The Members of KG Petrochem Limited
Report on the Audit of the Financial Statements Opinion
We have audited the accompanying financial statements of KG PetrochemLimited ("the Company") which comprise the Balance Sheet as at 31st March 2022the Statement of Profit and Loss (including Other Comprehensive Income) the Statement ofChanges in Equity and the Statement of Cash Flow for the year ended on that date and notesto the financial statements including a summary of significant accounting policies andother 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 Companies Act 2013 ("the Act") in the manner so required and give a trueand fair view in conformity with the Indian Accounting Standards prescribed underSection133 of the Companies Act 2013 read with the Companies (Indian AccountingStandards) Rules 2015 as amended ("IND AS") and other accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 312022its profit including other comprehensive income changes in equity and its cash flows forthe year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing(SAs) specified under section 143(10) of the Companies Act 2013. Our responsibilitiesunder those Standards are further described in the "Auditor's Responsibilities forthe Audit of the Financial Statements" section of our report. We are independent ofthe Company in accordance with the Code of Ethics issued by the Institute of CharteredAccountants of India (ICAI) together with the ethical requirements that are relevant toour audit of the financial statements under the provisions of the Companies Act 2013 andthe Rules there under 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 our auditopinion on the Financial Statements.
Key Audit Matters
We have determined that there are no key audit matters to communicatein our report. [Except for the matter described in the Basis for Opinion section]
Information other than the Financial Statements and Auditor's Reportthereon
The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the AnnualReport but does not include the financial statements and our auditor's report thereon.The Annual Report is expected to be made available to us after the date of this auditor'sreport.
Our opinion on the financial statements does not cover the otherinformation and we will not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements ourresponsibility is to read the other information identified above when it becomes availableand in doing so consider whether the 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 we conclude that there is a materialmisstatement therein we are required to communicate the matter to those charged withgovernance.
On audit report date we have nothing to report in this regard becausethe annual report is expected to be made available to us after the date of this auditor'sreport.
Management's Responsibility for the 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 total comprehensive income changes in equity and cashflows of the Company in accordance with the Ind AS and other accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) specifiedunder Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules2015 as amended. This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding of the assets of theCompany and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation of thefinancial statement that give a true and fair view and are free from material misstatementwhether 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 charged with governance are 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 detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in the aggregatethey could reasonably be expected to influence the economic decisions of users taken onthe basis 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 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.
Materiality is the magnitude of misstatements in the financialstatements that individually or in aggregate makes it probable that the economic decisionsof a reasonably knowledgeable user of the financial statements may be influenced. Weconsider quantitative materiality and qualitative factors in (i) planning the scope of ouraudit work and (ii) to evaluate the effect of any identified misstatements in thefinancial statements.
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
As required by the Companies (Auditor's Report) Order 2020 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Companies Act 2013 we give in the "Annexure A" statement onthe matters specified in paragraphs 3 and 4 of the Order to the extent applicable.
1. 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 (including OtherComprehensive Income) Statement of Changes in Equity and the Statement of Cash Flowsdealt 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 Rule 7 of theCompanies (Accounts) Rules 2014.
e. On the basis of the written representations received from thedirectors as on 31st March 2022 taken on record by the Board of Directors none of thedirector is disqualified as on 31st March 2022 from being appointed as a director in termsof Section164 (2) of the Act.
f. With respect to the adequacy of the internal financial controls overfinancial reporting of the Company and the operating effectiveness of such controls referto our separate Report in "Annexure B".
g. In our opinion and to the best of our information and according tothe explanation given to us the remuneration paid by the Company to its directors duringthe year is in accordance with the provisions of Section 197 read with Schedule V to theAct.
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 Company has disclosed the impact of pending litigations on itsfinancial positions in its financial statements - Refer note 45 to the financialstatements.
ii. The Company has made provision as required under the applicable lawor accounting standards for material foreseeable losses if any on long-term contractsincluding derivative contracts.
iii. There were no amounts which were required to be transferred to theInvestor Education and Protection Fund by the Company.
iv. (a) The Management has represented that to the best of itsknowledge and belief other than as disclosed in the notes to the accounts no funds(which are material either individually or in the aggregate) have been advanced or loanedor invested (either from borrowed funds or share premium or any other sources or kind offunds) by the Company to or in any other person(s) or entity(ies) including foreignentities ("Intermediaries") with the understanding whether recorded in writingor otherwise that the Intermediary shall directly or indirectly lend or invest in otherpersons or entities identified in any manner whatsoever by or on behalf of the Company("Ultimate Beneficiaries") or provide any guarantee security or the like onbehalf of the Ultimate Beneficiaries.
