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Megasoft Ltd.

BSE: 532408 Sector: IT
NSE: MEGASOFT ISIN Code: INE933B01012
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PREVIOUS CLOSE 23.55
VOLUME 2086
52-Week high 60.40
52-Week low 22.70
P/E 34.71
Mkt Cap.(Rs cr) 174
Buy Price 23.56
Buy Qty 2.00
Sell Price 23.79
Sell Qty 1.00
OPEN 24.00
CLOSE 23.55
VOLUME 2086
52-Week high 60.40
52-Week low 22.70
P/E 34.71
Mkt Cap.(Rs cr) 174
Buy Price 23.56
Buy Qty 2.00
Sell Price 23.79
Sell Qty 1.00

Megasoft Ltd. (MEGASOFT) - Auditors Report

Company auditors report

To the Members of

Megasoft Limited

Report on the Audit of the Standalone Ind AS Financial Statements

1. Opinion

We have audited the Standalone Ind AS Financial Statements of MEGASOFT LIMITED("the Company") which comprise the Balance Sheet as at 31st March 2022 and theStatement of Profit and Loss (including the Statement of Other Comprehensive Income) theStatement of Cash Flows Notes to Standalone Ind AS Financial Statements and the Statementof Changes in Equity for the year then ended and a summary of significant accountingpolicies and other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Standalone Ind AS Financial Statements give the informationrequired by the Companies Act 2013 in the manner so required and give a true and fairview in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at 31st March 2022 and profit changes in equity andits cash flows for the year ended on that date.

2. 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 theStandalone Ind AS Financial Statements section of our report. We are independent of theCompany in accordance with the Code of Ethics issued by the Institute of CharteredAccountants of India together with the ethical requirements that are relevant to our auditof the Standalone Ind AS Financial Statements under the provisions of the Companies Act2013 and the Rules thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the Code of Ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for ouropinion.

3. Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Standalone Ind AS Financial Statements of the currentperiod. These matters were addressed in the context of our audit of the Standalone Ind ASFinancial Statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report.

S.No. Key Audit Matter Auditor's Response
1 Accuracy of recognition measurement presentation and disclosures of revenues and other related balances in view of adoption of Ind AS 115 "Revenue from Contracts with Customers": We assessed the Company's process and policy to identify the impact of adoption of Ind AS 115. Our audit approach consisted testing of the design and operative effectiveness of internal controls and substantive testing as follows:
The application of the Ind AS 115 involves certain key judgements relating to identification of distinct performance obligations determination of transaction price of the identified performance obligations and the appropriateness of the basis used to measure revenue recognized over a period. Hence under Ind AS 115 revenue should be recognized when an entity transfers control of a good or service to a customer. A customer obtains contro l when it has the ability to direct the use of and obtain the benefits from the good or service. Evaluated the process relating to implementation of the new revenue accounting standard.
Accordingly the Company has not recognized revenue for sales initiated in the current year for which physical delivery of goods / rendering of service has happened in the next financial year. Selected a sample of continuing and new contracts relating to identification of the distinct performance obligations and we carried out a combination of procedures involving observation and inspection of evidence in this regard.
Identified the distinct performance obligations in these contracts.
Compared these performance obligations with those identified and recorded by the Company.
Performed analytical procedures for reasonableness of revenues disclosed by type and service offerings.
2 Evaluation of uncertain tax positions: We obtained the list of legal cases filed by and on the Company.
The Company has uncertain tax and legal positions including matters under dispute which involves significant judgment to determine the possible outcome of these disputes. We obtained details of completed tax assessments and demands for the year ended 31st March 2022 from the management.
We also reviewed the Company's correspondences and appeal documents.
We obtained status reports from the existing counsels handling each case.
Ascertained whether the chances of crystallization of liability are probable/ possible/ remote.
Ensured appropriate disclosure under Notes on accounts.
3 Capitalization of Building Transfer of Land upon Operation of Joint Development Agreement: We scrutinized all the documents maintained and agreements entered into by the Company including but not limited to the original Joint Development Agreement
The Company capitalized the 3rd Block of its Building received out of the Joint Development Agreement entered into with a developer. The Company also transferred a portion of its landed property arising out of the Joint Development Agreement. Occupancy Certificate Valuation Reports to ensure that the value of the capitalization of building transfer of land and the resultant gain is accurate.
This transaction has also been disclosed as an exceptional item in the Standalone Statement of Profit and Loss for the purpose of better understanding by the users of the Financial Statements.
4 Sale of Investments: During the year the Company has sold its investments in two foreign subsidiaries to another Indian subsidiary. In respect of the disinvestment made we checked documents such as sale agreements Board resolutions valuation reports etc. to confirm the correctness of the amounts recorded. We also ensured appropriateness of the accounting treatment and disclosure in line with the extant statutory regulations as well as the Indian Accounting Standards.
This transaction has also been disclosed as an exceptional item in the Standalone Statement of Profit and Loss for the purpose of better understanding by the users of the Financial Statements.

