To The Members of QUANTUM DIGITAL VISION (INDIA) LIMITED Report on the Audit of theFinancial Statements Opinion
We have audited the accompanying financial statements of QUANTUM DIGITAL
VISION (INDIA) LIMITED ("the Company") which comprise the Balance Sheet asat March 31 2020 the Statement of Profit and Loss (including Other ComprehensiveIncome) the Statement of Changes in Equity and the Statement of Cash Flows for the yearended on that date and a summary of the significant accounting policies and otherexplanatory information (hereinafter referred to as "the financial statements").In our opinion and to the best of our information and according to the explanations givento us the aforesaid financial statements give the information required by the CompaniesAct 2013 ("the Act") in the manner so required and give a true and fair view inconformity with the Indian Accounting Standards prescribed under section 133 of the Actread with the Companies (Indian Accounting Standards) Rules 2015 as amended ("IndAS") and other accounting principles generally accepted in India of the state ofaffairs of the Company as at March 31 2020 the profit and total comprehensive incomechanges in equity and its cash flows for the year ended on that date.
Basis for opinion
We conducted our audit of the financial statements in accordance with the Standards onAuditing specified under section 143(10) of the Act (SAs). Our responsibilities underthose Standards are further described in the Auditor's Responsibilities for the Audit ofthe Financial 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 independence requirements that are relevant to our audit ofthe financial statements under the provisions of the Act and the Rules made thereunderand we have fulfilled our other ethical responsibilities in accordance with theserequirements and the ICAI's Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion on thefinancial statements.
Emphasis of Matter
We draw attention to Note 2(b) to the accompanying "Significant Accounting Policesand Notes to Accounts" with regard to management's evaluation of uncertainty due tothe outbreak of COVID-19 and its impact on future operations of the Company. Our opinionis not modified in respect of the above matters.
Material Uncertainty Related To Going Concern
We draw attention to Note 33in the Financial Statements. The Company has accumulatedlosses and its net worth has been fully eroded the Company has incurred a net loss duringthe preceding years and the Company's current liabilities exceeded its current assets asat the balance sheet date. These conditions indicate the existence of a materialuncertainty that may cast significant doubt about the Company's ability to continue as agoing concern. However the financial statements of the Company have been prepared on agoing concern basis for the reasons stated in the said Note. Our opinion is not modifiedin respect of the above matter.
Key audit matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters. Wehave determined the matters described below to be the key audit matters to be communicatedin our report.
|SR NO KEY AUDIT MATTERS ||AUDITOR'S RESPONSE |
|1 Litigation Claims and Contingent Liabilities: ||Principal Audit Procedures Performed |
|The Company is exposed to a variety of different laws regulations and interpretations thereof which encompasses indirect taxation and legal matters. In the normal course of business provisions and contingent liabilities may arise from legal proceedings including regulatory and other Governmental proceedings constructive obligations as well as investigations by authorities and commercial claims. ||We understood the processes evaluated the design and implementation of controls and tested the operating effectiveness of the Company's controls over the recording and re-assessment of uncertain legal positions claims and contingent liabilities. |
|Based on the nature of regulatory and legal cases management applies significant judgement when considering whether and how much to provide for the potential exposure of each matter. ||We held discussions with senior management including the person responsible for legal and compliance to obtain an understanding of the factors considered by management in classification of the matter as probable' possible' and remote'; |
|These estimates could change substantially over time as new facts emerge as each legal case or matters progresses. Given the different views possible basis the interpretations complexity and the magnitude of the potential exposures and the judgement necessary to determine required disclosures thisis a key audit matter. ||Examined the Company's legal expenses on sample basis and read the minutes of the board meetings and the legal compliance committee in order to ensure completeness. |
| ||For those matters where Management concluded that no provision should be recorded we also considered the adequacy and completeness of the Company's disclosures made in relation to contingent liabilities. |
Information Other than the Financial Statements and Auditor's Report Thereon
The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexure to Board's Report BusinessResponsibility Report Corporate Governance and Shareholder's Information but does notinclude the financial statements and our auditor's report thereon.
Our opinion on the financial statements does not cover the other information and we donot express any form of assurance conclusion thereon. In connection with our audit of thefinancial statements our responsibility is to read the other information when it becomesavailable and in doing so consider whether the other information is materiallyinconsistent with the financial statements or our knowledge obtained during the course ofour audit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information; weare required to report that fact. We will report when we are made available with thisinformation.
Management's Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters stated in section
134(5) of the Act with respect to the preparation of these financial statements thatgive a true and fair view of the financial position financial performance totalcomprehensive income changes in equity and cash flows of the Company in accordance withthe Ind AS and other accounting principles generally accepted in India. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation 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 financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.
The Board of Directors are responsible for overseeing the Company's financial reportingprocess.
Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.
As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal controls.
Obtain an understanding of internal financial controls relevant to the audit in orderto design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sHowever future events or conditions may cause the Company to cease to continue as a goingconcern.
Evaluate the overall presentation structure and content of the financial statementsincluding the disclosures and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation. Materiality is themagnitude of misstatements in the financial statements that individually or in aggregatemakes it probable that the economic decisions of a reasonably knowledgeable user of thefinancial statements may be influenced. We consider quantitative materiality andqualitative factors in
(i) planning the scope of our audit work and in evaluating the results of our work; and
(ii) to evaluate the effect of any identified misstatements in the financialstatements.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.
From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"Annexure A" a statement on the matters specified in paragraphs 3 and 4 of theorder.
