The Members of Prime Securities Limited
Report on the Audit of the Standalone Basis for Opinion
Financial Statements Opinion
1. We have audited the accompanying standalone financial statements ofPrime Securities Limited (the Company') which comprise the Balance Sheet as at 31March 2022 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Cash Flow and the Statement of Changes in Equity for the year then ended anda summary of the significant accounting policies and other explanatory information.
2. In our opinion and to the best of our information and according tothe explanations 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 Indian Accounting Standards(Ind AS') specified under section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 and other accounting principles generally accepted inIndia of the state of affairs of the Company as at 31 March 2022 and its profit(including other comprehensive income) its cash flows and the changes in equity for theyear ended on that date.
3. We conducted our audit in accordance with the Standards on Auditingspecified under section 143(10) of the Act. Our responsibilities under those standards arefurther described in the Auditor's Responsibilities for the Audit of the StandaloneFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia (ICAI') together with the ethical requirements that are relevant to our auditof the standalone financial statements under the provisions of the Act and the rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the 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
4. Key audit matters 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 thestandalone financial statements as a whole and in forming our opinion thereon and we donot provide a separate opinion on these matters.
5. We have determined the matters described below to be the key auditmatters to be communicated in our report.
|Key audit matters ||How our audit addressed the key audit matters |
|Revenue Recognition ||Our audit procedures to address this key audit matter included but were not limited to the following: |
|We refer to the Company's significant accounting policies in note 2(b) and the revenue related disclosure in note 35 of the standalone financial statements. || Evaluated the appropriateness of the Company's accounting policy for revenue recognition. |
|The Company's revenue from operations arises from merchant banking and advisory services which mainly includes Corporate & Financial Advisory services arranging long term finance and raising equity funds. || Evaluated the design and operating effectiveness of key controls over the revenue recognition process. |
|Recognition of revenue is based upon the satisfaction of performance obligations upon transfer of control of promised services to customers in an amount that reflects the consideration the Company is contractually expected to receive in exchange for those services as set forth under the terms of engagement. ||For the revenue contracts entered by the Company the following procedures were performed: |
|Identification of the various performance obligations within the contract and allocation of consideration to these performance obligations is complex and requires significant management judgement. || Obtained and inspected mandates with respect to the key contractual terms entered by the Company with the customer and evaluated the appropriateness of the accounting treatment assessed by the management. |
|Considering the materiality of amounts involved significant judgements this has been identified as a key audit matter in respect of standalone financial statements. || Evaluated whether the performance obligations and service delivery obligations as per the terms of the engagement appear to be satisfied by the Company to the extent of revenue recognised by performing enquiry with the management and inspecting supporting documents evidencing completion of such work. |
| || On a sample basis tested invoices raised in relation to the advisory services and traced the receipt of money in respect of such invoices to the bank statements. Accounting of unbilled revenue was verified with invoices issued in subsequent period. |
| || Performed cut-off testing for samples of revenue transactions recorded before and after the financial year end date by comparing with relevant underlying documentation to assess whether the revenue was recognized in the correct period. |
|Valuation of unquoted investments carried at fair value ||Our audit procedures in relation to valuation of unquoted investments with the involvement of our valuation experts included but were not limited to the following: |
|Refer note 2(g) for significant accounting policies and note 7 of standalone financial statements || Obtained an understanding of Company's business model and its assessment in accordance with Ind AS 109 for classification and valuation of investments; |
|As at 31 March 2022 the Company held unquoted investments carried at fair value amounting to Rs.2275 lakhs which represents 19 % of the total standalone assets of the Company as at 31 March 2022. || Obtained a detailed understanding of the management's process and controls for determining the fair valuation of these investments. The understanding was obtained by performance of walkthroughs which included inspection of documents produced by the Company including its valuation policy and discussion with those involved in the process of valuation; |
|The aforesaid investments are not traded in the active market. These investments are fair valued using Level 3 inputs. The fair valuation of these investments is determined by a management-appointed independent valuation specialist. The process of computation of fair valuation of investments includes use of unobservable inputs and management judgements and estimates which are complex. || Evaluated the design and tested the operational effectiveness of relevant key controls over the valuation process including the Company's review and approval of the estimates and assumptions used for the valuation including independent price verification performed by the management expert and model governance. |
