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Mallcom (India) Ltd.

BSE: 539400 Sector: Industrials
NSE: MALLCOM ISIN Code: INE389C01015
BSE 00:00 | 25 Nov 680.05 12.30
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OPEN 680.00
PREVIOUS CLOSE 667.75
VOLUME 40
52-Week high 985.00
52-Week low 605.60
P/E 12.19
Mkt Cap.(Rs cr) 424
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 680.00
CLOSE 667.75
VOLUME 40
52-Week high 985.00
52-Week low 605.60
P/E 12.19
Mkt Cap.(Rs cr) 424
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Mallcom (India) Ltd. (MALLCOM) - Auditors Report

Company auditors report

To

TheMembers of

Mallcom(India) Limited

Reporton the Audit of the Standalone Ind AS Financial Statements Opinion

We have audited the accompanying standalonefinancial statements of MALLCOM (INDIA) LIMITED (“the Company”) which comprisethe Balance Sheet as at 31st March 2022 the statement of Profit and Loss (includingother Comprehensive Income) the Cash Flow Statement and the Statement of Changes inEquity for the year then ended and notes to the standalone financial statementsincluding a summary of significant accounting policies and other explanatory information.(herein after referred to as “Standalone Financial Statements”).

Inour opinion and to the best of our information and according to the explanations given tous the aforesaid standalone financial statements give the information required by theCompanies Act 2013 (“the Act”) in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of theState of Affairs of the Company as at March 31 2022 its Profit (including othercomprehensive income) its Cash Flows and the statement of changes in equity for the yearended on that date.

Basisfor Opinion

Weconducted our audit in accordance with the Standards on Auditing (SAs) specified undersection 143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditor?s Responsibilities for the Audit of the Standalone financialStatements section of our report. We are independent of the Company in accordance with theCode of Ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the standalone financial statementsunder the provisions of the Act and the Rules thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our opinion.

KeyAudit Matters

Keyaudit 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 financial statements as awhole and in forming our opinion thereon and we do not provide a separate opinion onthese matters. In addition we have determined the matters described below as Key AuditMatters and our description of how our audit addressed the matter is provided in thatcontext.

KeyAudit Matter that require to be communicated in our report:

(i) Completeness existence and accuracy ofRevenue Recognition (Refer to Note 3.14 and 23 to the standalone financial statements)

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Key Audit Matters

How the matter was addressed in our audit

Revenue is one of the key profit drivers and is therefore susceptible to misstatement. Cut-off is the key assertion in so far as revenue recognition is concerned since an inappropriate cut-off can result in material misstatement of results for the year. The Company manufactures and sells a number of products to its customers. The Company reviews it sales contracts as per AS-115 for determining the principles for recognizing revenue in accordance with the new standard.

Principal audit procedures:

 

a) Our audit procedures with regard to revenue recognition included testing controls automated and manual around dispatches/deliveries inventory reconciliations and circularization of receivable balances substantive testing for cut-offs and analytical review procedures.

 

b) Selected a sample of contracts and through inspection of evidence of performance of these controls tested the operating effectiveness of the internal controls relating to the identification of performance obligations and timing of revenue recognition.

 

c) Selected a sample of contracts and reassessed contractual terms to determine adherence to the requirements of the new accounting standard.

 

(ii) Existence and Valuation of Inventories(Refer note 3.9 and 9 of the Standalone Financial Statements)

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The Company?s major part of inventory comprises Raw Material/  Accessories/ Work-in-Progress/ finished goods which are  geographically spread over multiple locations such as factories  producing difference products. These inventories are also procured at many times as per customer specification and order requirement and customized as such. The whole inventory is counted by the Company on a cyclical basis and accordingly provision for obsolescence of inventories is assessed and recognized by the management in the financial statements based on management estimation as at end of reporting period.

In view of the significance of the matter we applied the following audit procedures in this area among others to obtain sufficient appropriate audit evidence:

 The Company manufactures and sells goods which may be subject to changing consumer demands and product developments. Significant degree of judgment is thereby required to assess the net realizable value of the inventories and appropriate level of provisioning for items which may be ultimately sold below cost. Such judgment includes management?s expectations for future sale volumes inventory  liquidation plans and future selling prices less cost to sell.

a)Obtaining an understanding of and assessing the design implementation and operating effectiveness of management?s key internal controls relating to physical verification of inventories by the management and the internal auditors of the Company identification of obsolete and slow-moving inventories inventories with low or negative gross margins monitoring of inventory ageing and assessment of provisioning and of net realizable values.

