To the Members of Orchid Pharma Limited
Report on the audit of the Standalone financial statements Qualified Opinion
We have audited the standalone financial statements of Orchid Pharma Limited ("theCompany") which comprise the balance sheet as at March 31 2021 and the statementof profit and loss (including other comprehensive income) the statement of changes inequity and the statement of cash flows for the year then ended and notes to thestandalone financial statements including a summary of significant accounting policiesand other explanatory information.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements subject to our comments in theBasis for Qualified Opinion paragraph give the information required by the Companies Act2013 ("the Act") in the manner so required and give a true and fair view inconformity 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 2021 and its loss total comprehensive income thechanges in equity and its cash flows for the year ended as on that date.
Basis for Qualified Opinion
Attention is invited to Note 54 to the Standalone financial statements which describesthat due to the extension of complete/ partial lockdown across India to contain the spreadof the Covid-19 virus the company could not complete the physical verification of fixedassets and its related reconciliation with the books of account. Accordingly we areunable to comment on the possible impact if any arising out of the above matters. Thisis was qualified in our earlier year audit report also.
We conducted our audit in accordance with the standards on auditing (SAs) specifiedunder section 143 (10) of the Act. Our responsibilities under those standards are furtherdescribed in the Auditor's responsibilities for the audit of the standalone financialstatements section of our report. We are independent of the Company in accordance with thecode of ethics issued by the Institute of Chartered Accountants of India("ICAI") together with the ethical requirements that are relevant to our auditof the standalone financial statements under the provisions of the Act and the Rules therender and we have fulfilled our other ethical responsibilities in accordance with theserequirements and the ICAI's code of ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone financial statements of the current period.These matters were addressed in the context of our audit of the standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters.
In our opinion and based on the information and explanations given to us we havedetermined the matters described below to be the key audit matters to be communicated inour report.
Accounting for Business Combination as per Ind AS 103 and the related revision in theprovisional accounting done in the previous year
As morefully explained in Note 51 to the standalone financial statements M/s DhanukaLaboratories Limited the successful resolution applicant has infused the requiredinvestments as per the approved Resolution Plan ("the Said Plan") and theCompany has accounted for the transactions relating to the above as directed by theHon'ble NCLT on March 31 2020. The adjustments to the carrying amount have been made on aprovision basis due to Covid'19 related restrictions in getting complete valuation forvarious assets and liabilities including impairment on the carrying value of propertyplant and equipment capital work in progress intangibles and intangibles underdevelopment.
The Company has obtained a detailed valuation report on lifting of the general lockdownthrough external experts and detailed internal assessment regarding the fair value ofvarious assets taken over and liabilities assumed as part of the business combination. Theconsequential adjustments have been made in March 2021 (i.e. within 1 year from the dateof acquisition) as provided in Para 45 to Para 49 of Ind AS 103 for provisional accountingfor business combinations.
Principal Audit Procedures
We assessed the Company's process to identify assess and respond to risks ofmaterial misstatement considering the complexity of the terms and conditions of the SaidPlan and the impact of the revision to the provisional accounting of the businesscombination on the Company's operations and standalone financial statements for the yearunder consideration.
As part of the evaluation of whether sufficient appropriate audit evidence hasbeen obtained we have evaluated the appropriateness of our initial risk assessments andrevised previous risk assessments in for certain financial statement areas like claims andfinal settlement of financial and operating creditors carrying amount of property plantand equipment capital work in progress intangible assets comprising of ANDA/ DMF andintangibles under development including related disclosure requirements under the Act andrespective Indian Accounting Standards.
We have considered the impact on the processes and controls that may be affectedby necessary changes to business processes in light of circumstances such as travelrestrictions result of remote working arrangements etc.
We have reviewed the terms and conditions stipulated by the Hon'ble NCLT in theSaid Plan.
We have reviewed the valuation report of the independent external expert who hascarried out the impairment assessment of property plant and equipment and the assumptionsconsidered in the valuation
We have obtained the internal assessment regarding the final fair value ofvarious assets taken over and liabilities assumed as part of the business combination ason the date of acquisition which were provisionally accounted for business combination asper Ind AS 103 in the previous year and the basis of such conclusions.
