<dhhead>IND EPENDENT AUDITOR’S REPORT</dhhead>
To the Members of MIRC Electronics Limited
Report on the Audit of the Financial Statements Opinion
We have audited the accompanying financial statements of MIRCElectronics Limited ("the Company") which comprise the Balance Sheet as atMarch 31 2022 the Statement of Profit and Loss including the statement of OtherComprehensive Income the Cash Flow Statement and the Statement of Changes in Equity forthe year then ended and notes to the financial statements including a summary ofsignificant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to theexplanations given to us the aforesaid financial statements give the information requiredby the Companies Act_ 2013 as amended ("the Act") in the manner so requiredand give a true and fair view in conformity with the accounting principles generallyaccepted in India of the state of affairs of the Company as at March_31_2022 its lossincluding other comprehensive loss its cash flows and the changes in equity for the yearended on that date.
Basis for Opinion
We conducted our audit of the financial statements in accordance withthe Standards on Auditing (SAs) as specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the ‘Auditor’sResponsibilities for the Audit of the Financial Statements’ section of ourreport. We are independent of the Company in accordance with the ‘Code ofEthics’ issued by the Institute of Chartered Accountants of India togetherwith the ethical requirements that are relevant to our audit of the 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 audit opinion on the financial statements.
Key Audit Matters
Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the financial statements for the financial yearended March 31 2022. These matters were addressed in the context of our audit of thefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. For each matter below our description of how ouraudit addressed the matter is provided in that context. We have determined the mattersdescribed below to be the key audit matters to be communicated in our report. We havefulfilled the responsibilities described in the Auditor’s responsibilities for theaudit of the financial statements section of our report including in relation to thesematters. Accordingly our audit included the performance of procedures designed to respondto our assessment of the risks of material misstatement of the financial statements. Theresults of our audit procedures including the procedures performed to address the mattersbelow provide the basis for our audit opinion on the accompanying financial statements.
| Key audit matters | How our audit addressed the key audit matter |
| Identification and value adjustments to slow-moving and non-moving inventories (Refer Note 8 to the financial statements) |
| Our procedures included the following: |
| As at March 31 2022 the carrying value of inventories amounted to _ 42428.03 lakhs. The inventories are valued at lower of cost or net realizable value. | We have obtained understanding of how the management identifies the slow moving and non-moving inventories and estimates the net realizable value of slow moving and non- moving inventories. |
| The Company carries out an inventory review on a periodic basis and considers the ageing and expected production and sales forecast of inventory items for the purpose of identification of slow moving and non-moving items against which it adjusts based on its estimated realizable value. | We also assessed reasonableness of the allowance policy which is based on historical sales performance and future production and sales plan of inventories. |
| Given the significant judgement exercised by the management in the estimation and considering the amount involved we have considered the identification and value adjustments to slow- moving and non-moving inventories as a key audit matter. | We obtained the list of slow moving and non- moving inventories from the Company verified the ageing and inquired with the management for the realizability plan of such items of inventories on a test check basis. |
| We have obtained the working of net realizable value for slow moving and non-moving inventories and tested the same on a sample basis by comparing it with the past sales transactions. |
| We have verified whether the value adjustments made to slow-moving and non-moving inventories are in line with the Company’s provisioning policy. |
| Key audit matters | How our audit addressed the key audit matter |
| Tax Litigations (Refer Note 39 to the financial statements) | |
| As at the balance sheet date the Company has certain tax | Our procedures included the following: |
| litigations which are pending with various level of judicial | |
| authorities. The total tax exposure amounts as at March 31 2022 is | We obtained the list of tax litigations from the Company. |
| rs 10118.75 lakhs. The Company has tax balances recoverable of Rs2646.48 lakhs related to these tax balances is dependent on the outcome of these tax litigations. | We have obtained and read the Company’s submission to tax authorities and the tax opinions of management’s experts on these litigation matters wherever considered necessary. |
| The accounting for these tax positions comprises significant judgment by the management mainly in the area whether to recognize these uncertain positions as a contingent liability or as a provision and also the recoverability of outstanding tax receivable. Given the high level of management judgement tax laws interpretations and significant amount of litigations involved we considered this area to be a key audit matter. | We also involved our internal team of tax specialists to review management’s assessment for material litigation matters based on past precedence and applicable compliance with tax laws. |
| We have assessed the accounting and disclosures related to these litigations in the financial statements. |
We have determined that there are no other key audit matters tocommunicate in our report.
