The Members of
Kriti Nutrients Limited
Report on the Audit of the Financial Statements
1. We have audited the accompanying financial statements of KRITINUTRIENTS LIMITED which comprise the Balance Sheet as at 31 March 2022 the Statement ofProfit and Loss the Statement of Changes in Equity and the Statement of Cash Flow on thatdate a summary of the significant accounting policies and other explanatory information.
2. In our opinion and to the best of our information and according tothe explanations given to us the aforesaid financial statements give the informationrequired by the Companies Act 2013 (the 'Act') in the manner so required and give a trueand fair view in conformity with the accounting standards prescribed under section 133 ofthe Act read with the Companies (Accounting Standards) Rules 2015 as amended and theother accounting principles generally accepted in India of the state of affairs of theCompany as at 31 March 2022 the Profit and other comprehensive income the changes inequity and its cash flows for the year ended on that date.
Basis for Opinion
3. 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 for theAudit of the Financial Statements section of our report. We are independent of the Companyin accordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia ('ICAI') together with the independence 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
4. Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of the financial statements of thecurrent period. These matters were addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters.
5. We have determined the matters described below to be the key auditmatters to be communicated in our report.
Provisions and Contingent liabilities in respect of certain litigationsof Assessment of Direct and Indirect Taxes and related to leasehold land of factorybuilding not acknowledged as debt. (Note No. 36 read with Note No. 4.8 to the financialstatements):
|Key Audit Matter ||Auditor's Response |
|The Company has material uncertain tax positions including other matters under dispute which involves significant judgment to determine the possible outcome of these disputes. The Company's assessment is supported by the facts of matter their own judgment past experience and advices from legal and independent tax consultants wherever considered necessary. Accordingly unexpected adverse outcomes may significantly impact the Company's reported profit and the Balance Sheet. ||Our audit approach involved :- |
|We determined the above area as a Key Audit Matter in view of associated uncertainty relating to the outcome of these matters. ||a. Understanding the current status of the litigations/tax assessments; |
| ||b. Examining communication received from various Tax Authorities/ Judicial forums and follow up action thereon; |
| ||c. Evaluating the merit of the subject matter under consideration with reference to available independent legal / tax advice; and |
| ||d. Review and analysis of evaluation of the contentions of the Company through discussions collection of details of the subject matter under consideration and the likely outcome. |
Information other than the Financial Statements and Auditor's Reportthereon
6. The Company's Management and Board of Directors are responsible forthe preparation of the other information and presentation of its report (Hereinaftercalled as "Board Report") which comprises various information required underSection 134(3) of the Companies Act 2013. However our opinion on the financialstatements does not cover other information and we do not express any form of assuranceconclusion thereon.
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the financial statements or ourknowledge obtained in the audit or otherwise appears to be materially misstated. If basedon the work we have performed we conclude that there is a material misstatement of thisother information we are required to report that fact. We have nothing to report in thisregard.
Management's and Board of Directors' Responsibility for the FinancialStatements
7. The Company's Management and Board of Directors are responsible forthe matters stated in Section 134(5) of the Companies Act 2013 ("The Act") withrespect to the preparation of these standalone financial statements that give a true andfair view of the financial position financial performance and cash flows of the Companyin accordance with the accounting principles generally accepted in India including theIndian Accounting Standards prescribed under Section 133 of the Act. This responsibilityalso includes maintenance of adequate accounting records in accordance with the provisionsof the Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.
8. 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.
9. Those Board of Directors are responsible for overseeing theCompany's financial reporting process. Auditor's Responsibilities for the Audit of theFinancial Statements
10. Our responsibility is to express an opinion on these standalonefinancial statements based on our report. In conducting our audit we have taken intoaccount the provisions of the act: the accounting and auditing standards and matter whichare required to be included in audit report under the provisions of the Act and Rules madethereunder.
11. 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 Standards on Auditing will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these financial statements.
12. As part of an audit in accordance with Standards on Auditing weexercise professional judgment and maintain professional skepticism throughout the audit.We also:
Identify and assess the risks of material misstatement of thefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.
Obtain an understanding of internal control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances butnot for the purpose of expressing an opinion on the effectiveness of the company'sinternal control systems.