 

b)Assessing whether items in the inventory ageing report prepared by the management were classified within the appropriate ageing bracket;

 Based on above existence and valuation of inventories has been identified as a key audit matter.

c)Performing a review of the provisions for inventories by examining movements in the balance during the current year and new provisions made for inventory balances as at 31 March 2022 during the current year to assess the historical accuracy of management?s inventory provisioning process;

 

d)Assessing on a sample basis the net realizable value of slow- moving and obsolete inventories and inventories with low or negative gross margins as calculated by management with reference to prices achieved and costs to sell after the financial year end.

 

e)Attending cyclical inventory counts at various godowns & factories at regular intervals during the reporting period and evaluating the results of the cycle counts performed by the management throughout the year to assess management?s estimation of the provisioning.

 

(i)Completeness existence and accuracy of Revenue Recognition (Refer to Note 3.14 and 23 tothe standalone financial statements)

Informationother than the Financial Statements and Auditors? Report thereon

TheCompany?s board of directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the Board?sReport including Annexures to Board?s Report Business Responsibility Report but doesnot include the standalone financial statements and our auditor?s report thereon. Theaforesaid documents are expected to be made available to us after the date of this auditor?sreport.

Ouropinion on the standalone financial statements does not cover the other information and wedo not express any form of assurance conclusion thereon.

Inconnection with our audit of the standalone financial statements our responsibility is toread the other information when it becomes available and in doing so consider whetherthe other information is materially inconsistent with the standalone financial statementsor our knowledge obtained during the course of our audit or otherwise appears to bematerially misstated.

Ifbased on the work we have performed we conclude that there is a material misstatement ofthis other information we are required to report that fact. We have nothing to report inthis regard.

Management?sResponsibility for the Standalone Ind AS Financial Statements

TheCompany?s Board of Directors is responsible for the matters stated in section 134(5)of the Companies Act 2013 (“the Act”) with respect to the preparation of thesestandalone financial statements that give a true and fair view of the financial positionfinancial performance including other comprehensive income cash flows and the statementof changes in equity of the Company in accordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards (Ind AS) specified undersection 133 of the Act read with Companies (Indian Accounting Standard) Rules 2015 asamended. 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 implementation and maintenance of accounting policies; makingjudgments 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 statement that give a true andfair view and are free from material misstatement whether due to fraud or error.

Inpreparing the standalone financial statements management is responsible for assessing theCompany?s ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.

TheBoard of Directors are also responsible for overseeing the Company?s financialreporting process.

Auditor?sResponsibilities for the Audit of the Standalone Ind AS Financial Statements

Ourobjectives are to obtain reasonable assurance about whether the standalone financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor?s report that includes our opinion. Reasonable assurance is ahigh level of assurance but is not a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when it exists. Misstatements can arisefrom fraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these standalone financial statements.

Aspart of an audit in accordance with SAs we exercise professional judgment and maintainprofessional skepticism throughout the audit. We also: Identify and assess the risks ofmaterial misstatement of the standalone financial statements whether due to fraud orerror design and perform audit procedures responsive to those risks and obtain auditevidence that is sufficient and appropriate to provide a basis for our opinion. The riskof not detecting a material misstatement resulting from fraud is higher than for oneresulting from error as fraud may involve collusion forgery intentional omissionsmisrepresentations or the override of internal control. Obtain an understanding ofinternal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances. Under section 143(3)(i) of the Companies Act 2013 weare also responsible for expressing our opinion on whether the company has adequateinternal financial controls system in place and the operating effectiveness of suchcontrols.

Evaluatethe appropriateness of accounting policies used and the reasonableness of accountingestimates and related disclosures made by management.

Concludeon the appropriateness of management?s use of the going concern basis of accountingand based on the audit evidence obtained whether a material uncertainty exists relatedto events or conditions that may cast significant doubt on the Company?s ability tocontinue as a going concern. If we conclude that a material uncertainty exists we arerequired to draw attention in our auditor?s report to the related disclosures in thestandalone 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 Company to ceaseto continue as a going concern.