|The key assumptions underpinning management's assessment of fair value of these investments include application of liquidity discounts calculation of discounting rates and the estimation of projections of revenues projections of future cash flows and growth rates. || Obtained the valuation reports of the management's expert and assessed the expert's competence objectivity and independence in performing the valuation of these investments; |
|The valuation of these investments was considered to be one of the areas which required significant auditor attention and was one of the matters of most significance in the standalone financial statements due to the materiality of total value of investments to the standalone financial statements and the complexity involved in the valuation of these investments. || Performed a reasonableness test on the valuation reports provided by Management by carrying out following procedures: |
| ||o Analysed financial performance of the investee companies from the date of investment till the valuation date. |
| ||o Applied calibration to Price of Recent Investment methodology in assessing the impact if any on the valuation of investee company as on the valuation date. |
| ||o Screened for comparable companies / comparable transactions (wherever transaction data was available) for each of the investee companies. |
| || Ensured the appropriateness of the carrying value of these investments in the standalone financial statements and the gain or loss recognised in the standalone financial statements as a result of such fair valuation; |
| || Ensured the appropriateness and sufficiency of the disclosures in accordance with the applicable accounting standards; and |
| || Obtained written representations from the management whether they believe significant assumptions used in valuation of the investments are reasonable. |
|Assessment of Ongoing Litigations ||Our audit procedures in relation to assessment of ongoing litigations included but were not limited to the following: |
|As disclosed in note 50 of standalone financial statements the Company is involved in certain litigations including claims filed by other parties not acknowledged as debt for which final outcome cannot be easily predicted. Considering the underlying facts of the subject matter the Company has assessed that the possibility of the ongoing litigations being decided against the Company is remote and accordingly there is no need to make a provision or to disclose a contingent liability in respect of the aforesaid litigations. || Obtained understanding of the management process for - |
|The assessment of whether a liability is recognised as a provision or disclosed as a contingent liability in the financial statements or remote is inherently subjective and requires significant management judgement in determination of the cash outflows from the business interpretation of applicable laws and regulations and careful examination of pending assessments at various levels of legislative proceedings. Adverse outcomes could significantly impact the Company's reported profit and balance sheet position. ||- identification of ongoing legal matters initiated against the Company |
|The eventual outcome of the litigations is uncertain and estimation at balance sheet date involves significant management and auditor judgement including input from legal counsel due to complexity of each litigation. ||- assessment of accounting treatment for each such litigation identified under principles of Ind AS 37 - Provisions Contingent Liabilities and Contingent Assets. |
|Considering the judgement involved in determining the need to make a provision or disclose as contingent liability the matter is considered a key audit matter for the current year audit. || Evaluated the design and tested the operating effectiveness of key controls around above process. |
| || Inspected the summary of ongoing litigation matters and discussed key developments during the year with the Company's Legal and Finance personnel. |
| ||Test of details included but were not limited to following: |
| || Obtained a list of litigations from the Company's inhouse legal counsel and evaluated the Company's assessment thereof by: |
| ||? Obtaining an understanding of the nature of litigations pending against the Company and discussed the key developments during the year for key litigations with the management and respective legal counsels handling such cases on behalf of the Company; |
| ||? Verifying correspondence orders and appeals in respect of open litigations; |
| ||? Assessing management's conclusions through discussions held with Company's external counsels involved where applicable in respect of material litigations; |
| ||? Assessing the Company's assumptions and estimates in respect of litigations including the liabilities or provisions recognised or contingent liabilities disclosed in the standalone financial statements or remote. This involved assessing the probability of an unfavorable outcome of a given proceeding and the reliability of estimates of related amounts; |
| ||? Obtaining and evaluating responses in the independent confirmations from Company's external legal counsels for certain material ongoing litigations and considering the same in our assessment; and |
| ||? performing detailed inquiries with the senior management. |
| || Evaluated the adequacy of provision if any and disclosures made in respect of matters under litigation |
Information other than the Standalone Financial Statements andAuditor?s Report thereon
6. 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. This 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 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 in the audit or otherwise appears to be materially 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