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.
13. 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.
14. We also provide those charged with governance with a statement thatwe have 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.
15. From the matters communicated with those charged with governancewe determine 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 should not be communicated in our report because the adverse consequencesof doing so would reasonably be expected to outweigh the public interest benefits of suchcommunication.
Report on Other Legal and Regulatory Requirements
16. As required by the Companies (Auditor's Report) order 2020("the order") issued by the Central Government of India in terms of sub-section(11) of section 143 of the Companies Act 2013 we give in the "annexure A" astatement on the matters specified in paragraphs 3 and 4 of the order to the extentapplicable.
17. 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 havebeen kept by the Company so far as it appears from our examination of those books of theCompany.
(c) The Balance Sheet the Statement of Profit and Loss (includingother comprehensive income) the Statement of Changes in Equity and the Statement of CashFlows dealt with by this Report are in agreement with the books of account.
(d) In our opinion the aforesaid Standalone financial statementscomply with the Indian Accounting Standards specified under Section 133 of the Act.
(e) On the basis of the written representations received from thedirectors as on 31st March 2022 and taken on record by the Board of Directorsnone of the directors is disqualified as on 31st March 2022 from beingappointed as a director in terms of Section 164 (2) of the Act
(f) With respect to the adequacy of the internal financial controlswith reference to financial statements of the Company and the operating effectiveness ofsuch controls refer to our separate Report in "Annexure B'.
(g) 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 if any of pending litigationson its financial position in its Ind AS financial statements - Refer Note- 36 to the IndAS financial statements;
ii. The Company has made provision as required under the applicablelaw or accounting standards for material foreseeable losses if any on long termlong-term contracts including derivative contracts.
iii. There were no amounts which were required to be transferred to theInvestor Education and Protection Fund by the Company.
(h) (i) The management has represented that to the best of itsknowledge and belief no funds have been advanced or loaned or invested (either fromborrowed funds or share premium or any other sources or kind of funds) by the Company toor in any other persons or entities including foreign entities("Intermediaries") with the understanding whether recorded in writing orotherwise that the Intermediary shall:
directly or indirectly lend or invest in other persons orentities identified in any manner whatsoever ("Ultimate Beneficiaries") by or onbehalf of the Company or
provide any guarantee security or the like to or on behalf ofthe Ultimate Beneficiaries.
(ii) The management has represented that to the best of its knowledgeand belief no funds have been received by the Company from any persons or entitiesincluding foreign entities ("Funding Parties") with the understanding whetherrecorded in writing or otherwise that the Company shall:
directly or indirectly lend or invest in other persons orentities identified in any manner whatsoever ("Ultimate Beneficiaries") by or onbehalf of the Funding Party or
provide any guarantee security or the like from or on behalf ofthe Ultimate Beneficiaries.
(iii) Based on such audit procedures as considered reasonable andappropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the representations under subclause (h) (i) and (h) (ii) contain any materialmis-statement.
(i) The Dividend declared or paid during the year by the Company withis in compliance with section 123 of the Act.
18. With respect to the matter to be included in the Auditors' Reportunder section 197(16):
In our opinion and according to the information and explanations givento us and based on our examination of the records of the Company the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandatedby the provisions of section 197 read with Schedule V to the Act.
| ||For M. MEHTA & COMPANY |
| ||Chartered Accountants |
| ||Firm Regn. No. 000957C |
| ||CA Nitin Bandi |
| ||(Partner) |
|Place: Indore ||M.No. 400394 |
|Dated: 30.05.2022 ||UDIN: 22400394AJXBNC1361 |
ANNEXURE A TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE TO THEMEMBERS OF KRITI NUTRIENTS LIMITED ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31MARCH 2022
(i) (a) (A) The company has maintained reasonable records showing fullparticulars including quantitative details and situation of Property Plant andEquipment.
(a) (B) The company has maintained proper records showing fullparticulars of intangible assets;
(b) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company has a regularprogram of verification to cover all the items of Property Plant and Equipment during theyear which in our opinion is reasonable having regard to the size of the Company and thenature of its assets. According to the information and explanations given to us nomaterial discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and onthe basis of records of Company examined by us we report that the title deeds of all theimmovable properties (other than properties where the company is the lessee and the leaseagreements are duly executed in favor of the lessee) disclosed in the financial statementsare held in the name of the company.
