The Members of MAHICKRA CHEMICALS LIMITED
Report on the Financial Statements
We have audited the accompanying annual financial results of MAHICKRA CHEMICALS LIMITED("the Company") for the half year ended on 31st March2021 and theyear to date results for the period from 1st April2020 and 31stMarch 2021 attached herewith being submitted by the Company pursuant to the requirementof Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 as amended ("Listing Regulations")
In Our Opinion and to the best of our information and according to the explanationsgiven to us these annual financial results as well as the year -to-date results:
i. are presented in accordance with the requirements of Regulation 33 of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 in this regard; and
ii. give a true and fair view in conformity with the recognition and measurementprinciples laid down in the applicable accounting standards and other accountingprinciples generally accepted in India of the net profit and other financial informationfor the half year ended on 31st March 2021 and as well as the year-to-dateresult for the period from 1st April 2020 to 31st March 2021.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Results section of our report. We are independent of the Company in accordancewith the Code of Ethics issued by the Institute of Chartered Accountants of India togetherwith the ethical requirements that are relevant to our audit of the financial resultsunder the provisions of the Companies Act 2013 and the Rules thereunder and we havefulfilled our other ethical responsibilities in accordance with these requirements and theCode of Ethics. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion on the financial results.
Management and Board Directors Responsibilities for the Financial Results
These Annual Financial Results have been prepared on the basis of Annual FinancialStatements.
The Company's Management and Board of Directors are responsible for the preparation andpresentation of this annual financial results that give a true and fair view of the netprofit and other financial information in accordance with the recognition and measurementprinciples laid down in accounting Standards specified under Section 133 of the Act readwith the relevant rules issued there-under and other accountresulting principles generallyaccepted in India and in Compliance with Regulation 33 of the Listing Regulations.
This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand 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 ofthe annual financial results that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing the annual financial results the Management & the Board of Directorsare responsible 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 the Board of Director either intends to liquidate the Companyor cease operations or has no realistic alternative but to do so.
The Board of Directors is also responsible for overseeing the company's financialreporting process. Auditor's Responsibilities for the Audit of the Financial Results
Our objectives are to obtain reasonable assurance about whether the financial resultsas a whole are free from material misstatement whether due to fraud or error and toissue an auditor's report that includes our opinion. Reasonable assurance is a high levelof assurance but is not a guarantee that an audit conducted in accordance with SAs willalways detect a material misstatement when it exists. Misstatements can arise from fraudor error and are considered material if individually or in the aggregate they couldreasonably be expected to influence the economic decisions of users taken on the basis ofthese financial results.
As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial resultswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.
Obtain an understanding of internal financial controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls with reference to the financial statementin place and the operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures in the annual financial result made bythemanagement and Board of Directors.
Conclude on the appropriateness of the Management and Board of Directors use ofthe going concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the Company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor's report tothe related disclosures in the annual financial result or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the Company to cease to continue as a going concern.
Evaluate the overall presentation structure and content of the annual financialresult including the disclosures and whether the financial results represent theunderlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
We 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.
The figures for the last half year ended on March 31 2021 are the balancing figuresbetween the audited figures in respect of full financial year ended on March 31 2021 andthe figure for the half year ended on September 302020.
ANNEXURE" A" TO THE INDEPENDENT AUDITOR'S REPORT
Referred to in paragraph 1 under the heading 'Report on Other Legal & RegulatoryRequirement' of our report of even date to the financial statements of the Company for theyear ended March 31st 2021:
1. In respect of the Company's Fixed Assets:
(a) The Company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets.
(b) As explained to us fixed assets have been physically verified by the management atreasonable intervals; no material discrepancies were noticed on such verification.
(c) The title deeds of immovable properties as disclosed in Note 9 on Fixed Assets tothe Financial Statements are held in the name of Company.
2. In respect of Company's inventories:
(a) The management during the year has conducted physical verification of theinventories & in our opinion the frequency of verification is reasonable.
(b) ln our opinion and according to the information and explanations given to us theCompany has maintained proper records of inventory. The discrepancies noticed onverification between the physical stocks and the book records were not material and havebeen properly dealt with in the books of accounts.
