TO THE MEMBERS OF OPTIMUS FINANCE LIMITED
Report on the audit of the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements ofOptimus Finance Limited ("the Company") which comprise the standalone balancesheet as at 31st March 2022 the standalone statement of Profit and Loss (including othercomprehensive income) standalone statement of cash flows standalone statement of changesin equity for the year ended and notes to the standalone financial statements including asummary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone financial statements give theinformation required by the Companies Act 201 3 (the "Act") in the manner sorequired and give a true and fair view in conformity with the Indian Accounting Standardsprescribed under section 1 33 of the Act read with the Companies (Indian AccountingStandards) Rule 2015 as amended ("Ind AS") and other accounting principlesgenerally accepted in India of the state of affairs of the Company as at 31st March2022 its loss and other comprehensive income changes in equity and its cash flows forthe year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing(SAs) specified under section 143(10) of the Companies Act 2013. Our responsibilitiesunder those Standards are further described in the Auditor's Responsibilities for theAudit of the Standalone Financial Statements section of our report. We are independent ofthe Company in accordance with the Code of Ethics issued by the Institute of CharteredAccountants of India together with the ethical requirements that are relevant to our auditof the standalone financial statements under the provisions of the Companies Act 2013 andthe Rules thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the Code of Ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for our opinionon the standalone financial statement.
Key Audit Matters
Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the standalone financial statements of thecurrent period. These matters were addressed in the context of our audit of the standalonefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. We have determined following key audit matters to becommunicated in our report.
|Sr. No ||Key Audit Matter ||Auditor's Response |
|1. ||The Company has a substantial exposure in loan given to various parties: ||How the matter was addressed in our audit: |
| ||The company has given loan in form of corporate deposit of Rs. 420.44 Lakhs. The above exposure in corporate deposit forms a substantial portion of the net worth of the company. || We have evaluated the relevant agreements entered by the company with the various parties for the corporate deposit given. |
| ||Refer no. 5 and 35 of the standalone financial statement. || We have also evaluated the relevant terms and conditions agreed between the parties. |
| || || The purpose for which the loan was given. |
Information Other than the Standalone Financial Statements andAuditor's Report Thereon
The Company's Board of Directors is responsible for the preparation ofthe other information. The other information comprises the information included in theBoard's Report including annexures to Board's Report Corporate Governance andshareholders information but does not include the standalone financial statements and ourauditor's report thereon. The above-referred information is expected to be made availableto us after the date of this audit report.
Our opinion on the standalone financial statements does not cover theother information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statementsour responsibility is to read the other information identified above and in doing soconsider whether the other information is materially inconsistent with the standalonefinancial statements or our knowledge obtained during the course of our audit or otherwiseappears to be materially misstated.
When we read the information if we conclude that there is a materialmisstatement therein we are required to communicate the matter to those charged withgovernance and take appropriate actions necessitated by the circumstances & theapplicable laws and regulations.
Responsibilities of Management and Those Charged with Governance forthe Standalone Financial Statements
The Company's Board of Directors is responsible for the matters statedin Section 134(5) of the Companies Act 2013 ("the Act") with respect to thepreparation of these standalone financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income changes inequity and cash flows of the Company in accordance with the
accounting principles generally accepted in India including theaccounting Standards specified under Section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error;
In preparing the standalone financial statements management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so;
That Board of Directors are also responsible for overseeing thecompany's financial reporting process.
Auditor's Responsibilities for the Audit of the Standalone FinancialStatements
Our objectives are to obtain reasonable assurance about whether thestandalone financial statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of thestandalone financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control;
Obtain an understanding of internal control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances butnot for the purpose of expressing an opinion on effectiveness the company's internalfinancial controls.
Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management;
Conclude on the appropriateness of management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the Company to cease to continue as a going concern;
Evaluate the overall presentation structure and content of thestandalone financial statements including the disclosures and whether the standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation;
Materiality is the magnitude of misstatements in the standalonefinancial statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the standalone financialstatements may be influenced. We consider quantitative materiality and qualitative factorsin (i) planning the scope of our audit work and in evaluating the results of our work; and(ii) to evaluate the effect of any identified misstatements in the standalone financialstatements.
We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.
We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.
From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the financialstatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.
