The Members of Nitin Spinners Limited
Report on the Audit of the Financial Statements
We have audited the accompanying Financial statements of Nitin Spinners Limited("the Company") which comprise the Balance Sheet as at March 31 2022 theStatement of Profit and Loss (including Other Comprehensive Income) the Statement ofChanges in Equity and the Statement of Cash Flows for the year ended on that date and asummary of the significant accounting policies and other explanatory information(hereinafter referred to as "the 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 CompaniesAct 2013 ("the Act") in the manner so required and give a true and fair viewin conformity with the Indian Accounting Standards prescribed under section 133 of the Actread with the Companies (Indian Accounting Standards) Rules 2015 as amended ("IndAs") and other accounting principles generally accepted in India of the state ofaffairs of the Company as at March 31 2022 the profit and total comprehensive incomechanges in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the Financial Statements in accordance with the Standards onAuditing (SAs) specified under section 143(10) of the Companies Act 2013 ("theact"). Our responsibilities under those Standards are further described in theAuditor's Responsibilities for the Audit of the Financial Statements section of ourreport. We are independent of the Company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India (ICAI) together with the independencerequirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules made thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the financial statements.
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. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters. Wehave determined the matters described below to be the key audit matters to be communicatedin our report.
|Key Audit Matter ||How the matter was addressed in our audit |
|1. Valuation of Inventories ||Our audit procedure: |
| The net carrying value of inventory as on 31st March 2022 is 22.27 % of Total Assets of the company. || We have performed the Inventory physical stock count on sample basis. We performed inventory counts at location which is selected based on financial significance and risk and we performed the following procedures at each site: |
| Sales in the industry can be extremely volatile with consumer demand changing significantly (Seasonal) based on current trends. As a result there is a risk that the carrying value of inventory exceeds its net realisable value. ||(i) Selected a sample of inventory items and compared the quantities we counted to the quantities recorded. |
|Hence we determined the valuation of inventories as a key audit matter. ||(ii) Observed a sample of management's inventory count procedures to assess compliance with Company's policy and |
|Related Disclosures: || |
|Please refer to Note-6 for details of the accounting policies of inventories and Note-6 of Notes to Financial Statements for relevant disclosures of inventories. ||(iii) Made inquiries regarding obsolete inventory items and inspected the condition of items counted. |
| || We have also evaluated a selection of controls over inventory existence across the company. |
| || Examining the Company's historical trading patterns of inventory sold at full price and inventory sold below full price together with the related margins achieved for each product lines in order to gain comfort that stock has not been sold below cost. |
| || Evaluating the rationality of the inventory policies such as the policy of inventory valuation and provision for obsolescence and understanding whether the valuation of inventory was performed in accordance with the Company's policy. |
| || Analyzing the inventory aging report and net realizable value of inventories. |
| || Inspecting the post period sales situation and evaluating the net realizable value of measurement applied on aging inventory in order to verify the evaluation accuracy of the estimated inventory allowance by the Company and |
| || Assessing whether the disclosures of provision for inventory valuation are appropriate. |
|2. Trade Receivables ||Our Audit Procedure: |
| The recoverability of trade receivables and the level of provisions for doubtful debts are considered to be a significant risk due to the pervasive nature of these balances to the financial statements and the importance of cash collection with reference to the working capital management of the business. || Assessed the design and implementation of key controls around the monitoring of recoverability. |
| At 31st March 2022 the trade receivables balances (net of provisions)consist of 13.19 % of the total amount of assets. Accordingly we determined audit of trade receivables as the key audit matter. || Discussed with the management regarding the level and ageing of trade receivables along with the consistency and appropriateness of receivables provisioning by assessing recoverability with reference to amount received in respect of trade receivables. |
|Related Disclosures: || In addition we have considered the company's previous experience of bad debt exposure and the individual counter-party credit risk. |
|Please refer to Note-7 of Notes to Financial Statements for relevant disclosures of inventories. || Tested these balances on a sample basis through agreement to post period end invoicing and cash receipt. |
| || The accuracy and completeness was verified through analytical reviews and balance confirmation. |
| || Analyzing the aging schedule of trade receivable past collection records industry boom and concentration of customers' credit risk. |
|3. Revenue Recognition ||Our audit procedure: |
| Revenue is an important measure used to evaluate the performance of the Company. There is a risk that the revenue is presented for amounts higher than what has been actually generated by the Company. || Assessing the design implementation existence and operating effectiveness of internal control procedures implemented as well as test of details to ensure accurate processing of revenue transactions. |
|Consequently we considered revenue recognition to be a significant key audit matter. || Inspecting underlying documentation for any book entries which were considered to be material on a sample basis. |
|Related Disclosures: Please refer to Note-11 of the accounting policies for details of the accounting policies of revenue recognition and Note-37 of Notes to Financial Statements. || Inspecting the key terms and conditions of agreements with major customers on a sample basis to assess if there were any terms and conditions that may have affected the accounting treatment of the revenue recognition. |
| || The accuracy and completeness of revenue was verified through cut-off test analytical reviews and balance confirmation. |
Information Other than the Financial Statements and Auditor's Report Thereon
The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexures to Board's Report CorporateGovernance and Shareholder's Information but does not include the financial statementsand our auditor's report thereon. The other information as identified above is expected tobe made available to us after the date of this auditor's report.
