Pioneer Embroideries Ltd.
|BSE: 514300||Sector: Industrials|
|NSE: PIONEEREMB||ISIN Code: INE156C01018|
|BSE 00:00 | 26 Oct||58.25||
|NSE 00:00 | 26 Oct||58.35||
|Mkt Cap.(Rs cr)||155|
|Mkt Cap.(Rs cr)||154.89|
Pioneer Embroideries Ltd. (PIONEEREMB) - Auditors Report
Company auditors report
The Members of Pioneer Embroideries Limited
Report on the Audit of the Standalone Financial Statements
We have audited the accompanying standalone financial statements ofPioneer Embroideries Limited (hereinafter referred to as "the Company") whichcomprise the Balance Sheet as at 31st March 2021 the Statement of Profit& Loss(including other comprehensive income) the statement of changes in equity andthe Cash Flow Statement for the year then ended and a summary of the significantaccounting policies and other explanatory information(hereinafter referred to as "thestandalone financial statements").
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 sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India including Indian Accounting Standards ('Ind AS') specifiedunder Section 133 of the Act of the state of affairs of the Company as at 31stMarch 2021 and its profit its cash flows and the changes in equity for the year endedon that date.
Basis for Opinion
We conducted our audit of the standalone financial statements inaccordance with the Standards on Auditing specified under Section 143(10) of the Act(SAs). Our responsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the standalone financial statements Section of ourreport. We are independent of the Company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India (ICAI) together with the independencerequirements that are relevant to our audit of the standalone financial statements underthe provisions of the Act and the Rules made there under and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the standalone financial statements.
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 the matters described below to bethe key audit matters to be communicated in our report.
The Company's Board of Directors is responsible for the preparation ofthe other information. The other information comprises the information included in theManagement Discussion and Analysis Board's Report including Annexures to Board's ReportBusiness Responsibility Report Corporate Governance and Shareholder's Information butdoes not include the standalone financial statements and our auditor's report thereon.
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 and in doing so consider whether theother information is materially inconsistent with the standalone financial statements orour knowledge obtained during the course of our audit or otherwise appears to bematerially misstated. If based on the work we have performed we conclude that there is amaterial misstatement of this other information; we are required to report that fact. Wehave nothing to report in this regard.
Management's Responsibility for the 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 standalone financialstatements that give a true and fair view of the financial position financialperformance total comprehensive income changes in equity and cash flows of the Companyin accordance with the accounting principles generally accepted in India including theIndian Accounting Standards specified under Section 133 of the Act. This responsibilityalso includes maintenance of adequate accounting records in accordance with the provisionsof the Act for safeguarding 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 financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.
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 responsible for overseeing the Company'sfinancial reporting process.
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 controls.
Obtain an understanding of internal financial controls relevantto the audit in order to design audit procedures that are appropriate in thecircumstances. Under Section 143(3)(i) of the Act we are also responsible for expressingour opinion on whether the Company has adequate internal financial controls system inplace and 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 the standalonefinancial statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the financial statements may beinfluenced. We consider quantitative materiality and qualitative factors in (i) planningthe scope of our audit work and in evaluating the results of our work; and (ii) toevaluate the effect of any identified misstatements in the financial statements.
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 issuedby the Central Government in terms of sub-section (11) of Section 143 of the Act(hereinafter referred to the "Order") and on the basis of such checks of thebooks and records of the Company as we considered appropriate and according to theinformation and explanations given to us we give in the Annexure "A" astatement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 197(16) of the Act we report that theCompany has paid remuneration to its directors during the year in accordance with theprovisions of and limits laid down under Section 197 read with Schedule V to the Act.
3. 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 financial statements dealt with by this Report arein agreement with the books of account.
(d) In our opinion the aforesaid standalone financial statementscomply with the Indian Accounting Standards specified under Section 133 of the Act readwith Rule 7 of the Companies (Accounts) Rules 2014.
(e) On the basis of the written representations received from thedirectors as on 31st March 2021 taken on record by the Board of Directorsnone of the directors is disqualified as on 31 st March 2021 from beingappointed as a director in terms 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) 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 disclosed the impact if any of pending litigationson its financial position in its financial statements;
iii. there is no amount that is required to be transferred to theInvestor Education and Protection Fund by the Company.
