To the Members of NUTECH GLOBAL LIMITED
Report on the Audit of the Financial Statements Opinion
We have audited the accompanying standalone financial statements of NUTECH GLOBALLIMITED ("the Company") which comprise the Balance Sheet as at March 31 2020the Statement of Profit and Loss(including othercomprehensive income) Statement of CashFlow and theStatement of Changes in Equity for the year then ended and a summary ofsignificant accounting policiesand other explanatory information (hereinafter referredtoas "Ind AS Financial Statements").
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 ("the Act") in the manner so required and give a trueand fair view in conformity with the Indian Accounting Standards prescribed under section133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015 asamended ("Ind AS") and other accounting principles generally accepted in Indiaof the state of affairs of the Company as at March 31 2020 the profit and totalcomprehensive income changes in equity and its cash flows for the year ended on thatdate.
Basis for Opinion
We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing (SAs) specified under section 143(10) of the Companies Act 2013.Our responsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Financial Statements section of our report. We areindependent of the Company in accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the independence requirements that arerelevant to our audit of the standalone financial statements under the provisions of theCompanies Act 2013 and the Rules made thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the ICAI's Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our opinion on the standalone financial statements.
Emphasis of matter
1. We invite attention to Note No. 42 to the financial statement regardinguncertainties associated with the COVID-19 pandemic and impact assessment made by thecompany on its business and financial statement for the year ended 31st March2020 the said assessment made by the management is highly dependent upon how thecircumstances evolve in subsequent periods.
Our opinion is not modified in respect of these matters
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone Ind AS financial statements for the financialyear ended March 31 2020. These matters were addressed in the context of our audit of thestandalone Ind AS financial statements as a whole and in forming our opinion thereon andwe do not provide a separate opinion on these matters. For matter below our descriptionof how our audit addressed the matter is provided in that context. We have determined thematter described below to be the key audit matter to be communicated in our report. Wehave fulfilled the responsibilities described in the Auditor's responsibilities for theaudit of the standalone Ind AS financial statements section of our report including inrelation to this matter. Accordingly our audit included the performance of proceduresdesigned to respond to our assessment of the risks of material misstatement of thestandalone Ind AS financial statements. The results of our audit procedures including theprocedures performed to address the matter below provide the basis for our audit opinionon the accompanying standalone Ind AS financial statements.
|The key audit matters ||How our audit addressed the key audit matter |
| ||Principal audit procedures performed: |
|1. Valuation of Inventories || We understood and tested the design and operating effectiveness of controls as established by the management in determination of net realizable value of inventory. |
|We refer to financial statement's accounting principle on inventories and related disclosure in the note 6 and 36(l). || |
| || Assessing the appropriateness of Company's accounting policy for valuation of stock-in- trade and compliance of the policy with the requirements of the prevailing accounting standards. We considered various factors including the actual selling price prevailing around and subsequent to the year-end and fixed price contracts with customers whose sales orders are on hand. Compared the cost of the finished goods with the estimated net realizable value and checked if the finished goods were recorded at net realizable value where the cost was higher than the net realizable value. |
|At the balance sheet date The value of inventory amounted to Rs. 12.46 Crores Representing 54.54% of total assets. According to the financial statements' accounting principle Inventories are measured at the lower of cost or net realizable value. Inventories were considered as a key audit matters due to the size of the balance and significant management judgment involved in the consideration of factors in determination of selling price such as fluctuation of raw material prices in the international market and substantial fall into selling prices due to shortage in demand due to COVID 19. || |
| || For the purpose of determination of cost the Company has considered the prevailing market situation. Based on the above procedures performed the management's determination of the net realizable value of the inventory as at the year end and comparison with cost for valuation of inventory is considered to be reasonable. |
The Company's management and Board of Directors are responsible for the otherinformation. The other informationcomprises the information included in the Company'sannual report but does not include the standalone financialstatements and our auditors'report thereon.
Our opinion on the standalone financial statements does not cover the other informationand we do not express anyform of assurance conclusion thereon.
In connection with our audit of the standalone financial statements our responsibilityis to read the other informationand in doing so consider whether the other informationis materially inconsistent with the standalone financialstatements or our knowledgeobtained in the audit or otherwise appears to be materially misstated. If based onthework we have performed we conclude that there is a material misstatement of this otherinformation we arerequired 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 in section 134(5) ofthe Companies Act 2013 ("the Act") with respect to the preparation of thesestandalone financial statements that give a true and fair view of the financial positionfinancial performance including other comprehensive income cash flows and changes inequity of the Company in accordance with accounting principles generally accepted in Indiaincluding the Indian Accounting Standards (Ind AS) referred to in section 133 of the Act.
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 standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing the standalone financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.
The Board of Directors are responsible for overseeing the Company's financial reportingprocess.
Auditor's Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalonefinancial 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. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism through out the audit. We also:
Identify and assess the risks of material misstatement of the standalonefinancial 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 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 standalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.
Evaluate the overall presentation structure and content of the standalonefinancial statements including the disclosures and whether the standalone financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.
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 standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when 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 2016 ("the Order")issued by the Central
Government of India in terms of sub-section (11) of section 143 of the Act we give inthe AnnexureA a statement on the matters specified in the paragraph 3 and 4 of the Orderto the extent applicable.
A) 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 (including other comprehensiveincome) the cash flow statement and Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account;
(d) in our opinion the aforesaid standalone Ind AS financial statements comply withthe Indian Accounting Standards specified under Section 133 of the Act except in lndAS-19"Employee Benefits" where in the Company has not provided liability for Gratuityon actuarial valuation basis;
(e) on the basis of the written representations received from the directors as on 31March 2020 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2020 from being appointed as a director in terms of Section164 (2) of the Act; and
(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".Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.