(d) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company has not revaluedits Property Plant and equipment (including Right of Use assets) or intangible assets orboth during the year.
(e) According to information and explanations given to us and result ofour audit procedures in our opinion no proceedings have been initiated or are pendingagainst the company for holding any Benami property under the Benami Transactions(Prohibition) Act 1988 (45 of 1988) and rules made thereunder.
(ii) (a) In our opinion and according to the information given to usthe company has maintained proper records of its inventories. No material discrepancieshave been noticed on physical verification of stock.
(b) According to the information and explanations given to us and onthe basis of our examination of the records produced of the company the company has beensanctioned working capital limits in excess of five crore rupees in aggregate from bankson the basis of security of current assets. In our opinion the quarterly returns orstatements filed by the company with such banks are in agreement with the books of accountof the company other than those as set out below.
|Name of Bank ||State Bank of India and HDFC Bank |
|Aggregate working capital limit sanctioned ||2200 |
|Quarter ended ||Amount utilised during the quarter ||Amount Disclosed as per quarterly return/statement ||Amount as per books of account ||Difference (in Lacs) |
|30.06.2021 ||209.60 ||5423.08 ||5540.81 ||(117.73) |
|30.09.2021 ||0.00 ||2578.58 ||2630.03 ||(51.45) |
|31.12.2021 ||937.63 ||9563.87 ||10421.61 ||(857.74) |
|31.03.2022 ||0.00 ||6972.13 ||6972.13 ||- |
(iii) The Company has granted loans to one of its Group company duringthe year.
(a) Loan of RS 1400 Lacs was given during the year. The amount of loanoutstanding as on the Balance sheet Date is RS 2400 Lacs.
(b) The terms and conditions on which loan has been granted is notprejudicial to the company's interest.
(c) According to information and explanation given to us the scheduleof repayment of principal and payment of interest has been stipulated and the repaymentsor receipts are regular.
(d) According to information and explanation given to us no amount ofloan is overdue as at the year end.
(e) No Loan has fallen due during the year and no loan has been renewedor extended or fresh loans granted to settle the overdue of existing loans given to thesame party.
(f) The company has not granted any loans in the nature of loans eitherrepayable on demand or without specifying any terms or period of repayment.
(iv) In our opinion and according to the information and explanationsgiven to us the Company has complied with the requirements of sections 185 and 186 of theCompanies Act in respect of loans given.
(v) According to the information and explanations given to us and basedon our audit procedure the company has not accepted any deposits within the meaning ofsection 73 to 76 of the Act or any other relevant provisions of the companies Act 2013.
(vi) We have broadly reviewed the books of account maintained by thecompany pursuant to the Rules made by the Central Government for the maintenance of costrecords under section 148 of the Act and are of the opinion that prima facie theprescribed accounts and records have been made and maintained."
(vii) (a) According to the information and explanations given to us andon the basis of our examination of the records of the Company amounts deducted / accruedin the books of account in respect of undisputed statutory dues including Goods andServices Tax ('GST') Provident fund Employees' State Insurance Income-Tax Duty ofCustoms Cess and other statutory dues have generally been regularly deposited with theappropriate authorities.
According to the information and explanations given to us noundisputed amounts payable in respect of Goods and Services Tax ('GST') Provident fundEmployees' State Insurance Income-Tax Duty of Customs Cess and other statutory dueswere in arrears as at 31 March 2022 for a period of more than six months from the datethey became payable.