Attention is drawn to the fact that the audited standalone financialstatements of the Company for the year ended 31 March 2021 were audited by erstwhileauditors whose report dated 29th May 2021 expressed an unmodified opinion on thoseaudited standalone financial statements. Our opinion is not modified in respect of thismatter.
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 of the Companies Act 201 3 we give in the Annexure A a statement onthe matters specified
in paragraphs 3 and 4 of the Order to the extent applicable.
2. As required by Section 143(3) of the Act we report that:
(a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit;
(b) In our opinion proper books of account as required by law havebeen kept by the Company so far as it appears from our examination of those books;
(c) The Standalone Balance Sheet the Standalone Statement of Profitand Loss and the Standalone Cash Flow Statement dealt with by this Report are inagreement with the books of account;
(d) In our opinion the aforesaid standalone financial statementscomply with the Accounting Standards specified under Section 133 of the Act
(e) On the basis of the written representations received from thedirectors as on 31st March 2022 taken on record by the Board of Directors none of thedirectors is disqualified as on 31st March 2022 from being appointed as a director interms of Section 164(2) of the Act;
(f) With respect to the adequacy of the internal financial controlsover financial reporting of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure B".
(g) In our opinion and to the best of our information and according tothe explanations given to us the remuneration paid by the Company to its directors duringthe year is in accordance with the provisions of section 197(16) of the Act as amended.
(h) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 inour opinion and to the best of our information and according to the explanations given tous:
i. The Company has no pending litigations on its financial position.
ii. The Company has made provision as required under the applicablelaw or accounting standards for material foreseeable losses if any on long-termcontracts including derivative contracts.
iii. As per information and explanation given to us there is no amountthat required to be transferred to to the Investor Education and Protection Fund by theCompany.
iv. a) The Management has represented to the best of its knowledge andbelief that no funds have been advanced or loaned or invested (either from borrowed fundsor share 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") withthe understanding 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")or provide any guarantee security or the like on behalf of the Ultimate Beneficiaries;
b) The Management has represented to the best of its knowledge andbelief that 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; and
c) Based on such audit procedures performed that have been consideredreasonable and appropriate in the circumstances nothing has come to our notice that hascaused us to believe that the representations under subclause (i) and (ii) contain anymaterial misstatement.
v. There is no dividend declared or paid during the year by the Companyand hence provisions of section 123 of the companies Act 2013 are not applicable.
ANNEXURE - A TO THE AUDITORS' REPORT
The Annexure-A referred to in our Independent Auditors' Report to themembers of the Company on the standalone financial statements for the year ended 31stMarch 2022 we report that
i (a)(A)The Company has maintained proper records showing fullparticulars including quantitative details and situation of the property plant andequipment;
i (a)(B) The company does not have any intangible asset and accordinglythe reporting under clause no. i (a)(B) of the order relating Intangible asset does notapplicable to the company;
i (b) In accordance with this program certain Property plant andequipment were verified by the management during the year. According to the informationand explanations given to us no material discrepancies were noticed on such verification;
i (c) According to the information and the explanation given to us thecompany does not have any immovable property and accordingly the reporting under clauseno. i (c) of the order relating to the title deeds of the immovable property is notapplicable to the company.
i (d) In our opinion and according to the information and explanationsgiven to us the company has not revalued its Property Plant and Equipment and intangibleassets during the year;
i (e) As disclosed in note no. 40(i) of the standalone financialstatement and as verified by us no proceedings have been initiated or are pending againstthe company for holding any Benami property under the Benami Transactions (Prohibition)Act 1988 and rules made thereunder;
ii (a) In our opinion and according to the information and theexplanation given to us the company does not hold any physical inventories hence thereporting under clause ii (a) of the Order is not applicable to the Company;
ii (b) In our opinion and according to the information and theexplanation given to us the company does not have sanctioned any working capital limitduring the year under consideration and accordingly the reporting under clause no. ii (b)of the order is not applicable to the company.
iii (a) The Company is a Non-Banking Finance Company and its principalbusiness is to give loans. Accordingly reporting under clause 3(iii)(a) of the Order isnot applicable to the Company.
(b) In respect of the loans and advances granted in nature of loansthe terms & conditions of the loans and advances are not prejudicial to the interestof the company.