Information Other than the Financial Statements and Auditor’sReport Thereon
The Company’s Board of Directors is responsible for the otherinformation. The other information comprises the information included in the Annualreport but does not include the financial statements and our auditor’s reportthereon. Our opinion on the financial statements does not cover the other information andwe do not express any form of assurance conclusion thereon. In connection with our auditof the financial statements our responsibility is to read the other information and indoing so consider whether such other information is materially inconsistent with thefinancial statements or our knowledge obtained in the 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.
Responsibilities of Management for the Financial Statements
The Company’s Board of Directors is responsible for the mattersstated in section 134(5) of the Act with respect to the preparation of these financialstatements that give a true and fair view of the financial position financial performanceincluding other comprehensive income cash flows and changes in equity of the Company inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards (Ind AS) specified under section 133 of the Act read with [theCompanies (Indian Accounting Standards) Rules 2015 as amended. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and the designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.
In preparing the financial statements management is responsible forassessing the Company’s ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing theCompany’s financial reporting process.
Auditor’s Responsibilities for the Audit of the FinancialStatements
Our objectives are to obtain reasonable assurance about whether thefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor’s report that includes our opinion. Reasonableassurance is a high level of assurance but is not a guarantee that an audit conducted inaccordance with SAs will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these financial statements.
As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the
financial statements whether due to fraud or error design and performaudit procedures responsive to those risks and obtain audit evidence that is sufficientand appropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control.
Obtain an understanding of internal control 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 financial statements inplace and the operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany’s ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor’s report to therelated disclosures in the financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor’s report. However future events or conditions may cause theCompany to cease to continue as a going concern.
Evaluate the overall presentation structure and content of thefinancial statements including the disclosures and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.
We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant de_ciencies in internal control that we identify during ouraudit.
We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.
From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the financialstatements for the financial year ended March 31 2022 and are therefore the key auditmatters. We describe these matters in our auditor’s report unless law or regulationprecludes public disclosure about the matter or when in extremely rare circumstances wedetermine that a matter should not be communicated in our report because the adverseconsequences of doing so would reasonably be expected to outweigh the public interestbenefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor’s Report) Order 2020("the Order") issued by the Central Government of India in terms of sub-section(11) of section 143 of the Act based on our audit we give in the "Annexure_1" astatement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act we report that:
(a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit;
(b) In our opinion proper books of account as required by law havebeen kept by the Company so far as it appears from our examination of those books;
(c) The Balance Sheet the Statement of Profit and Loss including theStatement of Other Comprehensive Income the Cash Flow Statement and Statement of Changesin Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion the aforesaid financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended;
(e) On the basis of the written representations received from thedirectors as on March 31 2022 taken on record by the Board of Directors none of thedirectors is disqualified as on March_31_2022 from being appointed as a director in termsof Section 164 (2) of the Act;
(f) With respect to the adequacy of the internal financial controlswith reference to these financial statements and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure 2" to this report;
(g) In our opinion the managerial remuneration for the year endedMarch 31 2022 has been paid / provided by the Company to its directors in accordancewith the provisions of section 197 read with Schedule V to the Act;
(h) With respect to the other matters to be included in theAuditor’s Report in accordance with Rule_11 of the Companies (Audit andAuditors)Rules 2014 as amended in our opinion and to the best of our information andaccording to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on itsfinancial position in its financial statements – Refer Note 39 to the financialstatements;
ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses;
iii. There were no amounts which were required to be transferred to theInvestor Education and Protection Fund by the Company;
iv. a) The management has represented that to the best of itsknowledge and belief no funds have been advanced or loaned or invested (either fromborrowed funds or share premium or any other sources or kind of funds) by the company toor in any other persons or entities including foreign entities("Intermediaries") with the understanding whether recorded in writing orotherwise that the Intermediary shall whether directly or indirectly lend or invest inother persons or entities identified in any manner whatsoever by or on behalf of thecompany ("Ultimate Beneficiaries") or provide any guarantee security or thelike on behalf of the Ultimate Beneficiaries;
b) The management has represented that to the best of its knowledgeand belief no funds have been received by the company from any persons or entitiesincluding foreign entities ("Funding Parties") with the understanding whetherrecorded in writing or otherwise that the company shall whether directly or indirectlylend or invest in other persons or entities identified in any manner whatsoever by or onbehalf of the Funding Party ("Ultimate Beneficiaries") or provide any guaranteesecurity or the like on behalf of the Ultimate Beneficiaries; and
c) Based on such audit procedures that were considered reasonable andappropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the representations under sub-clause (a) and (b) contain any materialmisstatement.
v. No dividend has been declared or paid during the year by theCompany.