Annexure "A" to the Independent Auditors' Report
Referred to in Paragraph 1 under Report on Other Legal and RegulatoryRequirements of the Independent Auditors' Report of even date to the members of PioneerEmbroideries Limited on the standalone financial statements for the year ended 31stMarch 2021.
i. In respect of the Company's fixed assets
a) The Company is generally maintaining proper records showing fullparticulars including quantitative details and situation of fixed assets.
b) As explained to us fixed assets according to the practice of theCompany are physically verified by the management in accordance with the phasedverification program which in our opinion is reasonable having regards to the size ofthe Company and the nature of its fixed assets. No material discrepancies have beennoticed on such verification.
c) The title deeds of immovable properties as disclosed in Note 3 onfixed assets to the financial statements are held in the name of the Company.
ii. The physical verification of inventory excluding stocks with thirdparties and goods in transit has been conducted at reasonable intervals by the management.In respect of inventory lying with the third parties these have substantially beenconfirmed by them. The discrepancies noticed on physical verification of inventory ascompared to book records were not material and have been appropriately dealt with in thebooks of the Company.
iii. As per the information and explanation given to us and the recordsproduced before us for verification the Company has granted unsecured loans to threecompanies covered in the register maintained under Section 189 of the Act.
a) In respect of the aforesaid loans the terms and conditions underwhich such loans were granted are not prejudicial to the Company's interest except thatthese loans are interest free.
b) As explained to us receipt of principal amount is on demand basisand there is no fixed repayment schedule.
c) There is no overdue amount as these loans are on demand basis.
iv. In our opinion and according to the information and explanationsgiven to us the Company has complied with the provisions of Section 185 and 186 of theAct in respect of the loans investments guarantees and securities except that suchloans are given interest free.
v. In our opinion and according to the information and explanationsgiven to us the Company has not accepted deposits in terms of directives issued by theReserve Bank of India and the provisions of Sections 73 to 76 or any other relevantprovisions of the Act and the rules framed there under.
vi. We have broadly reviewed the books of accounts maintained by theCompany in respect of products where pursuant to Rules made by the Central Government ofIndia the maintenance of cost records has been prescribed under sub-section (1) ofSection 148 of the Act and are of opinion that prima facie the prescribed accounts andrecords have been made and maintained. We have not however made a detailed examinationof the records with a view to determine whether they are accurate and complete.
vii. a) According to the information and explanations given to us theCompany is generally regular in depositing undisputed statutory dues including providentfund employees' state insurance income-tax sales-tax service tax duty of customsduty of excise value added tax cess and other statutory dues with the appropriateauthorities. There are no undisputed statutory dues which are in arrears as at 31stMarch 2021 for a period of more than six months from the date they became payable.
b) According to the information and explanations given to us detailsof dues of income-tax or sales-tax or service tax or duty of customs or duty of excise orvalue added tax which have not been deposited as on 31st March 2021 onaccount of any dispute are given below:
viii. In our opinion and according to the information and explanationsgiven to us the Company has not defaulted in repayment of loans or borrowings tofinancial institutions and banks during the year. The Company has not taken any loans orborrowings from government or through debentures.
ix. In our opinion and according to the information and explanationsgiven to us The Company did not raise moneys by way of further public offer (includingdebt instruments). The term loans have been applied for the purposes for which they wereobtained.
x. According to the information and explanations given to us no fraudby the company or any fraud on the Company by its officers or employees has been noticedor reported during the year.
xi. According to the information and explanations given to usmanagerial remuneration has been paid or provided in accordance with the requisiteapprovals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii. In our opinion the Company is not a Nidhi Company.
xiii. According to the information and explanations given to us alltransactions with the related parties are in compliance with Sections 177 and 188 of theAct where applicable and the details have been disclosed in the Financial Statements asrequired by the applicable Ind AS.
xiv. According to the information and explanations given to us thecompany has made preferential allotment of equity shares during the year. The requirementof section 42 of the Companies Act 2013 have been complied with and the amount raised hasbeen used for the purposes for which the funds were raised.
xv. According to the information and explanations given to us thecompany has not entered into any non-cash transactions with directors or persons connectedwith them covered under Section 192 of the Act.
xvi. According to the information and explanations given to us thecompany is not required to be registered under Section 45-IA of the Reserve Bank of IndiaAct 1934.
Annexure "B" to the Independent Auditors' Report
Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the Act.
We have audited the internal financial controls over financialreporting of Pioneer Embroideries Limited ("the Company") as of 31stMarch 2021 in conjunction with our audit of the standalone financial statements of theCompany for the 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 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 Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols 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 financial statements whether due to fraud 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 financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the Company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the Company are being made only in accordance with authorizations ofmanagement and directors of the Company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of theCompany's assets that could have a material effect on the financial 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 March2021 based on the internal control over financial reporting criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India.