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Sahara Housing Fina Corporation Ltd.

BSE: 511533 Sector: Financials
NSE: N.A. ISIN Code: INE135C01012
BSE 00:00 | 03 Feb 46.20 1.25
(2.78%)
OPEN

51.95

HIGH

53.90

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42.35

NSE 05:30 | 01 Jan Sahara Housing Fina Corporation Ltd
OPEN 51.95
PREVIOUS CLOSE 44.95
VOLUME 11519
52-Week high 65.80
52-Week low 33.85
P/E 18.05
Mkt Cap.(Rs cr) 32
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 51.95
CLOSE 44.95
VOLUME 11519
52-Week high 65.80
52-Week low 33.85
P/E 18.05
Mkt Cap.(Rs cr) 32
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sahara Housing Fina Corporation Ltd. (SAHARAHOUSING) - Auditors Report

Company auditors report

TO THE MEMBERS OF

SAHARA HOUSINGFINA CORPORATION LIMITED

Report on Audit of the Financial Statements

Opinion

We have audited the accompanying financial statements of SAHARAHOUSINGFINA CORPORATION LIMITED ("the Company") which comprise the BalanceSheet as at March 31 2021 the Statement of Profit and Loss (including OtherComprehensive Income) the Statement of Cash Flow and the Statement of Changes in Equityfor the year then ended and notes to the financial statements including a summary ofsignificant accounting policies and other explanatory information (hereinafter referred toas "the financial statements"). In our opinion and to the best of ourinformation and according to the explanations given to us the aforesaid financialstatements give the information required by the Companies Act 2013 ("the Act")in the manner so required and give a true and fair view in conformity with the IndianAccounting Standards prescribed under section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 as amended ("Ind AS") and otheraccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2021 and its profit (including Other Comprehensive Income) its cash flowsand changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the financial statements in accordance withthe Standards on Auditing (SAs) specified under Section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibility for the Audit of the Financial Statements section of our report. We areindependent of the Company in accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India (ICAI) together with the ethical requirements that arerelevant to our audit of the financial statements under the provisions of the Act and theRules made there under and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the ICAI's Code of Ethics. We believe that theaudit evidence obtained by us is sufficient and appropriate to provide a basis for ouraudit opinion on the financial statements.

Emphasis of Matter

We draw attention to Note 40 to the financial statements in which theCompany describes the uncertainties arising from the Covid-19 pandemic and itsconsequential effects on the Company' business activities as assessed by the management.Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the financial statements for the year endedMarch 31 2021. These matters were addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. We have determined the matter described below to be thekey audit matter to be communicated in our report: -

Key audit matter How the matter was addressed in audit
Expected Credit Loss - Impairment of Loans to customers
The Company has reported total gross loans of ` 9277.68 lakhs and Expected Credit Our audit procedures included the following:
Loss (ECL)/Impairment allowance of ` 512.15 lakhs there against as on March 31 2021 (Refer Note 6 to the financial statements). • Obtained an understanding of the Company's key credit processes comprising granting booking monitoring and provisioning and tested the operating effectiveness of key controls over these processes.
As per Ind AS 109 ECL is required to be determined for recognizing impairment loss on financial assets. • Understood and assessed the Company's process on timely recognition of impairment in the loan portfolio and assessed the accuracy of the reports of ageing and defaults.
Recognition and measurement of impairment loss or ECL involve significant management judgment requiring to estimate the probability of loss / expected loss based on past experience loss ratios and to the extent possible forward looking analysis. • Obtained an understanding of the Company's impairment provisioning methodology the underlying assumptions and the sufficiency of the data used by management.
The significant areas in the calculation of ECL where management estimates and judgements are required are as under: • Compared the Company's provisioning policy with the requirements of Ind AS 109 as well as relevant regulatory guidelines and pronouncements.
• Judgements about credit risk characteristics taking into account instrument type class of borrowers credit risk ratings date of initial recognition remaining term to maturity property valuation industry and other relevant factors for collective evaluation of impairment under various stages of ECL. • Tested on a sample basis data used for various components such as probability of defaults loss given defaults etc. for calculation of impairment allowance.
• Loan staging criteria • Performed a test check of the Company's process used to calculate the impairment charge and management review controls over measurement of impairment allowance.
• Calculation of probability of default and loss given default • Enquired with the management regarding significant judgments and estimates involved in the impairment computation and reasonability of assumptions used.
• Consideration of probability weighted scenario and forward looking macro-economic factors • Performed substantive procedures over validating completeness and correctness of the data and reasonableness of assumptions used by the management more specifically in the light of the RBI moratorium guidelines and its probable ramifications.
Further the COVID-19 pandemic situation and the lockdown restrictions coupled with the moratorium granted by the Reserve • Performed cut off procedures on a sample basis relating to the recoveries at the year- end having impact on staging of loans.
Bank of India has cast an uncertainty on the timing and manner in which the Company would be able to collect the dues from its customers. • Performed analytical reviews of disaggregated data to identify any unusual trends warranting additional audit procedures.
In our opinion this is considered a Key Audit Matter in view of the criticality of the item to the financial statements and the complex nature of assumptions and judgements exercised by the management. • Tested review controls over measurement of impairment allowance and disclosures in financial statements.
The Company's disclosures are included in Note 2.4.5.1.d and Note 6.2 to the financial statements which outline the accounting policy for Impairment provision and details of Impairment allowance made in the books of account respectively.

