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Karda Constructions Ltd.

BSE: 541161 Sector: Infrastructure
NSE: KARDA ISIN Code: INE278R01034
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OPEN 17.25
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VOLUME 3775662
52-Week high 23.90
52-Week low 8.10
P/E 44.50
Mkt Cap.(Rs cr) 1,095
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 17.25
CLOSE 17.15
VOLUME 3775662
52-Week high 23.90
52-Week low 8.10
P/E 44.50
Mkt Cap.(Rs cr) 1,095
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Karda Constructions Ltd. (KARDA) - Auditors Report

Company auditors report

To The Members of Karda Constructions Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the standalone financial statements of KARDA CONSTRUCTIONS LIMITED("the Company") which comprise the Balance Sheet as at March 31 2021 theStatement of Profit and Loss (including Other Comprehensive Income) the Statement ofChanges in Equity and the Statement of Cash Flows for the year ended on that date andnotes to the standalone financial statements including a summary of the significantaccounting policies and other explanatory information (hereinafter referred 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 accounting principles generally accepted in India ofthe state of affairs of the Company as at 31 March 2021 and profit (including othercomprehensive income) changes in equity and its cash flows for the year ended on thatdate.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder Section 143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditor’s Responsibilities section of our report. We are independentof the Company in accordance with the Code of Ethics issued by the Institute of CharteredAccountants of India together with the ethical requirements that are relevant to our auditof the standalone financial statements under the provisions of the Act and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion on thestandalone financial statements.

Key Audit Matters

Key audit matters (‘KAM’) are those matters that in our professionaljudgment were of most significance in our audit of the standalone financial statements ofthe current period. These matters were addressed in the context of our audit of thestandalone financial statements as a whole and in forming our opinion thereon and we donot provide a separate opinion on these matters. We have determined the matters describedbelow to be the key audit matters to be communicated in our report.

The Key Audit Matter How the matter was addressed in our audit
Accuracy of revenue recognition measurement presentation and disclosures as per IndAS 115 "Revenue from Contracts with Customers".
Revenue from sale of residential and commercial units represents 63.54% of the total revenue from operations of the Company. Principle Audit Procedures
Revenue is recognized upon transfer of control of residential and commercial units to customers. The trigger for revenue recognition is normally completion of the project or receipt of approvals on completion from relevant authorities. The Company records revenue over time till the actual possession to the customers or on actual possession to the customers as determined by the terms of contract with customers. ? Evaluating that the Company’s revenue recognition accounting policies are in line with the applicable accounting standards;
Measurement of revenue recorded over time which is dependent on the estimates of the costs to complete ? Identifying the impact on adoption of the new Ind AS 115;
Revenue recognition involves significant estimates related to measurement of costs to complete for the projects. Revenue from projects is recorded based on management’s assessment of the work completed costs incurred and accrued and the estimate of the balance costs to complete. Since revenue recognition has direct impact on the Company’s profitability the element of management bias is likely to be involved. ? Selection of samples of continuing and new contracts with the customers;
Due to the inherent nature of the projects and significant judgment involved in the estimate of costs to complete there is risk of overstatement or understatement of revenue. ? Scrutinizing all the revenue journal entries raised throughout the reporting period and comparing details of a sample of these journals with relevant underlying documentation;
? Conducting site visits during the year for selected projects to understand the scope and nature of the projects and to assess the progress of the projects;
? Testing sample sales of units for projects with the underlying contracts completion status and proceeds received from customers;
? Evaluation of industry wide procedures adopted for the revenue recognition under this standard.
Measurement of revenue recorded over time which is dependent on the estimates of the costs to complete
? Compared on a sample basis revenue transactions recorded during the year with the underlying contracts progress reports invoices raised on customers and collections in bank accounts and whether the related revenue 55 had been recognized in accordance with the Company’s revenue recognition policies;
? Identification and testing operating effectiveness of key controls over recording of actual costs incurred for the projects;
? Sighting approvals for changes in estimated costs with the rationale for the changes and related documentation.
? Comparison of the estimated costs with the costing details as mentioned for registration of the projects with the MahaRERA website.
Valuation of Inventories Assessing the net realisable value
Inventory represents the capitalized project costs to date less amounts expensed on sales by reference to the aforementioned projections. It is held at the lower of cost and net realisable value (NRV) the latter also being based on the forecast for the project. As such inappropriate assumptions in these forecasts can impact the assessment of the carrying value of inventories. Principle Audit Procedures
? Discussion with the management to understand the basis of calculation and justification for the estimated recoverable amounts of the unsold units ("the NRV assessment");
? Evaluating the design and implementation of the Company’s internal controls over the NRV assessment. Our evaluation included assessing whether the NRV assessment was prepared and updated by appropriate personnel of the Company and whether the key estimates including estimated future selling prices and costs of completion for all property development projects used in the NRV assessment were discussed and challenged by management as appropriate;
? Evaluating the management’s valuation methodology and assessing the key estimates data inputs and assumptions adopted in the valuations which included comparing expected future average selling prices with available market data such as recently transacted prices for similar properties located in the nearby vicinity of each property development project and the sales budget plans maintained by the Company;
Tax Assessments
Review effect and presentation of completed tax assessments Principle Audit Procedures
Verification of details of completed tax assessments and demands as at 31st March 2021 followed by verification of tax refunds on completed tax assessments and treatment of the same in books of account and financial statements.

