The Members of Servoteach Industries Limited Report on the standalone FinancialStatements
We have audited the financial statements of SERVOTEACH INDUSTRIES LIMITED ("TheCompany") which comprises the Balance Sheet as at 31st March 2021and the Statement of Profit and Loss Statement of Change in Equity and the Statement ofCash Flow for the year then ended and notes to the financial statements including asummary of the significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements gives the information requiredby the Companies Act 2013 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 (financial position) of the company as at March 31 2021 its loss (financialperformance) its changes in equity and its cash flows for the year ended on that date.
Basis for opinion
We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing (SAs) as specified under section 143(10) of the Companies Act 2013.Our responsibilities under those Standards are further described in the AuditorsResponsibilities 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 together with the ethical requirements that are relevantto our audit of the financial statements under the provisions of the Companies Act 2013and the Rules made there under and we have fulfilled our other ethical responsibilitiesin accordance with these requirements and the Code of Ethics. 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 judgement 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 seprate opinion on these matters.
We have determined that there are no key audit matters to communicate in our report.
The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the annual report but dose not includethe 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 the financial statement our responsibility is to readthe other informations and in doing so consider whether the other the other informationis materially inconsistent with financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we concluded that there is a material misstatement of this other informationwe are required to report that fact. We have nothing to report in this regard.
Responsibility of Management for the standalone Financial Statements
The Management and Board of Directors of the Company are responsible for the mattersstated in Section134(5) of the Companies Act 2013 ("the Act") with respect tothe preparation of these standalone financial statements that give a true and fair view ofthe financial position financial performance changes in equity and cash flows of theCompany in accordance with the accounting principles generally accepted in Indiaincluding the Indian Accounting Standards ('Ind AS') specified under Section 133 of theAct read with the Companies (Indian accounting Standards) Rule 2015 as amended. 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 statement the Board of Directors is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessthe Board of Directors either intends to liquidate the Company or to cease operations orhas no realistic alternative but to do so.
Boards of directors are also responsible for overseeing the Company's financialreporting process.
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. Misstatement 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 Standards on Auditing (SAs) we exerciseprofessional judgment and maintain professional skepticism throughout the audit. We also;
Identify and assess the risks of material misstatement of the 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.
Obtain an understanding of internal financial control relevant to the audit inorder to 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 reasonablenessof accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to event 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 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 the standalonefinancial statements including the disclosures and whether the standalone financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.
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 auditt.
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 section143 ofthe Act we give in the Annexure "B" a statement on the matters Specified inparagraphs 3 and 4 of the Order to the extent applicable.
1. As required by section 143(3) of the Act based on our audit we further reportthat:-
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 appears from our examination of those books;
c. The Balance Sheet the Statement of Profit and Loss Statement of Changes in Equityand the Statement of cash flow statement dealt with by this Report are in agreement withthe relevant books of account;
d. In our opinion the aforesaid standalone financial statements comply with theapplicable Accounting Standards specified under Section 133 of the Act read with Rule 7of the Companies (Accounts) Rules 2014.
e. On the basis of written representations received from the directors as on March 312021 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2021 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- "A"
g. With respect to the other materials to be included in the Auditor's Report inaccordance with the requirements of section 197 (16) of the Act as amended;
The Company has not given any remuneration to its directors during the year.
h. In our opinion and to the best of our information and according to the explanationsgiven to us we report as under with respect to other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules2014 as amended;
i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements.
ii. The Company did not have any long-term contracts including derivative contracts; assuch the question of commenting on any material foreseeable losses thereon does not arise.
iii. Since there has been no occasion during the year under report to transfer anysums to the Investor Education and Protection Fund the question of delay in transferringsuch sum does not arise.
Independent Auditor's Report to the Members of SERVOTEACH INDUSTRIES LIMITED. Annexure-"A" to the Auditor's Report
(Annexure referred to in Paragraph 1F under the heading "Report on other legal andregulatory requirements)
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")
In conjunction with our audit of the standalone financial statements of the Company asof and for the year ended 31 March 2019 we have audited the internal financial controlsover financial reporting of Servoteach Industries Limited. ("TheCompany").