Our opinion on the financial statements does not cover the other information and wewill not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements our responsibility is to readthe other information identified above when it becomes available and in doing soconsider whether the other information is materially inconsistent with the financialstatements or our knowledge obtained during the course of our audit or otherwise appearsto be materially misstated.
When we read the other information as identified above if we conclude that there is amaterial misstatement therein we are required to communicate the matter to those chargedwith governance.
Responsibilities of Management and Those Charged with Governance for the FinancialStatements
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 total comprehensive income changes in equity and cash flows of theCompany in accordance with the Ind AS and other accounting principles generally acceptedin India. This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the financialstatements that give a true and fair view and are free from material misstatement whetherdue 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.
Those Board of Directors are 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 control.
Obtain an understanding of internal financial controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany 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 financial statements thatindividually 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 alsoprovide those charged with governance with a statement that we have complied with relevantethical requirements regarding independence and to communicate with them allrelationships 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
1. 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 Act and according to the information & explanation given to us we give in theAnnexure-1 a statement on the matters specified in paragraphs 3 and 4 of the Order tothe extent applicable.
2) As required by section 143(3) of the Act based on our audit we report:
(a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purpose of our audit;
(b) In our opinion and to the best of our information and according to the explanationsgiven to us proper books of accounts as required by law have been kept by the Company sofar as appears from our examination of those books;
(c) The Balance Sheet the Statement of Profit and Loss (including Other ComprehensiveIncome) Statement of Changes in Equity and the Statement of Cash Flow dealt with by thisReport are in agreement with the relevant books of account.
(d) In our opinion the aforesaid financial statements comply with the Ind AS specifiedunder Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014
(e) On the basis of written representations received from the directors as on March31 2022 and taken on record by the Board of Directors none of the Directors aredisqualified as on March 31 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 toAnnexure 'II' to this report.
(g) With respect to the other matter to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended:
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 directors during the year is inaccordance with the provisions of section 197 of the Act.
(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:
i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements. (Refer Note No.30)
ii. The Company did not have any long term contracts including derivative contractsfor which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts which are required to betransferred to the Investor Education and Protection Fund by the Company.
iv. (a) The Management has represented that to the best of its knowledge and beliefno funds (which are material either individually or in the aggregate) have been advancedor loaned or invested (either from borrowed funds or share premium or any other sources orkind of funds) by the Company to or in any other person or entity including foreignentity ("Intermediaries") with the understanding whether recorded in writingor otherwise that the Intermediary shall whether directly or indirectly lend or investin other persons or entities identified in any manner whatsoever by or on behalf of theCompany ("Ultimate Beneficiaries") or provide any guarantee security or thelike on behalf of the Ultimate Beneficiaries;
(b) The Management has represented that to the best of its knowledge and belief nofunds (which are material either individually or in the aggregate) have been received bythe Company from any person or entity including foreign entity ("FundingParties") with the understanding whether recorded in writing or otherwise that theCompany shall whether directly or indirectly lend or invest in other persons orentities identified in any manner whatsoever by or on behalf of the Funding Party("Ultimate Beneficiaries") or provide any guarantee security or the like onbehalf of the Ultimate Beneficiaries;
(c) Based on the audit procedures that have been considered reasonable and appropriatein the circumstances nothing has come to our notice that has caused us to believe thatthe representations under sub-clause (i) and (ii) of Rule 11(e) as provided under (a) and(b) above contain any material misstatement.