(c) With respect to loans & advances granted in nature of loansthe schedule of repayment of principal and the payment of interest has been stipulated andthe same is regular;
(d) In respect of loans & advances granted in nature of loan thereis no amount overdue for more than 90 days;
(e) The Company is a Non-Banking Finance Company and its principalbusiness is to give loans. Accordingly reporting under clause 3(iii)(e) of the Order isnot applicable to the Company.
(f) The Company has not granted any loans or advances in the nature ofloans either repayable on demand or without specifying any terms or period of repaymentduring the year. Hence reporting under clause (iii)(f) is not applicable to the company;
Other than that mentioned above the company has not provided anyguarantee or security or granted any other advances in the nature of loans secured orunsecured to companies firms Limited Liability Partnership or any other parties.
iv Based on our verification of the documents provided to us andaccording to the information and explanations given to us in respect of loansinvestments guarantees and security the Company has complied with the provisions ofsection 185 and 186 of the Companies Act 2013.
v In our opinion and according to the information and the explanationgiven to us the company has not accepted deposits from the public. However theprovisions of the section 73 to 76 are not applicable to the company being registeredunder section 45- IA of the RBI Act 1934 i.e. NBFC.
vi In our opinion and according to the information and explanationsgiven to us the Central Government has not prescribed the maintenance of cost records bythe company under section 148(1) of the Companies Act 2013;
vii (a) In our opinion the company is generally regular in depositingundisputed statutory dues including Goods and Service tax provident fund employee stateinsurance income-tax and other statutory dues as applicable to the appropriateauthorities. There were no undisputed amounts payable with respect to above statutory duesin arrears as of March 31 2022 for a period of six months from the date they becamepayable;
vii (b) In our opinion and according to the information andexplanations given to us there are no statutory dues of referred in sub-clause
(a) that has not been deposited on account of disputes;
viii In our opinion and according to the information and theexplanation provided to us as disclosed in note no. 40(vii) of the standalone financialstatement there were no transactions which were not recorded in the books of accountthat have been surrendered or disclosed as income during the year in the tax assessmentsunder the Income Tax Act 1961;
ix (a) In our opinion and according to the information and theexplanation provided to us the company has not defaulted in repayment of loans or otherborrowings or in the payment of interest thereon to any lender;
ix (b) In our opinion and according to the information and theexplanation provided to us as disclosed in note no. 40(ix) of the standalone financialstatement the company is not declared as willful defaulter by any bank or financialinstitution or other lender;
ix (c) In our opinion and according to the information and theexplanation given to us the term loan were applied for the purpose for which the saidwere obtained.
ix (d) In our opinion and according to the information and explanationsgiven to us and on an overall examination of the standalone financial statements of theCompany funds raised by the Company on short term basis have not been utilized for longterm purposes.
ix (e) In our opinion and according to the information and theexplanation given to us the company has not taken any funds from any entity or person onaccount of or to meet the obligations of its subsidiaries associates or joint ventures.
ix (f) In our opinion and according to the information and theexplanation given to us the company has not raised loans during the year on the pledge ofthe securities held in its subsidiaries associates or joint ventures and accordingly thereporting under clause ix (f) is not applicable to the company.
x (a) In our opinion and according to the information and theexplanation given to us the Company has not raised moneys by way of initial public offeror further public offer (including debt instruments) during the year and accordingly thereporting under clause no. x(a) of the order is not applicable;
x (b) In our opinion and the according to the information and theexplanation given to us during the year the Company has not made any preferentialallotment or private placement of shares or convertible debentures (fully or partly oroptionally) and hence the reporting under clause no. x(b) of the Order is not applicableto the company;
xi (a) During the course of our examination of the books of account andrecords of the Company carried out in accordance with the generally accepted auditingpractices in India and according to the information and explanations given to us we haveneither came across any incidence of fraud on or by the Company noticed or reported duringthe year nor we have been informed of any such case by the management;
xi (b) No report under sub-section (12) of section 143 of the CompaniesAct has been filed in Form ADT-4 as prescribed under rule 13 of Companies (Audit andAuditors) Rules 2014 with the Central Government during the year and up to the date ofthis report.
xi (c) As represented to us by the management there are no whistleblower complaints received by the company during the year.
