To the Members of Mukand Engineers Limited
Report on the audit of the Financial statements
We have audited the accompanying Ind AS Financial Statements of M/s Mukand EngineersLimited ("the Company") which comprise the Balance Sheet as at March 31 2020the Statement of Profit and Loss including Other Comprehensive Income the Cash FlowStatement and the Statement of Changes in Equity for the year then ended and notes to thefinancial statements including a summary of significant accounting policies and otherexplanatory information (hereinafter referred to as financial statements).
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by theCompanies Act 2013 as amended (the Act') in the manner so required and give a trueand fair view in conformity with the accounting principles generally accepted in Indiaincluding Indian Accounting Standards (Ind AS') specified under Section 133 of theAct of the state of affairs of the Company as at 31 March 2020 and its loss includingother comprehensive loss its cash flows and the changes in equity for the year ended onthat date.
Basis of opinion
We conducted our audit of the financial statements in accordance with Standards onAuditing (SAs) specified under Section 143(10) of the Act. Our responsibilities underthose standards are further described in the Auditors Responsibilities for the Auditof the financial statements' section of our report. We are independent of the Company inaccordance with the Code of Ethics' issued by the Institute of Chartered Accountantsof India (ICAI') together with the ethical requirements that are relevant to ouraudit of 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. We believe that the audit evidence we have obtainedis sufficient and appropriate to provide a basis for our opinion on the financialstatements.
Material Uncertainty related to Going concern
We draw your attention to Note No. 44 of the Statement which states that the Companyhas incurred a net loss of Rs 3018.12 lakhs (loss after tax) during the year ending 31stMarch 2020 and as of that date the Company's current liabilities exceeded its totalassets by Rs 838.24 lakhs and has accumulated losses amounting to Rs 5039.11 lakhs (lossafter tax) up to 31st March 2020 resulting in to erosion of the Net Worth of theCompany. During the period under review Fund flow of the Company has been impacted onaccount of general slow-down in the business which may also seriously impair Company'sfinancial position. This indicate that a material uncertainty exists that may castsignificant doubt on the Company's ability to continue as going concern. However keepingin mind the ongoing restructuring exercise by the Company it is believed that thebusiness will be able to generate sufficient profits in future to meet its financialobligations these annual financial statements have been prepared using going concernbasis of accounting.
Our opinion is not modified in respect of above matter.
Key audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements for the financial year ending 31stMarch 2020. These matters were addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. For each matter below our description of how our auditaddressed the matter is provided in that context.
We have determined the matters described below to be the Key audit matters to becommunicated in our report. We have fulfilled the responsibilities described in theAuditor's Responsibilities for the Audit of the financial statements' section of ourreport including in relation to these matters. Accordingly our audit included theperformance of procedures designed to respond to our assessment of the risks of materialmisstatement of the financial statements. The results of our audit procedures includingthe procedures performed to address the matters below provide the basis for our auditopinion on the accompanying financial statements.
|Key Audit Matters ||How our audit addressed the key audit matter |
|I.Revenue from Contracts with Customers || |
|The Company has adopted Ind AS 115 "Revenue from Contracts with Customers (hereinafter referred as revenue accounting standard'). ||We assessed the Company's process to identify the impact of adoption of the revenue accounting standard. Our audit approach consisted testing of the design and operating effectiveness of the internal controls and substantive testing as follows: |
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|The application to this revenue accounting standard is complex and involves certain key judgments relating to identification of distinct performance obligations the appropriateness of the basis used to measure the quantum and the period when the revenue is recognized. Additionally the revenue accounting standard mandates disclosures which involves collation of information in respect of revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. || Assessed the appropriateness of the Company's revenue recognition accounting policies by comparing with the applicable accounting standards. |
| || Evaluated the design processes and internal controls relating to the revenue accounting standards. |
| || |
|Refer to Note-1 (v)(ii) to the financial statements || Selected a sample of continuing and new contracts and tested procedures involving enquiry observation and inspection of evidence in respect of operation of these controls information used in recording and disclosing revenue in accordance with the revenue accounting standard were carried out. |
| || Evaluated the appropriateness of the disclosures provided under the revenue standard and assessed the completeness of the relevant disclosures. |
|Key audit Matters ||How our audit addressed the key audit matter |
|2. revenue recognition-Fixed price contracts || |
|The Company inter alia engages in fixed price contracts where revenue is recognized using a percentage of completion computed as per input method based on management's estimate on contract costs (Refer Note-1 (v) to the financial statements) ||Our audit procedures on revenue recognized from fixed price contracts included: |