v. As stated in Note-34 to the financial statements
(a) The final dividend proposed in the previous year declared and paid by Companyduring the year is in accordance with section 123 of the act as applicable
(b) The interim dividend declared and paid by the company during the year and until thedate of this report is in compliance with section 123 of the act
(c) The Board of Director of the company have proposed final dividend for the yearwhich is subject to the approval of the members at the ensuing Annual General Meeting. Theamount of dividend proposed is in accordance with section 123 of the Act as applicable.
| ||For Kalani & Company |
| ||Chartered Accountants |
| ||Firm Regn. No 000722C |
| ||S.P. Jhanwar |
|Place: Bhilwara ||Partner |
|Date: 12th May 2022 ||Membership No.- 074414 |
Annexure - I to the Independent Auditors' Report
Annexure referred to in Para 1 of Report on Other Legal and Regulatory requirements ofIndependent Auditor's Report to the members of the Nitin Spinners Limited Bhilwaraon the standalone financial statements for the year ended 31st March 2022 we reportthat (i) In respect of Property Plant & Equipment and Intangible Assets
a) (A) The Company has maintained proper records showing full particulars includingquantitative details and the situation of its Property Plant and Equipment.
(B) The Company has maintained proper records showing full particulars of itsIntangible Assets.
b) The Company has a regular program of physical verification of its property plant& equipment by which these are verified in a phased manner by the management duringthe year which in our opinion is reasonable having regard to the size of the company andnature of its assets. No material discrepancies were noticed on such physicalverification.
c) According to information and explanation given to us and based on our verificationthe title deeds of immovable properties are held in the name of the company.
d) The company has not revalued its Property Plant and Equipment (including Right ofUse assets) or intangible assets or both during the year.
e) Based on the information and explanation given to us and as represented by theperson those charge with governance no proceedings have been initiated or are pendingagainst the company for holding any benami property under the Benami Transactions(Prohibition) Act 1988 (45 of 1988) and rules made thereunder.
(ii)a) As per the information and explanation given to us the Company's management hascarried out physical verification of inventory at reasonable intervals and in our opinionthe coverage and procedure of such verification by the management is appropriate. Nodiscrepancies of 10% or more in the aggregate for each class of inventory were noticed.
b) The company has been sanctioned working capital limits in excess of five crorerupees in aggregate from banks or financial institutions on the basis of security ofcurrent assets. Based on the information and explanation given to us and as represented bythe person those charge with governance we have not noticed any material variations inthe quarterly returns or statements filed by the company with such banks or financialinstitutions with the books of account of the Company.
(iii) During the year the company has not made any investments in provided guaranteeor security or granted any loans or advances in the nature of loans secured or unsecuredto companies firms Limited Liability Partnerships or any other parties.
a) No loans and advances in the nature of loan given by the company hence clause3(iii)(a) is not applicable
b) Company has not made any investments no guarantees provided no security givenhence clause 3(iii)(b) is not applicable
c) No loans and advances in the nature of loan given by the company hence reportingunder clause 3(iii)(c) is not applicable.
d) No loans and advances in the nature of loan given by the company hence reportingunder clause 3(iii)(d) is not applicable.
e) No loans and advances in the nature of loan given by the company hence reportingunder clause 3(iii)(e) is not applicable.
f) The company has not granted any loans or advances in the nature of loans eitherrepayable on demand or without specifying any terms or period of repayment hence reportingunder clause 3(iii)(f) is not applicable
(iv) The Company has not granted any loans made any investments given any guaranteesand security secured or unsecured to any companies firms limited liability partnershipor other parties covered in register maintained under Section 189 of the Companies Act2013. Hence the clause 3 (iv) of the Order is not applicable.