We have designed performed new procedures and modified previously planned auditprocedures as a result of the necessity for carrying out the audit procedures remotelyincluding verification of the source and completeness of data provided for audit. Thisincludes performing alternative audit procedures to obtain audit comfort in respect ofsignificant account balances for recognition measurement and disclosures.
We have audited the management's estimates required in the standalone financialstatements including but not limited to estimates related to expected credit loss fairvalue of various assets taken over and liabilities assumed inventory obsolescenceimpairment of non-financial assets etc. by checking the reasonableness of underlyingassumptions in making those key estimates.
We have considered the basis of management judgment in determining impact on thestandalone financial statements of subsequent events related to the implementation of theSaid Plan (in light of the COVID-19 related restrictions) taking into consideration thedate of the standalone financial statements the facts and circumstances pertaining to theentity and the conditions that existed at or arose after that date. As the impacts ofthe COVID-19 outbreak continue to evolve including regulatory restrictions/ conditionscapturing events that relate specifically to conditions that existed at the date of thestandalone financial statements or after the date of the standalone financial statementswe have considered all subsequent events and transactions to substantiate our conclusionson the appropriateness of management's estimate in making the adjustments as per the SaidPlan.
We have considered management's adjustments or disclosures which includes theimpact of the changes in the Accounting for Business Combination as per Ind AS 103 and therelated revision in the provisional accounting done in the previous year on therecognition and measurement of account balances and transactions in the standalonefinancial statements or other specific disclosures as per the Said Plan.
Emphasis of Matters
Without qualifying our opinion we draw attention to the following matters
(a) The Company has taken certain lands on lease for its operations in respect of whichthe lease agreement expired before the date of commencement of the Corporate InsolvencyResolution Process. As part of the right to review the existing agreements the Companyhas made a detailed assessment of the market rent for the property and the market value ofthe property for outright purchase. Since the present rent as per erstwhile leaseagreements is significantly high considering the market value of the property itself theCompany is in talks with the lessor for renewal of the lease with lower rent or foroutright purchase of the property as part of the implementation of the resolution plan.However no finality is reached on this matter as of date.
Pending completion of the negotiation and the uncertainties involved the Companydisputed the portion of the lease rent considered to be excessive than the market rate asassessed by an independent valuer amounting to Rs.1025.67 Lakhs for the year ended March31 2021 in respect of the aforesaid lease. The same has been treated as contingentliabilities in the standalone financial statements of the Company.
Based on legal opinion obtained the management is of the opinion that no liabilitywill arise on completion of the negotiation; and
(b) "Estimation of uncertainties relating to the global health pandemic fromCOVID-19" section of Note 2 to the standalone financial statements which describesthe uncertainties and the impact of Covid-19 pandemic on the Company's operations andresults as assessed by the management.
Further to the continuous spreading of COVID-19 across India the Central and StateGovernments announced partial/ complete lock down during April and May 2021 to contain thespread of the virus. This has resulted in restriction on physical visit to the clientlocations and the need for carrying out alternative audit procedures as per the Standardson Auditing prescribed by the Institute of Chartered Accountants of India (ICAI).
As a result of the above the major portion of the audit was carried out based onremote access of the data as provided the management. This has been carried out based onthe advisory on "Specific Considerations while conducting Distance Audit/ RemoteAudit/ Online Audit under current Covid-19 situation" issued by the Auditing andAssurance Standards Board of ICAI. We have been represented by the management that thedata provided for our audit purposes is correct complete reliable and are directlygenerated by the accounting system of the Company without any further manualmodifications.
We bring to the attention of the users that the audit of the financial statements hasbeen performed in the aforesaid conditions.
Our opinion is not modified in respect of the above matters.
Information other than the Standalone Financial Statements and auditors' 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 BusinessResponsibility Report Corporate Governance and Shareholder's Information but does notinclude the standalone financial statements and our auditor's report thereon.
Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained during the course of our audit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.
Management's responsibility for the standalone financial statements
The Company's board of directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income cash flows and changes in equity of the Company in accordancewith the Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act readwith the Companies (Indian Accounting Standards) Rules 2015 as amended from time totime and other accounting principles generally accepted in India.
This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone financial statements that give a true and fair view and are free frommaterial misstatement 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 also responsible for overseeing the Company's financialreporting process.