4. Information Other than the Financial Statements and Auditor's Report thereon

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Board's report including Annexureto Board's Report Business Responsibility Report Corporate Governance and Shareholder'sInformation but doesn't include the Standalone Ind AS Financial Statements and ourauditor's report thereon.

Our opinion on the Standalone Ind AS Financial Statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Ind AS Financial Statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the Standalone Ind AS FinancialStatements or our knowledge obtained in the course of our audit or otherwise appears to bematerially misstated. If based on the work we have performed we conclude that there is amaterial misstatement of this other information; we are required to report that fact. Wehave nothing to report in this regard.

5. Management's Responsibility for the Standalone Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 ("the Act") with respect to the preparationand presentation of these Standalone Ind AS Financial Statements that give a true and fairview of the financial position financial performance changes in equity and cash flows ofthe Company in accordance with the accounting principles generally accepted in Indiaincluding the accounting Standards specified under section 133 of the Act. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation 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 statement that givea true and fair view and are free from material misstatement whether due to fraud orerror.

In preparing the Standalone Ind AS 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.

The Board of Directors are also responsible for overseeing the Company's financialreporting process.

6. Auditor's Responsibilities for the Audit of the Standalone Ind AS FinancialStatements

Our objectives are to obtain reasonable assurance about whether the Standalone Ind ASFinancial Statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these Standalone Ind AS Financial Statements.

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 Standalone Ind ASFinancial 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 the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Companies Act 2013 we are also responsible for expressing our opinion on whetherthe company has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'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 Ind AS 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 the Standalone IndAS Financial Statements including the disclosures and whether the Standalone Ind ASFinancial Statements represent the underlying transactions and events in a manner thatachieves 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.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the Standalone Ind AS FinancialStatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.

7. Report on Other Legal and Regulatory Requirements

I. As required by the Companies (Auditor's Report) Order 2020 ("the Order")issued by the Central Government of India in terms of subsection (11) of section 143 ofthe Companies Act 2013 we give in the Annexure-A a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.

II. 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 the statement ofOther Comprehensive Income the Statement of Cash Flows Notes to the Standalone Ind ASFinancial Statements and the Statement of Changes in Equity dealt with by this Report arein agreement with the books of account.

(d) In our opinion the aforesaid Standalone Ind AS Financial Statements comply withthe Indian Accounting Standards specified under Section 133 of the Act read withCompanies (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 the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B".

(g) With respect to the matter to be included in the Auditors' Report under Section197(16) of the Act in our opinion and ac cording to the information and explanationsgiven to us the remuneration paid by the Company to its Directors during the year is inaccordance with the provisions of Section 197 of the Act.

(h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Aud it 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 litigation on its financial positionin its Standalone Ind AS Financial Statements - Refer Note No. 32 to the FinancialStatements.

