Mohit Industries Ltd.
|BSE: 531453||Sector: Industrials|
|NSE: MOHITIND||ISIN Code: INE954E01012|
|BSE 16:00 | 22 Oct||11.40||
|NSE 15:59 | 22 Oct||11.45||
|Mkt Cap.(Rs cr)||16|
|Mkt Cap.(Rs cr)||16.14|
Mohit Industries Ltd. (MOHITIND) - Auditors Report
Company auditors report
The Members of
MOHIT INDUSTRIES LIMITED
Report on the Audit of the Standalone Financial Statements Qualified
We have audited the accompanying standalone financial statements ofMohit Industries Limited ("the Company") which comprise the Balance Sheet as atMarch 31 2020 the Statement of Profit and Loss (including Other Comprehensive Income)the Statement of Changes in Equity and the Statement of Cash Flows for the year ended onthat date and a summary of the significant accounting policies and other explanatoryinformation (hereinafter referred to as "the standalone financial statements").In our opinion and to the best of our information and according to the explanations givento us except for the effects of matter described in the Basis of QualifiedOpinion' Paragraph below the aforesaid standalone financial statements give theinformation required by the Act in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at 31st March 2020 and its profit (financial performanceincluding other comprehensive income) its cash flows and the changes in equity for theyear ended on that date.
Basis of Qualified Opinion
The company has not provided for Post-Employment Benefits and otherlong term employee benefits under Defined Benefit Plans on accrual basis but provides thesame as and when they become due for payment. This method of accounting of Post-EmploymentBenefits and other long term employee benefits under Defined Benefit Plans is in deviationwith Ind AS 19 on Employee Benefits. As there is no actuarial report or basis ofcalculation available with the management of such Post-Employment Benefits and other longterm employee benefits the quantum of deviation cannot be ascertained. If the company hadfollowed the method accounting as per Ind AS 19 then employee benefit expensewould have increased and correspondingly Profit for the period would have reduced.
We conducted our audit in accordance with the Standards on Auditing(SAs) specified under section 143(10) of the Companies Act 2013. Our responsibilitiesunder those Standards are further described in the Auditor's Responsibilities for theAudit of the Financial Statements section of our report. We are independent of the Companyin accordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the 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. We have determined the matters described below to be the key audit mattersto be communicated in our report.
The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the Board ofDirectors report but does not include the financial statements and our auditor'sreport thereon.
Our opinion on the financial statements does not cover the otherinformation and we will not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the financial statements or ourknowledge obtained in the audit or otherwise appears to be materially misstated. If basedon the work we have performed we conclude that there is a material misstatement of thisother information we are required to report that fact.
We have nothing to report in this regard.
Management's Responsibility for the Standalone FinancialStatements
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 standalonefinancial statements that give a true and fair view of the financial position financialperformance total comprehensive income changes in equity and cash flows of the Companyin accordance with the Ind AS and other accounting principles generally accepted in India.This responsibility also includes maintenance of adequate accounting records in accordancewith the provisions of the Act for safeguarding the assets of the Company and forpreventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalonefinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error. In preparing the standalone financialstatements management is responsible for assessing the Company's ability to continueas a going concern disclosing as applicable matters related to going concern and usingthe going concern basis of accounting unless management either intends to liquidate theCompany or to cease operations or has no realistic alternative but to do so.
The Board of Directors are 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 fraudand 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 inaccordance with SAs we exercise professional judgment and maintain professionalskepticism throughout the audit.
Identify and assess the risks of material misstatement ofthe financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate 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 theaudit in order to design audit procedures that are appropriate in the circumstances.
Evaluate the appropriateness of accounting policies used andthe reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use ofthe going concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the Company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor'sreport to the related disclosures in the financial statements or if such disclosures areinadequate to modify our opinion. Our conclusion are based on the audit evidence obtainedupto the date of our auditor's report. However future events or conditions may causethe Company to cease to continue as a going concern.
Evaluate the overall presentation structure and content ofthe financial 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 deficiencies in internal control that we identify during ouraudit. We also provide those charged with governance with a statement that we havecomplied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may be reasonably be thought to bear onour 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 of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2016("the Order") issued by the Central Government of India in terms of sub-section(11) of section 143 of the Act we give in the Annexure "A" a statement on thematters specified in the paragraph 3 and 4 of the Order.
2. As required by Section 143(3) of the Act we report that:-
a) We have sought & 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 accounts as required by law havebeen kept by the company so far as appears from our examination of such books.
c) The Balance Sheet the Statement of Profit and Loss including OtherComprehensive Income the Cash Flow Statement and Statement of Changes in Equity dealtwith by this report are in agreement with the books of account;
d) In our opinion the aforesaid Ind AS financial statements complywith the Indian Accounting Standards prescribed under Section 133 of the Act except forInd AS 19 on Employee Benefits in respect of provision for Long Term EmployeeBenefit & Defined Benefit plans.
e) In our opinion the tax demands litigation matters described in Sr.No. 1 of "Key Audit Matters" paragraph above if decided against the companymay have an adverse effect on the functioning of the Company.
f) On the basis of the written representations received from thedirectors as on 31st March 2020 and taken on record by the Board of Directors none ofthe directors is disqualified as on 31st March 2020 from being appointed as a director interms of section 164(2) of the Act.
g) With respect to the adequacy of the internal financial controls overfinancial reporting of the Company and the operating effectiveness of such controls referto our separate report in "Annexure B".
h) With respect to the other matters to be included in theAuditor's Report in accordance with the requirements of Section 197(16) of the Actas amended; In our opinion and to the best of our information and according to theexplanations given to us the remuneration paid/ provided by the Company to its Directorsduring the year is in accordance with the provisions of Section 197 of the Act
i) With respect to the other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 in our opinion and to the best of our information and according to theexplanations given to us:
i. The Company has disclosed the impact of pending litigations on itsfinancial position in its financial statements Refer Note 32(i) 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 has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.