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|We identified revenue recognition of fixed price contracts as a KAM considering: || Understanding the systems processes and controls implemented by the management for recording and calculating revenue and the associated contract assets unearned and deferred revenue balances. |
| There is an inherent risk around the estimation of the revenues given the customized complex nature and interdependence on performance of these contracts. || In respect of selected samples relating to fixed-price contracts we tested that the revenue recognized is in accordance with the accounting standard by : |
| Application of revenue recognition accounting standards is complex and involves number of key judgments and estimates including estimating the future cost-to-completion of these contracts which is used to determine the percentage completion of the relevant performance obligations. || Evaluating the identification of performance obligation |
| || Testing management's calculations of the estimation of the contract costs and onerous obligations if any we: |
| || |
| These contracts may involve onerous obligations on the Company that requires critical estimates to be made by the management and || Observed that the estimates of cost to complete were reviewed and approved by appropriate levels of management |
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| At year end a significant amount of work in progress related to these contracts is recognized in the balance sheet. || Performed retrospective review of costs incurred with estimated cost to identify significant variations and verify whether those variations have been considered in estimating the remaining cost to complete the contract. |
| || Assessed the appropriateness of the work in progress (contract assets) as on balance sheet date by evaluating the underlying documentations to identify possible delays in achieving milestones which may require change in estimated cost to complete the remaining performance obligation and |
| || Performed test of details including analytical review to determine the reasonableness of the contract costs |
| || Reviewed a sample of contracts with unbilled revenues to identify possible delays in achieving milestones which require change in estimated efforts to complete the remaining performance obligations which prevents unauthorized changes to recording of efforts incurred |
|Key Audit Matters ||How our audit addressed the key audit matter |
|3. Evaluation of uncertain tax positions || |
| ||Our audit procedures include the following substantive procedures: |
|The Company operates in multiple jurisdictions and is subject to periodic challenges by local tax authorities on a range of tax matters during the normal course of business including direct and indirect tax matters. This involves significant management judgment to determine the possible outcome of the uncertain tax positions consequently having an impact on related accounting and disclosure in the financial statements. || Obtained details of completed tax assessments and demands for the year ended March 31 2020 from the management to understand management's underlying assumptions in estimating the tax provision and the possible outcome of the disputes. |
|Refer Note. 33 to the financial statements || Discussed with appropriate senior management and evaluated management's underlying key assumptions in estimating the tax provisions. |
| || Legal precedence and other rulings in evaluating management's position on these uncertain tax positions were also considered. |
| || We also considered the effect of new information in respect of uncertain tax positions as at April2019 to evaluate whether any change was required to management's position on these uncertainties. |
| || Read and analysed select key correspondences external legal opinions/consultations by managements for key uncertain tax positions. |
|Key audit Matters ||How our audit addressed the key audit matter |
|4. Impact of covid-19 on the company's operations and financial statement || |
|Coronavirus (COVID-19') was declared a global pandemic by World Health Organisation. In line with the directions on lockdown issued by the Central Governments & the respective State Governments all Establishments/ project sites of the Company had shut down its project operations from March 25th 2020 till 31 March 2020; and subsequently upto further dates as instructed by the respective State Governments. ||We have performed the following procedures to assess the impact on operations and financial statements because of business decisions Government actions or economic environment developments: |
| || We assessed the disclosures on COVID-19 made in the financial statements. |
|Covid-19 has impacted the Operations of the Company as all Establishment/ project sites of the Company had shut down during the lockdown period and are working with restricted labour force post resumption of partial service of operations in most of its projects/ units and hence considered key audit matter || Discussed with appropriate senior management and evaluated management's underlying key assumptions in assessing the impact of Covid-19. |
|Refer Note. 45 to the financial statements || Our ability to perform regular audit procedures has been impacted which has required us in certain cases to perform alternative audit procedures and exercise significant judgment in respect of Audit and quality control procedures which were earlier performed in person could not be performed; and hence alternative procedures have been performed based on inquiries (through phone calls video calls and e-mail communications) and review of scanned documentation sent through e-mails followed up with sighting with original documents. |
We have determined that there are no other key audit matters to communicate in ourreport.
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 Annual Report (comprising ManagementDiscussion and Analysis Corporate Governance and Directors' Report) but does not includethe financial statements and our auditor's report thereon.
Our opinion on the financial statements does not cover the other information and we donot express any form of assurance conclusion thereon.
In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact. We have nothing to report in this regard.