For S R B C & CO LLP Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Firoz Pradhan Partner
Membership Number: 109360 UDIN: 22109360AJNZOL6453
Place of Signature: Mumbai Date: May 25 2022
"Annexure 1" referred to in paragraph under the heading"Report on Other Legal and Regulatory Requirements" of our report of even date
In terms of the information and explanations sought by us and given bythe Company and the books of account and records examined by us in the normal course ofaudit and to the best of our knowledge and belief we state that: i.
(a) The Company has maintained proper records showing full particularsincluding quantitative details and situation of Property Plant and Equipment.
(b) The Company has maintained proper records showing full particularsof intangibles assets.
(c) Property Plant and Equipment have been physically verified by themanagement during the year and no material discrepancies were identified on suchverification.
(d) The title deeds of all the immovable properties (other thanproperties where the Company is the lessee and the lease agreements are duly executed infavour of the lessee) are held in the name of the Company.
(e) The Company has not revalued its Property Plant and Equipment(including Right of use assets) or intangible assets during the year ended March 31 2022.
(f) There are no proceedings initiated or are pending against theCompany for holding any benami property under the Prohibition of Benami PropertyTransactions Act 1988 and rules made thereunder.
(ii) (a) The inventory has been physically verified by the managementduring the year. In our opinion the frequency of verification by the management isreasonable and the coverage and procedure for such verification is appropriate and nodiscrepancies of 10% or more in aggregate for each class of inventory were noticed. Therewas no inventory lying with third parties.
(b) As disclosed in Note 16 to the financial statements the Companyhas been sanctioned working capital limits in excess of _ five crores in aggregate frombanks during the year on the basis of security of current assets of the Company. Thequarterly returns/ statements filed by the Company with such banks are in agreement withthe books of accounts of the Company.
(iii) (a) During the year the Company has not provided loans advancesin the nature of loans stood guarantee or provided security to companies firmsLimitedLiability Partnerships or any other parties. Accordingly the requirement to report onclause 3(iii)(a) of the Order is not applicable to the Company.
(b) During the year the Company has not made investments providedguarantees provided security and granted loans and advances in the nature of loans tocompanies firms Limited Liability Partnerships or any other parties. Accordingly therequirement to report on clause 3(iii)(b) of the Order is not applicable to the Company.
(c) The Company has not granted loans and advances in the nature ofloans to companies firms Limited Liability Partnerships or any other parties.Accordingly the requirement to report on clause 3(iii) (c) of the Order is not applicableto the Company.
(d) The Company has not granted loans or advances in the nature ofloans to companies firms Limited Liability Partnerships or any other parties.Accordingly the requirement to report on clause 3(iii)(d) of the Order is not applicableto the Company.
(e) There were no loans or advance in the nature of loan granted tocompanies firms Limited Liability Partnerships or any other parties. Accordingly therequirement to report on clause 3(iii)(e) of the Order is not applicable to the Company.
(f) The Company has not granted any loans or advances in the nature ofloans either repayable on demand or without specifying any terms or period of repaymentto companies firms limited liability partnerships or any other parties. Accordinglythe requirement to report on clause 3(iii)(f) of the Order is not applicable to theCompany.
(iv) There are no loans investments guarantees and security inrespect of which provisions of sections 185 and 186 of the Act are applicable andaccordingly the requirement to report on clause 3(iv) of the Order is not applicable tothe Company.
(v) The Company has neither accepted any deposits from the public noraccepted any amounts which are deemed to be deposits within the meaning of sections 73 to76 of the Act and the rules made thereunder to the extent applicable. Accordingly therequirement to report on clause 3(v) of the Order is not applicable to the Company.