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 throughout 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 controls relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(I)of the Companies Act 2013 we are also responsible for expressing our opinion on whetherthe company has adequate internal financial controls system in place and the operatingeffectiveness of such controls
Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe 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 standalone financial statements may be influenced. Weconsider quantitative materiality and qualitative factors in
(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 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 ofthe Companies Act 2013 we give in Annexure "A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act we report that:
(a) We have sought and obtained all the information and 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 statement of changes in equity and the statement of cash flow dealt with by thisreport are in agreement with the books of account;
(d) In our opinion the aforesaid standalone financial statements comply with theIndian Accounting Standards specified under Section 133 of the Act;
(e) On the basis of the written representations received from the directors as on March31 2021 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2021 from being appointed as a director in terms of Section 164 (2) of theAct;
(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;
(g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197 (16) of the Act as amended in ouropinion and to the best of our information and according to the explanations given to usthe remuneration paid by the Company to its directors during the year is in accordancewith the provisions of section 197 of the Act; and
(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:
a. The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements - Refer Note 44 to the standalonefinancial statements;
b. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts; and
c. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company.
For CNGSN & ASSOCIATES LLP
| ||Chartered Accountants |
| ||Firm's Registration No. 004915S/ S200036 |
| ||(CHINNSAMY GANESAN) |
| ||Partner |
|Place: Chennai ||Membership No. 027501 |
|Date: May 22 2021 ||UDIN: 21027501AAAACN5744 |
Annexure "A" to the Independent Auditors' Report on Standalone FinancialStatements
(Referred to in paragraph 1 under 'Report on other Legal and Regulatory Requirements'section of our report to the Members of Orchid Pharma Limited of even date)
1. In respect of the Company's fixed assets:
(a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) The Company has a program of verification to cover all the items of fixed assets ina phased manner over a period of three years which in our opinion is reasonable havingregard to the size of the Company and the nature of its assets.
Pursuant to the said program we were informed by the management that a portion of thefixed assets have been physically verified during the year but due to the Covid'19 relatedrestrictions the same could not be comprehensively reconciled with the books.Accordingly we were unable to comment on whether any material discrepancies were noticedon such verification and whether they are properly dealt with in the standalone financialstatements.
(c) According to the information and explanations given to us the records examined byus and based on the examination of the conveyance deeds provided to us we report thatthe title deeds comprising all the immovable properties of land and buildings which arefreehold are held in the name of the Company as at the balance sheet date.
In respect of immovable properties pledged as security for borrowings the Company isin the process of obtaining confirmation of title deeds deposited with the lenders.Accordingly we are unable to express our comment on those items of immovable properties.
2. The inventory has been physically verified by the management during the year. In ouropinion the frequency of such verification is reasonable. According to the informationand explanations given to us no material discrepancies were noticed on such verification.
3. According to information and explanation given to us the company has not grantedany loan secured or unsecured to companies firms limited liability partnerships orother parties covered in the register required under section 189 of the Companies Act2013. Accordingly paragraph 3 (iii) of the order is not applicable.
4. In our opinion and according to information and explanation given to us the companyhas not granted any loans or provided any guarantees or given any security to which theprovision of section 185 of the companies Act are applicable.
In respect of investments made by the Company the Company had complied with theprovisions of section 186 of the Companies Act 2013.
5. In our opinion and according to the information and explanations given to us thecompany has not accepted any public deposits during the year and accordingly paragraph 3(v) of the order is not applicable.
6. We have broadly reviewed the books of account maintained by the Company pursuant tothe rules made by the Central Government for the maintenance of cost records under section148 of the Act and are of the opinion that prima facie the prescribed accounts andrecords have been made and maintained. However we have not carried out a detailedexamination of the same.
7. According to the information and explanations given to us and based on ourexamination of the relevant records:
(a) The Company has been generally regular in depositing undisputed statutory duesincluding provident fund employees' state insurance income tax sales tax service taxvalue added tax goods and services tax customs duty excise duty cess and othermaterial statutory dues applicable to it with the appropriate authorities.
According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income-tax sales- taxservice tax goods and service tax duty of customs duty of excise value added tax cessand other material statutory dues were in arrears as at March 31 2021 for a period ofmore than six months from the date they became payable.
