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Mold-Tek Technologies Ltd.

BSE: 526263 Sector: Engineering
NSE: MOLDTECH ISIN Code: INE835B01035
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OPEN 76.00
PREVIOUS CLOSE 76.35
VOLUME 197
52-Week high 107.95
52-Week low 32.00
P/E 19.49
Mkt Cap.(Rs cr) 216
Buy Price 76.10
Buy Qty 14.00
Sell Price 76.60
Sell Qty 20.00
OPEN 76.00
CLOSE 76.35
VOLUME 197
52-Week high 107.95
52-Week low 32.00
P/E 19.49
Mkt Cap.(Rs cr) 216
Buy Price 76.10
Buy Qty 14.00
Sell Price 76.60
Sell Qty 20.00

Mold-Tek Technologies Ltd. (MOLDTECH) - Auditors Report

Company auditors report

To

The Members of Mold-Tek Technologies Limited

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the standalone financial statements of Mold-TekTechnologies Limited ("the Company") which comprise the Balance Sheet as at31st March 2020 and the Statement of Profit and Loss (including OtherComprehensive Income) the Statement of Changes in Equity and the Statement of Cash Flowsfor the year then ended and notes to the standalone financial statements including asummary of significant accounting policies and other explanatory information (hereinafterreferred to as "the standalone financial statements").

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone financial statements give theinformation required by the Companies Act 2013 ("the Act") in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the state of affairs of the Company as at 31stMarch 2020 and its profit (including other comprehensive income) changes in equity andits cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing(SAs) specified under section 143(10) of the Act. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theStandalone 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 thestandalone financial statements under the provisions of the Act and the Rules thereunderand we have fulfilled our other ethical responsibilities in accordance with theserequirements and the Code of Ethics issued by the Institute of Chartered Accountants ofIndia. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that in our professionaljudgement were of most significance in our audit of the standalone financial statementsof the current period. These matters were addressed in the context of our audit of thestandalone financial statements as a whole and in forming our opinion thereon and we donot provide a separate opinion on these matters. We have determined the matters describedbelow to be the key audit matters to be communicated in our report.

Sr. No. Key Audit Matter Auditor's Response
1 Revenue Recognition (Ind AS 115 Revenue from contracts with Customers) Principal Audit Procedures
Our audit procedures in revenue included -
The revenue standard establishes a comprehensive framework for determining whether how much and when revenue is recognized. This involves certain key judgments relating to identification of distinct performance obligations determination of transaction price of identified performance obligation the appropriateness of the basis used to measure revenue recognized over a period. • Assessing the appropriateness of Company's revenue recognition in line with Ind AS 115 - Revenue from Contracts with Customers.
• Evaluated the design and implementation of the processes and internal controls relating in respect of revenue recognition.
• Testing the effectiveness of such controls over revenue cut off at year-end.
• Testing the supporting documentation for sales transactions recorded during the period closer to the year end and subsequent to the year end and
• Performing analytical procedures on current year revenue based on monthly trends and where appropriate conducting further enquiries and testing.
2 Evaluation of uncertain tax positions Principal Audit Procedures
The Company has material uncertain tax positions including matters under dispute which involves significant management judgment to determine the possible outcome of these disputes. Refer Note No 36 to the Standalone Financial Statements Obtained details of completed tax assessments and demands for the year ended 31st March 2020 from management. We involved our internal experts to challenge the management's underlying assumptions in estimating the tax provision and the possible outcome of the disputes. Our internal experts also considered legal precedence and other rulings in evaluating management's position on these uncertain tax positions. Additionally we considered the effect of new information in respect of uncertain tax positions as at April 1 2019 to evaluate whether any change was required to management's position on these uncertainties.
3 Leases (Ind AS 116 'Leases') Principal Audit Procedures
The standard introduces a new lease accounting model wherein lessees are required to recognise a right-of-use (ROU) asset and a lease liability arising from a lease on the balance sheet. Our audit procedures on adoption of Ind AS 116 include:
• Evaluated the appropriateness of the accounting policy and the design and implementation of the processes and internal controls in respect of the lease accounting standard (Ind AS 116);
Adoption of the standard involves significant judgements and estimates including determination of the discount rates and the lease term.
• Assessed the appropriateness of leases identified by the Company based on the contractual agreements and our knowledge of the business;
• Upon transition as at 1 April 2019
- evaluated the method of transition and related adjustments;
- tested the completeness of the lease data by reconciling the Company's operating lease commitments to data used in computing ROU asset and related lease liabilities.
- Selected a sample to assess the key terms and conditions of each lease with the underlying lease contracts and evaluated computation of lease liabilities and challenged the key estimates such as discount rates and the lease term.
• Evaluated the completeness and accuracy of presentation and disclosures relating to Ind AS 116 including disclosures relating to transition.