(b) The Management has represented that to the best of its knowledgeand belief other than as disclosed in the notes to accounts no funds (which are materialeither individually or in the aggregate) have been received by the Company from anyperson(s) or entity(ies) including foreign entities ("Funding Parties") withthe understanding whether recorded in writing or otherwise that the Company shalldirectly or indirectly lend or invest in other persons or entities identified in anymanner whatsoever by or on behalf of the Funding Party ("UltimateBeneficiaries") or provide any guarantee security or the like on behalf of theUltimate Beneficiaries.
(c) Based on the audit procedures that has been considered reasonableand appropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the representations under sub-clause (i) and (ii) of Rule 11(e) as providedunder (a) and (b) above contain any material misstatement.
v. The Company has not declared or paid any dividend during the yearand has not proposed final dividend for the year.
|Place: Jaipur ||For R Sogani & Associates |
|Date: 25.05.2022 ||Chartered Accountants |
| ||FRN: 018755C |
| ||Sd/- |
| ||(Bharat Sonkhiya) |
| ||Partner |
|UDIN: 22403023AJPLWI7372 ||Membership No.: 403023 |
ANNEXURE - A REFERRED TO IN THE INDEPENDENT AUDITOR'S REPORT ON THEACCOUNTS OF KG PETROCHEM LIMITED FOR THE YEAR ENDING 31 MARCH 2022
As required by the Companies (Auditor's report) Order 2020 issued bythe Central Government of India in terms of section 143(11) of the Companies Act 2013 wereport that:
i. In respect of the Company's Property Plant and Equipment andIntangible Assets:
(a) (A) The Company is under process of finalization of records showingfull particulars including quantitative details and situation of Property Plant andEquipment and relevant details of right-of-use assets.
(B) The Company does not have any intangible assets and hencereporting under clause3(i)(a) (B) of the Order is not applicable.
(b) The Company has a program of physical verification of PropertyPlant and Equipment and right-of-use assets so to cover all the assets once in a yearwhich in our opinion is reasonable having regard to the size of the Company and thenature of its assets. Pursuant to the program certain Property Plant and Equipment weredue for verification during the year and were physically verified by the Management duringthe year. According to the information and explanations given to us no materialdiscrepancies were noticed on such verification.
(c) Based on our examination of the property tax receipts and leaseagreement for land on which building is constructed registered sale deed / transfer deed/ conveyance deed provided to us we report that the title in respect of self-constructedbuildings and title deeds of all other immovable properties (other than properties wherethe company is the lessee and the lease agreements are duly executed in favour of thelessee) disclosed in the financial statements are held in the name of the Company as atthe balance sheet date.
(d) The Company has not revalued any of its Property Plant andEquipment (including right- of-use assets) and intangible assets during the year.
(e) No proceedings have been initiated during the year or are pendingagainst the Company as at March 31 2022 for holding any benami property under the BenamiTransactions (Prohibition) Act 1988 (as amended in 2016) and rules made thereunder.
ii. (a) The inventory were physically verified by the management atregular intervals during the year. In our opinion and according to the information andexplanations given to us the coverage and procedure of such verification by theManagement is appropriate having regard to the size of the Company and the nature of itsoperations.
(b) The Company has been sanctioned working capital limits in excess offive crore rupees in aggregate during the year from banks or financial institutions onthe basis of security of current assets. The quarterly returns or statements filed by theCompany with such banks or financial statements are not in agreement with the books ofaccount of the Company. Details are as under:
(Amount in Lakhs)
|Quarter ||Name of Bank ||Particulars of security provided ||Amount as per books of accounts ||Amount as reported in the quarterly return/ statement ||Amount of Difference ||Reasons for Material Discrepancies |
| || ||Raw Material ||3661.66 ||3236.48 ||425.18 ||There are some deviations in Inventory and the reasons are based on the remarks given in Balance sheet and based on the records they are duly reconciled. |
|Apr-21 to Jun-21 ||SBI/HDFC/ AXIS ||Work In process ||2691.87 ||1862.12 ||829.75 || |
| || ||Finished Goods ||972.76 ||1178.49 ||-205.73 || |
| || ||Total Stock ||7326.29 ||6277.09 ||1049.20 || |
| || ||Raw Material ||3676.61 ||3216.92 ||459.69 || |
|Jul-21 to Sep-21 ||SBI/HDFC/ AXIS ||Work In process ||3121.53 ||2204.87 ||916.66 || |
| || ||Finished Goods ||1688.97 ||1640.91 ||48.06 || |
| || ||Total Stock ||8487.12 ||7062.70 ||1424.42 || |
