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Munoth Financial Services Ltd.

BSE: 531821 Sector: Financials
NSE: N.A. ISIN Code: INE348D01019
BSE 00:00 | 28 Nov 76.05 3.60
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NSE 05:30 | 01 Jan Munoth Financial Services Ltd
OPEN 76.05
PREVIOUS CLOSE 72.45
VOLUME 145
52-Week high 76.05
52-Week low 5.95
P/E
Mkt Cap.(Rs cr) 39
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 76.05
CLOSE 72.45
VOLUME 145
52-Week high 76.05
52-Week low 5.95
P/E
Mkt Cap.(Rs cr) 39
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Munoth Financial Services Ltd. (MUNOTHFINSERV) - Auditors Report

Company auditors report

To the Members of Munoth Financial Services Limited

Opinion

We have audited the financial statements of Munoth Financial Services Limited("the Company") which comprise the balance sheet as at 31st March 2022 and thestatement of Profit and Loss (including other comprehensive income) statement of changesin equity and statement of cash flows for the year then ended and notes to the financialstatements including a summary of significant accounting policies and other explanatoryinformation.

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 the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2022 the loss and total comprehensive income changes in equityand its cash flows forthe year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance 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 judgment were of mostsignificance in our audit of the financial statements of the current period. We did notcome across any matter of such material significance to be reported in this section.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese financial statements that give a true and fair view of the financial positionfinancial performance changes in equity and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards specified under section 133 of the Act. 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 statement that give a true and fair view andare 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 a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.

The Board of Directors are also responsible for overseeing the Company's financialreporting process.

Auditor's Responsibilities 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 controls.

• 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 on whetherthe company has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by 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.

Materiality is the magnitude of misstatements in the standalone financial statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the financial statements.

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 thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor's Report) Order 2020 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the "Annexure B" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

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 the Statement of Profit and Loss and the Cash Flow Statementdealt with by this Report 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 Rule 7 of the Companies(Accounts) Rules

e) On the basis of the written representations received from the directors as on 31stMarch 2022 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2022 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 A". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the company's internal financial controls overfinancial reporting.

g) With respect to the matter to be included in the Auditor's Report under Section197(16) of the Act:

In our opinion and according to the information and explanations given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of Section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under Section 197(16) of the Act whichare required to be commented upon by us

h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

1. The Company has no pending litigations which would have a material impact on itsfinancial position.

2. The Company has not entered into any long-term contracts including derivativecontracts for which there were any material foreseeable losses.

3. There has not been an occasion in case of the company during the year under reportto transfer of any sums to the Investor Education and Protection Fund by the Company. Thequestion of delay in transferring such sums does not arise.

4. The management has represented that to the best of its knowledge and belief otherthan as disclosed in the notes to the accounts

i. no funds have been advanced or loaned or invested (either from borrowed funds orshare premium or any other sources or kind of funds) by the company to or in any otherperson(s) or entity(ies) including foreign entities ‘Intermediaries' with theunderstanding whether recorded in writing or otherwise that the Intermediary shallwhether directly or indirectly lend or invest in other persons or entities identified inany manner whatsoever by or on behalf of the company ‘Ultimate Beneficiaries' orprovide any guarantee security or the like on behalf of the Ultimate Beneficiaries; and

ii. no funds have been received by the company from any person(s) or entity(ies)including foreign entities ‘Funding Parties' with the understanding whetherrecorded in writing or otherwise that the company shall whether directly or indirectlylend or invest in other persons or entities identified in any manner whatsoever by or onbehalf of the Funding Party ‘Ultimate Beneficiaries' or provide any guaranteesecurity or the like on behalf of the Ultimate Beneficiaries.

iii. Based on audit procedures carried out by us that we have considered reasonableand appropriate in the circumstances nothing has come to our notice that has caused usbelieve that the representations under sub-clause (i) and (ii) contain any materialmisstatement.

5. The Company has not declared or paid any dividends during the year and accordinglyreporting on the compliance with section 123 of the Companies Act 2013 is not applicablefor the year under consideration.

For Kumbhat and co
Chartered Accountants
FRN:001609S
[M.V. Chandramouleeswaran]
Place: Chennai. Partner
Date: 27-05-2022 M NO: 202629 UDIN: 22202629AKSKCT7796

ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2(f) under ‘Report on Other Legal and RegulatoryRequirements' section of our report to the Members of MUNOTH FINANCIAL SERVICES LIMITED ofeven date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSubsection 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of MunothFinancial Services Limited ("the Company") as of March 31 2022 in conjunctionwith our audit of the standalone financial statements of the Company for the year ended onthat date.