3. The Company has not granted any loans secured or unsecured to Companies FirmsLimited Liability Partnerships or other parties covered in the Register maintained underSection 189 of the Act. Accordingly the provisions of Clause 3 (iii) (a) to (c) of theOrder are not applicable to the Company and hence not commented upon.
4. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 185 & 186 of the Companies Act2013 in respect of Loans Investments guarantees and security.
5. In our opinion and according to the information and explanations given to us theCompany has not accepted deposits from the public during the year. Therefore thedirectives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 orany other relevant provisions with regards to deposits are not applicable to the Company.
6. As informed to us the maintenance of Cost Records has not been specified by theCentral Government under sub-section (1) of Section 148 of the Act in respect of theactivities carried on by the Company.
7. (a) According to the records of the Company undisputed statutory dues includingProvident Fund Investor Education and Protection Fund Employees' State InsuranceIncome-tax Goods & Services Tax Custom Duty and Cess to the extent applicable andany other statutory dues have generally been regularly deposited with the appropriateauthorities.
(b) According to the information and explanations given to us no undisputed amountspayable in respect of Income tax Goods& Services Tax Custom Duty Excise Duty andCess were in arrears as on 31st of March 2021 for a period of more than sixmonths from the date they became payable.
8. In our opinion and according to the information and explanations given to us theCompany has not defaulted in repayment of dues to Financial Institutions Banks andDebentures Holders. Also the Company has not taken any further loan from FinancialInstitutions or from the government and has not issued any debentures.
9. Based upon the audit procedures performed and the information and explanations givenby the management the Company has not raised monies by way of initial public offer wereapplied for the purpose for which those are raised.
10. Based upon the audit procedures performed and the information and explanationsgiven by the management we report that no fraud by the Company or on the Company by itsofficers or employees has been noticed or reported during the year.
11. According to information and explanation given to us and based on our examinationof the records of the Company the Company has paid/provided for managerial remunerationin accordance with the requisite approvals mandated by the Provisions of Section 197 readwith Schedule V to the Act.
12. The Company is not a Nidhi Company. Therefore the provisions of clause 3 (xii) ofthe Order are not applicable to the Company.
13. According to information and explanation given to us and based on our examinationof the records of the Company all the transactions with the related parties are incompliance with Section 177 and 188 of Companies Act 2013 and the details have beendisclosed in the financial statements as required by the applicable accounting standards.
14. Based upon the audit procedures performed and the information and explanationsgiven by the management the Company has not made private placement of share during theyear under review. Accordingly the provisions of Clause 3 (xiv) of the Order areapplicable to the Company and the requirement of Section 42 of Companies Act 2013 havebeen complied with and the amount raised has been used for the purpose for which the fundswere raised.
15. Based upon the audit procedures performed and the information and explanationsgiven by the management the Company has not entered into any non-cash transactions withdirectors or persons connected with him. Accordingly the provisions of clause 3 (xv) ofthe Order are not applicable to the Company and hence not commented upon.
16. The Company is not required to be registered under section 45IA of the Reserve Bankof India Act 1934 and accordingly the Provisions of clause 3 (xvi) of the Order are notapplicable to the Company and hence not commented upon.
(Referred to in paragraph 2(f) under "Report on Other Legal and regulatoryrequirements" of our report of even date)
Report on the Internal Financial Controls under Clause (i) of Sub-Section 3 of Section143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of MAHICKRACHEMICALS LIMITED("the Company") as of 31st March 2021in conjunctionwith our audit of the financial statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Company's management is responsible for establishing 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 Companies Act 2013.
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 Companies Act 2013 to the extentapplicable to an audit of internal financial controls. Those Standards and the GuidanceNote require that we comply with ethical requirements and plan and perform the audit toobtain reasonable assurance about whether adequate internal financial controls overfinancial reporting was established and maintained and if such controls operatedeffectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial 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 financial statements for external purposes in accordance with generallyaccepted accounting principles. A Company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the Company;
(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the Company are being made only inaccordance with authorizations of management and directors of the Company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the Company's assets that could have amaterial effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.
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 Bl^March 2021 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.
|For SINGHI & CO. Chartered Accountants |
|FRN NO: 302049E |
|SUNIL CBOHARA |
|Membership No. 103395 |
|Ahmedabad22nd May 2021 |