Evaluatethe overall presentation structure and content of the standalone financial statementsincluding the disclosures and whether the standalone financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.

Materialityis the magnitude of misstatements in financial statements that individually or inaggregate makes it probable that the economic decisions of a reasonably knowledgeableuser of the financial statements may be influenced. We consider quantitative materialityand qualitative factors in (i) planning the scope of our audit work and in evaluating theresults of our work; and (ii) to evaluate the effect of any identified misstatements inthe financial statements.

Wecommunicate with those charged with governance regarding among other matters the plannedscope and timing of the audit and significant audit findings including any significantdeficiencies in internal control that we identify during our audit.

Wealso provide those charged with governance with a statement that we have complied withrelevant ethical requirements regarding independence and to communicate with them allrelationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

Fromthe matters communicated with those charged with governance we determine those mattersthat were of most significance in the audit of the standalone financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor?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.

Reporton Other Legal and Regulatory Requirements

1)Asrequired 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 ofthe Companies Act 2013 we give in the Annexure A a statement on the matters specifiedin paragraphs 3 and 4 of the Order to the extent applicable.

2)Asrequired by Section 143(3) of the Act we report that:

a)We have sought and obtained all the information and explanations which to the best of ourknowledge 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 the Companyso far as it appears from our examination of those books.

c)The standalone Balance Sheet the standalone Statement of Profit and Loss (including OtherComprehensive Income) the standalone Statement of changes in Equity and the standaloneCash Flow Statement dealt with by this Report are in agreement with the books of account.

d)In our opinion the aforesaid standalone Ind AS financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Indian Accounting Standards) Rules 2015 as amended.

e)On the basis of the written representations received from the directors as on 31stMarch2022 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2022 from being appointed as a director in terms of Section164 (2) of the Act.

f) With respect to the adequacy of internal financial controls over financial reporting ofthe Company and the operating effectiveness of such controls refer to our separate Reportin “Annexure B”.

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 opinionand to the best of our information and explanations given to us and based on ourexamination of the records of the Company the Company has paid/ provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Act.

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 in our opinionand to the best of our information and according to the explanations given to us:

(i)The Company has disclosed the impact of pending litigations as at 31st March 2022 on itsfinancial position in its standalone Ind AS financial statements refer notes to thestandalone Ind AS financial statements;

(ii)The company has made provision for material foreseeable losses on long-term derivativecontracts as required under the applicable laws or Ind AS in these standalone financialstatements

(iii)There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the company during the year.

(iv)(a) The Management has represented that to the best of its knowledge and belief 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 or entity including foreign entity (“Intermediaries”)with the understanding whether recorded in writing or otherwise that the Intermediaryshall whether directly or indirectly lend or invest in other persons or entitiesidentified in any manner whatsoever by or on behalf of the Company (“UltimateBeneficiaries”) or provide any guarantee security or the like on behalf of theUltimate Beneficiaries;

(b)The Management has represented that to the best of its knowledge and belief no funds(which are material either individually or in the aggregate) have been received by theCompany from any person or entity including foreign entity (“Funding Parties”)with the understanding whether recorded in writing or otherwise that the Company shallwhether directly or indirectly lend or invest in other persons or entities identified inany manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”)or provide any guarantee security or the like on behalf of the Ultimate Beneficiaries;

(c)Based on the audit procedures that have been considered reasonable and appropriate in thecircumstances nothing has come to our notice that has caused us to believe that therepresentations under sub-clause (i) and (ii) of Rule 11(e) as provided under (i) and(ii) above contain any material misstatement.

(v)(a) The final dividend proposed in the previous year declared and paid by the Companyduring the year is in accordance with Section 123 of the Act as applicable.

(b)The Company has neither declared nor paid any interim dividend during the year.

(c)The Board of Directors of the Company have proposed final dividend for the year which issubject to the approval of the members at the ensuing Annual General Meeting. The amountof dividend proposed is in accordance with section 123 of the Act as applicable.

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For S. K. SINGHANIA & CO.

 

CHARTERED ACCOUNTANTS

 

(Firm Registration No. 302206E)

 

(RAJESH KR. SINGHANIA

19A Jawaharlal Nehru Road

M. NO. 052722)

Kolkata – 700 087.