Information Other than the Financial Statements and Auditor'sReport thereon

The Company's Board of Directors is responsible for preparation ofthe other information. The other information comprises the information included inDirectors' Report Corporate Governance Report and Management Discussion and AnalysisReport but does not include the financial statements and our auditor's reportthereon. The Other Information is expected to be made available to us after the date ofthis Auditor's Report.

Our opinion on the financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the financial statements or ourknowledge obtained during the course of our audit or otherwise appears to be materiallymisstated.

When we read the other information if we conclude that there ismaterial misstatement therein we are required to communicate the matter to those chargedwith governance as required under SA 720 ‘The Auditor's ResponsibilitiesRelating to Other Information'.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the mattersstated in Section 134(5) of the Act with respect to the preparation of these financialstatements that give a true and fair view of the financial position financial performanceincluding other comprehensive income cash flows and changes in equity of the Company inaccordance with the Ind AS and the 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 forassessing the Company's ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibility for the Audit of the Financial Statements

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. Reasonableassurance is a high level of assurance but is not a guarantee that an audit conducted inaccordance with SAs 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 financial statements.

As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of thefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal financial controls relevantto the audit in order to design audit procedures that are appropriate in thecircumstances. Under Section 143(3)(i) of the Act we are also responsible for expressingour opinion on whether the Company has adequate internal financial controls over financialreporting 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 the management.

• Conclude on the appropriateness of management's use of thegoing concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the Company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor'sreport to the related disclosures in the 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 conditionsmay cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of thefinancial statements including the disclosures and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the financialstatements for the financial year ended March 31 2021 and are therefore the key auditmatters. We describe these matters in our auditor's report unless law or regulationprecludes public disclosure about the matter or when in extremely rare circumstances wedetermine that a matter should not be communicated in our report because the adverseconsequences of doing so would reasonably be expected to outweigh the public interestbenefits 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 Section143(11) of the Act we give in Annexure "A" a statement on the matters specifiedin paragraphs 3 and 4 of the Order to the extent applicable

2. As required by Section143(3) of the Act based on our audit wereport 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) the Statement of Cash Flow and Statement of Changes in Equity dealtwith by this Report are in agreement with the books of account.

d) In our opinion the aforesaid financial statements comply with theIndian Accounting Standards (Ind AS) specified under Section 133 of the Act.

e) On the basis of the written representations received from thedirectors as on March 31 2021 taken on record by the Board of Directors none of thedirectors is disqualified as on March 31 2021 from being appointed as a director in termsof Section 164(2) of the Act.

f) 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" to this report.

g) With respect to the other matters to be included in theAuditor's Report in accordance with the requirements of Section 197(16) of the Actas amended: In our opinion and to the best of our information and according to theexplanations given to us the managerial remuneration paid/ provided by the Company duringthe year is in accordance with the provisions of Section 197 of the Act.

h) With respect to the other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 as amended in our opinion and to the best of our information and according tothe explanations given to us:

i. The Company has disclosed the impact of the pending litigation onits financial position in the financial statements - Refer Note 38 to the financialstatements.

ii. The Company did not have any long- term contracts includingderivative contracts for which there were any material foreseeable losses.

iii. There was no amount which was required to be transferred to theInvestor Education and Protection Fund by the Company during the year under review.

For CHATURVEDI & PARTNERS
Chartered Accountants
Firm Registration No. 307068E
LAXMI NARAIN JAIN
Partner
New Delhi Membership No. 072579
June 30 2021 UDIN – 21072579AAAAAU4230

ANNEXURE ‘‘A'' to the Independent Auditor'sReport (Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date)

(i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of property plant andequipment.

(b) Property plant and equipment have been physically verified by themanagement during the year pursuant to a regular programme designed for physicalverification which in our opinion is reasonable having regards to the size of theCompany and the nature of its assets. According to the information and explanations givento us no material discrepancies were noticed on such verification

(c) According to the information and explanations given to us and onthe basis of examination of records of the Company the title deeds of immovableproperties are held in the name of the Company.

(ii) The Company does not have any inventory and accordingly theclause (ii) of paragraph 3 of the Order is not applicable to the Company.

(iii) The Company has not granted any loans secured or unsecured tocompanies firms limited liability partnerships or other parties covered in the registermaintained under Section 189 of the Companies Act 2013. Accordingly the clause (iii)(a)(b) and (c) of paragraph 3 of the Order are not applicable to the Company.

(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 with respect of loans investments guarantees and securities as applicable.