Information Other than the Financial

Statements and Auditor’s Report Thereon

The Company’s Board of Directors are responsible for the other information. Theother information comprises the information included in the Management Discussion andAnalysis Board’s Report including Annexure’s to Board’s Report CorporateGovernance and Shareholder’s Information but does not include the standalonefinancial statements and our auditors’ 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 ouraudit of the standalone financial statements our responsibility is to read the otherinformation and in doing so consider whether the other information is materiallyinconsistent with the standalone financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. 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. We have nothing to report in this regard.

Management’s Responsibility for the Standalone Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) prescribedunder section 133 of the Act. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding 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 standalone Ind AS financial statements that give a true and fair viewand are free from material misstatement whether due 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. Board of Directors is alsoresponsible for overseeing the Company’s financial reporting process.

Auditors’ Responsibility 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 assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these 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 theAct we are also responsible for expressing our opinion on whether the company hasadequate internal financial controls with reference to standalone financial statements inplace and the operating effectiveness 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 basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists 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 standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditors' report. However future events or conditions maycause the Company to cease to continue as a going concern.

? Evaluate the overall presentation structure and content of the standalone financialstatements including the disclosures and whether the standalone financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

Materiality is the magnitude of misstatements in the standalone financial statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the standalone financial statements may be influenced. Weconsider quantitative materiality and qualitative factors in

(i) planning the scope of our audit work and in evaluating the results of our work; and

(ii) to evaluate the effect of any identified misstatements in the standalone financialstatements.

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 auditors’ report unless law or regulation precludes public disclosure aboutthe matter or when in extremely rare circumstances we determine that a matter should notbe communicated in our report because the adverse consequences of doing so wouldreasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors’ Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of Section 143(11) of theAct 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 Balance Sheet the Statement of Profit and Loss including Other ComprehensiveIncome Statement of Changes in Equity and the Statement of Cash Flows dealt with by thisReport are in agreement with the books of account.

d) In our opinion the aforesaid standalone financial statements comply with the IndianAccounting Standard (Ind AS) specified under Section 133 of the Act read with Rule 7 ofthe 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 with reference tofinancial statements of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure B". Our report expresses anunmodified opinion on the adequacy and operating effectiveness of the Company’sinternal financial controls over financial reporting.

g) With respect to the other matters to be included in the Auditors’ Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations as at 31 March 2021 onits financial position in its standalone financial statements - Refer Note 24 to thestandalone financial statements;

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

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company during the year ended 31 March2021;

h) With respect to the matter to be included in the Auditors’ Report under Section197(16) of the Act we report that:

In our opinion and according to the information and explanations given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of Section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act; and the Ministry ofCorporate Affairs has not prescribed other details under Section 197(16) which arerequired to be commented upon by us.

For Sharp Aarth & Co

Chartered Accountants

Firm Registration No 132748W

CA Vipul Lathi

Partner

Membership No.134897

UDIN: 21134897AAAAAY2591

Place: Nasik

Date: May 31 2021

ANNEXURE "A" TO THE INDEPENDENT AUDITORS’ REPORT 31 MARCH 2021

With reference to the Annexure A referred to in the Independent Auditors’ Reportto the members of the Company on the standalone financial statements for the year ended 31March 2021 we report the following:

(i) In respect of Property Plant and Equipments

(a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets including property plant and equipmentand investment properties and investment property under construction.