PARTNER

Dated : 30th May 2022.

ICAI UDIN: : 22052722AJXPHR7526

AnnexureA to the Independent Auditor?s report

(Referredto in Paragraph 1 under the heading “Report on other legal and regulatoryrequirements” of our report of even date)

Asrequired by section 143(3) of the Act we report that

1.a) The company has maintained proper records showing full particulars includingquantitative details and situation of its Property Plant & Equipment The Company hasmaintained proper records showing full particulars of intangible assets.

b)The Property Plant & Equipment have been physically verified by the management duringthe year. In our opinion the frequency of verification of the fixed assets by themanagement is reasonable having regard to the size of the company and the nature of itsassets. No discrepancies were noticed on verification.

c)With respect to immovable properties (other than properties where the Company is thelessee and the lease agreements are duly executed in favour of the Company) disclosed inthe financial statements included in property plant & equipment capitalwork-in-progress investment property and noncurrent assets held for sale according theinformation and explanations given to us and based on the examination of the registeredsale deed / title deed provided to us we report that the title deeds of such immovableproperties are held in the name of the Company as at the balance sheet date.

d)According to the information and explanations given to us and the records of the companyexamined by us the Company has not revalued any of its Property Plant and Equipment(including Right of Use assets) or Intangible assets during the year.

e)According to the information and explanations given to us no proceeding has been initiatedduring the year or are pending against the Company as at March 312022 for holding anybenami property under the Benami Transactions (Prohibition) Act 1988 (as amended in 2016)and rules made thereunder.

2.a) The inventories were physically verified during the year by the Management atreasonable intervals. In our opinion and according to the information and explanationsgiven to us the coverage and procedure of such verification by the Management isappropriate having regard to the size of the Company and the nature of its operations. Nodiscrepancies of 10% or more in the aggregate for each class of inventories were noticedon such physical verification of inventories when compared with books of account. b)According to the information and explanations given to us and the records of the companyexamined by us quarterly statement of current assets in respect of its working capitalborrowing are generally in agreement with the books of accounts of the company.

3.TheCompany had provided guarantees for RS 10 Crores in earlier years on behalf ofsubsidiary/Associate companies and was outstanding as at balance sheet date. Terms andconditions thereof in our opinion prima facie not prejudicial to the Company?sinterest. Since the company has not granted any loans secured or unsecured clause (a)(b) & (c) of section (iii) of para 3 of the Order is not applicable.

4.Accordingto the information and explanations given to us and the records of the Company examined byus the provisions of section 185 and 186 of the Companies Act 2013 have been compliedwith in respect of guarantees and securities given by the Company.

5.TheCompany has not accepted any deposits or amounts which are deemed to be deposits withinthe meaning of Sections 73 to 76 of the Act and the rules framed there under. Further noorders have been passed by Company Law Board or National Company Law Tribunal or ReserveBank of India or any court or any other tribunal which could impact the Company.

6.Wehave broadly reviewed the accounts and records maintained by the company pursuant to theCompanies (Cost Records and Audit) Rules 2014 read with Companies (Cost Records and Audit)Amendment Rules 2014 specified by the Central Government under section 148 of the Actand are of the opinion that prima facie the prescribed cost records have been maintained.We have however not made a detailed examination of the records with a view to determinewhether they are accurate or complete.

7.a) According to the information and explanations given to us the company has generallybeen regular in depositing undisputed statutory dues with appropriate authoritiesincluding Provident Fund Employees State Insurance Income Tax Sales Tax Value AddedTax Service Tax Custom Duty Excise Duty GST Cess and other material statutory duesapplicable to it and there has been no arrears as at 31st March 2022 for a period of morethan six months from the date they became payable.

b)Details of statutory dues referred to in sub-clause (a) above which have not beendeposited as on March 31 2022 on account of disputes are given below: ( Rs In Lakhs)

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Nature of Statute

Period to Which Amount Relates (Assessment Year)

Gross Demand

lign:right;mso-pagination:none; mso-layout-grid-align:none;text-autospace:none>Amount paid under Protest

Amount (Net of Amount paid under Protest)

Forum where dispute in pending

Income Tax Act

2010-11

25.31

12.00

13.31

CIT (Appeal)

 

2011-12

45.90

23.00

22.90

 