(v) The company has not accepted deposits from the public within the meaning ofSections 73 to 76 of the Companies Act 2013 and the rules made there under hence thisclause is not applicable.
(vi) We have broadly reviewed the accounts and records maintained by the Companypursuant to the Rules made by the Central Government for the maintenance of cost recordsunder sub-section (1) of Section 148 of the Act read with Companies (Cost Records &Audit) Rules 2014 and we are of the opinion that prima facie the prescribed accounts andrecords have been made and maintained. We have not however made detailed examination ofthe records with a view to determine whether they are accurate and complete.
(vii) a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company the company is generally regular indepositing undisputed statutory dues including Goods and Services Tax provident fundemployees' state insurance income-tax sales-tax service tax duty of customs duty ofexcise value added tax cess and any other statutory dues to the appropriate authoritiesand there are no undisputed statutory dues outstanding as on 31st March 2022 for a periodof more than six months from the date they became payable.
b) According to the information and explanations given to us there are no unpaid duesof Goods and Services Tax provident fund employees' state insurance income-taxsales-tax service tax duty of customs duty of excise value added tax cess underdispute except as per details given hereunder :
|Sr. No. ||Name of the Statue ||Nature of Dues ||Gross Amount Involved (Rs. in Lacs) ||Amount Deposited under Protest (Rs. in Lacs) ||Amount not deposited (Rs. in Lacs) ||Period to which it relates ||Forum where dispute is pending |
|1. ||Central Excise ||Excise duty & Penalty ||9.25 ||9.25 ||- ||2006-07 ||High Court Jodhpur |
|2. ||Customs ||Redemption Fine ||0.50 ||- ||0.50 ||2009-10 ||CESTAT Ahmedabad |
|3. ||SGST & CGST ||Penalty ||27.82 ||- ||27.82 ||2018-19 ||Jt. Commissioner (A) Ajmer |
|4. ||SGST & CGST ||Penalty ||28.67 ||- ||28.67 ||2019-20 ||Jt. Commissioner (A) Ajmer |
| ||Total || ||66.24 ||9.25 ||56.99 || || |
(viii) There are no transactions which are not recorded in the books of accounts. Hencereporting under the clause 3 (viii) of the CARO is not applicable.
(ix) (a) The company has not defaulted in repayment of loans or other borrowings or inthe payment of interest thereon to any lender accordingly reporting under clause 3(ix)(a)is not applicable.
(b) According to the information and explanations given to us and on the basis of ouraudit procedures we report that the company has not been declared wilful defaulter by anybank or financial institution or government or any government authority.
(c) In our opinion and according to the information and explanations given to us thecompany has utilized the money obtained by way of term loans during the year for thepurposes for which they were obtained.
(d) According to the information and explanations given to us and the proceduresperformed by us and on an overall examination of the financial statements of the companywe report that no funds raised on short-term basis have been used for long-term purposesby the company
(e) According to the information and explanations given to us and on an overallexamination of the financial statements of the company we report that the company has nottaken any funds from any entity or person on account of or to meet the obligations of itssubsidiaries associates or joint ventures.
(f) According to the information and explanations given to us and procedures performedby us we report that the company has not raised loans during the year on the pledge ofsecurities held in its subsidiaries joint ventures or associate companies.
(x)(a) The Company has not raised money by way of Initial Public Offer / further publicoffer (including debt instruments) hence reporting under clause (x) of 'the Order' is notapplicable.
(b) In our opinion and according to the information and explanations given to us thecompany has utilized funds raised by way of preferential allotment or private placement ofshares or convertible debentures (fully partially or optionally convertible) for thepurposes for which they were raised.
(xi)(a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company no material fraud by the company or anyfraud on the company has been noticed or reported during the year.
(b) No report under sub-section (12) of section 143 of the Companies Act has been filedby the auditors in Form ADT-4 as prescribed under rule 13 of Companies (Audit andAuditors) Rules 2014 with the Central Government;
(c) As represented to us by the management there are no whistle blower complaintsreceived by the company during the year.
