To the Members of Hindustan Everest Tools Limited
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the accompanying Standalone financial statements of Hindustan EverestTools Limited ("the Company") which comprise the Balance sheet as at31-March-20 the Statement of Profit and Loss (including Other Comprehensive Income) theCash Flow Statement and the Statement of Changes in Equityfortheyearthenendedandnotestothefinancialstatements including a summary of significantaccounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS financial statements give the information required by theCompanies Act 2013 as amended ("the Act") in the manner so required and give atrue and fair view in conformity with the accounting principles generally accepted inIndia of the state of affairs its loss including other comprehensive income its cashflows and the changes in equity for the year ended on that date.
Basis for Opinion
We conducted our audit of theInd AS financial statements in accordance with theStandards on Auditing (SAs)as 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 ofEthics'issued by the Institute of Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules thereunder and we have fulfilled our other ethical inaccordance with these requirements and the Code of Ethics. We believe that the auditevidence we have obtained is appropriate to provide a basis for our audit opinion on theInd AS financial statements.
Emphasis of Matter - Material Uncertainty Related to Going Concern
We draw attention to note 21 to the standalone financial statements explainingin detail the management's plan to identify a new business subsequent to closure of theCompany's only manufacturing unit and the ability of the Company to continue as a goingconcern. The conditions that exist after closure of the only manufacturing plant of theCompany cast a significant doubt on the ability of the Company to continue as a goingconcern. Our opinion is not qualified in respect of this matter.
Key Audit Matters
Except for the matter described in the Material Uncertainty Related to Going Concernsection above we have determined that there are no other key audit matters to communicatein our report.
Information Other than the Financial Statements and Auditor's Report Thereon
The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Annual report but does not includethe standalone financial statements and our auditor's report thereon. The Annual Report isexpected to be made available to us after the date of this auditor's report Our opinion onthe standalone financial statements does not cover the other information conclusionthereon. In connection with our audit of the standalone financial statements ourresponsibility is to read the other information identified above when it becomes availableand in doing so consider whether such other information is materially inconsistent withthe financial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated. When we read the Annual Report If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact to those charged with governance.
Responsibilities of Management for the Standalone Financial 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 specified under section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 as amended. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and the design implementationand maintenance of adequate internal financial controls that were operating effectivelyfor ensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the standalone financial statements that give a true andfair view and are free from material misstatement whether due to fraud or .
In preparing the standalone 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 charged with governance are also responsible foroverseeing the Company's financial reporting process
Auditor's Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalonefinancial material misstatement whether due to fraud or error and to issue an auditor'sreport that includes our opinion. Reasonable assurance is a high level of assurance butis not a guarantee that an audit conducted in accordance with SAs will always detect amaterial misstatement when it exists. Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they could reasonably beexpected to influencethe economic decisions of users taken on the basis of thesestandalone 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 theInd AS financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is to provide a basis for our opinion. Therisk of not detecting a material misstatement resulting from fraud is higher than for oneresulting from error as fraud may involve collusion forgery intentional omissionsmisrepresentations 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 theAct we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls system in place and the operating effectiveness ofsuch 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 standalone financialstatements including the disclosures and whether the standalone financial statementsrepresent the underlying transactions and events fair presentation.
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 alsoprovide those charged with governance with a statement that we have complied with relevantethical requirements regarding independence and to communicate with them allrelationships 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 statementsfor the financial year ended 31-March-20 and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.
Report on Other Legal and Regulatory Requirements
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 1"a statement on the matters specifiedin paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act 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 Balance Sheet the Statement of Profit and Loss(including Other ComprehensiveIncome) the Cash Flow Statement and Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account;
(d) In our opinion the aforesaid standalonefinancial statements comply with theAccounting Standards specified under Section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended;
(e) On the basis of the written representations received from the directors as on31-March-20 taken on record by the Board of Directors none of the directors isdisqualified as on 31-March-20 from being appointed as a director in terms of Section 164(2) of the Act;
(f) With respect to the adequacy of the internal financial controls over financialreporting of the Company with reference to these standalone financial statements and theoperating effectiveness of such controls refer to our separate Report in" Annexure2" to this report;
(g) In our opinion the managerial remuneration for the year ended 31-March-20 has beenpaid by the Company to its directors in accordance with the provisions of section 197 readwith Schedule V to the Act;
(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 to 21 (b)(iv) the financialstatements;
II. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses; and III. There were no amounts whichwere required to be transferred to the Investor Education and Protection Fund by theCompany.
For SSRA & Co.
Firm Registration Number: 014266N
Membership Number: 093711
Place: New Delhi
ANNEXURE 1 TO THE INDEPENDENT AUDITOR'S REPORT
[Referred to in paragraph 1 under Report on Other Legal and RegulatoryRequirements' in the Independent Auditor's Report of even date to the members of HindustanEverest Tools Limited on the standalone financial statements for the year ended31-March-20.]
(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of property plant and equipment. Further refer note21 related to discontinued operations.
(b) During the year the property plant and equipment of the Company have beenphysically verified by the management and as informed no material discrepancies werenoticed on such verification. In our opinion the frequency of verification is reasonablehaving regard to the size of the Company and the nature of its assets. Further refer note21 related to discontinued operations.
