Mahashree Trading Ltd.
|BSE: 512337||Sector: Financials|
|NSE: N.A.||ISIN Code: INE924T01013|
|BSE 05:30 | 01 Jan||Mahashree Trading Ltd|
|NSE 05:30 | 01 Jan||Mahashree Trading Ltd|
|BSE: 512337||Sector: Financials|
|NSE: N.A.||ISIN Code: INE924T01013|
|BSE 05:30 | 01 Jan||Mahashree Trading Ltd|
|NSE 05:30 | 01 Jan||Mahashree Trading Ltd|
To the Member of MAHASHREE TRADING LIMITED
Report on the Audit of Standalone Financial Statements
We have audited the accompanying Standalone Financial Statements of Mahashree TradingLimited (the Company) which comprises the Balance Sheet as at March 31 2020the Statement of Profit and Loss (including other comprehensive income) Statement of CashFlow and Statement of Changes in Equity for the year then ended and summary of significantaccounting policies and other explanatory information (hereinafter referred to asthe 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 true and fairview in conformity with the Accounting Standards prescribed under section 133 of the Actread with the Companies (Indian Accounting Standards) Rules 2015 as amended (IndAS') and other accounting principles generally accepted in India of the state of affairsof the Company as at March 31 2020 and its loss (including other comprehensive income)changes in equity and its cash flow for the year ended on that date.
Basis for opinion
We conducted our audit of the Standalone Financial Statement in accordance with theStandards on Auditing (SAs') specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the Auditors 'Responsibilities for the Audit of the Standalone Financial Statements section of ourreport. We are independent of the Company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India (ICAI') together with the ethicalrequirements that are relevant to our audit of the Standalone Financial Statements underthe provisions of the Act and the Rules framed thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the Standalone Financial Statement.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Standalone Financial Statements of the current period.These matters were addressed in the context of our audit of the Standalone FinancialStatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. We have determined that there are no key audit mattersto communicate in our report.
Information Other than the Standalone Financial Statements and Auditor's Report thereon
The Company's management and Board of Directors are responsible for the preparation ofthe other information. The other information comprises the information included in AnnualReport but does not include the Standalone Financial Statements and our auditors' reportthereon. The Annual Report is expected to be made available to us after the date of thisreport.
Our opinion on the standalone financial statements does not cover the other informationand we do not and will not express any form of assurance conclusion thereon.
In connection with our audit of the Standalone Financial Statements our responsibilityis to read the other information identified above and in doing so consider whether theother information is materially inconsistent with the Standalone Financial Statements orour knowledge obtained in the audit or otherwise appears to be materially misstated.
When we read the Annual Report if we conclude that there is a material misstatementtherein we are required to communicate the matter to Those Charged with Governance andtake appropriate actions in accordance with Standards on Auditing.
Responsibilities of Management for the Standalone Financial Statements
The Company's management and Board of Directors are responsible for the matters statedin section 134(5) of the Act with respect to the preparation of the Standalone FinancialStatements that give a true and fair view of the financial position financial performanceincluding other comprehensive income changes in equity cash flows of the Company inaccordance with the accounting principles generally accepted in India including the IndAS and relevant provisions of the Act. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgements and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the Standalone Financial Statements
that give a true and fair view and are free from material misstatement whether due tofraud 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.
The Board of Directors are also responsible for overseeing the Company's financialreporting process.
Auditor's responsibilities 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 assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith the SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these Standalone Financial Statements.
As part of an audit in accordance with the SAs we exercise professional judgment andmaintain professional scepticism throughout the audit. We also:
a. Identify and assess the risks of material misstatement of the standalone financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.
b. Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theAct we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls system with reference to financial statements inplace and the operating effectiveness of such controls.
c. Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
d. Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Bank'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe standalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Bank to cease tocontinue as a going concern.
e. 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 quantitative factors in (i) planning the scope ofour audit work and in evaluating the results of our work; and (ii) to evaluate the effectof any identified misstatements in the Standalone Financial Statements.
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 auditor's report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.
We draw attention to note no. 4.11 of the Statement relating to the cancellation of theNBFC Registration certificate (CoR) by Reserve Bank of India as confirmed by Department ofFinancial Services Ministry of Finance (MoF) Government of India. The Board has alsoformulated action plan to discontinue NBFC activities and to explore new businessopportunities. However on account of outbreak of Covid 19 and subsequent lockdownannounced by the Central and State Governments the management has not taken finaldecision in respect of new line of activities and has not completed the formalitiesrelating to cancellation of registration with the Bank. Pending the same the managementhas prepared this financial statements on the assumption of a going concern.
Our conclusion is not modified in respect of the above matter.
Report on other legal and regulatory requirements
1. As required by the Companies (Auditor's Report) Order 2016 (the Order)issued by the Central
Government of India in terms of section 143(11) of the Act we give in the Annexure I a
statement on the matters specified in paragraph 3 and 4 of the Order to the extent
2. As required by Section 143 (3) of the Act we report that:
(a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit;
(b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books;
(c) The Balance Sheet the Statement of Profit and Loss (including other comprehensiveincome) the Statement of Changes in Equity and the Statement of Cash Flow dealt with bythis Report are in agreement with the books of account;
(d) In our opinion the aforesaid financial statements comply with the AccountingStandards specified under Section 133 of the Act read with the rules made thereunder andthe relevant provisions of the Act;
(e) On the basis of the written representations received from the directors as on March31 2020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2020 from being appointed as a director in terms of Section 164 (2) of theAct;
(f) With respect to the adequacy of the Internal Financial Controls over FinancialReporting of the Company and the operating effectiveness of such controls refer to ourseparate report in Annexure II;
(g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended:
In our opinion and to the best of our information and according to the explanationsgiven to us during the year the Company has not provided managerial remuneration todirectors. Accordingly the provision of Section 197 has been complied; and
(h) With respect to the other matters to be included in the Auditor's Report inaccordance with rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended bythe Companies (Audit and Auditors) Rules 2017 in our opinion and to the best of ourinformation and according to the explanations given to us:
i. The Company does not have any pending litigations which would impact its financialposition- Refer Note No 4.05 to the financial statements.