7. The accompanying standalone financial statements have been approvedby the Company's Board of Directors. The Company's Board of Directors are responsible forthe matters stated in section 134(5) of the Act with respect to the preparation andpresentation of these standalone financial statements that give a true and fair view ofthe financial position financial performance including other comprehensive incomechanges in equity and cash flows of the Company in accordance with the Ind AS specifiedunder section 133 of the Act and other accounting principles generally accepted in India.This responsibility also includes maintenance of adequate accounting records in accordancewith the provisions of the Act for safeguarding of the assets of the Company and forpreventing and detecting
frauds and other irregularities; selection and application ofappropriate accounting policies; making judgements and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalonefinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
8. In preparing the standalone financial statements the Board ofDirectors are responsible for assessing the Company's ability to continue as a goingconcern disclosing as applicable matters related to going concern and using the goingconcern basis of accounting unless the Board of Directors either intend to liquidate theCompany or to cease operations or has no realistic alternative but to do so.
9. Those Board of Directors is also responsible for overseeing theCompany's financial reporting process.
Auditor?s Responsibilities for the Audit of the StandaloneFinancial Statements
10. Our objectives are to obtain reasonable assurance about whether thefinancial 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 Standards on Auditing will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these standalone financial statements.
11. As part of an audit in accordance with Standards on Auditingspecified under section 143(10) of the Act we exercise professional judgment and maintainprofessional 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 Act we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls system with reference tofinancial statements in place 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; and
Evaluate the overall presentation structure and content of thestandalone financial statements including the disclosures
and whether the standalone financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.
12. 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.
13. We also provide those charged with governance with a statement thatwe have 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.
14. From the matters communicated with those charged with governancewe determine 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
15. As required by section 197(16) of the Act based on our audit wereport that the Company has paid remuneration to its directors during the year inaccordance with the provisions of and limits laid down under section 197 read withSchedule V to the Act.
16. As required by the Companies (Auditor's Report) Order 2020(the Order') issued by the Central Government of India in terms of section 143(11)of the Act we give in the Annexure I a statement on the matters specified in paragraphs3 and 4 of the Order to the extent applicable.
17. Further to our comments in Annexure I as
required by section 143(3) of the Act based on
our audit we report to the extent applicable
a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purpose of our auditof the accompanying standalone financial statements;
b) In our opinion proper books of account as required by law have beenkept by the Company so far as it appears from our examination of those books;
c) The standalone financial statements dealt with by this report are inagreement with the books of account;
d) In our opinion the aforesaid standalone financial statements complywith Ind AS specified under section 133 of the Act;
e) On the basis of the written representations received from thedirectors and taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2022 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 withreference to standalone financial statements of the Company as on 31 March 2022 and theoperating effectiveness of such controls refer to our separate Report in Annexure IIwherein we have expressed an unmodified opinion; and
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 (asamended) in our opinion and to the best of our information and according to theexplanations given to us:
i. the Company as detailed in note 28 to the standalone financialstatements has disclosed the impact of pending litigations on its financial position asat 31 March 2022;
ii. the Company did not have any longterm contracts includingderivative contracts for which there were any material foreseeable losses as at 31 March2022;
iii. There were no amounts which were required to be transferred to theInvestor Education and Protection Fund by the Company during the year ended 31 March 2022;
iv. a. The management has represented
that to the best of its knowledge and belief other than as disclosedin note 48 to the standalone financial statements no funds have been advanced or loanedor invested (either from borrowed funds or securities premium or any other sources or kindof funds) by the Company to or in any person or entity including foreign entities(the intermediaries') with the understanding whether recorded in writing orotherwise that the intermediary shall whether directly or indirectly lend or invest inother persons or entities identified in any manner whatsoever by or on behalf of theCompany (the Ultimate Beneficiaries') or provide any guarantee security or the likeon behalf the Ultimate Beneficiaries;
b. The management has represented that to the best of its knowledgeand belief as disclosed in note 48 to the standalone financial statements no funds havebeen received by the Company from any person or entity including foreign entities(the Funding Parties') with the understanding whether recorded in writing orotherwise that the Company shall whether directly or indirectly lend or invest in otherpersons or entities identified in any manner whatsoever by or on behalf of the FundingParty (Ultimate Beneficiaries') or provide any guarantee security or the like onbehalf of the Ultimate Beneficiaries; and
c. Based on such audit procedures performed as considered reasonableand appropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the management representations under sub-clauses
(a) and (b) above contain any material misstatement.