(c) The title deeds of immovable properties recorded as property plant and equipmentin the books of account of the Company are held in the name of the Company. Further refernote 21 related to discontinued operations. (ii) The Company does not hold any inventory(refer note 21 related to discontinued operations). Accordingly the provisions ofparagraph 3 (ii) of the Order are not applicable to the Company.
(iii) Based on information and explanation given to us the Company has not grantedany loans secured or unsecured to companies firms Limited Liability Partnerships orother parties covered in the register maintained under Section 189 of the Act.Accordingly the provisions of paragraph 3 (iii)(a) 3 (iii)(b) and 3 (iii)(c) of theOrder are not applicable to the Company.
(iv) Based on information and explanation given to us the Company has not givenguarantees or securities for loan taken by others and has not given any loans.Accordingly provisions of paragraph 3 (iv) of the Order insofar related to loanssecurities and guarantees are not applicable to the Company. Further the Company hascomplied with the provisions of Section 186 of the Act in respect of investments made bythe Company in securities of other body corporates. (v) In our opinion and according tothe information and explanations given to us the Company has not accepted any depositsfrom the public within the provisions of Sections 73 to 76 of the Act and the rules framedthere under. Accordingly the provisions of paragraph 3 (v) of the Order are notapplicable to the Company.
(vi) The Central Government has not prescribed the maintenance of cost records for anyof the products of the Company under sub-section (1) of Section 148 of the Act and therules framed there under. Accordingly the provisions of paragraph 3 (vi) of the Order arenot applicable to the Company.
(vii) (a) The Company is generally regular in depositing with appropriate authoritiesundisputed statutory dues including goods and services tax provident fund employees'state insurance income tax sales tax service tax value added tax customs duty exciseduty cess and any other material statutory dues as applicable to it though there wereslight delays in few cases. However there were no undisputed statutory dues as at theyear end outstanding for a period more than six months from the date they became payable.
(b) According to the information and explanation given to us there are no dues withrespect to income tax sales tax service tax value added tax customs duty excise dutyand goods & service tax which have not been deposited on account of any dispute.
(viii) In our opinion and according to the information and explanations given to usthe Company has not borrowed any funds from financialinstitutions or raised any fundsthrough issue of debentures. Accordingly the provisions of paragraph 3 (viii) of theOrder are not applicable to the Company.
(ix) The Company has neither raised money by way of public issue offer nor has obtainedany term loans. Accordingly provisions of paragraph 3(ix) of the Order are not applicableto the Company.
(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come employeesnoticed or reported acrossanyinstance of fraud by theCompanyoranyfraudontheCompanybyitsofficers during the year nor have we been informed ofany such instance by the management.
(xi) According to the information and explanations given to us managerial remunerationhas been paid in accordance with the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Act.
(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly provisions of paragraph 3(xii) of the Orderare not applicable to the Company.
(xiii) According to the information and explanation given to us all transactionsentered into by the Company with the related parties are in compliance with Sections 177and 188 of Act where applicable and the details have been disclosed in the Financial
Statements etc. as required by the applicable accounting standards.
(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review.Accordingly provisions of paragraph 3(xiv) of the Order are not applicable to theCompany. (xv) According to the information and explanations given to us the Company hasnot entered into any non-cash transactions with directors or persons connected with himduring the year. (xvi) According to the information and explanation given to us theCompany is not required to be registered under Section 45-IA of the Reserve Bank of IndiaAct 1934.
For SSRA & Co. Chartered Accountants
Firm Registration No. 014266N
Membership No. 093711 UDIN: 20093711AAAACY3552 Place: New Delhi Date: 31-July-20
ANNEXURE 2 TO THE INDEPENDENT AUDITOR'S REPORT
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")
To the Members of Hindustan Everest Tools Limited
We have audited the internal financial controls over financial reporting of HindustanEverest Tools Limited as of 31-March-20 in conjunction with our audit of the standalonefinancial 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 andmaintaininginternalfinancialcontrols 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 theAct.
Our responsibilityistoexpress financialcontrols over financial opiniontheCompany'sinternal
We conducted our audit in accordance with the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting (the "Guidance Note") and theStandards on Auditing issued by ICAI and deemed to be prescribed under section 143(10) ofthe Act to the extent applicable to an audit of internal financial controls bothapplicable to an audit of Internal Financial Controls and both issued by the Institute ofChartered Accountants of India. Those Standards and the Guidance Note require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.
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 and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgement including the assessment of the risks of materialmisstatement of the financial to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriateCompany's internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A Company's internal financial control over financialreporting is a process designed toprovide 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 overfinancialreporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of thecompany's assets that could have a material 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 financialcontrol overfinancialreporting may become inadequate because of changes in conditions orthat the degree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31-March-20 based on thecriteria for the internal control over financial reporting 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.
We also have audited in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India as specified under section 143(10) of theAct the standalone financial statements of the Company which comprise the Balance Sheetas at 31-March-20 and the related Statement of Profit and Loss and Cash Flow Statementfor the year then ended and a summary of significant accounting policies and otherexplanatory information and our report dated 31-July-20 expressed an unmodified opinion.
For SSRA & Co. Chartered Accountants
Firm Registration Number: 014266N
Suresh Goyal Partner
Membership Number: 093711 UDIN: 20093711AAAACY3552 Place: New Delhi Date: 31-July-20