Management's Responsibility for Internal Financial Controls

The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business 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.

Auditor's Responsibility

Our responsibility is to express an opinion on the internal financial controls overfinancial reporting of the Company based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") issued by the Institute of Chartered Accountantsof India and the Standards on Auditing prescribed under Section 143(10) of the CompaniesAct 2013 to the extent applicable to an audit of internal financial controls. 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 ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures 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.

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.

Opinion

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2022 based on the internal controlover financial reporting criteria established by the Company considering 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.

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements' section of our report to the member of M/s. Munoth Financial ServicesLimited of even date)

1. (a) In our opinion and according to the inform ation and explanations given to usthe Company is maintaining proper records showing full particulars including quantitativedetails and situation of property plant and equipment and intangible assets.

(b) The property plant and equipment of the Company were physically verified by themanagement during the year. According to the information and explanations given to us andas examined by us no material discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanations given to us andbased on the examination of the conveyance deeds provided to us we report that the titledeeds comprising all the immovable properties of land and buildings which are freeholdare held in the name of the Company as at the balance sheet date.

(d) The Company has not revalued its property plant and equipment (including right ofuse asset) during the year. Accordingly paragraph 3 (i) (d) of the Order is notapplicable.

(e) In our opinion and according to the information and explanations given to us thereare no proceedings initiated or are pending against the Company for holding any benamiproperty under the Benami Transactions (Prohibition) Act 1988 (45 of 1988) and rules madethereunder. Accordingly paragraph 3 (i) (e) of the Order is not applicable.

2. (a) The Company is a service company primarily rendering financial services.Accordingly it does not hold any physical inventories. Accordingly paragraph 3(ii) ofthe Order is not applicable.

(b) The Company has not been sanctioned working capital limits in excess of five crorerupees in aggregate from banks or financial institutions on the basis of security ofcurrent assets at any point of time during the year. Accordingly paragraph 3 (ii) (b) ofthe Order is not applicable.

3. In our opinion and according to information and explanation given to us the Companyhas not made investments in/ provided any guarantee or security/ granted any loans oradvances in the nature of loans secured or unsecured to companies firms LimitedLiability Partnerships or other parties. Accordingly paragraph 3 (iii) of the Order isnot applicable.

4. In our opinion and according to information and explanation given to us the companyhas not granted any loans or provided any guarantees or given any security or made anyinvestments to which the provision of section 185 and 186 of the Companies Act 2013.Accordingly paragraph 3 (iv) of the order is not applicable.

5. In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits or amounts which are deemed to be deposits duringthe year. Accordingly paragraph 3 (v) of the Order is not applicable.

6. The Central Government of India has not prescribed the maintenance of cost recordsunder sub-section (1) of section 148 of the Act for any of the activities of the companyand accordingly paragraph 3 (vi) of the order is not applicable.

7. In our opinion and according to the information and explanations given to us:

(a) Amounts deducted/ accrued in the books of account in respect of undisputedstatutory dues including goods and services tax provident fund employees' stateinsurance income-tax sales-tax service tax duty of customs duty of excise valueadded tax cess and other material statutory dues have been generally regularly depositedby the Company with the appropriate authorities.

(b) No undisputed amounts payable in respect of goods and services tax provident fundemployees' state insurance income-tax sales-tax service tax duty of customs duty ofexcise value added tax cess and other material statutory dues were in arrears as atMarch 31 2022 for a period of more than six months from the date they became payable.

(c) There are no statutory dues referred to in sub-clause (a) which have not beendeposited on account of dispute.

8. In our opinion and according to the information and explanations given to us thereare no transactions not recorded in the books of account that have been surrendered ordisclosed as income during the year in the tax assessments under the Income Tax Act 1961(43 of 1961). Accordingly paragraph 3 (viii) of the Order is not applicable.

9. (a) In our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of loans or other borrowings or in the paymentof interest thereon to any lender during the year.

(b) In our opinion and according to the information and explanations given to us theCompany is not declared as a wilful defaulter by any bank or financial institution orother lender.

(c) In our opinion and according to the information and explanations given to us theterm loans not obtained during the year.

(d) In our opinion and according to the information and explanations given to us fundsraised on short term basis have not been utilised for long term purposes.