v. The final dividend declared by the Company during the year ended 31March 2022 is in accordance with section 123 of the Act to the extent it applies todeclaration of dividend. However the said dividend is not paid on the date of this auditreport. The final dividend paid by the Company during the year ended 31 March 2022 inrespect of such dividend declared for the previous year is in accordance with section 123of the Act to the extent it applies to payment of dividend.
|For Walker Chandiok & Co LLP |
|Chartered Accountants |
|Firm?s Registration No.: 001076N/N500013 |
|Murad D. Daruwalla |
|Membership No.: 043334 |
|UDIN: 22043334AJMDHF1175 |
|Place: Mumbai |
|Date: May 24 2022 |
Annexure I referred to in Paragraph 16 of the IndependentAuditor?s Report of even date to the members of Prime Securities Limited on thestandalone financial statements for the year ended 31 March 2022
In terms of the information and explanations sought by us and given bythe Company and the books of account and records examined by us in the normal course ofaudit and to the best of our knowledge and belief we report that:
(i) (a) (A) The Company has maintained proper records showing fullparticulars including quantitative details and situation of property plant and equipmentand right of use assets.
(B) The Company has maintained proper records showing full particularsof intangible assets.
(b) The Company has a regular program of physical verification of itsproperty plant and equipment and right of use assets under which the assets arephysically verified once in every three years which in our opinion is reasonable havingregard to the size of the Company and the nature of its assets. In accordance with thisprogram property plant and equipment and right of use assets were verified during theyear and no material discrepancies were noticed on such verification.
(c) The Company does not own any immovable property (other thanproperties where the Company is the lessee and the lease agreements are duly executed infavour of the lessee). Accordingly reporting under
clause 3(i)(c) of the Order is not applicable to the Company.
(d) The Company has not revalued its Property Plant and Equipment andRight of Use assets or intangible assets during the year.
(e) No proceedings have been initiated or are pending against theCompany for holding any benami property under the Benami Transactions (Prohibition) Act1988 (45 of 1988) and rules made thereunder. Accordingly reporting under clause 3(i) (e)of the Order is not applicable to the Company.
(ii) (a) The Company does not hold any inventory.
Accordingly reporting under clause 3(ii)
(a) of the Order is not applicable to the Company.
(b) The Company has a working capital limit in excess of Rs 5 croresanctioned by banks on the basis of security of current assets. However pursuant to termsof the sanction letter the Company is not required to file any quarterly return orstatement with such banks or financial institutions.