| || ||Raw Material ||3922.00 ||3539.67 ||382.33 || |
|Oct-21 to Dec-21 ||SBI/HDFC/ AXIS ||Work In process ||3898.37 ||2682.02 ||1216.35 || |
| || ||Finished Goods ||1458.76 ||1387.62 ||71.15 || |
| || ||Total Stock ||9279.13 ||7609.31 ||1669.82 || |
| || ||Raw Material ||3330.16 ||3203.71 ||126.45 || |
|Jan-22 to Mar-22 ||SBI/HDFC/ AXIS ||Work In process ||3467.32 ||3454.19 ||13.13 || |
| || ||Finished Goods ||1151.72 ||1203.72 ||-52.00 || |
| || ||Total Stock ||7949.20 ||7861.62 ||87.58 || |
(b) Trade Recievables
(Amount in Lakhs)
|Quarter ||Name of Bank ||Amount as per books of accounts ||Amount as reported in the quarterly return/ statement ||Amount of Difference ||Reasons for Material Discrepancies |
|Apr-21 to Jun-21 ||SBI/HDFC/AXIS ||6991.59 ||6887.48 ||104.11 ||There are some deviations in Trade |
|Jul-21 to Sep-21 ||SBI/HDFC/AXIS ||7556.39 ||7462.31 ||94.08 ||receivables and the reasons are based on |
|Oct-21 to Dec-21 ||SBI/HDFC/AXIS ||7581.33 ||7563.11 ||18.22 ||the remarks given in Balance sheet and based on the records |
|Jan-22 to Mar-22 ||SBI/HDFC/AXIS ||8348.02 ||8426.35 ||-78.33 ||they are duly reconciled. |
iii. The Company has made investments in but not provided anyguarantee or security or granted any loans or advances in the nature of loans secured orunsecured to companies firms Limited Liability Partnerships or any other partiesduring the year in respect of which:
(a) The Company has not provided any loans or advances in the nature ofloans secured or unsecured to companies firms Limited Liability Partnerships or anyother parties during the year and hence reporting under clause 3(iii)(a) (c) (d) (e)and (f) of the Order is not applicable to the Company.
(b) In our opinion the investments made during the year are primafacie not prejudicial to the interest of the Company.
iv. The Company has complied with the provisions of Section 185 and 186of the Companies Act 2013 in respect of loans granted investments made and guaranteesand securities provided as applicable.
v. The Company has not accepted any deposits or amounts which aredeemed to be deposits. Hence reporting under clause 3(v) of the Order is not applicable.
vi. The maintenance of cost records has not been specified by theCentral Government under subsection (1) of section 148 of the Companies Act 2013 for theperiod under review. Hence reporting under clause 3(vi) of the Order is not applicable tothe Company.
vii. In respect of statutory dues:
(a) In our opinion the Company has generally been regular indepositing undisputed statutory dues including Goods and Services tax Provident FundEmployees' State Insurance Income Tax Sales Tax Service Tax duty of Custom duty ofExcise Value Added Tax Cess and other material statutory dues applicable to it withappropriate authorities.
There were no undisputed amounts payable in respect of Goods andServices tax Provident Fund Employees' State Insurance Income Tax Sales Tax ServiceTax duty of Custom duty of Excise Value Added Tax Cess and other material statutory inarrears as at March 31 2022 for a period of more than six months from the date theybecame payable.
(b) Details of statutory dues referred to in sub-clause (a) above whichhave not been deposited as on March 31 2022 on account of disputes are given below:
| ||Amount (in Rs.) ||Period to which the amount relates ||Forum where dispute is pending |
|Civil Suit against the Company ||1375622 (including interest) ||F.Y. 2009-10 ||Bombay High Court |
|Service Tax ||2300456 (including Edu cess @ 2% and S&HE Cess @ 1%) ||F.Y. 2014-15 ||Central Goods and Services Tax Division-A Jaipur |
|Service Tax ||1937087 (including SBC @ 0.5% and KKK @ 0.5%) ||F.Y. 2014-15 ||Central Goods and Services Tax Division-A Jaipur |
|Income Tax Demand ||1216832 (including interest) ||A.Y. 2018-19 ||Income Tax Department |
viii. There were no transactions relating to previously unrecordedincome that have been surrendered or disclosed as income during the year in the taxassessments under the Income Tax Act 1961 (43 of 1961).
ix. In respect of repayment of dues:
(a) The Company has not defaulted in repayment of loans or otherborrowings or in the payment of interest thereon to any lender.
(b) According to the information and explainations given to us wereport that the Company has not been declared wilful defaulter by any bank or financialinstitution or government or any government authority or any other lender.
(c) According to the information and explanations given to us theCompany has utilized the money obtained by way of term loans during the year for thepurposes for which they were obtained.
(d) According to the information and explanations given to us on anoverall examination of the financial statements of the Company we report that no fundsraised on short-term basis have been used for long-term purposes by the Company.
(e) The Company do not have subsidiaries associates or joint venturesand hence reporting under clause 3(ix)(e) of the Order is not applicable to the Company.