(e) The Company does not have any subsidiaries/ associates/ joint-ventures andaccordingly paragraphs 3 (ix) (e) and 3 (ix) (f) of the Order are not applicable.

(f) In our opinion and according to the information and explanations given to us thecompany has not raised any loans during the year on the pledge of securities held in itssubsidiaries joint ventures or associate companies.

10. (a) In our opinion and according to the information and explanations given to usthe Company has not raised any money by way of initial public offer or further publicoffer (including debt instruments) during the year. Accordingly paragraph 3 (x) (a) ofthe Order is not applicable.

(b) In our opinion and according to the information and explanations given to us theCompany has not made any preferential allotment or private placement of shares orconvertible debentures (fully partially or optionally convertible) during the year.Accordingly paragraph 3 (x) (b) of the Order is not applicable.

11. (a) To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company or no material fraud on the Company by any person hasbeen noticed or reported during the year. Accordingly paragraph 3 (xi) (a) of the Orderis not applicable.

(b) Since there is no fraud by the Company or no material fraud on the Company by anyperson has been noticed or reported during the year paragraph 3 (xi) (b) of the Order isnot applicable.

(c) To the best of our knowledge and according to the information and explanationsgiven to us no whistle-blower complaints have been received by the Company during theyear.

12. The Company is not a Nidhi Company and accordingly Paragraphs 3 (xii) of the Orderis not applicable.

13. In our opinion and according to the information and explanations given to us thetransactions with the related parties are in compliance with section 177 and 188 of theAct. Where applicable the details of such transactions have been disclosed in thefinancial statements as required by the applicable accounting standards.

14. (a) In our opinion and according to the information and explanations given to usthe Company has an internal audit system commensurate with the size and nature of itsbusiness.

(b) The reports of the internal auditors for the year under audit were considered byus as part of our audit procedures.

15. In our opinion and according to the information and explanations given to us theCompany has not entered into non-cash transactions with directors or persons connectedwith them. Accordingly paragraph 3 (xv) of the Order is not applicable.

16. (a) In our opinion and according to the information and explanations given to usthe Company is not required to be registered under section 45-IA of the Reserve Bank ofIndia Act

(b) In our opinion and according to the information and explanations given to us theCompany has not conducted any Non-Banking Financial or Housing Finance activities withouta valid Certificate of Registration (CoR) from the Reserve Bank of India as per theReserve Bank of India Act 1934

(c) In our opinion and according to the information and explanations given to us theCompany is not a Core Investment Company (CIC) as defined in the regulations made by theReserve Bank of India. Accordingly paragraph 3 (xvi) (c) of the Order is not applicable.

(d) In our opinion and according to the information and explanations given to us theCompany is not a Core Investment Company (CIC) and it does not have any other companies inthe Group. Accordingly paragraph 3 (xvi) (d) of the Order is not applicable.

17. The Company has incurred cash losses (Net Profit before Taxes and Depreciation) ofRs.246.40 (‘000) and Rs.629.62 (‘000) respectively in the financial year andin the immediately preceding financial year.

18. There has been resignation of the statutory auditors during the year and we havetaken in to consideration the issues objections or concerns raised by the outgoingauditors.

19. In our opinion and according to the information and explanations given to us and onthe basis of the financial ratios ageing and expected dates of realisation of financialassets and payment of financial liabilities other information accompanying the financialstatements our knowledge of the board of directors and management plans there are nomaterial uncertainty exists as on the date of the audit report that Company is capable ofmeeting its liabilities existing at the date of balance sheet as and when they fall duewithin a period of one year from the balance sheet date.

20. (a) In our opinion and according to the information and explanations given to usin respect of other than ongoing projects there are no unspent amounts to be transferredto a fund specified in Schedule VII to the Act.

(b) In our opinion and according to the information and explanations given to us thereare no amount remaining unspent under sub-section (5) of section 135 of the Act pursuantto any ongoing project to be transferred to special account in compliance with theprovision of sub-section (6) of section 135 of the said Act.

21. In our opinion and according to the information and explanations given to us theCompany does not have investments in subsidiaries/ associates or joint venture companies.Accordingly paragraph 3 (xxi) of the Order is not applicable.

For Kumbhat and co
Chartered Accountants
FRN: 001609S
[M.V. Chandramouleeswaran]
Place: Chennai. Partner
Date: 27-05-2022 M NO: 202629
UDIN: 22202629AKSKCT7796

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