 

2012-13

24.36

16.00

8.36

 

 

2014-15

16.03

12.25

3.78

 

 

2015-16

16.87

6.40

10.47

 

 

2019-20

48.98

-

48.98

ACIT CC-1(4) Kolkata

 

2020-21

50.80

-

50.80

 

VAT Act

2017-18

296.24

-

296.24

West Bengal Taxation Tribunal (WBTT)

CST Act

2017-18

36.93

3.31

33.62

Commissioner (Appeal)

8.Therewere no transactions relating to previously unrecorded income that have been surrenderedor disclosed as income during the year in the tax assessments under the Income Tax Act1961 (43 of 1961).

9.(a)In our opinion and according to the information and explanations given to us we are ofthe opinion that the company has not defaulted in the repayment of loans and borrowingsfrom Banks. The company did not have outstanding loans from Financial InstitutionsGovernments or Debenture Holders during the year.

(b)The Company has not been declared wilful defaulter by any bank or financial institution orgovernment or any government authority.

(c)According to the information and explanations given to us and the records of the Companyexamined by us the Company has applied the term loans for the purpose for which the loanswere obtained.

(d)On an overall examination of the financial statements of the Company funds raised onshort-term basis have prima facie not been used during the year for long-term purposesby the Company.

(e)According to the information and explanations given to us the Company has not raised fundsfrom any entity or person on account of or to meet the obligations of its subsidiariesassociates or joint ventures hence reporting under this clause is not applicable.

(f)According to the information and explanations given to us the Company has not taken loansduring the year on the pledge of securities held in its any subsidiaries associates orjoint ventures hence reporting under this clause is not applicable.

10.(a) The Company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments) during the year and hence reporting under this clauseis not applicable.

(b)According to the information and explanations give to us and based on our examination ofthe records of the Company the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year as suchsection (xiii) of para 3 of the Order is not applicable.

11.(a) During the course of our examination of the books and records of the Company carriedout in accordance with the generally accepted auditing practices in India and accordingto the information and explanations given to us we have neither come across any instanceof fraud on or by the Company noticed or reported during the year nor have we beeninformed of such case by the management.

(b)No report under sub-section (12) of section 143 of the Companies Act has been filed inForm ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules 2014 withthe Central Government during the year and up to the date of this report.

(c)According to the information and explanations given to us and the records of the Companyexamined by us the Company has not received any complaints from any whistle-blower duringthe year (and up to the date of this report) and hence reporting under this clause is notapplicable.

12.In our opinion and according to the information and explanations given to us the Companyis not a nidhi company as such section (xii) of para 3 of the Order is not applicable.

13.In our opinion and according to the information and explanations give to us alltransactions with the related parties are in compliance with Sections 177 and 188 of theCompanies Act 2013 where applicable and details of such transactions have been disclosedin the financial statements as required by the applicable accounting standards details ofrelated party transactions have been disclosed in Note 34 of the standalone financialstatements for the year under audit.

14.(a) In our opinion the Company has an internal audit system. The Internal Audit System isbeing further strengthened to make it commensurate with the size and the nature of itsbusiness and (b) We have considered the internal audit reports for the year under auditissued to the company during the year and till date in determining the nature timing andextent of our audit procedures.

15.According to the information and explanations give to us and based on our examination ofthe records of the Company the Company has not entered into non-cash transactions withdirectors or persons connected with them as such section (xv) of para 3 of the Order isnot applicable.

16.(a) The Company is not required to be registered under Section 45-IA of the Reserve Bankof India Act 1934.

(b)In our opinion there is no core investment company within the Group (as defined in theCore Investment Companies (Reserve Bank) Directions 2016) and hence reporting under thisclause is not applicable.

17.According to the information and explanations given to us and the records of the Companyexamined by us the Company has not incurred cash losses in the financial year and in theimmediately preceding financial year.

18.There has been no resignation of the statutory auditors of the Company during the year.