(f) The Company do not have subsidiaries associates or joint venturesand hence reporting under clause 3(ix)(f) of the Order is not applicable to the Company.
x. (a) The Company has not raised moneys by way of initial public offeror further public offer (including debt instruments) during the year and hence reportingunder clause 3(x)(a) of the Order is not applicable.
(c) During the year the Company has not made any preferentialallotment or private placement of shares or convertible debentures (fully or partly oroptionally convertible) and hence reporting under clause 3(x)(b) of the Order is notapplicable.
xi. (a) According to the information and explanations given to us nomaterial fraud by the Company or fraud on the Company has been noticed or reported duringthe year.
(b) No report under sub-section (12) of section 143 of the CompaniesAct has been filed by the auditors in Form ADT-4 as prescribed under rule 13 of Companies(Audit and Auditors) Rules 2014 with the Central Government during the year and upto thedate of this report.
(c) No whistle-blower complaints have been received by the Companyduring the year.
xii. The Company is not a Nidhi Company and hence reporting underclause 3(xii) of the Order is not applicable.
xiii. In our opinion the Company is in compliance with Section 177 and188 of the Companies Act 2013 with respect to the applicable transactions with therelated parties and the details of related party transactions have been disclosed in thefinancial statements as required by the applicable accounting standards.
xiv. (a) In our opinion the Company has an internal audit system butthere is a substantial scope of improvement in terms of coverage of reporting and incompliance by the Company of internal audit.
(b) We have considered the internal audit reports for the year underaudit issued to the Company during the year and till date in determining the naturetiming and extent of our audit procedures.
xv. In our opinion the Company has not entered into any non-cashtransactions with its Directors or persons connected with its directors and henceprovisions of section 192 of the Companies Act 2013 are not applicable to the Company.
xvi. The Company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934 and hence reporting under clause 3(xvi) of theOrder is not applicable.
xvii. The Company has not incurred cash losses during the currentfinancial year covered by our audit and in the immediately preceding financial year.
xviii. There has not been resignation of the statutory auditors duringthe year.
xix. On the basis of the financial ratios ageing and expected dates ofrealisation of financial assets and payment of financial liabilities other informationaccompanying the financial statements and our knowledge of the Board of Directors andManagement plans and based on our examination of the evidence supporting the assumptionsnothing has come to our attention which causes us to believe that any materialuncertainity exists as on the date of the audit report indicating that Company is notcapable of meeting its liabilities existing at the date of balance sheet as and when theyfall due within a period of one year from the balance sheet date.
We however state that our reporting is based on the facts up to thedate of the audit report and we neither give any guarantee nor any assurance that allliabilities falling due within a period of one year from the balance sheet date will getdischarged by the Company as and when they fall due.
xx. There are no unspent amounts towards Corporate SocialResponsibility (CSR) under subsection (5) of Section 135 of the Companies Act as on thebalance sheet date. Hence reporting under clause 3(xx)(a) (b) of the Order is notapplicable for the year.
|Place: Jaipur ||For R Sogani & Associates |
|Date: 25.05.2022 ||Chartered Accountants |
| ||FRN: 018755C |
| ||Sd/- |
| ||(Bharat Sonkhiya) |
| ||Partner |
|UDIN: 22403023AJPLWI7372 ||Membership No.: 403023 |
ANNEXURE - B TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THEFINANCIAL STATEMENTS OF KG PETROCHEM LIMITED
Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financialreporting of KG Petrochem Limited ("the Company") as of March 31 2022 inconjunction with our audit of the financial statements of the Company for the year endedon 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 respective Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and timely preparation of reliablefinancial information 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 ICAI anddeemed to be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. 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 judgment including the assessment of the risksof 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:
1) Pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of theCompany;
2) 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 are beingmade only in accordance with authorizations of management and directors of the Company;and
3) 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 management overrideof controls 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.
In our opinion the Company has in all material respects judging by thenature and quantum of transactions appearing in the financial statements an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at March 31 2022 based onthe 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.
Broadly the Company is having most of the system in place as requiredfor the compliance of Internal Financial Control on Financial Reporting. However thosesystems or controls are having scope of further improvement. Also Company has notdocumented adequately the internal financial controls based on Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India. Based on our audit procedures we are of the opinion that Companyhas rectified all observations of our audit on internal financial controls over financialreporting to ensure that they do not significantly affect financial reporting on InternalFinancial Control as on Balance Sheet date.
| ||For R Sogani & Associates |
|Place: Jaipur ||Chartered Accountants |
|Date: 25.05.2022 ||FRN:018755C |
| ||Sd/- |
| ||(Bharat Sonkhiya) |
| ||Partner |
|UDIN: 22403023AJPLWI7372 ||Membership No.: 403023 |