B) 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 if any of pending litigations on itsstandalone IND AS financial position in its standalone Ind AS financial statements
(ii) as per the information provided to us by the management the company has notentered in to long term contract including derivative contracts for which provisioning isrequired;
(iii) As the Company has not declared any dividend in the past years & there is nounpaid dividend so there is no requirement of transfer of amount in Investor Education& Protection fund (IEPF).
C) With respect to the matter to be included in the Auditors' Report under section197(16):
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) which arerequired to be commented upon by us.
|For: O. P. DAD & CO. |
|Chartered Accountants |
|(Firm Reg. No. 002330C) |
|M. No. 035373 |
|Dated: 29.06.2020 |
|Place :- Bhilwara |
|UDIN:- 20035373AAAABP3888 |
ANNEXURE A TO THE INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 1 under the heading of "Report on Other Legal andRegulatory Requirements'' of our report of even date)
On the basis of such checks as we considered appropriate and according to theinformation & explanation given to us during the course of our audit we report that:
i. In respect of company's fixed assets:
(a) The company has generally maintained proper records showing full particularsincluding quantitative details and situation of its fixed assets on the basis of availableinformation.
(b) As explained to us all the fixed assets have been physically verified by themanagement in a phased periodical manner which in our opinion is reasonable havingregard to the size of the Company and nature of its assets. No material discrepancies werenoticed on such physical verification.
(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.
ii. As explained to us physical verification of inventory has been conducted atreasonable intervals by the management and the discrepancies noticed on verificationbetween the physical stocks and the book records were not material having regard to thesize of the Company and the same have been properly dealt with in the books of account.
iii. According to the information Et explanations given to us and on the basis of ourexamination of the books of account the Company has not granted any loans secured orunsecured to companies firms or other parties listed in the register maintained underSection 189 of the Companies Act 2013. Hence clause (iii) (a) (b) & (c) is notapplicable to the company as the company has not granted any such loans.
iv. According to the information 8t explanations given to us and on the basis ofour examination of the books of account the Company has not granted any loan todirectors.
V. The Company has not accepted any loans/deposits from public. In our opinion andaccording to the information and explanation given to us the provisions of Section 73 and76 of the Companies Act 2013 and the Rules framed there
under wherever applicable are being complied with. No order has been passed bycompany law board against the company.
vi The Central Government has prescribed maintenance of the cost records under 148(1)of the Companies Act 2013 in respect to the company's products. We have broadly reviewedthe books of accounts and records maintained by the company in this connection and are ofthe opinion that prima facie the prescribed accounts and records have been made andmaintained. We have however not made a detailed examination of the records with a view todetermine whether they are accurate or complete.
Vi. A. According to the records of the Company undisputed statutory dues includingProvident Fund Employees State Insurance Income Tax Custom Duty GST Sales Tax ExciseDuty cess and other statutory dues have been regularly deposited with the appropriateauthorities. According to the information and explanation given to us no undisputedamounts payable in respect of the aforesaid dues were outstanding as at 31st March 2020for a period of more than six months from the date they have become payable.
b. According to the information & explanations given to us and the records examinedby us there is no amount which have not been deposited on account of any disputed amountpayable in respect of income tax service tax GST sales tax customs duty and exciseduty and cess.
viii. Based on our audit procedures and on the information & explanations given bythe management we are of the opinion that the Company has not defaulted in repayment ofdues to a financial institution banks or debenture holders.
ix. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company did not raise any money by way ofinitial public offer or further public offer (including debt instruments) and term loansduring the year. Accordingly paragraph 3(ix) of the Order is not applicable.
x. In our opinion and according to the information &t explanations given to us wereport that no material fraud on or by the company has been noticed or reported during theyear nor have we been informed of such case by the management.
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 for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Act.
xii. In our opinion and according to the information and explanations give to us theCompany is not a Chit Fund / Nidhi / Mutual Benefit Fund / Society. Therefore theprovision of clause 3(xii) of the Companies (Auditor's Report) Order 2016 is notapplicable to the Company.
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 and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.
xiv. According to the information and explanations given 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.
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. Accordingly paragraph 3(xv) ofthe Order is not applicable.
xvi. The Company is not required to be registered under sec. 45-IA of the Reserve Bankof India Act 1934.
| ||For: O. P. DAD & CO. |
| ||Chartered Accountants |
| ||(Firm Reg. No. 002330C) |
| ||(O.P.DAD) |
|Dated: 29.06.2020 ||Partner |
|Place Bhilwara ||M. No. 035373 |
| ||UDIN:- 20035373AAAABP3888 |
ANNEXURE B TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONE FINANCIALSTATEMENTS OF NUTECH GLOBAL LIMITED
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 NUTECHGLOBAL LIMITED ("the Company") as of March 31 2020 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.
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 Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.
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 on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate 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 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 procedures selected depend on the auditor's judgment 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 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 standalone Ind AS financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail .accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of standaloneInd AS financial statements in accordance with generally accepted accounting principlesand that receipts and expenditures of the company are being made only in accordance withauthorizations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition use ordisposition of the company's assets that could have a material effect on the standaloneInd AS 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 operating effectively as at March 31 2020 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.
| ||For: O. P. DAD 6 CO. |
| ||Chartered Accountants |
| ||(Firm Reg. No. 002330C) |
|Place: Bhilwara ||(O.P.DAD) |
|Dated: 29.06.2020 ||Partner |
| ||M. No. 035373 |
| ||UDIN:- 20035373AAAABP38SB |