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.

iv. (a) The management has represented that to the best of its knowledge and beliefas disclosed in the Note No. 30(n) to the accounts no funds have been advanced or loanedor invested (either from borrowed funds or share premium or any other sources or kind offunds) by the Company to or in any other person(s) or entity(ies) including foreignentities ("Intermediaries") with the understanding whether recorded in writingor otherwise that the Intermediary shall directly or indirectly lend or invest in otherpersons or entities identified in any manner whatsoever by or on behalf of the company("Ultimate Beneficiaries") or provide any guarantee security or the like onbehalf of the Ultimate Beneficiaries;

(b) The management has represented that to the best of its knowledge and belief asdisclosed in the Note No. 30(n) to the accounts no funds have been received by theCompany from any person(s) or entity(ies) including foreign entities ("FundingParties") with the understanding whether recorded in writing or otherwise that thecompany shall directly or indirectly lend or invest in other persons or entitiesidentified in any manner whatsoever by or on behalf of the Funding Party ("UltimateBeneficiaries") or provide any guarantee security or the like on behalf of theUltimate Beneficiaries; and

(c) Based on the audit procedures performed that have been considered reasonable andappropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the representations under sub-clause (i) and (ii) of Rule 11(e) of theCompanies (Audit and Auditors) Rules 2014 contain any material misstatement.

v. No dividend has been declared or paid during the year by the Company.

For N.C. Rajagopal & Co.
Chartered Accountants
Firm Regn. No.: 003398S
Arjun S
Place : Chennai (Partner)
Date: 30.05.2022 Membership No. 230448
UDIN: 22230448ALDGEF5772

ANNEXURE - A TO THE AUDITOR'S REPORT [Referred to in Para 7(I) of our report of evendate]

i) a)(A) The Company is maintaining proper records showing full particulars includingquantitative details and situation of its property plant and equipment.

(B) The Company is maintaining proper records showing full particulars of intangibleassets.

b) We have been informed that the property plant and equipment of the Company arephysically verified by the Management according to a phased program designed to cover allthe items over a period of three years which in our opinion is reasonable having regardto the size of the Company and the nature of its assets. Pursuant to the program physicalverification was carried out during the year and to the best of our knowledge no materialdiscrepancies were noticed.

c) The title deeds of all immovable properties disclosed in the financial statementsare held in the name of the Company.

d) According to the information given to us the company has not revalued its PropertyPlant and Equipment (including right of use assets) or intangible assets during the year.

e) According to the information and explanations given to us there have been noproceedings initiated or are pending against the Company for holding any benami propertyunder the Benami Transactions (Prohibition) Act 1988 (45 of 1988) and Rules madethereunder.

ii)a) The Company is a service company primarily rendering software services.Accordingly it does not have any inventory. Hence reporting under Clause (ii) (a) of theCompanies (Auditor's Report) Order 2020 does not arise.

b) Based on the information and explanations provided to us the Company has beensanctioned working capital limits in excess of Rs 5 crores in aggregate from banks on thebasis of security of current assets. The periodic returns / statements filed by theCompany with the bank are in agreement with the books of accounts of the Company.

iii) (a) (A) Based on the information and explanations given to us the Company has notprovided any advances in the nature of loans stood guarantee or given security to anyentity but has provided loans:

Guarantees Security Loans Advances in Nature of Loans
Aggregate amount granted/ provided during the year Nil Nil 359673251 Nil
Subsidiaries Nil Nil 284673251 Nil
Joint Ventures Nil Nil Nil Nil
Associates Nil Nil Nil Nil
Others Nil Nil 75000000 Nil
Balance outstanding as at balance sheet date in respect of Nil Nil 75000000 Nil
Subsidiaries Nil Nil Nil Nil
Joint Ventures Nil Nil Nil Nil
Associates Nil Nil Nil Nil
Others Nil Nil 75000000 Nil

(b) The investments made and loans granted by the Company are not prejudicial to theinterests of the Company.