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
Annexure I referred to in paragraph 1 under "Report on Other Legal and Regulatory
Requirements of our report of even date to the members of the Company on the
Standalone Financial Statements for the year ended March 31 2020
(i) The Company does not have any Property plant and equipment and hence reportingunder sub-clause (a) to (c) of clause 3(i) of the Order is not applicable to the Company.
(ii) The Company does not have any inventory and hence reporting under sub-clause (a)regarding physical verification of stock sub-clause (b) regarding material discrepancieson physical verification of stocks of clause 3(ii) of the Order is not applicable to theCompany.
(iii) The Company has not granted any loan to the body corporate covered in theregister maintained under section 189 of the Act.
(iv) In our opinion and according to the information and explanation given to us theCompany has complied with the provisions of Section 185 and 186 of the Act in respect ofinvestments made and loans guarantees and securities granted.
(v) The Company has not accepted any deposits from the public within the meaning ofsections 73 to 76 of the Act and the rules framed there under are not applicable to theCompany. We are informed by the Management that no order has been passed by the CompanyLaw Board or National Company Law Tribunal or Reserve Bank of India or any court or anyother Tribunal in this regard.
(vi) The provisions of section 148(1) of the Act relating to maintenance of costrecords are not applicable to the Company.
(vii) In respect of statutory dues:
a) According to the information and explanations given to us and according to therecords of the Company examined by us in our opinion the Company is generally regular indepositing with the appropriate authorities undisputed statutory dues such as providentfund employees' state insurance sales tax income tax professional tax goods andservices tax cess and other applicable statutory dues with appropriate authorities exceptProfession Tax of Rs. 39175.
b) Based on the records produced before us and books of accounts maintained by theCompany there are no disputed dues of income tax sales tax service tax duty ofcustoms duty of excise or value added tax goods and service tax on account of anydispute.
(viii) According to the information and explanations given to us the Company has notdefaulted in repayment of loans or borrowing to financial institutions banks governmentor dues to debenture holders.
(ix) The Company has not raised money by way of initial public offer or further publicoffer (including debt instruments). According to the information and explanations given tous and on the basis of the records examined by us the Company has prima facie applied theterm loan for the purpose for which it was obtained.
(x) During the course of our examination of the books and records of the Corporationcarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us no instances of material fraudby the Company or on the Company by its officers and employees have been noticed orreported during the year
(xi) During the year the provisions of section 197 of the Act the Company has notprovided managerial remuneration to directors. Accordingly paragraph 3(xi) of the Orderregarding payment of managerial remuneration in compliance of this section is notapplicable.
(xii) The Company is not a chit fund or a nidhi company. Hence the question ofreporting under clause 3(xii) of the Order does not arise.
(xiii) In our opinion all transactions with related parties are in compliance withSection 177 and 188 of the Act and the details have been disclosed in the financialstatements as required by the applicable accounting standards.
(xiv) Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to information and explanations givenby the management the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year.Accordingly para 3(xiv) of the Order are not applicable to the Company.
(xv) The Company has not entered into any non-cash transactions with directors orpersons connected with him covered under the provisions of section 192 of the Act. We havebeen informed that no such transaction have been entered into with person connected withdirectors. Accordingly para 3(xv) of the Order is not applicable to the Company.
(xvi) We draw attention to note no. 4.11 of the Statement relating to the cancellationof the NBFC Registration certificate (CoR) by Reserve Bank of India as confirmed byDepartment of Financial Services Ministry of Finance (MoF) Government of India. As onthe date of the balance sheet the total non-financial assets is more than total financialassets of the Company in terms of relevant circulars issued by the Bank and accordingly
the Company is not a NBFC. Accordingly registration under section 45-IA of the ReserveBank of India Act 1934 is not required.
Annexure II - referred to in paragraph 3(g) under "Report on Other Legal andRegulatory Requirements" of our report of even date
Report on the Internal Financial Controls over Financial Reporting under clause (i) ofsub-section 3 of section 143 of the Companies Act 2013 (the Act)
We have audited the internal financial controls over financial reporting of MAHASHREETRADING LIMITED (the Company) as of March 31 2020 in conjunction with ouraudit of the Standalone Financial Statements of the Company for the year ended on thatdate.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 2020 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India (ICAI).
Management's Responsibility for Internal Financial Controls
The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India (ICAI). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Act.
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) and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the Institute of Chartered Accountants of India. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance
about whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness.
Our audit of internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk.
The procedures selected depend on the auditor's judgement including the assessment ofthe risks of material misstatement of the standalone financial statements whether due tofraud 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 controls systemover financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A Company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of standalone 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 themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of standalonefinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorizations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition use ordisposition of the company's assets that could have a material effect on the standalonefinancial 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 that the degree of compliance with the policies orprocedures may deteriorate.