(iii) (a) During the year the Company has not provided any advance inthe nature of loans or guarantee or security to any other entity. The Company hasprovided loan to Subsidiary as per details given below:
(Amount in Lakhs)
|Particulars ||Guarantees ||Security ||Loans ||Advances in nature of loans |
|Aggregate amount granted during the year || || || || |
|- Subsidiaries || || ||4 ||- |
|- Joint Ventures || || || ||- |
|- Associates || || || ||- |
|- Others ||- ||- ||- ||- |
(Amount in Lakhs)
|Particulars ||Guarantees ||Security ||Loans ||Advances in nature of loans |
|Balance outstanding as at balance sheet date in respect of above cases: || || || || |
|- Subsidiaries || || || ||- |
|- Joint Ventures || || || ||- |
|- Associates || || || ||- |
|- Others ||- ||- ||- ||- |
(b) In our opinion and according to the information and explanationsgiven to us the investments made and terms and conditions of the grant of loan are primafacie not prejudicial to the interest of the Company. The Company has not provided anyguarantee or given any security or advances in the nature of loans during the year.
(c) In respect of loan granted by the Company the schedule ofrepayment of principal and payment of interest has not been stipulated and accordingly weare unable to comment as to whether the repayments/receipts of principal and interest areregular.
(d) In the absence of stipulated schedule of repayment of principal andpayment of interest we are unable to comment as to whether there is any amount which isoverdue for more than 90 days and
whether reasonable steps have been taken by the Company for recovery ofsuch principal amounts and interest.
(e) In respect of loan granted by the Company the schedule ofrepayment of principal and the payment of the interest has not been stipulated andaccordingly we are unable to comment as to whether the loan has fallen due during theyear and whether the same has been renewed or extended or fresh loans granted to settlethe overdues of existing loan given to the same party.
(f) The Company has not granted any advance in the nature of loanrepayable on demand or without specifying any terms or period of repayment. The Companyhas not granted any loan repayable on demand. The Company has granted loan withoutspecifying any terms or period of repayment as per details below:
(Amount in Lakhs)
|Particulars ||All Parties ||Promoters ||Related Parties |
|Aggregate of loans/ || || || |
|- Repayable on demand (A) || || ||- |
|- Agreement does not specify any ||4 ||- ||4 |
|terms or period of repayment (B) || || || |
|Total (A+B) ||4 ||- ||4 |
|Percentage of loans to the total loans ||100% ||- ||100% |
(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 loans and investments as applicable. Further the Company has notentered into any transaction covered under section 185 and 186 of the Act in respect ofguarantees and security.
(v) In our opinion and according to the information and explanationsgiven to us the Company has not accepted any deposits or there is no amount which hasbeen considered as deemed deposit within the meaning of sections 73 to 76 of the Act andthe Companies (Acceptance of Deposits) Rules 2014 (as amended). Accordingly reportingunder clause 3(v) of the Order is not applicable to the Company.
(vi) The Central Government has not specified maintenance of costrecords under subsection (1) of section 148 of the Act in respect of Company'sproducts/business activity. Accordingly reporting under clause 3(vi) of the Order is notapplicable.
(vii) (a) In our opinion and according to the
information and explanations given to us undisputed statutory duesincluding goods and services tax provident fund employees' state insurance income-taxsales-tax service tax duty of customs duty of excise value added tax cess and othermaterial statutory dues as applicable have
generally been regularly deposited with the appropriate authorities bythe Company though there have been slight delays in a few cases. Further no undisputedamounts payable in respect thereof were outstanding at the year-end for a period of morethan six months from the date they became payable.
(b) According to the information and explanations given to us thereare no statutory dues referred in sub-clause (a) which have not been deposited with theappropriate authorities on account of any dispute except for the following:
(Amount in Lakhs)
|Name of the statute ||Nature of dues ||Gross Amount (H) ||Amount paid under Protest (Rs.) ||Period to which the amount relates ||Forum where dispute is pending ||Remarks if any |
|Income Tax Act 1961 ||Income tax ||175 || ||Assessment Year 2017-18 ||Commissioner of Income Tax (Appeals) ||None |
(viii) According to the information and explanations given to us notransactions were surrendered or disclosed as income during the year in the taxassessments under the Income Tax Act 1961 (43 of 1961) which have not been recorded inthe books of accounts.