19.On the basis of the financial ratios ageing and expected dates of realization offinancial assets and payment of financial liabilities other information accompanying thefinancial statements and our knowledge of the Board of Directors and Management plans andbased on our examination of the evidence supporting the assumptions nothing has come toour attention which causes us to believe that any material uncertainty exists as on thedate of the audit report indicating that Company is not capable of meeting its liabilitiesexisting at the date of the balance sheet as and when they fall due within a period of oneyear from the balance sheet date. We however state that this is not an assurance as tothe future viability of the Company. We further state that our reporting is based on thefacts up to the date of the audit report and we neither give any guarantee nor anyassurance that all liabilities falling due within a period of one year from the balancesheet date will get discharged by the Company as and when they fall due.

20.(a) According to information and explanation given to us and records of the Companyexamined by us no amount was unspent in respect of other than ongoing projects for thecurrent year hence reporting under this clause is not applicable.

(b)According to information and explanation given to us and records of the Company examinedby us there has been a shortfall at the end of the year. A disclosure including nature ofCSR activities and related party transactions have been disclosed in Note 42 of thestandalone financial statements for the year under audit.

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For S. K. SINGHANIA & CO.

 

CHARTERED ACCOUNTANTS

 

(Firm Registration No. 302206E)

 

(RAJESH KR. SINGHANIA

19A Jawaharlal Nehru Road

M. NO. 052722)

Kolkata – 700 087.

PARTNER

Dated : 30th May 2022

ICAI UDIN: : 22052722AJXPHR7526

AnnexureB to the Auditors? Report

Reporton the Internal Financial Controls under Clause (i) of sub-section 3 of Section 143 of theCompanies Act 2013 (‘the Act?)

Wehave audited the internal financial controls over financial reporting of MALLCOM (INDIA)LIMITED (‘the Company?) as of 31st March 2022 in conjunction with our audit ofthe standalone Ind AS financial statements of the Company for the year ended on that date.

Management?sResponsibility for Internal Financial Controls

TheCompany?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 of Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India (‘ICAI?). 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 the Company?s policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

Auditors?Responsibility

Ourresponsibility is to express an opinion on the Company?s internal financial controlsover financial reporting based on our audit. We conducted our audit in accordance with theGuidance Note of Audit of Internal Financial Controls over Financial Reporting (the ‘GuidanceNote?) and the Standards on Auditing issued by ICAI and deemed to be prescribedunder Section 143(10) of the Companies Act 2013 to the extent applicable to an audit ofinternal controls both applicable to an audit of Internal Financial Controls and bothissued by the Institute of Chartered Accountants of India. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting were established and maintained and if such controls operatedeffectively in all material respects. Our audit involves performing procedures to obtainaudit evidence about the adequacy of the internal financial controls system over financialreporting and their operating effectiveness. Our audit of internal financial controls overfinancial reporting included obtaining an understanding of internal financial controlsover

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 auditors? judgment including the assessment of therisks of material misstatement of the standalone financial statements whether due tofraud or error.

Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the Company?s internal financial controls systemover financial reporting with reference to standalone financial statements.

Meaningof Internal Financial Controls over Financial Reporting

Acompany?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 purpose 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 transaction anddispositions of the assets of the Company (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the Company are being made only in accordance with authorizations of theManagement and directors of the Company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of theCompany?s assets that could have a material effect on the financial statements.

InherentLimitation of Internal Financial Controls over Financial Reporting

Becauseof the inherent limitations of internal financial controls over financial reportingincluding the possibility of collusion or improper management override of controlsmaterial misstatements due to error or fraud may occur and not be detected. Alsoprojections of any evaluation of the internal financial controls over financial reportingto future period are subject to the risk that the internal financial control overfinancial reporting may become inadequate because of changes in condition or that thedegree of compliance with the policies or procedures may deteriorate.

Opinion

Inour opinion the Company has in all material respects and adequate internal financialcontrols system over financial reporting and such internal financial controls overfinancial reporting were operating effectively as at 31st March 2022 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.

Wehave considered the material weakness identified and reported above in determining thenature timing and extent of audit tests applied in our audit of the 31st March 2022financial statements of the company and these material weakness doesn?t affect ouropinion on the financial statements of the Company.

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For S. K. SINGHANIA & CO.

 

CHARTERED ACCOUNTANTS

 

(Firm Registration No. 302206E)

 

(RAJESH KR. SINGHANIA

19A Jawaharlal Nehru Road

M. NO. 052722)

Kolkata – 700 087.

PARTNER

Dated : 30th May 2022

ICAI UDIN: 22052722AJXPHR7526

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