(b) According to the information and explanations given to us and as confirmed by theResolution Professional (RP) and the Successful Resolution Applicant in view of theimplementation of the resolution plan as approved by the Hon'ble National Company LawTribunal (based on the order of the Hon'ble Supreme Court of India) except to the extentof payment to the stakeholders as per the approved Resolution Plan the Company shall haveno liability with respect to any claims relating in any manner to the period prior to"the effective date" i.e. pre-Corporate Insolvency Resolution Process period(pre- CIRP period). We were informed that to the extent of claims raised (pertaining tothe pre-CIRP period) by various statutory authorities and approved by the RP have beenfully paid as part of the approved resolution plan. Accordingly all other pendinglitigations relating to pre-CIRP period are deemed to be extinguished as at March 312020 i.e. the date of implementation of the approved resolution plan. Accordingly thereare no dues of income tax sales tax service tax excise duty value added tax and goodsand service tax which have not been deposited as at March 31 2021 on account of dispute.
8. In our opinion and according to the information and explanations given to us thecompany has not defaulted in repayment of dues to its bankers and debenture holders duringthe year. According to the information and explanations given to us the company has nooutstanding dues to any financial institutions or any government during the year.
9. In our opinion and according to the information and explanations given to us theCompany has not taken any term loans from banks and financial institutions during theyear. The Company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments) during the year.
10. To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company or no material fraud on the Company by its officersor employees has been noticed or reported during the year.
11. In our opinion and according to the information and explanations given to us theCompany has paid/ provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the Act.
12. The Company is not a Nidhi Company and accordingly Paragraph 3 (xii) of the orderis not applicable to the Company.
13. 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 section 177 and 188 of the Act. Where applicable the details of suchtransactions have been disclosed in the standalone financial statements as required by theapplicable accounting standards.
14. 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. Accordingly paragraph 3 (xiv) of the order is not applicable.
15. 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 them. Accordingly paragraph 3 (xv)of the order is not applicable.
16. According to the information and explanations given to us and based on ourexamination of the records of the company the company is not required to be registeredunder section 45- IA of the Reserve Bank of India Act 1934.
For CNGSN & ASSOCIATES LLP
| ||Chartered Accountants |
| ||Firm Registration No.004915S/ S200036 |
| ||(CHINNSAMY GANESAN) |
| ||Partner |
|Place: Chennai ||Membership No. 027501 |
|Date: April 22 2021 ||UDIN: 21027501AAAACN5744 |
Annexure "B" to the Independent Auditor's Report on Standalone FinancialStatements
(Referred to in paragraph 2 (f) under 'Report on other Legal and RegulatoryRequirements' section of our report to the Members of Orchid Pharma Limited of even date)
Report on the internal financial controls over financial reporting under clause (i) ofsub - section 3 of section 143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of OrchidPharma Limited ("the Company") as at March 31 2021 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 Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") issued by the Institute of Chartered Accountantsof India. 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 the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.
Our responsibility is to express an opinion on the internal financial controls overfinancial reporting of the Company based on our audit. We conducted our audit inaccordance with the Guidance Note and the standards on auditing prescribed under Section143 (10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls. Those standards and the guidance note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls over financial reporting were 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 proceduresselected depend on the auditor's judgement including the assessment of the risks ofmaterial misstatement in the standalone 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 control 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 financial statements for external purposes in accordance withgenerally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that
(i) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(ii) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of standalone financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and
(iii) 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 standalone 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 of 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 and according to the information and explanations given to us theCompany has in all material respects an adequate internal financial control system overfinancial reporting and such internal financial controls over financial reporting wereoperating effectively as at March 31 2021 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.
We bring to the attention of the users that the audit of the internal financial controlsystem over financial reporting and the operating effectiveness of such internal financialcontrols over financial reporting has been performed remotely in the conditions morefullyexplained in the Other Matters Paragraph of our Independent Audit Report on the audit ofthe Standalone financial statements.
Our opinion on the internal financial control system over financial reporting is notmodified in respect of the above.
For CNGSN & ASSOCIATES LLP
| ||Chartered Accountants |
| ||Firm Registration No.004915S/ S200036 |
| ||(CHINNSAMYGANESAN) |
| ||Partner |
|Place: Chennai ||Membership No. 027501 |
|Date: May 22 2021 ||UDIN: 21027501AAAACN5744 |