(ix) (a) According to the information and
explanations given to us the Company has not defaulted in repayment ofits loans or borrowings or in the payment of interest thereon to any lender.
(b) According to the information and explanations given to us includingconfirmations received from banks and representation received from the management of theCompany and on the basis of our audit procedures we report that the Company has not beendeclared a willful defaulter by any bank or financial institution or other lender.
(c) In our opinion and according to the information and explanationsgiven to
us money raised by way of term loans were applied for the purposes forwhich these were obtained.
(d) In our opinion and according to the information and explanationsgiven to us and on an overall examination of the financial statements of the Companyfunds raised by the Company on short term basis have not been utilised for long termpurposes.
(e) According to the information and
explanations given to us and on an overall examination of the financialstatements of the Company the Company has not taken any funds from any entity or personon account of or to meet the obligations of its subsidiaries.
(f) According to the information and explanations given to us theCompany has not raised any loans during the year on the pledge of securities held in itssubsidiaries.
(x) (a) The Company has not raised any money by way of initial publicoffer or further public offer (including debt instruments) during the year. Accordinglyreporting under clause 3(x)(a) of the Order is not applicable to the Company.
(b) During the year the Company has made preferential allotment ofshares. In our opinion and according to the information and explanations given to us theCompany has complied with the requirements of section 42 and section 62 of the Act and theRules framed thereunder with respect to the same. Further the amounts so raised wereunutilised as on 31 March 2022 and have been invested in readily realisable liquidinvestments.
(xi) (a) To the best of our knowledge and according to the informationand explanations given to us no fraud by the Company or on the Company has been noticedor reported during the period covered by our audit.
(b) No report under section 143(12) of the Act has been filed with theCentral Government for the period covered by our audit.
(c) According to the information and explanations given to us includingthe representation made to us by the management of the Company there are nowhistle-blower complaints received by the Company during the year.
(xii) The Company is not a Nidhi Company and the Nidhi Rules 2014 arenot applicable to it. Accordingly reporting under clause 3(xii) of the Order is notapplicable to the Company.
(xiii) In our opinion and according to the information and explanationsgiven to us all transactions entered into by the Company with the related parties are incompliance with sections 177 and 188 of the Act where applicable. Further the details ofsuch related party transactions have been disclosed in the standalone financialstatements as required under Indian Accounting Standard (Ind AS) 24 Related PartyDisclosures specified in Companies (Indian Accounting Standards) Rules 2015 as prescribedunder section 133 of the Act.
(xiv) (a) In our opinion and according to the information andexplanations given to us the Company has an internal audit system as required undersection 138 of the Act which is commensurate with the size and nature of its business.
(b) We have considered the reports issued by the Internal Auditors ofthe Company till date for the period under audit.
(xv) According to the information and explanation given to us theCompany has not entered into any non-cash transactions with its directors or personsconnected with them and accordingly provisions of section 192 of the Act are notapplicable to the Company.
(xvi) The Company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934. Accordingly reporting under clause 3(xvi) of theOrder is not applicable to the Company.
(xvii) The Company has not incurred any cash loss in the current aswell as the immediately preceding financial year.
(xviii) There has been no resignation of the statutory auditors duringthe year. Accordingly reporting under clause 3(xviii) of the Order is not applicable tothe Company.
(xix) According to the information and explanations given to us and onthe basis of the financial ratios ageing and expected dates of realisation of financialassets and payment of financial liabilities other information accompanying the standalonefinancial statements nothing has come to our attention which causes us to believe thatany material uncertainty exists as on the date of the audit report that Company is notcapable of meeting its liabilities existing at the date of balance sheet as and when theyfall due within a period of one year from the balance sheet date. We however state
that this is not an assurance as to the future viability of thecompany. We further state that our reporting is based on the facts up to the date of theaudit report and we neither give any guarantee nor any assurance that all liabilitiesfalling due within a period of one year from the balance sheet date will get dischargedby the company as and when they fall due.