(vi) We have broadly reviewed the books of account maintained by theCompany pursuant to the rules made by the Central Government for the maintenance of costrecords under section 148(1) of the Act related to the manufacture of the consumerappliances and are of the opinion that prima facie the specified accounts and recordshave been made and maintained. We have not however made a detailed examination of thesame.
(vii) (a) The Company is regular in depositing with appropriateauthorities undisputed statutory dues including goods and services tax provident fundemployees’ state insurance income-tax duty of customs cress and other statutorydues applicable to it. The provisions relating to sales- tax service tax duty of exciseand value added tax are not applicable to the Company. According to the information andexplanations given to us and based on audit procedures performed by us no undisputedamounts payable in respect of these statutory dues were outstanding at the year end fora period of more than six months from the date they became payable.
(b) The dues of goods and services tax provident fund employees’state insurance income-tax sales-tax service tax duty of custom duty of excise valueadded tax cess and other statutory dues have not been deposited on account of anydispute are as follows:
| Name of the statute | Nature of Dues | Amount of dispute in _ lakhs (net of deposits) | Period to which the amount relates | Forum where the dispute is pending |
| The Income-tax Act 1961 | Income Tax | 205.19 | FY 2009-2010 | ITAT |
| | 160.98 | FY 2015-2016 | CIT(A) |
| | | FY 2016-2017 | |
| | 337.12 | FY 2000-2001 | High Court |
| | | FY 2001-2002 | |
| | | FY 2004-2005 | |
| | | FY 2005-2006 | |
| | | FY 2007-2008 | |
| | | FY 2010-2011 | |
| The Finance Act | Service | 5765.59 | FY 2007-08 - FY 2009-10 | CESTAT |
| 1994 | Tax | | December 2007 - December | |
| | | 2015 | |
| | | April 2011 - December 2015 | |
| | | January 2016 - June 2017 | |
| | 129.31 | FY 2015 - 2016 | High Court |
| | 92.55 | FY 2005 – 2010 | Commissioner (Appeals) |
| The Central | Excise | 2.02 | FY 1997-1998 | Commissioner (Appeals) |
| Excise Act 1944 | Duty | | FY 1999-2000 | |
| | 10.00 | FY 1998-1999 | HIGH COURT |
| | 189.94 | FY 2007-08 | CESTAT |
| | | FY 2008-09 | |
| | | March 2010 - February 2012 | |
| | | April 2011 to March 2016 | |
| | | For the months of April’13 | |
| | | April’14 April’15 and April’16 | |
| The Customs Act 1962 | Customs duty | 22.40 | FY 2012-13 | CESTAT |
| | 50.88 | FY 2012-14 | Commissioner of Customs |
| | 0.10 | FY 2015-16 | Commissioner of Customs (Appeals) |
| | 88.74 | FY 2014-16 | Deputy Commissioner of Customs |
| Name of the statute | Nature of Dues | Amount of dispute in _ lakhs (net of deposits) | Period to which the amount relates | Forum where the dispute is pending |
| The SalesTax Act (Centre and state) | Sales Tax | 0.03 | FY 2009 -10 FY 2011-12 | Appellate Authorities |
| | 0.87 | FY 2010-11 | Additional Commissioner (Appeals) |
| | 52.93 | FY 2010-11 | Appellate Authority |
| | | FY 2013-14 | |
| | 656.36 | FY 2008-09 | Assessing Officer |
| | | FY 2010-11 | |
| | | FY 2011-12 | |
| | | FY 2012-13 | |
| | | FY 2014-15 | |
| | | FY 2017-18 | |
| | 128.84 | FY 2010-11 | Assistant Commissioner |
| | | FY 2011-12 | |
| | | FY 2012-13 | |
| | | FY 2013-15 | |
| | 137.45 | FY 2006 -07 | Commissioner |
| | | FY 2007-08 | |
| | | FY 2008-09 | |
| | | FY 2011-12 | |
| | | FY 2012-13 | |
| | 370.32 | FY 2000-01 | Deputy Commissioner (Appeals) |
| | 48.21 | FY 1997-98 | Deputy Commissioner |
| | | FY 1999-00 | |
| | | FY 2000-01 | |
| | | FY 2003-04 | |
| | | FY 2004-05 | |
| | | FY 2006-07 | |
| | | FY 2007-08 | |
| | | FY 2008-09 | |
| | | FY 2009-10 | |
| | | FY 2010-11 | |
| | | FY 2011-12 | |
| | | FY 2012-13 | |
| | | FY 2016-17 | |
| | 213.90 | FY 2002-03 | High Court |
| | | FY 2003-04 | |
| | | FY 2004-05 | |
| | | FY 2010-11 | |
| Name of the statute | Nature of Dues | Amount of dispute in _ lakhs (net of deposits) | Period to which the amount relates | Forum where the dispute is pending |