Management's Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Act with respect to the preparation of these financial statements to give atrue and fair view of the financial position financial performance including othercomprehensive loss cash flows and changes in equity of the Company in accordance with theaccounting principles generally accepted in India including the Indian AccountingStandards specified under Section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 as amended. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.
In preparing the financial statements Management is responsible for assessing theCompany's ability to continue as going concern disclosing as applicable matters relatedto going concern and using the going concern basis of accounting unless Management eitherintends to liquidate the Company or to cease operations or has no realistic alternativebut to do so.
The board of Directors are responsible for overseeing the Company's financial reportingprocess.
Auditors' Responsibility for the Audit of the Financial statements
Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these 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 financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.
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 onwhether the Company has adequate internal financial controls system with reference tofinancial statements in place and the operating effectiveness of such controls
Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by the 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 financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.
Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves 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 financial statements of thefinancial year ended 31 st March 2020 and are therefore the key audit matters. Wedescribe these 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 (hereinafter referred toas "the Order") issued by the Central Government of India in terms ofsub-Section (11) of the Section 143 of the Act we give in the "Annexure A" astatement on the matters specified in paragraph 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 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 Statement of Profit and Loss including Other ComprehensiveIncome Cash Flow Statement and the Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account;
d. In our opinion the aforesaid financial statements comply with the Indian AccountingStandards specified under Section 133 of the Act read with Companies (Indian AccountingStandards) Rules 2015 as amended;
e. On the basis of written representations received from the directors as on March312020 and taken on record by the Board of Directors none of the directors isdisqualified as on March 312020 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" to this report;
g. In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its Manager during the year is inaccordance with the provisions of section197 read with Schedule V to the Act;
h. With respect to the other matters to be included in the Auditors' Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our knowledge and belief and according to the information andexplanations given to us:
i. The Company has disclosed the impact if any of pending litigations as at March 312020 on its financial position in its financial statements;
ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts. The Companyhas not entered into any Derivative Contracts during the financial year;
iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company during the year ended March 312020.
GiRiSH M. PATHAK
Membership No. 102016
For and on behalf of K.K.MANKESHWAR & CO.
FRN - 106009W
Mumbai 27th June 2020
"ANNEXURE A" TO INDEPENDENT AUDITORS' REPORT
(The Annexure referred to in our report to the members of Mukand Engineers Limited forthe year ended March 312020.)
(i) In respect of its Fixed Assets:
(a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of property plant and equipment.
(b) As per the explanation given to us all property plant and equipment werephysically verified in accordance with a regular program covering all the assets over aperiod of three years which in our opinion is reasonable having regard to the size ofthe Company and the nature of its assets. No material discrepancies were noticed on suchverification. In our opinion this periodicity of physical verification is reasonablehaving regard to the size of the Company and nature of assets.
(c) According to the information and explanations given to us by the Management and onthe basis of our examination of the records of the Company the Company does not hold anyimmovable properties in its name.
(ii) The physical verification of inventory has been conducted at reasonable intervalby the Management during the year. In our opinion the frequency of verification isreasonable.
(iii) According to information and explanations given to us and the records produced tous for our verification the Company has granted unsecured loan to a company covered inthe register maintained under Section 189 of the Act during the year.
a) In respect of the aforesaid loan the terms and conditions of the grant of such loanare prima facie not prejudicial to the Company's interest;
b) In respect of the aforesaid loan the schedule of repayment of principal and paymentof interest is stipulated and as at 31st March 2020 no repayment of the principal andinterest amounts as stipulated is due;
c) In respect of the aforesaid loan no amount is overdue for more than ninety days.
(iv) In our opinion and according to the information and explanations given to us theCompany has granted loan to other Companies by the way of Special Resolution as per theprovisions of Section 186 of the Act. The Company has not provided any guarantees andsecurities in respect of which provisions of Section 185 and 186 of the Act. The Companyhas complied with the provisions of 186 of the Act in respect of investments made in anybody corporate.
(v) In our opinion and according to the information and explanations given to us theCompany has generally complied with the directives issued by the Reserve Bank of India andthe provisions of Sections 73 to 76 or any other provisions of the Act and the Companies(Acceptance of Deposits) Rules 2014 to the extent notified with regard to depositsaccepted from the public. The Company not being an "Eligible Company" as definedin Companies (Acceptance of Deposits) Rules 2014 sought and obtained the approval fromthe Company Law Board for extension in time limit for repayment of Public Depositsoutstanding as on March 31 2015 on the respective due dates of maturity.
(vi) To the best of our knowledge and as explained the Central Government has notprescribed the maintenance of cost records under Section 148(1) of the Act for any of theservices rendered by the Company.