(xx) According to the information and explanations given to us theCompany does not have any unspent amount in respect of any ongoing or other than ongoingproject as at the expiry of the financial year. Accordingly reporting under clause 3(xx)of the Order is not applicable to the Company.
(xxi) The reporting under clause 3(xxi) is not applicable in respect ofaudit of standalone financial statements of the Company. Accordingly no comment has beenincluded in respect of said clause under this report.
|For Walker Chandiok & Co LLP |
|Chartered Accountants |
|Firm?s Registration No.: 001076N/N500013 |
|Murad D. Daruwalla |
|Membership No.: 043334 |
|UDIN: 22043334AJMDHF1175 |
|Place: Mumbai |
|Date: May 24 2022 |
Independent Auditor?s Report on the internal financial controlswith reference to the standalone financial statements under Clause (i) of Sub-section 3 ofSection 143 of the Companies Act 2013 (the Act?)
1. In conjunction with our audit of the standalone financial statementsof Prime Securities Limited (the Company') as at and for the year ended 31 March2022 we have audited the internal financial controls with reference to standalonefinancial statements of the Company as at that date.
Responsibilities of Management and Those Charged with Governance forInternal Financial Controls
2. The Company's Board of Directors is responsible for establishing andmaintaining internal financial controls based on the internal financial controls withreference to financial statements criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls over Financial Reporting (the Guidance Note') issued by theInstitute of Chartered Accountants of India (ICAI'). These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of the Company'sbusiness including adherence to the Company's policies the safeguarding of its assetsthe prevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Act.
Auditor?s Responsibility for the Audit of the Internal FinancialControls with Reference to Financial Statements
3. Our responsibility is to express an opinion on the Company'sinternal financial controls with reference to standalone financial statements based on ouraudit. We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India (ICAI') prescribed under Section 143(10)of the Act to the extent
applicable to an audit of internal financial controls with reference tofinancial statements and the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the Guidance Note') issued by the ICAI. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlswith reference to financial statements were established and maintained and if suchcontrols operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidenceabout the adequacy of the internal financial controls with reference to financialstatements and their operating effectiveness. Our audit of internal financial controlswith reference to financial statements includes obtaining an understanding of suchinternal financial controls assessing the risk that a material weakness exists andtesting and evaluating the design and operating effectiveness of internal control based onthe assessed risk. The procedures selected depend on the auditor's judgement includingthe assessment of the risks of material misstatement of the financial statements whetherdue to fraud or error.
5. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion on the Company's internalfinancial controls with reference to financial statements.
Meaning of Internal Financial Controls with Reference to FinancialStatements
6. A company's internal financial controls with reference to financialstatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposesin accordance with generally accepted accounting principles.
A company's internal financial controls with reference to financialstatements include those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls with Reference toFinancial Statements
7. Because of the inherent limitations of internal financial controlswith reference to financial statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to financial statements to future periods are subject to
the risk that the internal financial controls with reference tofinancial statements may become inadequate because of changes in conditions or that thedegree of compliance with the policies or procedures may deteriorate.
8. In our opinion the Company has in all material respects adequateinternal financial controls with reference to standalone financial statements and suchcontrols were operating effectively as at 31 March 2022 based on the internal financialcontrols with reference to financial statements criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Noteissued by ICAI.
| ||For Walker Chandiok & Co LLP |
| ||Chartered Accountants |
| ||Firm's Registration No.: 001076N/N500013 |
| ||Murad D. Daruwalla |
| ||Partner |
| ||Membership No.: 043334 |
| ||UDIN: 22043334AJMDHF1175 |
|Place ||: Mumbai |
|Date ||: May 24 2022 |