| | 563.01 | FY 2003-04 | Joint Commissioner |
| | | FY 2005-06 | |
| | | FY 2008-09 | |
| | | FY 2010-11 | |
| | | FY 2012-13 | |
| | | FY 2013-14 | |
| | | FY 2014-15 | |
| | | FY 2015-16 | |
| | | FY 2016-17 | |
| | 6435.06 | FY 2005-06 | Joint Commissioner (Appeals) |
| | | FY 2006-07 | |
| | | FY 2007-08 | |
| | | FY 2009-10 | |
| | | FY 2011-12 | |
| | | FY 2012-13 | |
| | | FY 2013-14 | |
| | | FY 2014-15 | |
| | | FY 2015-16 | |
| | | FY 2016-12 | |
| | | FY 2017-18 | |
| | 448.14 | FY 2006-07 | Revisional Board |
| | | FY 2007-08 | |
| | | FY 2008-09 | |
| | | FY 2009-10 | |
| | | FY 2010-11 | |
| | 195.69 | FY 2003-04 | Tribunal |
| | | FY 2005-06 | |
| | | FY 2006-07 | |
| | | FY 2007-08 | |
(c) The Company has not surrendered or disclosed any transactionpreviously unrecorded in the books of account in the tax assessments under the Income TaxAct 1961 as income during the year. Accordingly the requirement to report on clause3(viii) of the Order is not applicable to the Company.
(viii) The Company has not surrendered or disclosed any transactionpreviously unrecorded in the books of account in the tax assessments under the Income TaxAct 1961 as income during the year. Accordingly the requirement to report on clause3(viii) of the Order is not applicable to the Company.
(ix) (a) The Company has not defaulted in repayment of loans or otherborrowings or in the payment of interest thereon to any lender.
(b) The Company has not been declared willful defaulter by any bank orfinancial institution or government or any government authority.
(c) Term loans were applied for the purpose for which the loans wereobtained.
(d) On an overall examination of the financial statements of theCompany no funds raised on short-term basis have been used for long-term purposes by theCompany.
(e) The Company does not have any subsidiary associate or jointventure. Accordingly the requirement to report on clause 3(ix)(e) of the Order is notapplicable to the Company.
(f) The Company does not have any subsidiary associate or jointventure. Accordingly the requirement to report on Clause 3(ix)(f) of the Order is notapplicable to the Company.
(x) (a) The Company has not raised any money during the year by way ofinitial public offer / further public offer
(including debt instruments) hence the requirement to report on clause3(x)(a) of the Order is not applicable to the Company.
(b) The Company has not made any preferential allotment or privateplacement of shares /fully or partially or optionally convertible debentures during theyear under audit and hence the requirement to report on clause 3(x)(b) of the Order isnot applicable to the Company.
(xi) (a) No material fraud by the Company or no material fraud on theCompany has been noticed or reported during the year.
(b) During the year no report under sub-section (12) of section 143 ofthe Act has been filed by the cost auditor or secretarial auditor or by us in Form ADT– 4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules 2014 withthe Central Government.
(c) As represented to us by the management there are no whistle blowercomplaints received by the Company during the year.
(xii) The Company is not a nidhi Company as per the provisions of theAct. Therefore the requirement to report on clause 3(xii)(a)(b) and (c) of the Order isnot applicable to the Company.
(xiii) Transactions with the related parties are in compliance withsections 177 and 188 of the Act where applicable and the details have been disclosed inthe notes to the financial statements as required by the applicable accounting standards.
(xiv) (a) The Company has an internal audit system commensurate withthe size and nature of its business.
(b) The internal audit reports of the Company issued till the date ofthe audit report for the period under audit have been considered by us.
(xv) The Company has not entered into any non-cash transactions withits directors or persons connected with its directors and hence requirement to report onclause 3(xv) of the Order is not applicable to the Company.