(c) In respect of loans given the schedule of repayment of principal and interest hasbeen stipulated and repayment and receipts are regular in line with the terms ofsanction.

(d) Based on our verification of the records of the Company no amount of loan isoverdue.

(e) Based on the information and explanations given to us no loan granted which hasfallen due during the year has been renewed or extended or fresh loans granted to settlethe overdues of existing loans given to the same parties.

(f) The Company has not granted any loan or advance in the nature of loan eitherrepayable on demand or without specifying any terms or period of repayment.

iv) In our opinion and according to the information and explanations given to us theCompany has not made any investment or provided any guarantee or security as envisagedunder Section 185 and Section 186 of the Companies Act 2013. With respect to loansgranted the Company has complied with the provisions of section 186 of the Companies Act2013.

v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits or amounts which are deemed to be deposits from thepublic within the meaning of Section 73 to 76 or any other relevant provisions of theCompanies Act 2013 and the rules framed there under or under the directives of theReserve Bank of India. Hence reporting under clause (v) of the Companies (Auditor'sReport) Order 2020 does not arise.

vi) According to the information and explanations given to us the Central Governmenthas not prescribed maintenance of cost record under Section 148(1) of the Companies Act2013 in respect of the company.

vii) a) According to the information and explanations given to us and as per ourverification of the records of the Company in our opinion the company is generallyregular in depositing undisputed statutory dues including Income Tax Goods and ServicesTax Employees Provident Fund Employees State Insurance Customs Duty Excise Duty andother statutory dues applicable to it and there are no statutory dues outstanding for aperiod of more than six months from the date they become payable as on the last day of thefinancial year except for Tax deducted at Source of Rs. 41.15 lakhs.

b) According to the information and explanations given to us following are the disputeddues payable in respect of Income Tax as on 31st March 2022:

(1) Income tax and Interest amounting to Rs. 379.71 lakhs pertaining to the AssessmentYear 2012-13 (FY 2011-12) is pending before the ITAT of which an amount of Rs. 40.00 Lakhshas been deposited with the Income Tax Department during the previous year.

(2) Income tax and Interest amounting to Rs. 248.38 lakhs pertaining to the AssessmentYear 2013-14 (FY2012-13) is pending before the ITAT.

(3) Tax deducted at Source amounting to Rs. 17.79 lakhs for Assessment Years 2014-15 to2017-18 (FY 2013-14 to 2016-17) is pending at the TDS Circle.

viii) According to the information and explanations given to us and as per the recordsof the Company there have been no transactions not recorded in the books of account whichhave been surrendered or disclosed as income during the year and no tax assessments underthe Income Tax Act 1961 (43 of 1961) have been received during the year.

ix) a) Based on the records verified by us the Company has not defaulted in repaymentof loans or other borrowings or in the payment of interest thereon to any lender.

b) The Company has not been declared as a wilful defaulter by any bank or financialinstitution or other lender.

c) Based on our verification of the books and records the Company has applied the TermLoans for the purpose which they were obtained.

d) In our opinion and according to the information and explanations given to us thefunds raised on a short-term basis have not been utilised for long term purposes.

e) Based on our verification of the books of account the Company has not taken anyfunds from any entity or person on account of or to meet the obligations of itssubsidiaries and the Company does not have any associates or joint ventures.

f) Based on the audit procedures performed by us the Company has not raised any loansduring the year on the pledge of securities held in its subsidiaries and the Company doesnot have any joint ventures or associate companies.

x) a) Based on the information and explanations given to us the Company has raisedmoneys by way of Further Public Offer of equity shares during the year and the same wereapplied for the purpose for which they were raised and there were no moneys raised by wayof Initial Public Offer (including debt instruments) during the year.

b) According to the information and explanation given to us the Company has not madeany preferential allotment or private placement of shares or convertible debentures(fully partially or optionally convertible) during the year. Hence reporting underclause (x) (b) of the Companies (Auditor's Report) Order 2020 does not arise.