(b)The Company has a regular programme of physical verification of its property plantand equipment and investment properties by which the property plant and equipment andinvestment properties are verified by the management according to a phased programmedesigned to cover all the items over a period of three years. In our opinion thisperiodicity of physical verification is reasonable having regard to the size of theCompany and the nature of its assets. In accordance with the policy the Company hasphysically verified certain property plant and equipment and investment properties duringthe year and no discrepancies were noticed in respect of assets verified during the year.

(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

In our opinion and according to the information and explanations given to us havingregard to the nature of inventory the physical verification by way of verification oftitle deeds site visits by the management and certification of extent of work completionby competent persons are at reasonable intervals. The Company inventory includesconstruction work in progress accordingly the requirements under paragraph 3(ii) of theOrder is not applicable for construction work in progress. The inventory comprising offinished goods has been physically verified by the management during the year. In ouropinion the frequency of such verification is reasonable. No discrepancies were noticedon verification between the physical stocks and the book records.

(iii) Compliance under section 189 of the Companies Act 2013

As informed by the company company has not granted any loans secured or unsecured tocompanies firms or other parties covered in the register maintained under section 189 ofthe Companies Act 2013.

(a) Company has not granted such loan during the period.

(b)As informed to us the Company has not granted any loans secured or unsecured hencethe question of repayment of loans does not arise. Consequently the said sub clause of theOrder is not applicable to the Company.

(c) As informed to us the Company has not granted any loans secured or unsecuredduring the year under audit hence the question of overdue amount of loans does not arise.Consequently the said sub clause of the Order is not applicable to the Company

(iv) Compliance under section 185 and 186 of The Companies Act 2013

In our opinion and according to the information and explanations given to us and basedon the audit procedures conducted by us the Company has complied with the provisions ofSection 185 and 186 of the Act with respect to loans and investments made by the Company.The Company has not provided any security during the year to the parties covered underSections 185 and 186 of the Act. Accordingly compliance under Section 185 and 186 of theAct in respect of providing securities is not applicable to the Company.

(v) Compliance under section 73 to 76 of The Companies Act 2013 and Rules framed thereunder while accepting Deposits

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 and the provisions of Sections 73 to 76 or any other relevant provisions of the Actand the rules framed there under. Accordingly paragraph 3 (v) of the Order is notapplicable to the Company

(vi) Maintenance of cost records

We have broadly reviewed the books of accounts maintained by the Company pursuant tothe rules prescribed by the Central Government for the maintenance of cost records underSection 148(1) of the Act and are of the opinion that prima facie the prescribed accountsand records have been made and maintained. However we have not made a detailedexamination of the same.

(vii) Deposit of Statutory Dues

(a) According to the information and explanations given to us and on the basis of ourexamination of records of the Company amounts deducted / accrued in the books of accountin respect of undisputed statutory dues including Provident fund Employees’ StateInsurance Goods and Service tax Labour cess Professional tax Property tax Cess andother material statutory dues have been regularly deposited during the year by the Companywith the appropriate authorities. Amounts deducted / accrued in the books of account inrespect of undisputed statutory dues of Income tax have generally been regularly depositedduring the year by the Company with the appropriate authorities though there have beenslight delays in a few cases. As explained to us the Company did not have any dues onaccount of wealth tax.

According to the information and explanations given to us no undisputed amountspayable in respect of Provident fund Employees’ State Insurance Profession taxProperty Tax Labour cess Income-tax Goods and Service tax Cess and other materialstatutory dues were in arrears as at 31 March 2021 for a period of more than six monthsfrom the date they became payable.

(b) According to the information and explanations given to us there are no dues ofIncome-tax Sales tax Service tax Value added tax and Goods and Service tax as at 31March 2021 which have not been deposited with the appropriate authorities on account ofany dispute except as stated below:

(INR in Lakhs)

Name of the statute Nature of the dues Period to which the amount relates Demand Amount Amount Paid Forum where dispute is pending
Income Tax Act 1961 Income Tax A Y 2014- 15 1.50 1.50 Income Tax Appella te Tribuna
Income Tax Act 1961 Income Tax A Y 2015- 16 36.13 36.13 l (ITAT)
Income Tax Act 1961 Income Tax A Y 2015- 16 16.39 - CIT (Appeal)

(viii) Repayment of Loans and Borrowings

In our opinion and according to the information and explanations given to us theCompany has not defaulted during the year in repayment of loans or borrowings to banks orfinancial institutions or dues to debenture holders. The Company does not have any loansor borrowings from government during the year.