(b) According to the information and explanations given to us thereare no statutory dues relating to Goods and Service Tax Provident Fund Employees StateInsurance Income-Tax Duty of Customs or Cess or other statutory dues which have not beendeposited on account of any dispute except the following: -
|S. No. Name of the Statute (Nature of the Dues) ||Forum where Matter is pending ||Period to which the amounts relate to ||Amount of Demand (in Lacs) ||Amount paid under protest |
|1. M.P. Comm. Tax ||High Court ||2004-05 ||29.99 ||8.46 |
|2. M.P. Comm. Tax ||High Court ||2005-06 ||113.08 ||31.67 |
|3. Entry Tax ||High Court ||2005-06 ||69.89 ||33.91 |
|4. M.P. Comm. Tax ||Assessing Authority ||2006-07 ||12.13 ||5.60 |
|5. Entry Tax ||High Court ||2006-07 ||12.92 ||9.07 |
|6. Central Sales Tax ||High Court ||2006-07 ||127.25 ||13.00 |
|7. Entry Tax ||High Court ||2007-08 ||36.30 ||18.08 |
|9. Entry Tax ||High Court ||2008-09 ||8.89 ||4.98 |
|10. Entry Tax ||High Court ||2008-09 ||27.55 ||12.76 |
|11. M.P. Comm. Tax ||Appellate Board ||2013-14 ||6.78 ||1.70 |
|12. M.P. Comm. Tax ||Additional Commissioner ||2016-17 ||0.97 ||0.24 |
|13. Central Excise ||Commissioner Appeal ||2013-14 ||1.38 ||0.10 |
|14. Central Excise ||CESTAT ||2016-17 ||2.05 ||0.20 |
|15. Income Tax ||CIT Appeal ||2018-19 ||18.61 ||0.00 |
(viii) According to the information and explanations given to us therewas no transaction found unrecorded in the books of accounts of the company which havebeen surrendered or disclosed as income during the year in the tax assessments under theIncome Tax Act 1961 (43 of 1961).
(ix) (a) According to the information and explanations and as verifiedfrom books of accounts the company has not defaulted in repayment of loans or interestthereon to any lender.
(b) According to the information and explanations given to us and onthe basis of our audit procedures we report that the company has not been declaredwillful defaulter by any bank or financial institution or government or any governmentauthority.
(c) In our opinion and according to the information and explanationsgiven to us the company not obtained any term loan during the year. Accordingly clause3(ix)(c) of the order is not applicable.
(d) According to the information and explanations given to us and theprocedures performed by us and on an overall examination of the financial statements ofthe company we report that no funds raised on short-term basis have been used forlong-term purposes by the company.
(e) According to the information and explanations given to us and on anoverall examination of the financial statements of the company we report that the companyhas not taken any funds from any entity or person on account of or to meet the obligationsof its subsidiaries associates or joint ventures. Accordingly clause 3(ix)(e) of theorder is not applicable.
(f) According to the information and explanations given to us andprocedures applied by us we report that the company has not raised loans during the yearon the pledge of securities held in its subsidiaries joint ventures or associatecompanies. Accordingly clause 3(ix)(f) of the order is not applicable.
(x) (a) In our opinion and according to the information andexplanations given to us the company has not raised any amount by way of initial publicoffer/ further public offer (including debt instruments) accordingly clause 3(x)(a) of theOrder is not applicable.
(b) In our opinion and according to the information and explanationsgiven to us the company has not raised funds by way of preferential allotment or privateplacement of shares or convertible debentures (fully partially or optionally convertible)during the year accordingly clause 3(x)(b) of the Order is not applicable.
(xi) (a) During the course of our examination of the books and recordsof the company carried out in accordance with the generally accepted auditing practicesin India and according to the information and explanation given to us we have neithercome across any instance of fraud on or by the company noticed or reported during theyear nor we have been informed of such case by the management.
(b) To the best of our knowledge and information with us there is noinstance of fraud reportable under sub-section (12) of section 143 of the Companies Acthas 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.
(c) As represented to us by the management there are no whistle blowercomplaints received by the Company during the year.
(xii) In our opinion and according to the information and explanationsgiven to us the company is not a Nidhi Company. Accordingly paragraph 3(xii) of the orderis not applicable.
(xiii) According to the information and explanations given to us alltransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where ever applicable and the details have been disclosed in theFinancial Statements etc. as required by the applicable Indian Accounting Standards;
(xiv) (a) In our opinion and based on our examination the company hasan internal audit system commensurate with the size and nature of its business.
(b) We have considered the internal audit reports of the company issuedtill date for the period under audit.