Annexure "A" To The Independent Auditors' Report OfMohit Industries Limited For Year Ended 31St March 2020
i. (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets.
(b) The Company has a regular programme of physical verification of itsfixed assets by which fixed assets are verified at reasonable intervals. In accordancewith this programme certain fixed assets were verified during the year and no materialdiscrepancies were noticed on such verification.
(c) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the title deeds of immovableproperties are held in the name of the Company.
ii. As informed to us physical verification of inventory has beenconducted by the management at reasonable intervals during the year. As explained to usno material discrepancies were noticed on such physical verification.
iii. The Company has granted unsecured loans to one company covered inthe register maintained under section 189 of the Companies Act 2013 (theAct').
(a) In our opinion the rate of interest and other terms and conditionson which the loans had been granted to the company listed in the register maintained underSection 189 of the Act were not prima facie prejudicial to the interest of the Company
(b) As informed to us the principal and interest of above loans wererepayable as and when demanded and accordingly repayments or receipts were regular as andwhen demanded by the company.
(c) There are no overdue amounts in respect of the loans granted to thecompany listed in the register maintained under section 189 of the Act.
iv. In our opinion and according to the information and explanationsgiven to us the Company has complied with the provisions of section 185 and 186 of theAct with respect to the loans and investments made.
v. According to information & explanation given to us the companyhas not accepted any deposit from the public.
vi. As explained to us the company is maintaining cost accounts andrecords prescribed by the Central Government under section 148 (1) of the Companies Act2013. However these cost accounts/records were not examined by us.
vii. (a) The company has generally been regular in depositing theundisputed statutory dues including provident fund employees' state insuranceincome tax sales tax service tax duty of customs duty of excise value added tax cessand other material statutory dues applicable to it with the appropriate authorities.
According to the information and explanation given to us no undisputedamounts in respect of income tax sales tax service tax duty of customs duty of excisevalue added tax cess were in arrears as at 31st March 2020 for a period of more thansix months from the date they became payable.
(b) According to the information and explanations given to us thereare no material dues of duty of customs which have not been deposited with the appropriateauthorities on account of any dispute. Details of Income Tax Sales Tax Service TaxExcise Duty Value Added Tax (VAT) Entry Tax and Cess which have not been deposited as on31 March 2020 on account of disputes are given below:
viii. In our opinion and according to the information and explanationsgiven to us the company has not defaulted in repayment of loans or borrowings to thebanks financial institutions or government. As explained to us no debenture has beenissued by the company.
ix. The Company did not raise any money by way of initial public offeror further public offer (including debt instruments). According to information andexplanations given to us we are of the opinion that the term loans have been applied forthe purposes for which they were raised.
x. According to the information and explanations given to us nomaterial fraud by the Company or on the Company by its officers or employees has beennoticed or reported during the course of our audit.
xi. According to the information and explanations give to us and basedon our examination of the records of the Company the Company has paid/provided formanagerial remuneration in accordance with the requisite approvals mandated by theprovisions of section 197 read with Schedule V to the Act.
xii. In our opinion and according to the information and explanationsgiven to us the Company is not a nidhi company. Accordingly paragraph 3(xii) of theOrder is not applicable.
xiii. According to the information and explanations given to us andbased on our examination of the records of the Company transactions with the relatedparties are in compliance with sections 177 and 188 of the Act where applicable anddetails of such transactions have been disclosed in the financial statements as requiredby the applicable accounting standards.
xiv. According to the information and explanations give to us and basedon our examination of the records of the Company the Company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the year.
xv. According to the information and explanations given to us and basedon our examination of the records of the Company the Company has not entered intononcash transactions with directors or persons connected with him. Accordinglyparagraph 3(xv) of the Order is not applicable.
xvi. The Company is not required to be registered under section45IA of the Reserve Bank of India Act 1934.
Annexure "B" to the Independent Auditor's Report of Evendate on the Standalone Financial Statements of Mohit Industries Limited for year ended on31st March 2020
Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financialreporting of Mohit Industries Limited ("the Company") as of 31st March 2020 inconjunction with our audit of standalone financial statements of the Company for the yearended 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 tocompany'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 Companies Act 2013.
Our responsibility is to express an opinion on the Company'sinternal financial controls over financial reporting based on our audit. We conducted ouraudit in accordance with the Guidance Note on Audit of Internal Financial Controls overFinancial Reporting (the "Guidance Note") and the Standards on Auditing issuedby ICAI and deemed to be prescribed under section 143(10) of the Companies Act 2013 tothe extent applicable to an audit of internal financial controls both applicable to anaudit of Internal Financial Controls and both issued by the Institute of CharteredAccountants of India. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects. Our auditinvolves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system over financial reporting and their operating effectiveness. Ouraudit 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 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 system over financialreporting.
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial control over financial reporting isa process designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial controlover financial reporting includes those 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 authorizations of management and directors of thecompany; and
(3) provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition use or disposition of the company's assetsthat could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over FinancialReporting
Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31st March 2020 basedon the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.