Phoenix Mills Ltd.
|BSE: 503100||Sector: Infrastructure|
|NSE: PHOENIXLTD||ISIN Code: INE211B01039|
|BSE 00:00 | 22 Oct||915.35||
|NSE 00:00 | 22 Oct||920.80||
|Mkt Cap.(Rs cr)||15,744|
|Mkt Cap.(Rs cr)||15744.02|
Phoenix Mills Ltd. (PHOENIXLTD) - Auditors Report
Company auditors report
To the Members of THE PHOENIX MILLS LIMITED
Report on the Audit of Standalone Financial Statements
We have audited the accompanying Standalone Financial Statements of ThePhoenix Mills Limited ("the Company")which comprise the Balance Sheet as atMarch 31 2020 the Statement of Profit and Loss including the statement of OtherComprehensive Income the Cash Flow Statement and the Statement of Changes in Equity forthe year then ended and a summary of significant accounting policies and otherexplanatory information (hereinafter referred to as "Standalone FinancialStatements").
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 2013 ("the Act) in the manner so requiredand give a true and fair view in conformity with the accounting principles generallyaccepted in India of the state of affairs of the Company as at March 31 2020 itsProfit including Other Comprehensive Income its Cash Flows and the Statement of Changesin Equity for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing("SA") specified under Section 143(10) of the Companies Act 2013 (the"Act"). Our responsibilities under those Standards are further described in theAuditor's Responsibilities for the Audit of the Standalone Financial Statements section ofour report. We are independent of the Company in accordance with the Code of Ethics issuedby the Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of the Standalone Financial Statements under the provisionsof the Companies Act 2013 and the Rules thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our opinion.
Emphasis of Matter
1. We draw attention to Note 40 of the Statement as regardsrecognition of income on settlement claim of ' 4900 Lakhs as exceptional item and therecovery of the balance amount in this regard.
2. We draw attention to Note 45 to the financial statements whichstates the impact of Corona virus Disease 2019 (Covid-19) on the operation of the Company.
Our opinion is not modified in respect of these Matters.
Key Audit Matters
Key audit matters ('KAM') are those matters that in our professionaljudgment were of most significance in our audit of the Standalone Financial Statements ofthe current period. These matters were addressed in the context of our audit of theStandaloneFinancial statements as a whole and in forming our opinion thereon and we donot provide a separate opinion on these matters.
The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the AnnualReport but does not include the standalone financial statements and our Auditor's Reportthereon. The Annual Report is expected to be made available to us after the date of thisauditor's report.
Our opinion on the standalone financial statements does not cover theother information and we will not express any form of assurance conclusion thereon.Inconnection with our audit of the standalone financial statements our responsibility is toread the other information identified above when it becomes available and in doing soconsider whether the other information is materially inconsistent with the standalonefinancial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated
When we read the Annual Report if we conclude that there is a materialmisstatement therein we are required to communicate the matter to those charged withgovernance.
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 Act with respect to the preparation of these StandaloneFinancial statements that give a true and fair view of the Financial Position FinancialPerformance including Other Comprehensive Income Cash Flows and the Statement Of Changesin Equity of the Company in accordance with the accounting principles generally acceptedin India including the Indian Accounting Standards (Ind AS) specified under section 133of the Act read with the Companies (Indian Accounting Standards) Rules 2015 as amended.
This responsibility also includes maintenance of adequate accountingrecords in accordance with the provision of the Act for safeguarding the assets of theCompany and for preventing and detecting frauds and other irregularities; selection andapplication of the appropriate accounting policies; making judgements and estimates thatare reasonable and prudent; and design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and fair presentationof the 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 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.
The Board of Directors are also responsible for overseeing theCompany's financial reporting process.
Auditor's Responsibilities for the Audit of the StandaloneFinancial Statements
Our objective 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.
INDEPENDENT AUDITOR'S REPORT
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. Undersection 143(3)(i) of the Companies Act 2013 we are also responsible for expressing ouropinion on whether the company has adequate internal financial controls system in placeand the operating effectiveness of such 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 theStandaloneFinancial statements that individually or in aggregate makes it probable thatthe economic decisions of a reasonably knowledgeable user of the StandaloneFinancialstatements 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 StandaloneFinancial Statements of the current period and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.
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 in the "Annexure A" a statement on thematters specified 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 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 have beenkept by the Company so far as appears from our examination of those books;
c) The Balance Sheet Statement of Profit and Loss including OtherComprehensive Income the Cash Flow Statement and Statement of Changes in Equity dealtwith by this report are in agreement with the books of account;
d) In our opinion the aforesaid Standalone Financial Statements complywith the accounting standards specified under section 133 of the Act read with Companies(Indian Accounting Standards) Rules 2015 as amended.
e) On the basis of written representations received from the directorsas on March 31 2020 taken on record by the Board of Directors none of the directors isdisqualified as on March 312020 from being appointed as a director in terms of section164(2) of the Act;
f) With respect to the adequacy of the internal financial controls overfinancial reporting of the Company and the operating effectiveness of such controls referto our separate Report in "Annexure B". Our report expresses an unmodifiedopinion on the adequacy and operating effectiveness of the Company's internal financialcontrols over financial reporting;
g) In our opinion the managerial remuneration for the year ended March31 2020 has been paid by the Company to its directors in accordance with the provisionsof section 197 read with schedule V to the Act
h) With respect to the other matters to be included in the Auditor'sReport in accordance with Rules 11 of the Companies (Audit and Auditors) Rules 2014 asamended in our opinion and to the best of our information and according to theexplanations given to us:
ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company .