xii In our opinion and according to the information and the explanationgiven to us the Company is not a Nidhi company and accordingly the reporting under clausexii (a) to (c) of the order is not applicable to the Company
xiii In our opinion and according to the information and explanationgiven to us all the transactions with the related parties are in compliance with section177 and 188 of the Companies Act 2013 where applicable and the details have beendisclosed in the Standalone Financial Statements as required by the applicable accountingstandards;
xiv (a) & (b) In our opinion and according to the information andthe explanation given to us the company have an internal audit system and the reports ofthe internal auditors have been considered by us.
xv In our opinion and according to the information and explanationsgiven to us the Company has not entered into any non-cash transactions with directors orpersons connected with him and accordingly the compliance under the provisions of section192 of the Companies Act 2013 are not applicable;
xvi (a) The Company is registered under section 45-IA of the ReserveBank of India Act 1934.
(b) The Company has not conducted any Non-Banking Financial activitywithout a valid certificate of Registration from Reserve Bank of India as per Reserve Bankof India Act 1934.
(c) The company is a not Core Investment Company (CIC); accordingly thereporting under the clause (c) of the order does not applicable to the company.
xvii The Company has incurred cash losses amounting to Rs. 4.82 Lakhsin the current financial year. However the company has not incurred any cash losses in theimmediately preceding financial year;
xviii There is resignation of the statutory auditors during the yearand the said was on account of Guidelines for Appointment of Statutory Central Auditors(SCAs)/Statutory Auditors (SAs) of Commercial Banks (excluding RRBs) UCBs and NBFCs(including HFCs) dated 27th April 2021 as issued by RBI. However there are no objectionor issues or concerns raised by the outgoing auditors.
xix Based on our examination financial ratios ageing and expecteddates of realisation of financial assets and payment of financial liabilities otherinformation accompanying the standalone financial statements knowledge of the Board ofDirectors and management plans there is no material uncertainty exists as on the date ofthe audit report that company is not capable of meeting its liabilities existing at thedate of balance sheet as and when they fall due within a period of one year from thebalance sheet date;
We however state that this is not an assurance as to the futureviability of the Company. We further state that our reporting is based on the facts up tothe date of the audit report and we neither give any guarantee nor any assurance that allliabilities if any falling due within a period of one year from the balance sheet datewill get discharged by the Company as and when they fall due;
xx(a) & xx(b) In our opinion and according to the information andthe explanation given to us the provisions of Corporate Social Responsibility (CSR) arenot applicable to the company accordingly the reporting under clause xx (a) and (b) of theorder is not applicable to the company.
ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT
Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financialreporting of Optimus Finance Limited ("the Company") as of 31st of March 2022in conjunction with our audit of the standalone financial statements of the company forthe year ended on that date.
Management's Responsibility for Internal Financial Controls
The company's management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting criteria established by the company considering the essential components ofinternal control stated in the guidance note on audit of Internal Financial Controls overFinancial Reporting issued by the Institute of Chartered Accountants of India ('ICAI').These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.
Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls over FinancialReporting (the "Guidance Note") and the Standards on Auditing issued by I CAIand deemed to be prescribed under section 143(10) of the Companies Act 2013 to theextent applicable to an audit of internal financial controls both applicable to an auditof Internal Financial Controls and both issued by the Institute of Chartered Accountantsof India. 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 aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgment including the assessment of therisks of material misstatement of the standalone financial statements whether due tofraud or error.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial control over financial reporting is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of standalone financial statements for external purposes inaccordance with generally accepted accounting principles. A company's internal financialcontrol over financial reporting includes those policies and procedures that (1) pertainto the maintenance of records that in reasonable detail accurately and fairly reflectthe transactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of standalonefinancial statements in accordance with generally accepted accounting principles and thatreceipts 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 standalonefinancial statements.
Inherent Limitations of Internal Financial Controls over FinancialReporting
Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31st March 2022 basedon the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.
|For Shah Mehta & Bakshi |
|Chartered Accountants |
|(Registration No. 103824W) |
|(Prashant Upadhyay) |
|M No. 121218 |
|UDIN: 22121218AJXJPW1596 |
|Place: Vadodara |
|Date: 30th May 2022 |