(vii) In respect of Statutory Dues:
(a) According to the information and explanations given to us and the records of theCompany examined by us in our opinion the Company is generally regular in depositingundisputed statutory dues including Provident Fund Employee State Insurance Corporation(ESIC) Income Tax Goods and Service Tax Custom Duty Cess and other material statutorydues applicable to it with the appropriate authorities. Some delays have been observed inthe payment of Income Tax Goods and Services Tax and Cess. As explained to us there wereno dues towards Custom Duty and Wealth Tax during the year.
(b) According to information and explanations given to us there were no undisputedamounts payable in respect of Provident Fund Employee State Insurance Corporation (ESIC)Income Tax Goods and Service Tax Cess and other material statutory dues in arrears as on31st March 2020 for a period of more than six months from the date they become payable.
(c) According to information and explanations given to us upon our enquiries in thisregard and records of the Company the following statutory dues in respect of Income TaxWorks Contract Tax Entry Tax and Service Tax as at 31st March 2020 have not beendeposited by the Company on account of dispute:
|Nature of dues ||Amount (Rs) ||Period to which the amount relates ||Forum where the dispute is pending |
|Income Tax ||8622250 ||2000-20012001-2002 ||High Court of Bombay |
|Income Tax ||8455448 ||1999-2000 2005-2006 ||Income Tax Appellate Tribunal |
|Income Tax ||19463724 ||2013-2014 2015-2016 ||Commissioner of Income Tax-Appeal |
|Income Tax ||9895634 ||2002-2003 to 2012-2013 ||Income Tax Department Authorities |
|Works Contracts Tax ||7583974 ||2001-2002 and 2002-2003 ||High Court-UP & Odisha |
|Works Contracts Tax ||22076799 ||2001-2002 to 2004-2005 2011-12 2012-13 2014-15 ||Sales Tax Department Authorities |
|Entry Tax ||811173 ||1999-2000 to 2002-2003 ||High Court Odisha |
|Entry Tax ||127835 ||2003-2004 and 1999-2000 ||Asst. Commissioner (Sales Tax) |
|CST ||2824518 ||2014-2015 ||Dy Commissioner - Mumbai |
(viii) According to the records of the Company examined by us and information andexplanations given to us the Company has not defaulted in repayment of dues to anyfinancial institution or banks during the year. The Company has not issued any debentures.
(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loans during the year. Accordinglyclause (ix) of paragraph 3 of the Order is not applicable.
(x) Based on the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the Management we report that no fraud by the Company or no fraud on the Companyby the officers and employees of the Company has been noticed or reported during the year.
(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/ provided managerialremuneration in accordance with requisite approvals mandated by the provisions of section197 read with Schedule V of the Act.
(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly clause (xii) of paragraph 3 of the Order isnot applicable and hence not commented upon.
(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with Sections 177 and 188 of the Act where applicable. The details of relatedparty transactions have been disclosed in the financial statements as required by theapplicable accounting standard.
(xiv) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. Accordingly clause (xiv) of paragraph 3 of the Order is not applicable andhence not commented upon.
(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with Directors or persons connected with him as referred to in section 192 ofthe Act. Accordingly clause (xv) of paragraph 3 of the Order is not applicable.
(xvi) According to the information and explanations given by the Management theprovisions of section 45-IA of the Reserve Bank of India Act 1934 are not applicable tothe Company.
GiRiSH M. PATHAK
Membership No. 102016
For and on behalf of K.K.MANKESHWAR & CO.
FRN- 106009W UDIN: 20102016AAAAAW4362
Mumbai 27th June 2020
"ANNEXURE B" TO INDEPENDENT AUDITORS' REPORT
Report on the internal Financial Controls under Clause (i) of Sub-Section 3 of Section143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of MukandEngineers Limited ("the Company") as of March 312020 in conjunction with ouraudit of the 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 Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants of India(ICAI'). These responsibilities include the design implementation and maintenanceof adequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to Company's policiesthe safeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013 ("theAct").
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 and the Standards on Auditing deemed to be prescribed under Section143(10) of the Act to the extent applicable to an audit of internal financial controlsboth applicable to an audit of internal financial controls and 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 over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the 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 financial statements for external purposes in accordance with generallyaccepted accounting principles. A Company's internal financial control over financialreporting includes those policies and procedures that;
1) pertain to the maintenance 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 financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the Company are being made only inaccordance 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 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.
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 generally 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 ICAI.
GiRiSH M. PATHAK
Membership No. 102016
For and on behalf of
k.k.mankeshwar & co.
Mumbai 27th June 2020