S Kumars Online Ltd.
|BSE: 532316||Sector: IT|
|NSE: N.A.||ISIN Code: INE827A01018|
|BSE 00:00 | 26 Apr||S Kumars Online Ltd|
|NSE 05:30 | 01 Jan||S Kumars Online Ltd|
|BSE: 532316||Sector: IT|
|NSE: N.A.||ISIN Code: INE827A01018|
|BSE 00:00 | 26 Apr||S Kumars Online Ltd|
|NSE 05:30 | 01 Jan||S Kumars Online Ltd|
To the Members of S Kumars Online Limited
Report on the Audit of the Standalone Financial Statements
We have audited the standalone financial statements of S Kumars OnlineLimited (the Company) which comprise the Balance Sheet as at 31stMarch 2020 the Statement of Profit and Loss (including other Comprehensive Income) theStatement of Changes in Equity) and the Statement of Cash Flows for the year ended on thatdate and notes to the Standalone Financial Statements including a summary of significantaccounting policies and other explanatory information (hereinafter referred to asthe Standalone Financial Statements).
In our opinion and to the best of our information and according to theexplanations given to us except for the effect of the matters described in the Basis ofQualified Section of our report 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 India Accounting Standardsprescribed under Section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended (Ind As) and other accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 312020the loss and total comprehensive income changes in equity and its cash flows for the yearended on that date.
Basis for Our Qualified Opinion
(1) Refer Note No.24to the standalone audited financial statement ofthe Company has been incurring constant losses and also the net worth of the Company hasbeen fully eroded. Further the Company has also discontinued all its major line ofbusiness and it has also been facing cash-flow mismatches and as of 31st March2020 the Company liabilities exceeded its assets. These factors along with other mattersas set forth in said note raise substantial doubt about the Company's ability to continueas a going concern in the foreseeable future. However the Company's standalone financialstatement has been prepared on going concern basis. If the management is not able toinfuse adequate money on appropriate time than the going concern assumption might getimpacted. However the standalone financial Statement of the Company is prepared on goingconcern basis.
(2) Refer Note No. 26to the standalone audited financial statement ofthe Company has not carried out Actuarial valuation as per the recommendations of Ind AS15 Employee Benefits and instead provided for Gratuity on accrual basis as perManagement Estimates. The amount of shortfall in such provision is currentlyunascertainable since the Actuarial Valuation was not carried out. However the managementis of the opinion that the provision created in the books is sufficient considering thenumber of employees.
We conducted our audit in accordance with the Standards on Auditing(SAs) specified under section 143(10) of the Act. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theStandalone Financial Statements section of our report. We are independent of the Companyin accordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia (CAI) together with the ethical requirements that are relevant to our audit of thestandalone financial statements under the provisions of the Act and the Rules madethereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics issued by the ICAI. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for our auditopinion 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 following matter to be the Keyaudit matter to be communicated in our Report.
Information Other than the Standalone Financial Statements andAuditor's Report Thereon
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 and Shareholder's Information but does not include thestandalone financial statements and our auditor's report thereon. Our opinion on thestandalone financial statements does not cover the other information and we do not expressany form of assurance conclusion thereon. In connection with our audit of the standalonefinancial statements Our responsibility is to read the other information and in doingso consider whether the other information is materially inconsistent with the standalonefinancial statements or our knowledge obtained during the course of our audit or otherwiseappears to be materially misstated. If based on the work we have performed we concludethat there is a material misstatement of this other information we are required to reportthat fact. We have nothing to report in this regard expect that stated in Basis ofQualified Opinion and Key Audit Matter above.
Management's Responsibility for the Standalone FinancialStatements
The Company's Board of Directors is responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these standalonefinancial statements that give a true and fair view of the financial position financialperformance total Comprehensive Income changes in equity and cash flows of the Companyin accordance with the Ind AS 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 judgments 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 statement that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing the standalone financial statements management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing theCompany's financial reporting process.
Auditor's Responsibilities for the Audit of the StandaloneFinancial Statements
Our 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 a part of an audit in accordance with the SAs we exercise professional judgment andmaintain professional scepticism throughout the Audit.