For D T S & Associates LLP
(Firm Registration No. 142412W/W100595)
Ashish G. Mistry
Membership No.: 132639 UDIN: 20132639AAAAAY4840
Place: Mumbai Dated: 29th June 2020
"Annexure A" to the Independent Auditors' Report on theStandalone Financial Statements of The Phoenix Mills
(Referred to in Paragraph 1 under the heading of "Report on otherlegal and regulatory requirements" of our report of
i) In respect of its Property Plant and Equipment :
a) The Company has generally maintained proper records showing fullparticulars including quantitative details and situation of Property Plant and Equipmenton the basis of available information.
b) As explained to us all the Property Plant and Equipment have beenphysically verified by the management in a phased periodical manner which in our opinionis reasonable having regard to the size of the Company and nature of its assets.According to the information and explanations given to us no material discrepancies werenoticed on such physical verification.
c) In our opinion and according to the explanations given to us thetitle deeds of the Immovable Property which is mortgage as a security are held in thename of Company.
ii) As Company has no inventories during the year clause (ii) ofparagraph of 3 of the order is not applicable to the company
iii) The Company has not granted loans secured or unsecured tocompanies firms limited liability partnerships or other parties covered in the registermaintained under Section 189 of the Act. Therefore the provision of Clause (iii) ofparagraph 3 of the Order is not applicable to the Company.
iv) In our opinion and according to the information and explanationsgiven to us the Company has complied with the provisions of Section 186 of the CompaniesAct 2013 in respect of grant of loans making investments and providing guarantees andsecurities as applicable. During the year the Company has not granted any loans coveredunder Section 185 of the Act.
v) According to the information and explanations given to us theCompany has not accepted any deposits within the meaning of provisions of sections 73 to76 or any other relevant provisions of the Act and the rules framed there under.Therefore the clause (v) of paragraph 3 of the Order is not applicable to the Company
vi) To the best of our knowledge and explanations given to us theCentral Government has not prescribed the maintenance of cost records under sub section(1) of Section 148 of the Act in respect of the activities undertaken by the Company.
vii) In respect of Statutory dues :
a) The Company has generally been regular in depositing undisputedstatutory dues including Provident Fund Employees' State Insurance Labour Welfare FundIncome-tax Customs Duty Cess and other material statutory dues applicable to it with theappropriate authorities except for provident fund of ' 0.29 Lakhs not paid due totechnical issue of not linking UAN with Aadhar card. Also the Company has generally beenregular in depositing the undisputed statutory dues relating to Goods and Service Taxconsidering the relief provided to the taxpayers by the Government vide Notification No.31/ 2020 dated April 3 2020.
According to the information and explanations given to us noundisputed amounts payable in respect of the aforesaid dues were outstanding as at 31stMarch 2020 for a period of more than six months from the date they became payable.
b) According to the records of the Company and the information andexplanations given to us the disputed dues on account of income tax service tax goods& service tax duty of customs duty of excise cess amounting to ' 2146.69 Lakhsthat have not been deposited before appropriate authorities are as under.
viii) In our opinion and according to the information and explanationsgiven to us the Company has not defaulted in repayment of loans or borrowings to afinancial institutions and banks. The Company has not taken any loans or borrowings fromgovernment and has not issued any debenture.
ix) The company has not raised moneys by way of initial public offer orfurther public offer (including debt instruments) or term loans during the year.
x) Based on the audit procedures performed for the purpose of reportingthe true and fair view of the Standalone Financial Statements and as per information andexplanations given to us no fraud by the Company or on the Company by its officers oremployees has been noticed or reported during the year.
xi) In our opinion and according to the information and explanationsgiven to us managerial remuneration has been paid or provided in accordance with therequisite approvals mandated by the provisions of section 197 read with Schedule V to theAct.
xii) In our opinion company is not a nidhi company. Therefore theprovisions of clause (xii) of paragraph 3 of the Order are not applicable to the company.
xiii) In our opinion and according to the information and explanationsgiven to us all transactions with related parties are in compliance with sections 177 and188 of the Act and their details have been disclosed in the Financial statements etc. asrequired by the applicable accounting standards.
xiv) In our opinion and according to the information and explanationsgiven to us the Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review and henceclause (xiv) of paragraph 3 of the Order is not applicable to the company
xv) In our opinion and according to the information and explanationsgiven to us the Company has not entered into any non-cash transaction with the directorsor persons connected with him and covered under section 192 of the Act. Hence clause (xv)of the paragraph 3 of the Order is not applicable to the Company.
xvi) To the best of our knowledge and as explained the Company is notrequired to be registered under section 45- IA of the Reserve Bank of India Act 1934.
For D T S & Associates LLP
(Firm Registration No. 142412W/W100595)
Ashish G. Mistry
Membership No.: 132639
Dated: 29th June 2020
Annexure "B" To the Independent Auditor's Report On theStandalone Financial Statements Of The Phoenix Mills Limited
(Referred to in paragraph 2 (f) under Report on Other Legal andRegulatory Requirements' of our report of even date)
Report on the Internal Financial Controls Over Financial Reportingunder Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("theAct")
We have audited the internal financial controls over financialreporting of The Phoenix Mills Limited("the Company") as of 31st March 2020 inconjunction with our audit of the Standalone Financial Statements of the Company for theyear then ended..
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 Act.
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 ICAIand deemed to be prescribed under section 143(10) of the Act to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the ICAI. Those Standards and the Guidance Note require thatwe comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.
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 theStandalone Financial Statements whether due to fraudor 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 a 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 withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised 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 2020 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 ICAI.
For D T S & Associates LLP
(Firm Registration No. 142412W/W100595)
Ashish G. Mistry
Membership No.: 132639 UDIN: 20132639AAAAAY4840
Place: Mumbai Dated: 29th June 2020