(xvi) (a) The provisions of section 45-IA of the Reserve Bank of IndiaAct 1934 (2 of 1934) are not applicable to the Company. Accordingly the requirement toreport on clause (xvi)(a) of the Order is not applicable to the Company.
(b) The Company has not conducted any Non-Banking Financial or HousingFinance activities without obtaining a valid Certificate of Registration (CoR) from theReserve Bank of India as per the Reserve Bank of India Act 1934.
(c) The Company is not a Core Investment Company as defined in theregulations made by Reserve Bank of India. Accordingly the requirement to report onclause 3(xvi)(c) of the Order is not applicable to the Company.
(d) There is no Core Investment Company as a part of the Group hencethe requirement to report on clause 3(xvi) of the Order is not applicable to the Company.
(xvii) The Company has not incurred cash losses in the currentfinancial year and in the immediately preceding financial year.
(xviii) There has been no resignation of the statutory auditors duringthe year and accordingly requirement to report on Clause 3
(xviii) of the Order is not applicable to the Company.
(xix) On the basis of the financial ratios disclosed in Note 49 to thefinancial statements ageing and expected dates of realization of financial assets andpayment of financial liabilities other information accompanying the financial statementsour knowledge of the Board of Directors and management plans and based on our examinationof the evidence supporting the assumptions nothing has come to our attention whichcauses us to believe that any material uncertainty exists as on the date of the auditreport that Company is not capable of meeting its liabilities existing at the date ofbalance sheet as and when they fall due within a period of one year from the balance sheetdate. We however state that this is not an assurance as to the future viability of theCompany. We further state that our reporting is based on the facts up to the date of theaudit report and we neither give any guarantee nor any assurance that all liabilitiesfalling due within a period of one year from the balance sheet date will get dischargedby the Company as and when they fall due.
(xx) The provision of section 135 of the Act is not applicable to theCompany. Therefore the requirement to report on clause 3(xx) of the order is notapplicable to the Company.
For S R B C & CO LLP Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Firoz Pradhan Partner
Membership Number: 109360 UDIN: 22109360AJNZOL6453
Place of Signature: Mumbai Date: May 25 2022
"Annexure 2" referred to in Paragraph 2(f) under the heading"Report on Other Legal and Regulatory Requirements" of our report of even dateReport on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143of the Companies Act 2013 ("the Act")
We have audited the internal financial controls with reference tofinancial statements of MIRC Electronics Limited ("the Company") as ofMarch_31_2022 in conjunction with our audit of the financial statements of the Companyfor the year ended on that date.
Management’s Responsibility for Internal Financial Controls
The Company’s Management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India("ICAI"). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence to theCompany’s policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.
Auditor’s Responsibility
Our responsibility is to express an opinion on the Company’sinternal financial controls with reference to these financial statements based on ouraudit. We conducted our audit in accordance with the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting (the "Guidance Note") and theStandards on Auditing as specified under section 143(10) of the Act to the extentapplicable to an audit of internal financial controls both issued by ICAI. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls with reference to these financial statements was established andmaintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls with reference to these financialstatements and their operating effectiveness. Our audit of internal financial controlswith reference to financial statements included obtaining an understanding of internalfinancial controls with reference to these financial statements assessing the risk that amaterial 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 judgments including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the
Company’s internal financial controls with reference to thesefinancial statements.
Meaning of Internal Financial Controls With Reference to theseFinancial Statements
A company’s internal financial controls with reference tofinancial statements is a process designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles. Acompany’s internal financial controls with reference to financial statements includesthose policies and procedures that
(1) pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany;
(2) provide reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorisations of management and directors of thecompany; and
(3) provide reasonable assurance regarding prevention or timelydetection of unauthorised acquisition use or disposition of the company’s assetsthat could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls With Reference toFinancial Statements
Because of the inherent limitations of internal financial controls withreference to financial statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to financial statements to future periods are subject to the riskthat the internal financial control with reference to financial statements may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.
Opinion
In our opinion the Company has in all material respects adequateinternal financial controls with reference to financial statements and such internalfinancial controls with reference to financial statements were operating effectively as atMarch_31_2022 based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note issued by the ICAI.
For S R B C & CO LLP Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Firoz Pradhan Partner
Membership Number: 109360 UDIN: 22109360AJNZOL6453
Place of Signature: Mumbai Date: May 25 2022
