The Members of
Sagardeep Alloys Limited
Report on the Audit of the Standalone Financial Statements
We have audited the accompanying standalone financial statements of Sagardeep AlloysLimited ("the Company") which comprise the Standalone Balance Sheet as at 31stMarch 2020 the Standalone Statement of Profit and Loss (including other comprehensiveincome) Standalone Statement of Changes in Equity and the Standalone Cash Flows for theyear then ended and notes to the standalone financial statements including a summary ofsignificant accounting policies and other explanatory information(hereinafter referred toas "the standalone financial statements").
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013
("the Act") in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at 31 March 2020 and profit and other comprehensive incomechanges in equity and its cash flows for the year ended on that date.
Basis of Our Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder Section
143(10) of the Act. Our responsibilities under those SAs are further described in theAuditor's
Responsibilities for the Audit of the Standalone Financial Statements section of ourreport. We are independent of the Company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of the standalone financial statements under the provisionsof the Act and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our opinion.
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 year. 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 separate opinion on these matters.
We have determined that there are no key audit matters to be communicated in ourreport.
The Company's management and Board of Directors are responsible for the otherinformation. The other information comprises the information included in the Company'sannual report but does not include the standalone financial statements and our auditors'report thereon.
Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated. If based on thework we have performed we conclude that there is a material misstatement of this otherinformation we are required to report that fact. We have nothing to report in thisregard.
Management's Responsibility for The Standalone Financial Statements
The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.
In preparing the standalone financial statements management and Board of Directors areresponsible 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 is alsoresponsible for overseeing the Company's financial reporting process.
Auditor's Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalonefinancial 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 SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:
a. Identify and assess the risks of material misstatement of the standalone financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.b. 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 and its subsidiary companies which are companies incorporated in India hasadequate internal financial controls system in place and the operating effectiveness ofsuch controls. c. Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management. d.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 ability ofthe Company to continue as a going concern. If we conclude that a material uncertaintyexists we are required to draw attention in our auditor's report to the relateddisclosures in the standalone financial statements or if such disclosures are inadequateto modify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern. e. Evaluate the overall presentation structureand content of the standalone financial statements including the disclosures and whetherthe standalone financial statements represent the underlying transactions and events in amanner that achieves fair presentation.
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 standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when 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
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 ofthe Companies Act 2013 we give in the "Annexure A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.
A. As required by Section 143(3) of the Act we report that: a) We have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purposes of our audit; b) In our opinion proper books ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books. c) the standalone balance sheet the standalone statement ofprofit and loss dealt with by this Report are in agreement with the books of account; d)In our opinion the aforesaid standalone financial statements comply with the Ind ASspecified under 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 ason 31stMarch 2020 taken on record by the Board of Directors none of the directors isdisqualified as on 31stMarch 2020 from being appointed as a director in terms of Section164 (2) of the Act. f) With respect to the adequacy of the internal financial controlsover financial reporting of the
Company and the operating effectiveness of such controls refer to our separate Reportin "Annexure B".
B. 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 in our opinionand to the best of our information and according to the explanations given to us:
1. The company has disclosed the impact of pending litigation on its standalonefinancial position in its financial statement.
2. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
3. There was no amount which are required to be transferred to the investor'seducation and protection fund by the company.
4. The disclosures in the standalone financial statements regarding holdings as well asdealings in specified bank notes during the period from 8 November 2016 to 30 December2016 have not been made in these standalone financial statements since they do not pertainto the financial year ended 31 March 2020.
C. With respect to the matter to be included in the Auditors' Report under Section197(16) of the
In our opinion and according to the information and explanations given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of Section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under Section 197(16) which arerequired to be commented upon by us.
|For Piyush J. Shah & Co. |
|Chartered Accountants |
|FRN: 121172W |
|Piyush J. Shah |
|M. No: 108670 |
|UDIN: 20108670AAAABX1829 |
|Place: Ahmedabad |
|Date: 27th June 2020 |
Annexure - A to the Auditors' Report
The Annexure referred to in our Independent Auditors' Report to the members of theCompany on the standalone financial statements for the Period 01-04-2019 to 31-03-2020 wereport that: i) (a) The company has maintained proper records showing full particularsincluding quantitative details and situation of fixed assets.
(b) The company has a regular programme of physical verification of its fixed assets bywhich fixed assets are verified in a phased manner over a period of three years. Inaccordance with this programme certain fixed assets were verified during the year and nomaterial discrepancies were noticed on such verification. In our opinion this periodicityof physical verification is reasonable having regard to the size of the Company and thenature of its assets.
(c) The title deeds of immovable properties are held in the name of the company.
ii) The Inventories have been physically verified during the year by the management. Inour opinion and according to the information and explanations given to us the company hasmaintained proper records of inventory. As explained to us there were no materialdiscrepancies noticed on physical verification of inventory as compared to book recordsand the same has been properly dealt with in books of accounts.
iii) The Company had granted loans to parties covered in the register maintained undersection 189 of the Companies Act 2013 (the Act').
(a) In our opinion and according to the information and explanations given to us theterms and conditions of the grant of such loans are not prejudicial to the company'sinterest.
(b)There is no repayment schedule relating to the loans granted by the company It isrepayable on demand. Moreover the company is not charging any kind of interest on theloans granted.
