The Members of
MUNOTH COMMUNICATION LIMITED
We have audited the standalone financial statements of MunothCommunication Limited which comprise the balance sheet as at 31st March 2021 and thestatement of profit and loss statement of changes in equity and statement of cash flowsfor the 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 standalone financial statements give theinformation required by the Companies Act 2013 in the manner so required and give a trueand fair view in conformity with the accounting principles generally accepted in India ofthe state of affairs of the Company as at March 31 2021 and its loss changes in equityand its 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 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.
Responsibilities of Management and Those Charged with Governance forthe Standalone Financial Statements
The Company's Board of Directors is responsible for the mattersstated in Section 134(5) of the Companies Act 2013 with respect to the preparation ofthese financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.
This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding of the assets of theCompany and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
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.
Identify and assess the risks of material misstatement of thefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.
Obtain an understanding of internal control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. Undersection 143(3)(i) of the Companies Act 2013 we are also responsible for expressing ouropinion on whether the company has adequate internal financial controls system in placeand 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 thegoing 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 conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditionsmay cause the Company 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 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.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order2016 issued by the Central Government of India in terms of sub-section (11) of section 143of The Companies Act 2013 we give in the "Annexure A" a statement on thematters 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 purpose of our audit;
b. In our opinion proper books of account as required by law have beenkept by the Company so far as it appears from our examination of those books and properreturns adequate for the purposes of our audit have been received from the branches notvisited by us.
c. There are no branch offices of the Company.
d. The Balance Sheet Statement of Profit and Loss and Cash FlowStatement dealt with by this Report are in agreement with the books of accounts.
e. In our opinion the aforesaid financial statements comply withAccounting Standards specified under section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.
f. On the basis of written representations received from the directorsas on March 31 2021 taken on record by the Board of Directors none of the directors isdisqualified as on March 31 2021 from being appointed as a director in terms of Section164(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".
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 inour opinion and to the best of our information and according to the explanations given tous:
i) The Company has an pending litigation with the High Court of Madrasagainst "M/s Kingtech Electronics" since 2012. Its impact on the financialposition of the company amounts to Rs. 52 lacs.
ii) The Company does not have any long-term contracts requiring aprovision for material foreseeable losses.
iii) The Company does not have any amounts required to be transferredto the Investor Education and Protection Fund.
Annexure A referred to in paragraph 1 of the section on "Report onother legal and regulatory requirements" of our report of even date
TO THE MEMBERS OF MUNOTH COMMUNICATION LIMITED
(i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets.
(b) During the year fixed assets have been physically verified by themanagement at reasonable intervals and no material discrepancies have been noticed on suchverification.
(c) According to the information and explanations given by themanagement the Company has title deeds of immovable properties held in the name of thecompany.
(ii) The inventories have been physically verified by the managementduring the year. In our opinion the frequency of verification is reasonable. No materialdiscrepancies were noticed on such physical verification.
(iii) According to the information and explanations given to us and onthe basis of our examination of the Books of accounts the Company has not granted anyloans secured or unsecured to companies firms limited liability partnerships or otherparties covered in the register maintained under section 189 of the Companies Act 2013.Accordingly the provisions of clause 3(iii)(a) (b) and (c) of the Order are notapplicable to the Company and hence not commented upon.
(iv) In our opinion and according to the information and explanationsgiven to us there are no loans investments guarantees and securities given in respectof which provisions of section 185 and 186 of the Companies Act 2013 are applicable andhence not commented upon.
(v) The Company has not accepted any deposits from the public.
(vi) As informed to us the Central Government has not prescribedmaintenance of cost records under sub section (1) of Section 148 of the Act in respect ofactivities carried on by the Company.
(vii) (a) The company has generally been regular in depositing theundisputed statutory dues including Provident Fund Employees' State InsuranceIncome tax Sales-tax Wealth Tax Service Tax Custom Duty Excise Duty and othermaterial statutory dues as applicable with the appropriate authorities in India.
(b) According to the information and explanations given to us noundisputed amounts payable in respect of provident fund employees' state insuranceincome-tax service tax sales-tax customs duty excise duty value added tax cess andother material statutory dues were outstanding at the year end for a period of more thansix months from the date they became payable.
(viii) In our opinion and according to the information and explanationsgiven by the management the Company has not defaulted in repayment of loans or borrowingto banks and debenture holders. The Company did not have any outstanding dues in respectof a financial institution or to Government during the year.
(ix) According to the information and explanations given by themanagement the Company has not raised any money by way of initial public offer or furtherpublic offer or debt instruments or raised any term loans and hence reporting under Clause3 (ix) of the Order is not applicable to the Company and hence not commented upon.
(x) Based upon the audit procedures performed for the purpose ofreporting the true and fair view of the financial statements and according to theinformation and explanations given by the management we report that no fraud by theCompany or no material fraud on the Company by the officers and employees of the Companyhas been noticed or reported during the year.
(xi) According to the information and explanations given by themanagement the managerial remuneration has been paid / provided in accordance with therequisite approvals mandated by the provisions of section 197 read with Schedule V to theCompanies Act 2013.
(xii) In our opinion the Company is not a nidhi company. Thereforethe provisions of clause 3(xii) of the order are not applicable to the Company and hencenot commented upon.
(xiii) In our opinion and according to the information andexplanations given to us transactions with the related parties are in compliance withsection 177 and 188 of Companies Act 2013 where applicable and the details have beendisclosed in the Standalone Ind AS financial statements as required by the applicableaccounting standards.
(xiv) According to the information and explanations given to us and onan overall examination of the balance sheet the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year under review and hence reporting requirements under clause 3(xiv) are notapplicable to the Company and not commented upon.
(xv) According to the information and explanations given by themanagement the Company has not entered into any non-cash transactions with directors orpersons connected with him as referred to in section 192 of Companies Act 2013.
(xvi) According to the information and explanations given to us theprovisions of section 45-IA of the Reserve Bank of India Act 1934 are not applicable tothe Company.
ANNEXURE B REFERRED TO IN PARAGRAPH 2 (g) OF THE SECTION ON"REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS" OF OUR REPORT OF EVEN DATE
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 Munoth Communication Limited as of March 31 2021 in conjunction with ouraudit of the Standalone Ind AS financial statements of the Company for the year ended onthat 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 under the COSO 2013 criteria which considers the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls over Financial Reporting issued by the Institute of Chartered Accountants ofIndia. These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to the Company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors 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 asspecified under section 143(10) of the Companies Act 2013 to the extent 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 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 judgement including the assessment ofthe risks of material misstatement of the financial statements whether due to fraud orerror.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the internal financial controlssystem over financial reporting.
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 March 31 2021 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.
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For Mardia & Associates
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| ||Firm's registration number: 007888S |
| ||(Manish Mardia) |
| ||Proprietor |
|Place : Chennai ||Membership number: 205307 |
|Date : 28th May 2021 ||UDIN: 21205307AAAAEJ5965 |