Other Information

The Company's Board of Directors is responsible for the otherinformation. The other information comprises the other information in the Annual Reportbut does not include the standalone financial statements consolidated financialstatements and our auditor's report thereon. The other information is expected to be madeavailable to us after the date of this auditor's report.

Our opinion on the standalone financial statements does not cover theother information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statementsour responsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone financial statements orour knowledge obtained in the audit or otherwise appears to be materially misstated.

When we read the other information included in the annual report if weconclude that that there is a material misstatement therein we are required tocommunicate the matter to those charged with governance.

Responsibilities of Management and Those Charged with Governance forthe Standalone Financial Statements

The Company's Board of Directors is responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these standalone financialstatements that give a true and fair view of the financial position financialperformance changes in equity and cash flows of the Company in accordance with theaccounting principles generally accepted in India including

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 standalone financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone financial statements the Board ofDirectors is responsible for assessing the Company's ability to continue as a goingconcern disclosing as applicable matters related to going concern and using the goingconcern basis of accounting unless the Board of Directors either intends to liquidate theCompany or to cease operations 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 Standalone FinancialStatements

Our objectives are to obtain reasonable assurance about whether thestandalone financial statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these standalone financial statements.

As part of an audit in accordance with SAs we exercise professionaljudgement and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of thestandalone 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. Undersection 143(3)(i) of the Act we are also responsible for expressing our opinion onwhether the company has adequate internal financial controls system in place and theoperating 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 standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of thestandalone financial statements including the disclosures and whether the standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.

Materiality is the magnitude of misstatements in the standalonefinancial statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the standalone financialstatements may be influenced. We consider quantitative materiality and qualitative factorsin (i) planning the scope of our audit work and in evaluating the results of our work; and(ii) to evaluate the effect of any identified misstatements in the standalone financialstatements.

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 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 standalonefinancial statements of the current period and are therefore the key audit matters. Wedescribe these

matters in our auditor's report unless law or regulation precludespublic disclosure about the matter or when in extremely rare circumstances we determinethat a matter should not be communicated in our report because the adverse consequences ofdoing so would reasonably be expected to outweigh the public interest benefits of suchcommunication.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act based on our audit wereport 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 (includingOther Comprehensive Income) Statement of Changes in Equity and the Statement of CashFlows dealt with by this Report are in agreement with the books of account.

(d) In our opinion the aforesaid standalone financial statementscomply with Accounting Standards specified under Section 133 of the Act read with Rule 7of Companies (Accounts) Rules 2014.

(e) On the basis of the written representations received from thedirectors as on 31st March 2020 taken on record by the Board of Directors noneof the directors is disqualified as on 31st March 2020 from being appointed asa director in terms of Section 164 (2) of the Act.

(f) With respect to the adequacy of the internal financial controlsover financial reporting of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure A".

(g) In our opinion and to the best of our information and according tothe explanations given to us the remuneration paid by the Company to its directors duringthe year is in accordance with the provisions of section 197 of the Act.

(h) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 asamended 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 standalone financial statements (Refer Note No. 36 of thestandalone financial statements);

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 which wererequired to be transferred to the Investor Education and Protection Fund by the Company.

2. As required by the Companies (Auditor's Report) Order 2016 ('theOrder7) issued by the Central Government of India in terms of Section 143 (11)of the Act we give in "Annexure B" a statement on the matters specified inparagraphs 3 and 4 of the Order.

For M. Anandam & Co.
Chartered Accountants
(Firm's Registration No. 000125S)
Sd/-
M R Vikram
Partner
Membership No. 021012
UDIN: 20021012AAAAAW9595
Place: Hyderabad
Date: 17.06.2020

Annexure "A" to the Independent Auditor's Report

(Referred to in paragraph 1(f) under 'Report on Other Legal andRegulatory Requirements' section of our report of even date)

Report on the Internal Financial Controls Over Financial Reportingunder Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("theAct")

We have audited the internal financial controls over financialreporting of Mold-Tek Technologies Limited ("the Company") as of 31stMarch 2020 in conjunction with our audit of the standalone financial statements of theCompany for 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 and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Act.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls over FinancialReporting (the "Guidance Note") and the Standards on Auditing prescribed undersection 143 (10) of the Act to the extent applicable to an audit of internal financialcontrols both applicable to an audit of Internal Financial Controls. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgment including the assessment of therisks of material misstatement of the standalone financial statements whether due tofraud or error.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is aprocess 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 control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that 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.

