (Indian AccountingStandards) Rules 2015. 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 design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.
In preparing the financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative 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 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. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detecta material misstatement when it exists. Misstatements can arisefrom fraud 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 professionaljudgment and maintain professional 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 theaudit in order to design audit procedures that are appropriate in the circumstances. Undersection 143(3)(i) of the Companies Act 2013 we are also responsible for expressing ouropinion on whether the company has adequate internal financial controls system in placeand 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 management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto 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.
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.
From the matters communicated with those charged with governance wedetermine 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 public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.
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 of the Companies Act 2013 we give in the 'Annexure A' a statementon the matters specified in paragraphs 3 and 4 of the Order to the extent applicable.
2. As required by Section 143 (3) of the Act we report that:
a) We have sought 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 Balance Sheet the Statement of Profit and Loss and the CashFlow Statement dealt with by this Report are in agreement with the books of account.
d) In our opinion the aforesaid financial statements comply with theIndian Accounting Standards specified under Section 133 of the Act read with Companies(Indian Accounting Standards) Rules 2015.
e) On the basis of the written representations received from thedirectors as on 31st March 2021 taken on record by the Board of Directors none of thedirectors is disqualified as on 31st March 2021 from being appointed as a director interms of 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'.
g) With respect to the matter to be included in the Auditor's Reportunder section 197(16) In our opinion and according to the information and explanationsgiven to us the remuneration paid by the Company to its directors during the current yearis in accordance with the provisions of section 197 of the Act. The remuneration paid toany director is not in excess of the limit laid down under section 197 of the Act. TheMinistry of Corporate Affairs has not prescribed other details under section 197(16) whichare required to be commented upon by us.
h) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 inour opinion and to the best of our information and according to the explanations given tous:
i. The details of pending litigations of the Company have beendisclosed in Note 35 to the financial statements. However no impact of the same has beendetermined on its financial position as the matter is pending before the respectiveauthorities.
ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred to theInvestor Education and Protection Fund by the Company.
The Annexure referred to in paragraph 1 of Our Report on "OtherLegal and Regulatory Requirements"
We report that:
1. a. The company has not maintained records showing full particularsincluding quantitative details and situation of its fixed assets. However the requireddetails have been examined to the extent available in the books of accounts and ledgersmaintained by the company.
b. As explained to us fixed assets have been physically verified bythe management at reasonable intervals; no material discrepancies were noticed on suchverification.
c. The title deeds of immovable properties are held in the name of thecompany.
2. As explained to us inventories have been physically verified duringthe year by the management at reasonable intervals. No material discrepancy was noticed onphysical verification of stocks by the management as compared to book records.
3. According to the information and explanations given to us and onthe basis of our examination of the books of account the Company has not granted anyloans secured or unsecured to companies firms limited liability partnerships or otherparties listed in the register maintained under Section 189 of the Companies Act 2013.Consequently the provisions of clauses iii (a) (b) and (c) of the order are notapplicable to the Company.
4. In respect of loans investments guarantees and securityprovisions of section 185 and 186 of the Companies Act 2013 have been complied with.
5. The company has not accepted any deposits from the public coveredunder sections 73 to 76 of the Companies Act 2013.
6. The company is required to maintain cost records as prescribed undersection 148 of the Companies Act 2013 read with Companies (Cost Records and Audit) Rules2018 for the current financial year. As per the explanation given by the management theaudit of records for the current period is pending.
7. a. According to the records of the company undisputed statutorydues including Provident Fund Investor Education and Protection Fund Employees' StateInsurance Income Tax Goods and Services Tax Sales Tax Service Tax Custom Duty ExciseDuty Value Added Tax Cess and any other statutory dues to the extent applicable havegenerally been regularly deposited with the appropriate authorities. According to theinformation and explanations given to us there were no outstanding statutory dues as on31st of March 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 there isno amount payable in respect of income tax goods and services tax service tax sales taxcustoms duty excise duty value added tax and cess whichever applicable which have notbeen deposited on account of any disputes.
8. In our opinion and according to the information and explanationsgiven by the management we are of the opinion that the Company has not defaulted inrepayment of dues to a financial institution bank government or debenture-holders asapplicable to the company.
9. The company has not raised any money by way of initial public offeror further public offer (including debt instruments) or by way of term loans during theyear.
10. According to the information and explanations given to us wereport that no fraud by the company or any fraud on the Company by its officers oremployees has been noticed or reported during the year.
11. According to the information and explanations given to us wereport that managerial remuneration has been paid in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct.
12. The company is not a Nidhi Company. Therefore clause (xii) of theorder is not applicable to the company.
13. According to the information and explanations given to us alltransactions with the related parties are in compliance with sections 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the FinancialStatements etc. as required by the applicable accounting standards.
14. The company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year underreview.
15. The company has not entered into non-cash transactions withdirectors or persons connected with him.
16. The company is not required to be registered under section 45-IA ofthe Reserve Bank of India Act 1934.
Report on Internal Financial Controls with reference to financialstatements
Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financialreporting of Gujarat Terce Laboratories Limited ("the Company") as of 31st March2021 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 Company's management is responsible for establishing andmaintaining 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 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.
Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") and the Standards on Auditing issued by ICAIand deemed to be prescribed under section 143(10) of the Companies Act 2013 to theextent applicable to an audit of internal financial controls both applicable to an auditof Internal Financial Controls and both issued by the Institute of Chartered Accountantsof India. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence 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. Theprocedures selected depend on the auditor's judgement including the assessment of therisks of material misstatement of the financial statements 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 internal financialcontrols system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A company's internal financial control over financial reporting is aprocess 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 overfinancial reporting includes 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 unauthorized acquisition use or disposition of the company's assets thatcould have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over FinancialReporting
Because of the inherent limitations of internal financial controls overfinancial reporting 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 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 the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31st March 2021 basedon the internal control over financial reporting 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 M. A. Shah & Co. |
|Chartered Accountants |
|FRN: 112630W |
|CA Pa rag Patel |
|Membership No.: 155916 |
|UDIN: 21155916AAAADS8904 |
|Place: Anand |
|Date: 24-06-2021 |