xi) a) According to the information and explanations given to us no fraud on or by thecompany has been noticed or reported during the year;

b) No report under section 143 (12) of the Companies Act 2013 has been filed by us inForm ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules 2014 withthe Central Government;

c) According to the information and explanation given to us there have been no whistleblower complaints received by the Company during the year. Hence reporting under clause(xi) (c) of the Companies (Auditor's Report) Order 2020 does not arise.

xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi company. Hence reporting under clauses (xii) (a) to (c) of theCompanies (Auditor's Report) Order 2020 does not arise.

xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements etc. as required by theapplicable accounting standards.

xiv) (a) Based on the information and explanations given to us and in our opinion theCompany has an internal audit system commensurate with the size and nature of itsbusiness;

(b) The reports of the Internal Auditor for the period under Audit were considered byus.

xv) According to the information and explanations given to us the Company has notentered into any non-cash transactions with the directors or persons connected with them.Hence reporting under Clause (xv) of the Companies (Auditor's Report) Order 2020 doesnot arise.

xvi) a) According to the information and explanations given to us and in our opinionthe Company is not required to be registered under Section 45-IA of the Reserve Bank ofIndia Act 1934.

b) Based on the information and explanations given to us the Company has not conductedany Non-Banking Financial or Housing Finance Activities without a valid Certificate ofRegistration (CoR) from the Reserve Bank of India as per the Reserve Bank of India Act1934.

c) In our opinion the Company is not a Core Investment Company (CIC) and hencereporting under Clause (xvi) (c) of the Compani es (Auditor's Report) Order 2020 does notarise.

d) According to the information and explanations given to us the Group does not anyCIC as part of the Group.

xvii) According to the information and explanations given to us and in our opinion thecompany has not incurred any cash losses in the financial year or in the immediatelypreceding financial year.

xviii) Based on the information and explanations given to us there has been noresignation of the statutory auditors during the year. Hence reporting under Clause(xviii) of the Companies (Auditor's Report) Order 2020 does not arise.

xix) 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 our knowledge of the Board of Directors and management plans in ouropinion no material uncertainty exists as on the date of the audit report that theCompany is capable of meeting its liabilities existing on the balance sheet date as andwhen they fall due within a period of one year from the balance sheet date.

xx) According to the information and explanations given to us and based on ourexamination of the records of the Company the provisions of section 135 (5) of theCompanies Act 2013 are not applicable to the Company. Hence reporting under Clause (xx)of the Companies (Auditor's Report) Order 2020 does not arise.

xxi) There have not been any qualifications or adverse remarks by the respectiveauditors in the Companies (Auditor's Report) Orde r 2020 Reports of the Companiesincluded in the consolidated financial statements of the Company. This reportingrequirement has also been covered in our Independent Auditor's Report on the ConsolidatedFinancial Statements of the Company.

For N.C. Rajagopal & Co.
Chartered Accountants
Firm Regn. No.: 003398S
Arjun S
Place : Chennai (Partner)
Date: 30.05.2022 Membership No. 230448
UDIN: 22230448ALDGEF5772

ANNEXURE - B TO THE AUDITORS' REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE(I) OF SUB-SECTION 3 OF SECTION 143 OF THE COMPANIES ACT 2013 ("THE ACT")

We have audited the internal financial controls over financial reporting of MegasoftLimited ("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'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. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

Auditors' Responsibility

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 both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial control 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 selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS 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 Ind AS 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 the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

(2) Provide reasonable assurance that transactions are recorded as necessary to permitpreparation of Ind AS financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance 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 Ind AS 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.

Opinion

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 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.

For N.C. Rajagopal & Co.
Chartered Accountants
Firm Regn. No.: 003398S
Arjun S
Place : Chennai (Partner)
Date: 30.05.2022 Membership No. 230448
UDIN: 22230448ALDGEF5772

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