Identify and assess the risk 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 of 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 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 expressingan opinion on whether the Company has adequate internal financial controls system in placeand the operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the standalone financial
statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.
Evaluate the overall presentation structure and content of 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 standalone financialstatements may be influenced. We consider quantitative materiality and qualitative factorsin (i) planning the scope of our audit work and in evaluating the results of our work; and(ii) to evaluate the effect of any identified misstatements in the standalone financialstatements.
We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.
We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards. From the matterscommunicated with those charged with governance we determine those matters that were ofmost significance in the audit of the standalone financial statements of the currentperiod and are therefore the key audit matters.
We describe these matters in our auditor's report unless law orregulation precludes public disclosure about the matter or when in extremely rarecircumstances we determine that a matter should not be communicated in our report becausethe adverse consequences of doing so would reasonably be expected to outweigh the publicinterest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2016(the Order) issued by the Central Government of
India in terms of sub-section (11) of section 143 of the Companies Act2013 we give in the Annexure A a
statement on the matters specified in paragraphs 3 and 4 of the Orderto the extent applicable.
2. As required by Section 143(3) of the Act we report that:
a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit.
b) In our opinion proper books of account as required by law have beenkept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet the Statement of Profit and Loss including otherComprehensive Income Statement of Changes in Equity and the Statement of Cash Flow dealtwith by this Report are in agreement with the relevant books of accounts.
d) Except for the effects of the matter described in the Basis forQualified Opinion paragraph above in our opinion the aforesaid standalone financialstatements comply with the Ind As specified under Section 133 of the Act read with Rule 7of the Companies (Accounts) Rules 2014.
e) The qualification relating to the maintenance of accounts and othermatters connected therewith are as stated in the Basis for Qualified Opinion paragraphabove.
f) On the basis of the written representations received from theDirectors as on 31stMarch 2020 taken on record by the Board of Directors noneof the Directors is disqualified as on 31stMarch 2020 from being appointed asa director in terms of Section 164 (2) of the Act.
g) With respect to the adequacy of the internal financial controls overfinancial reporting of the Company and the operating effectiveness of such controls referto our separate Report in Annexure B. Our report expresses an unmodifiedopinion on the adequacy and operating effectiveness of the Company's internal financialcontrols over financial reporting.
h) With respect to the other matters to be included in the Auditor'sReport in accordance with the requirements of Section 197(6) of the Act as amended Rule11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to the best ofour information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on itsfinancial position in its standalone financial statements.
ii. The Company does not have long-term contracts including derivativecontracts requiring provision for material foreseeable losses.
iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.
Annexure A to the Independent Auditors' Report (Referred to in ourreport of even date)
In terms of the information and explanations given to us and the booksand records examined by us and on the basis of
such checks as we considered appropriate we further report as under:
(i) Fixed Assets:
a) In our opinion the Company is maintaining proper records showingthe relevant particulars including quantitative details of its fixed assets.
b) The Company due to lockdown was not able to conduct a physicalverification of its fixed asset as at the end of the year. The Company is in process oftagging individual fixed assets. There were no discrepancies noticed on such verification.
c) In our opinion and according to information and explanations givento us and on the basis of an examination of the records of the Company the company doesnot have any immovable properties.
As explained to us the management was not able to conduct physicalverification of inventory as at the close of the year due to COVID pandemic. However theCompany has written off the said inventory in its books as the same is old and does nothave any realizable value.
(iii) Loans & Advances granted and taken:
During the year the Company has not granted any loans and advancessecured or unsecured to any parties covered in the register maintained under Section 189of the Companies Act.
(iv) Compliance of Sec 185 and 186 of Companies Act 2013
In our opinion in respect of loans investments guarantees andsecurity provisions of section 185 and 186 of the Companies Act 2013 have been compliedwith.
(v) Public Deposits:
According to the information and explanations given to us the Companyhas not accepted deposits as per the directives issued by Reserve Bank of India and theprovisions of Sections 73 and 76 or any other relevant provisions of the Act and the rulesframed there under.
(vi) Cost Records:
As explained to us maintenance of cost records under of section 148(1)of the Act is not applicable to the Company during the year under review.