(ix) Utilization of Money Raised by Public Offers and Term Loan for which they Raised

The Company has not raised any money by way of initial public offer or further publicoffer (including debt instruments). However the company has raised money by way of termloans during the year. In our opinion and according to the information and explanationsgiven to us the proceeds of term loans have been applied by the Company for the purposesfor which they were raised other than temporary deployment pending application ofproceeds.

(x) Reporting of Fraud During the Period

During the course of our examination of the books and records of the Company carriedout in accordance with the generally accepted auditing practices in India and accordingto the information and explanations given to us we have neither come across any instanceof material fraud by the Company or on the Company by its officers or employees noticedor reported during the year nor have we been informed of any such case by the management.

(xi) Managerial Remuneration

According to the information and explanations given to us and based on our examinationof records of the Company the remuneration paid by the Company to its directors duringthe current year is in accordance with the provisions of Section 197 of the Act. Theremuneration paid to any director is not in excess of the limit laid down under Section197 of the Act.

(xii) Compliance by Nidhi Company Regarding Net Owned Fund to Deposits Ratio

In our opinion and according to the information and explanations given to us theCompany is not a Nidhi company and the Nidhi Rules 2014 are not applicable to it.Accordingly paragraph 3 (xii) of the Order is not applicable to the Company.

(xiii) Related party compliance with Section 177 and 188 of Companies Act 2013

In our opinion and according to the information and explanations given to us theCompany has entered into transactions with related parties in compliance with theprovisions of Sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the standalone financial statements as required byIndian Accounting Standard (Ind AS) 24 Related Party Disclosures specified under Section133 of the Act.

(xiv) Compliance under section 42 of the Companies Act 2013 regarding privateplacement of Shares or Debentures

According to the information and explanations given to us and on the basis of 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 and hence reporting under clause (xiv) of paragraph 3 of the Order is notapplicable to the Company.

(xv) Compliance under section 192 of Companies Act 2013

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

(xvi) Requirement of Registration under 45-IA of Reserve Bank of India Act 1934

In our opinion and according to the information and explanations given to us theCompany is not required to be registered under Section 45-IA of the Reserve Bank of IndiaAct 1934. Accordingly paragraph 3 (xvi) of the Order is not applicable to the Company.

For Sharp Aarth & Co

Chartered Accountants

Firm Registration No 132748W

CA Vipul Lathi

Partner

Membership No.134897

UDIN: 21134897AAAAAY2591

Place: Nasik

Date: May 31 2021

ANNEXURE B TO THE INDEPENDENT AUDITORS’

REPORT 31 MARCH 2021

Report on the Internal Financial Controls with reference to the aforesaid standalonefinancial statements under Clause (i) of Sub-section 3 of Section 143 of the CompaniesAct 2013 ("the Act")

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

Opinion

We have audited the internal financial controls over financial reporting of KARDACONSTRUCTIONS LIMITED ("the Company") as of 31st March 2021 inconjunction with our audit of the standalone Ind AS financial statements of the Companyfor the year ended on that date.

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 as at 31 March 2021 based on "the internalcontrol over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Note on FINANCIAL SECTIONAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India".

Management’s Responsibility for Internal

Financial Controls

The Company’s management and the Board of

Directors are responsible for establishing and maintaining internal financial controlsbased on the internal controls with reference to standalone financial statements criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note. These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence to theCompany’s policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

Auditor’s 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 Act to the extentapplicable to an audit of internal financial controls. Those Standards and the GuidanceNote require that we comply with ethical requirements and plan and perform the audit toobtain reasonable assurance about whether adequate internal financial controls overfinancial reporting was established and maintained and if such controls operatedeffectively 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 controlssystem over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company’s internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company’s internal financial control overfinancial reporting 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 authorizations of management and directors of the company; and

3. Provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company’s assets that could havea 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 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.

For Sharp Aarth & Co

Chartered Accountants

Firm Registration No 132748W

CA Vipul Lathi

Partner

Membership No.134897

UDIN: 21134897AAAAAY2591

Place: Nasik

Date: May 31 2021

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