(xii) The company is not a Nidhi Company hence reporting under clause xii(a) xii(b)xii(c) of 'the Order' is not applicable.
(xiii) According to information and explanation given to us and based on ourexamination section 177 of 'the Act' is not applicable to company and company hascomplied with the provisions of Section 188 of 'the Act' w.r.t. transactions with therelated parties wherever applicable. Details of the transactions with the related partieshave been disclosed in the Financial Statements as required by the applicable AccountingStandards.
(xiv) (a) In our opinion and based on our examination the company has an internalaudit system commensurate with the size and nature of its business.
(b) We have considered the internal audit reports of the company issued till date forthe period under audit.
(xv) According to the information and explanations given to us in our opinion duringthe year the company has not entered into any non-cash transactions with its directors orpersons connected with its directors and hence provisions of section 192 of the CompaniesAct 2013 are not applicable to the company.
(xvi)(a) Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934 (2 of 1934).
(b) Company has not conducted any Non-Banking Financial or Housing Finance activitieswithout a valid Certificate of Registration (COR) from the Reserve Bank of India as perthe Reserve Bank of India Act 1934.
(c) Company is not a Core Investment Company (CIC) as defined in the regulations madeby the Reserve Bank of India accordingly this clause is not applicable.
(d) Company does not have CIC as part of the Group.
(xvii) Company has not incurred any cash losses in the financial year and in theimmediately preceding financial year.
(xviii) There has been no resignation of the statutory auditors during the year andaccordingly this clause is not applicable.
(xix) According to the information and explanations given to us and on the basis of thefinancial ratios ageing and expected dates of realization of financial assets and paymentof financial liabilities other information accompanying the financial statements ourknowledge of the Board of Directors and management plans and based on our examination ofthe evidence supporting the assumptions nothing has come to our attention which causesus to believe that any material uncertainty exists as on the date of the audit report thatcompany is not capable of meeting its liabilities existing at the date of balance sheet asand when they fall due within a period of one year from the balance sheet date. Wehowever state that this is not an assurance as to the future viability of the company. Wefurther state that our reporting is based on the facts up to the date of the audit reportand we neither give any guarantee nor any assurance that all liabilities falling duewithin a period of one year from the balance sheet date will get discharged by thecompany as and when they fall due.
(xx) (a) There is no unspent amount in respect of CSR accordingly this clause is notapplicable.
(b) There is no unspent amount in respect of CSR accordingly this clause is notapplicable.
(xxi) Since this report is in relation to stand alone financial statements accordinglythis clause is not applicable.
| ||For Kalani & Company |
| ||Chartered Accountants |
| ||Firm Regn. No 000722C |
| ||S.P. Jhanwar |
|Place: Bhilwara ||Partner |
|Date: 12th May 2022 ||Membership No.- 074414 |
Annexure "II" forming part of Independent Auditor's 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 with reference to financial statementsof Nitin Spinners Limited ("the Company") as of March 31 2022 in conjunctionwith our audit 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 with reference to financial statements 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. 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 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 Act.
Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to financial statements based on our audit. We conducted our auditin accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") and the Standards on Auditing issuedby ICAI and deemed to be prescribed under section 143(10) of the Companies Act 2013 tothe extent applicable to an audit of internal financial controls both applicable to anaudit of Internal Financial Controls and both issued by the Institute of CharteredAccountants of India. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls with reference to financial statements wasestablished and maintained and if such controls operated effectively in all materialrespects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system with reference to financial statements 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 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 withreference to financial statements.
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial controls with reference to financial statements 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 controlswith reference to Ind AS financial statements 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 ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.
Inherent Limitations of Internal financial controls with reference to financialstatements
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 with reference to financial statements and such internal financialcontrols with reference to Ind AS financial statements were operating effectively as atMarch 31 2022 based on the internal financial controls with reference to Ind ASfinancial statements 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.
| ||For Kalani & Company |
| ||Chartered Accountants |
| ||Firm Regn. No 000722C |
| ||S.P. Jhanwar |
|Place: Bhilwara ||Partner |
|Date: 12th May 2022 ||Membership No.- 074414 |