(v) According to the information and explanations given to us theCompany has not accepted any deposit within the meaning of Section 73 to 76 of the Act andthe Companies (Acceptance of Deposits) Rules 2014 as amended. Accordingly the clause (v)of paragraph 3 of the Order is not applicable to the Company.

(vi) According to the information and explanations given to us theCentral Government has not prescribed maintenance of cost records under sub-section (1) ofSection 148 of the Act in respect of the activities carried on by the Company.

(vii) According to the information and explanations given to us and onthe basis of the records examined by us:

(a) The Company has generally been regular in depositing undisputedstatutory dues including Provident Fund Employees' State Insurance Income-taxGoods and Service Tax and other material statutory dues applicable to it to theappropriate authorities. Considering the nature of business of the Company Sales TaxCustom Duty Excise Duty Cess and Value Added Tax are not applicable to the Company.There are no undisputed statutory dues outstanding as at March 31 2021 for a period ofmore than six months from the date they became payable.

(b) According to the information and explanations given to us therewere no dues of the Income Tax Goods and Service Tax and Service Tax which have not beendeposited by the Company on account of any dispute except income tax demand of Rs. 38.78lakhs for the assessment year 2010-11 under the Income Tax Act 1961 pending before theCommissioner of Income Tax (Appeal). The Company had paid Rs. 7.76 lakhs under protestagainst this demand.

(viii) In our opinion and according to the information and explanationsgiven to us the Company has not taken any loan or borrowing from financial institutionBank or government. There was no default in payment of dues to the debenture holder duringthe year.

(ix) According to the information and explanations given to us theCompany has not raised any money by way of initial public offer or further public offer(including debt instruments) or term loan during the year. Accordingly the clause (ix) ofparagraph 3 of the Order is not applicable to the Company.

(x) To the best of our knowledge and according to the information andexplanations given to us no fraud by the Company or on the Company by its officers oremployees has been noticed or reported during the year.

(xi) According to the information and explanations given to us themanagerial remuneration paid/ provided by the Company during the year is in accordancewith the provisions of Section 197 of the Act.

(xii) In our opinion and according to the information and explanationsgiven to us the Company is not a Nidhi Company. Accordingly the clause (xii) ofparagraph 3 of the Order is not applicable to the Company.

(xiii) In our opinion and according to the information and explanationsgiven to us all transactions made with the related parties are in compliance with Section177 and 188 of the Act where applicable and the details of related party transactionshave been disclosed in the financial statements as required by the applicable accountingstandards.

(xiv) According to the information and explanations given to us theCompany has not made any preferential allotment or private placement of shares or fully orpartly convertible debentures during the year under review. Accordingly the clause (xiv)of paragraph 3 of the Order is not applicable to the Company.

(xv) In our opinion and according to the information and explanationsgiven to us the Company has not entered into any non-cash transactions with its directorsor persons connected with them as per provisions of Section 192 of the Act.

(xvi) According to the information and explanations given to us theCompany is not required to be registered under Section 45–IA of the Reserve Bank ofIndia Act 1934.

For CHATURVEDI & PARTNERS
Chartered Accountants
Firm Registration No. 307068E
LAXMI NARAIN JAIN
Partner
New Delhi Membership No. 072579
June 30 2021 UDIN – 21072579AAAAAU4230

ANNEXURE ‘‘B'' to the Independent Auditor'sReport

(Referred to in paragraph 2(f) under ‘Report on Other Legal andRegulatory Requirements' section of our report 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 financialreporting of SAHARA HOUSINGFINA CORPORATION LIMITED ("the Company") as of March31 2021 in conjunction with our audit of the financial statements of the Company for theyear ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (‘the Guidance Note') issued by the Institute of CharteredAccountants of India (‘ICAI'). These responsibilities include the designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring the orderly and efficient conduct of its business includingadherence to company's policies the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial information as required under the Act.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company'sinternal financial controls over financial reporting based on our audit. We conducted ouraudit in accordance with the Standards on Auditing prescribed under Section 143(10) of theAct and the Guidance Note issued by the ICAI to the extent applicable to an audit ofinternal financial controls. Those Standards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects. Our audit involves performing procedures to obtain audit evidence about theadequacy of the internal financial controls over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of such internal financial controls assessing the risk that amaterial weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the Company's internal financial controls system over financialreporting.

Meaning of Internal Financial Controls Over financial reporting

A company's internal financial control over financial reporting isa process designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financialcontrols 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 financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorizations of management and directors of thecompany; and

(3) provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition use or disposition of the company's assetsthat could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over financialreporting

Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion to the best of our information and according to theexplanations given to us the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 2021 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note issued by theICAI.

For CHATURVEDI & PARTNERS
Chartered Accountants
Firm Registration No. 307068E
LAXMI NARAIN JAIN
Partner
New Delhi Membership No. 072579
June 30 2021 UDIN – 21072579AAAAAU4230

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