Opinion

In our opinion to the best of our information and according to theexplanations given to us 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 2020based on 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.

For M. Anandam & Co.
Chartered Accountants
(Firm's Registration No. 000125S)
Sd/-
M R Vikram
Partner
Membership No. 021012
UDIN: 20021012AAAAAW9595
Place: Hyderabad
Date: 17.06.2020

Annexure "B" to the Independent Auditor's Report

With reference to Paragraph 2 under 'Report on Other Legal andRegulatory Requirements' section of our report of even date to the Members of the Companywe report that:

(i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of

property plant and equipment.

(b) The property plant and equipment have been physically verified bythe management in a periodical manner which in our opinion is reasonable having regardto the size of the Company and the nature of its business. No material discrepancies werenoticed 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) The Company does not have any inventories. Accordingly reportingunder clause 3 (ii) of the Order is not applicable to the company.

(iii) The company has not granted any loans secured or unsecured tocompanies firms Limited Liability Partnerships or other

parties covered in the register maintained under section 189 of theAct. Accordingly paragraph 3 (iii) (a) to (c) of the Order is not applicable.

(iv) In our opinion and according to the information and explanationsgiven to us the Company has complied with the provisions of Section 186 of the Act inrespect of making investments. The Company has not granted loans or provided guaranteesand securities.

(v) According to the information and explanations given to us theCompany has not accepted deposits within the meaning of Sections 73 to 76 of the Act andthe rules framed thereunder.

(vi) In our opinion and according to the information and explanationsgiven to us maintenance of cost records has not been specified by the Central Governmentunder sub-section (1) of section 148 of the Act.

(vii) (a) According to the information and explanations given to us andthe records of the Company examined by us the

Company is regular in depositing undisputed statutory dues includingprovident fund employees' state insurance income-tax customs duty goods and servicestax cess and any other statutory dues as applicable with the appropriate authorities andthere were no arrears of outstanding statutory dues as at the last day of the financialyear concerned for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us andrecords of the Company examined by us the particulars of income-tax and other statutorydues as at 31st March 2020 which have not been deposited on account of anydispute pending are as under:

Name of the statute Nature of the dues Amount (' in '000) Period to which the amount relates Forum where the dispute is pending
Income-tax Act 1961

Income-tax

3387.40 AY 2009-10

DCIT

1507.38 AY 2010-11
Income-tax Act 1961 Dividend distribution tax 70.35 AY 2015-16 CIT (Appeals)
Income-tax Act 1961 Income-tax 3498.37 AY 2013-14 ITAT

(viii) In our opinion and according to the information and explanationsgiven to us the Company has not defaulted in repayment of loans or borrowings tofinancial institutions and banks. The Company has not obtained borrowings from thegovernment and has not issued any debentures.

(ix) The Company did not raise any money by way of initial public offeror further public offer during the year. In our opinion and according to the informationand explanations given to us the term loans have been applied for the purpose for whichthe loans were obtained.

(x) To the best of our knowledge and belief and according to theinformation and explanations given to us no fraud on or by the Company was noticed orreported during the year.

(xi) In our opinion and according to the information and explanationsgiven to us the Company has paid/provided for managerial remuneration in accordance withthe requisite approvals mandated by the provisions of section 197 read with Schedule V tothe Act.

(xii) The Company is not a Nidhi Company and hence reporting underparagraph 3 (xii) of the Order is not applicable.

(xiii) In our opinion and according to the information and explanationsgiven to us and based on our examination of the records of the Company transactions withthe related parties are in compliance with section 177 and 188 of the Act where applicableand details of such transactions have been disclosed in the standalone financialstatements as required by the applicable accounting standards.

(xiv) During the year the Company has not made preferential allotmentor private placement of shares or fully or partly convertible debentures and hencereporting under paragraph 3 (xiv) of the Order is not applicable.

(xv) In our opinion and according to the information and explanationsgiven to us and based on our examination of the records of the Company the Company hasnot entered into any non-cash transactions with directors or persons connected with him.Accordingly paragraph 3 (xv) of the Order is not applicable.

(xvi) The Company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934.

For M. Anandam & Co.
Chartered Accountants
(Firm's Registration No. 000125S)
Sd/-
M R Vikram
Partner
Membership No. 021012
UDIN: 20021012AAAAAW9595
Place: Hyderabad
Date: 17.06.2020

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