(vii) Statutory Dues:
a) As per the records verified by us there had been delays/defaults indepositing the statutory dues involving Provident Fund Profession Tax Income-tax (TDS)with the appropriate authorities. Dues outstanding for a period exceeding six months is onaccount of Profession Tax of Rs.15800 Provident Fund of Rs. 68568 and Income Tax (TDS)of Rs. 15649.
We were explained that the statutes pertaining to Employees' StateInsurance Corporation Excise Duty Customs Duty are not applicable to the Company duringthe year under review.
b) According to the information and explanations given to us therewere no disputed dues of Sales Tax and Income Tax which have not been deposited by theCompany during the year under review except in respect of Income Tax matters as per thedetails given below:
(viii) Dues to Financial Institutions/Banks/Debenture Holders:
As per the records verified by us and based on our audit proceduresthere were no secured loans taken by the Company during the current year. The Company hasnot issued any debentures during the year under review.
(ix) Utilization of funds raised:
As per the records verified by us and based on our audit proceduresthe Company has not raised moneys by way of initial public offer or further public offer(including debt instruments) and no term loans were taken by the Company during thecurrent year.
To the best of our knowledge and belief and according to theinformation and explanations given to us no material fraud on or by the Company by itsofficers or employees during the year was noticed or reported nor have we been informedof such case by the management.
(xi) Managerial remunerations:
As per the Company's records managerial remuneration paid by theCompany is in accordance with section 197 of the Act read with schedule V.
(xii) Nidhi Company
According to the information and explanation given to us the Companyis not a Nidhi Company as prescribed under Section 406 of the Act. Accordingly paragraph3(xii) of the order is not applicable to the Company.
(xiii) Related Party Transaction
According to the information and explanation given to us all thetransactions with the related parties are in compliance with sections 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in thestandalone Financial Statements as required by the applicable accounting standards;
(xiv) Preferential or private allotment
According to the information and explanation given to us and based onour examination of 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 review.
(xv) Non cash transaction with Directors
According to the information and explanation given to us and based onour examination of records of the Company the company has not entered into non-cashtransactions with directors or persons connected with him.
(xvi) Non Banking Financial Institution
According to the information and explanation given to us the companyis not required to be registered under section 45-IA of the Reserve Bank of India Act1934. Accordingly paragraph 3(xvi) is not applicable.
Annexure B to the Auditor's Report of even date on the standalone financial statement -Annexure B Report on the Internal Financial Controls under Section 143(3)(i) of theCompanies Act 2013 (the Act)
We have audited the internal financial controls over financialreporting of S Kumars Online Limited (the Company) as of 31stMarch 2020 in conjunction with our audit of the standalone financial statements of theCompany comprising of the Balance Sheet as at March 31st2020 the Statement ofProfit and Loss including Comprehensive Income Statement of Changes in Equity and CashFlow Statement for the period then ended.
Management's Responsibility for Internal Financial Controls :
The Company's management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls overFinancial Reporting issued by the Institute of Chartered Accountants of India (ICAI).These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.
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 and the Standards on Auditing issued by the ICAI deemed to be prescribed undersection 143(10) of the Companies Act 2013 to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the ICAI. Those standards and the Guidance Note that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls over financial reporting was established andmaintained and if such controls 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 standalone financial statements whether due tofraud 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 standalone financial statements for external purposes inaccordance with generally accepted accounting principles. A company's internal financialcontrol over financial reporting includes those policies and procedures that
(1) Pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany;
(2) Provide reasonable assurance that transactions are recorded asnecessary to permit preparation of standalone financial statements in accordance withgenerally accepted accounting principles and that receipts and expenditures of thecompany are being made only in accordance with authorizations of management and directorsof the company; and
(3) Provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition use or disposition of the company's assets thatcould have a material effect on the standalone 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
be detected. Also projections of any evaluation of the internalfinancial controls over financial reporting to future periods are subject to the risk thatthe internal financial control over financial reporting may become inadequate because ofchanges in conditions or that the degree of compliance with the policies or proceduresmay deteriorate.
According to the information and explanations given to us in ouropinion the Company hasin all material respects established an adequate internalfinancial controls system over financial reporting on criteria based on or considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Control over Financial Reporting issued by the Institute of CharteredAccountants of India. Such internal financial controls over financial reporting wereoperating effectively as at March 31st 2020.