2. As required by Section 143(3) of the Act based on our audit we report that:
a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.
c) The Balance Sheet the Statement of Profit and Loss including Other ComprehensiveIncome Statement of Changes in Equity and the Statement of Cash Flow dealt with by thisReport are in agreement with the relevant books of account.
d) In our opinion the aforesaid financial statements comply with the Ind AS specifiedunder Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.
e) On the basis of the written representations received from the directors as on March31 2020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2020 from being appointed as a director in terms of Section 164 (2) of theAct.
f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial.
g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended:
In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its directors during the year is inaccordance with the provisions of section 197 of the Act.
h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:
i. The Company does not have any pending litigations which would impact its financialposition.
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the company.
Annexure A' to the Independent Auditor's Report
(Referred to in paragraph 1 under Report on Other Legal and RegulatoryRequirements' section of our report to the Members of QUANTUM DIGITAL VISION
(INDIA) LIMITED of even date)
I. In respect of fixed assets:
(a) The company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets on the basis of available information.
(b) All the assets have not been physically verified by the management during the yearbut there is a regular program of verification which in our opinion is reasonable havingregard to the size of the company and the nature of its assets. No material discrepancieswere noticed on such verification.
(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the company except certain agreements yet to be executed.
II. There was no inventory as at the year end hence reporting under this para isnot applicable.
III. The Company has not granted loans secured or unsecured to companies firms orother parties covered in the register maintained under section 189 of the Companies Act2013. Hence reporting under this clause is not applicable.
IV. In our opinion and according to information and explanation given to us the
Company has complied with the provisions of section 185 and 186 of the Act withrespect of loans investments guarantees and security.
V. The company has not accepted any deposits from the public within the meaning ofthe section 73 and 74 of the Act and rules framed there under to the extent notified.
VI. The maintenance of cost records under section 148(1) of the Companies Act
2013 has not been prescribed by the Central Government in respect of any of theactivities carried out by the company.
VII. (a) According to the information and explanations given to us and on the basisof our examination of the records of the Company the company is generally regular indepositing with the appropriate authorities undisputed statutory dues including incometax sales tax wealth tax service tax cess Goods and Service Tax and other materialstatutory dues applicable to it.
(b) There were undisputed amounts payable in respect of Provident Fund
Employees' State Insurance Income Tax Goods and Service Tax Customs Duty Cess andother material statutory dues in arrears as at March 31 2020 for a period of more thansix months from the date they became payable. Details as under:
|Particulars ||(Amount in Rs.) |
|TDS (F.Y. 2018-19 ) ||789345 |
(c) According to the information and explanations given to us there are no materialdues in respect of income tax sales tax wealth tax service tax cess Goods and ServiceTax etc. which have not been deposited with the appropriate authorities on account of anydispute.
VIII. In our opinion and according to the information and explanations given to usthe company has not defaulted in repayment of dues to a financial institution or bank. TheCompany has not taken any loan from the government and has not issued any debenturesduring the year.
IX. Based upon the audit procedures performed and the information and explanationsgiven by the management the company did not raise moneys by way of initial public offeror further public offer including debt instruments. The Company did not raise funds by wayof any term loan during the year. Hence reporting under this clause is not applicable.
X. Based upon the audit procedures performed and the information and explanationsgiven by the management we report that no fraud by the Company or on the company by itsofficers or employees has been noticed or reported during the year.
XI. According to information and explanations given by the management themanagerial remuneration has been paid/provided in accordance with the provision of section197 read with Schedule V to the Companies Act 2013.
XII. In our opinion and according to the information and explanations give to usthe
Company is not a Nidhi Company. Therefore the provisions of clause 4 (xii) of theOrder are not applicable to the Company.
XIII. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with section 177 and 188 of Companies Act 2013 and the details of suchtransactions have been disclosed in the Financial Statements as required by the applicableaccounting standards.
XIV. According to the information and explanations given to us and based on ourexamination of the records of the Company the company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year under audit. Accordingly the provisions of clause 3 (xiv) of the Order are notapplicable to the Company.
XV. According to the information and explanations given to us and based on ourexamination of the records of the Company the company has not entered into any non-cashtransactions with directors or persons connected with him. Accordingly the provisions ofclause 3 (xv) of the Order are not applicable to the Company and hence not commented upon.
XVI. In our opinion the company is not required to be registered under section45-IA of the Reserve Bank of India Act 1934 and accordingly the provisions of Clause3(xvi) of the Order are not applicable to the Company and hence not commented upon.
Annexure "B" to the Independent Auditor's Report
(Referred to in paragraph 2(f) under Report on Other Legal and RegulatoryRequirements' section of our report to the Members of QUANTUM DIGITAL VISION (INDIA)LIMITED 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 financial reporting ofQUANTUM DIGITAL VISION (INDIA) LIMITED ("the Company") as of March 31 2020 inconjunction with our audit of the financial statements of the Company for the year endedon that date.
Management's Responsibility for Internal Financial Controls
The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to respective company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.
Our responsibility is to express an opinion on the internal financial controls overfinancial reporting of the Company based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") issued by the Institute of Chartered Accountantsof India and the Standards on Auditing prescribed under Section 143(10) of the CompaniesAct 2013 to the extent applicable to an audit of internal financial controls. 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 performingprocedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal control based on the assessed risk. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide a basis for our audit opinion onthe internal financial controls system over financial reporting of the Company.
Meaning of Internal Financial Controls Over Financial Reporting
A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that
(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.
Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate. Opinion In ouropinion to the best of our information and according to the explanations given to us theCompany has in all material respects an adequate internal financial controls system overfinancial reporting and such internal financial controls over financial reporting wereoperating effectively as at March 31 2020 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.