Management's Responsibility for Internal Financial Controls
The Respective Board of Directors of the Company are 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 maintenanceof adequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company's policiesthe safeguarding 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 internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls over Financial Reporting(the "Guidance Note") issued by ICAI and the Standards on Auditing prescribedunder section 143(10) of the Companies Act 2013 to the extent applicable to an audit ofinternal financial controls both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate 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 about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the 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 Company's internal financial controls systemover financial reporting.
Meaning of Internal Financial Control 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 authorizations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.
Inherent 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.
In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at 31 March 2020 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the ICAI.
(Annexure referred to in Paragraph 1 under the heading "Report on other legal andregulatory requirements "of Our Report of Even Date.)
On the basis of such checks as we considered appropriate areas according to theinformation and explanation given to us during the course of our audit we state that:
i) In respect of the Companies fixed assets;
(a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) As explained to us the fixed assets have been physically verified by themanagement during the year at reasonable intervals. No material discrepancies were noticedon verification.
(c) According to the records of the company examined by us and as per the informationand explanations given to us the company does not have any immovable property. Thusparagraph 3(ic) of the Order is not applicable to the company.
ii) According to information and explanations given to us the Company does not haveany inventory during the year; therefore the requirements of Clause (ii) of the paragraph3 of said Order are not applicable.
iii) According to information and explanations given to us the Company has not grantedany loans secured or unsecured to companies firms or other parties covered in theregister maintained under section 189 of the Act. Accordingly paragraph 3(iii) of the saidOrder is not applicable.
iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of sections 185 and 186 of the Act in respect ofloans investments guarantees and security to the extent applicable to it.
v) According to the information and explanations given to us the Company has notaccepted any deposits from the public and hence the directives issued by the Reserve Bankof India and provisions of the Companies Act 2013 and rules framed there under are notattracted.
vi) To the best of our knowledge and as explained Central Government has notprescribed the maintenance of cost records under sub-section (1) of Section 148 of theAct for the products of the Company. Therefore the provision of clause 3(vi) of theOrder is not applicable to the Company.
vii) (a) According to the records of the Company and the information and explanationsgiven to us the Company has been generally regular in depositing with appropriateauthorities undisputed statutory dues including provident fund Employees' StateInsurance Income Tax Sales Tax Service Tax Customs Duty Excise Duty Value Added TaxCess and any other statutory dues to the extent applicable to it.
According to the information and explanations given to us and based on the records ofthe company examined by us no undisputed amounts payable in respect of Provident FundEmployees' State Insurance Income Tax Service Tax Sales Tax Customs Duty ExciseDuty Value Added Tax Cess and other material statutory dues were outstanding at theyearend for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us and the records of theCompany examined by us there are no dues of income-tax sales-tax service-tax customsduty and excise duty value added tax except a sum of Rs. 212960/- on account ofProvident Fund.
(viii) Based on our audit procedures and as per the information and explanations givenby the management the Company did not have any loans from banks financial institutionsgovernment or has not issued debentures during the year.
(ix) According to the records of the company examined by us and as per the informationand explanations given to us the Company has not raised any money from any Public Issue /follow-on offer. Including debt instruments and term loan in year under review.
(x) According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.
(xi) According to the records of the company examined by us and as per the informationand explanations given to us the company has not paid/provided managerial remuneration.Therefore the provision of clause 3(xi) of the Order is not applicable to the Company.
(xii) In our opinion the Company is not a chit fund or a nidhi/mutual benefitfund/society. Therefore the provision of clause 3(xii) of the Order is not applicable tothe Company.
(xiii) In our opinion all the transactions with the related parties are in compliancewith sections 177 and 188 of the Act where applicable and the details have been disclosedin the financial statements as required by applicable accounting standard. (Refer to Noteno. 33)
(xiv) The Company has not made any preferential allotment or private placement ofshares or partly or fully convertible debentures during the year therefore reportingunder clause 3(xiv) is not applicable.
(xv) According to the information and explanations given to us we report that theCompany has not entered into any non-cash transaction with directors or persons connectedwith him.
(xvi) In our opinion the Company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934.
|For A.V. Mody & Co LLP |
|Chartered Accountants |
|Firm Reg. No. 117614W |
|(Amit V Mody) |
|UDIN: 21102706AAAAIM9381 |
|Membership No. 102706 |
|Place: Mumbai |
|Date: 20-08-2021 |