(c) In respect of the said loans there are no overdue accounts.
iv) In our opinion and according to the information and explanations given to us inrespect of loans investments guarantees and security provisions of section 185 and 186of the Companies Act 2013 had been complied with.
v) The company had not accepted any deposits from public therefore the directivesissued by the Reserve Bank of India and the provisions of sections 73 to 76 or any otherrelevant provisions of the Companies Act 2013 and the rules framed there under is notapplicable.
vi) The Central Government has not prescribed the maintenance of cost records undersection 148(1) of the Act for the goods supplied by the Company.
vii) (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted / accrued in the books ofaccount in respect of undisputed statutory dues including provident fund income taxsales tax wealth tax service tax duty of customs value added tax cess and othermaterial statutory dues have been regularly deposited during the year by the Company withthe appropriate authorities. As explained to us the
Company did not have any dues on account of employees' state insurance and duty ofexcise.
According to the information and explanations given to us no undisputed amountspayable in respect of provident fund income tax sales tax wealth tax service tax dutyof customs value added tax cess and other material statutory dues were in arrears as at31stMarch 2020 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us there are no materialdues of wealth tax duty of customs and cess which have not been deposited with theappropriate authorities on account of any dispute.
viii) The company had not defaulted in repayment of loans or borrowing to a financialinstitution bank Government or dues to debenture holders.
ix) According to the information and explanations given to us the company had notraised any money by way of Initial Public Offer or Further Public Offer and term loans.
x) According to the information and explanations given to us no material fraud on orby the Company has been noticed or reported during the course of our audit.
xi) According to the information and explanations given to us managerial remunerationhad been paid or provided in accordance with the requisite approvals mandated by theprovisions of Section 197 read with Schedule V to the Companies Act.
xii) In our opinion the company is not Nidhi company. Therefore the provisions asmentioned in the Nidhi Rules 2014 are not applicable to the company.
xiii) In our opinion and according to the information and explanations given to us alltransactions with the related parties are in compliance with sections 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the FinancialStatements etc. as required by the applicable accounting standards.
xiv) According to the information and explanations given to us the company had notmade preferential allotment of shares during the year/period under review and therequirement of Section 42 of the Companies Act 2013 and other applicable provisions aretherefore not applicable.
xv) According to the information and explanations given to us the company had notentered into any non-cash transactions with directors or persons connected with him.
xvi) In our opinion the company is not a Non-Banking Finance Company therefore therequirement to register under section 45-IA of the Reserve Bank of India Act 1934 in notapplicable.
Annexure - B to the Independent Auditors' Report
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the
Companies Act 2013 ("the Act") on the Standalone Financial Statements ofSagardeep Alloys Limited Opinion
We have audited the internal financial controls with reference to standalone financialstatements of
Sagardeep Alloys Limited ("the Company") as of 31 March 2020 in conjunctionwith our audit of the standalone financial statements of the Company for the year ended onthat date.
In our opinion the Company has in all material respects adequate internal financialcontrols with reference to standalone financial statements and such internal financialcontrols were operating effectively as at 31stMarch 2020 based on the internalfinancial controls with reference to standalone financial statements criteria establishedby the Company considering the essential components of internal control stated in theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting issued bythe Institute of Chartered Accountants of India (the "Guidance Note").
Management's Responsibility for Internal Financial Controls
The Company's management and the Board of Directors are responsible for establishingand maintaining internal financial controls based on the internal financial controls withreference to standalone financial statements criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note.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 the 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 (hereinafterreferred to as "the Act").
Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to standalone financial statements based on our audit. Weconducted our audit in accordance with the Guidance Note and the Standards on Auditingprescribed under Section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls with reference to standalone financial statements. 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 with reference to standalone financial statements were established andmaintained and whether such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to standalone financial statements andtheir operating effectiveness. Our audit of internal financial controls with reference tostandalone financial statements included obtaining an understanding of internal financialcontrols with reference to standalone financial statements assessing the risk that amaterial weakness exists and testing and evaluating the design and operating effectivenessof the internal control based on the assessed risk. The procedure selected depend on theauditor's judgement including the assessment of risks of material misstatement of thestandalone financial statements whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the internal financial controls with reference tostandalone financial statements.
Meaning of Internal Financial Controls with reference to Standalone FinancialStatements
A company's internal financial controls with reference to standalone financialstatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of standalone financial statements for externalpurposes in accordance with generally accepted accounting principles. A company's internalfinancial controls with reference to standalone financial statements include thosepolicies and procedures that (1) pertain to the maintenance of records that in reasonabledetail accurately and fairly reflect the transactions and dispositions of the assets ofthe company; (2) provide reasonable assurance that transactions are recorded as necessaryto permit preparation of standalone financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorisations of management and directors of thecompany; 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 standalone financial statements.
Inherent Limitations of Internal Financial Controls with reference to StandaloneFinancial Statements
Because of the inherent limitations of internal financial controls with reference tostandalone 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 standalone financial statements to future periods are subjectto the risk that the internal financial controls with reference to standalone financialstatements may become inadequate because of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate.
|For Piyush J. Shah & Co. |
|Chartered Accountants |
|FRN: 121172W |
|Piyush J. Shah |
|M. No: 108670 |
|UDIN: 20108670AAAABX1829 |
|Place: Ahmedabad |
|Date: 27th June 2020 |