(xv) According to the information and explanations given to us in ouropinion during the year the company has not entered into any non-cash transactions withits directors or persons connected with its directors and hence provisions of section 192of the Companies Act 2013 are not applicable to the company.
(xvi) (a) The Company is not required to be registered under Section45-IA of the Reserve Bank of India Act 1934. Accordingly clause 3(xvi)(a) of the Orderis not applicable.
(b) The Company is not required to be registered under Section 45-IA ofthe Reserve Bank of India Act 1934. Accordingly clause 3(xvi)(b) of the Order is notapplicable.
(c) The Company is not a Core Investment Company (CIC) as defined inthe regulations made by the Reserve Bank of India. Accordingly clause 3(xvi)(c) of theOrder is not applicable.
(d) According to the information and explanations given to us duringthe course of audit the group does not have any CICs accordingly clause 3(xvi) (d) of theorder is not applicable.
(xvii) The Company has not incurred cash loss during the year as wellas in immediately preceding financial year.
(xviii) There has been no resignation of the statutory auditors duringthe year. Accordingly clause 3(xviii) of the Order is not applicable.
(xix) According to the information and explanations given to us and onthe basis of the financial ratios ageing and expected dates of realization of financialassets and payment of financial liabilities other information accompanying the financialstatements our knowledge of the Board of Directors and management plans and based on ourexamination of the evidence supporting the assumptions nothing has come to our attentionwhich causes us to believe that any material uncertainty exists as on the date of theaudit report that company is not capable of meeting its liabilities existing at the dateof balance sheet as and when they fall due within a period of one year from the balancesheet date. We however state that this is not an assurance as to the future viability ofthe company. We further state that our reporting is based on the facts up to the date ofthe audit report and we neither give any guarantee nor any assurance that all liabilitiesfalling due within a period of one year from the balance sheet date will discharged bythe company as and when they fall due.
(xx) (a) There is no unspent amount other than ongoing projects whichwere to be transferred to the funds specified in Schedule VII of the Companies Act'2013 incompliance with second proviso to sub-section (5) of section 135 of the said Act.
(b) The Company has transferred the amount remaining unspent undersubsection (5) of section 135 of the Companies Act pursuant to any ongoing project incompliance with the provision of subsection (6) of section 135 of the said Act.
| ||For M. MEHTA & COMPANY |
| ||Chartered Accountants |
| ||Firm Regn. No. 000957C |
| ||CA Nitin Bandi |
| ||(Partner) |
|Place: Indore ||M.No. 400394 |
|Dated: 30.05.2022 ||UDIN: 22400394AJXBNC1361 |
ANNEXURE B TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE TO THEMEMBERS OF KRITI NUTRIENTS LIMITED ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31MARCH 2022
Annexure - B
Report on the internal financial controls with reference to theaforesaid financial statements under Clause (i) of Sub-section 3 of Section 143 of theCompanies Act 2013 (Referred to in paragraph 2(A)(f) under 'Report on Other Legal andRegulatory Requirements' section of our report of even date)
We have audited the internal financial controls over financialreporting of KRITI NUTRIENTS LIMITED ("the Company") as of March 31 2022 inconjunction with our audit of the standalone financial statements of the Company for theyear ended on that date.
In our opinion the Company has in all material respects adequateinternal financial controls with reference to financial statements and such internalfinancial controls were operating effectively as at 31 March 2022 based on the internalfinancial controls with reference to financial statements criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India (the "Guidance Note').
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 (the "Guidance Note") issued by the Institute of CharteredAccountants of India (ICAI). 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 toCompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial 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 and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act'2013 to the extent applicableto an audit of internal financial controls both applicable to an audit of InternalFinancial Controls and both issued by ICAI. Those Standards and the Guidance Note requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in allmaterial 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 therisks of material misstatement of the financial statements whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A Company's internal financial control over financial reporting is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A Company's internal financial control overfinancial reporting includes those policies and procedures that
(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 arebeing made only in accordance with authorizations of management and directors of theCompany; 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 managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.
| || |
For M. MEHTA & COMPANY
| || |
| || |
Firm Regn. No. 000957C
| || |
CA Nitin Bandi
| || |