TO THE MEMBERS OF SHETRON LIMITED Report on the Audit of the Standalone FinancialStatements
We have audited the accompanying Ind AS financial statements of SHETRON LIMITED(referred to as "the Company") which comprise the Balance Sheet as at 31 March2021 the Statement of Profit and Loss (including other comprehensive income) the CashFlow Statement and the Statement of Changes in Equity for the year then ended and asummary of the significant accounting policies and other explanatory information(hereinafter referred to as "the Ind AS financial statements").
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by theCompanies Act 2013 ("the Act") in the manner so required and give a true andfair view inconformity with the India Accounting Standards prescribed under section 133read with the Companies(Indian Accounting Standards) Rules 2015 as amended ("IndAS")and other accounting principles generally accepted in India of the state ofaffairs of the company as at March 31 2021 and its loss changes in equity and its cashflows for the year ended on that date.
Basis for Opinion
We conducted our audit of the financial statements in accordance with the Standards onAuditing specified under section 143(10) of the Act (SAs). Our responsibilities underthose Standards are further described in the Auditor's Responsibilities for the Audit ofthe Financial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia (ICAI) together with the independence requirements that are relevant to our audit ofthe financial statements under the provisions of the Act and the Rules made thereunderand we have fulfilled our other ethical responsibilities in accordance with theserequirements and the ICAI's Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion on thefinancial statements.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Standalone Financial Statements of the current period.These matters were addressed in the context of our audit of the Standalone 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 Matters
|S.No Key Audit Matters ||Auditor's Response |
|1. The valuation of sale of assets held for disposal Rs.40 lakhs as mentioned in Note No 34 ||Due to adverse market conditions the sale of some of the assets did not take place. The value of assets came down and hence re-valued based on present conditions covid outbreak and the difference has been treated as stated in Note 34. The present values are supported by valuation of technical experts in the company. Considering the present low value appearing on the Balance Sheet the same is close to realisable value. |
Information Other than the Financial Statements and Auditor's Report Thereon
The Company's Board of Directors are responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexures to Board's Report BusinessResponsibility Report Corporate Governance and Shareholder's Information but does notinclude the financial statements and our auditor's report thereon.
Our opinion on the financial statements does not cover the other information and we donot express any form of assurance conclusion thereon.
In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained during thecourse of our audit or otherwise appears to be materially misstated. If based on the workwe 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 Financial Statements
The Company's Board of Directors is responsible for the preparation of these Ind ASfinancial statements in terms of the requirements of the Companies Act 2013 that give atrue and fair view of the financial position financial performance including othercomprehensive income cash flows and changes in equity of the Company is in accordancewith the accounting principles generally accepted in India including the IndianAccounting Standards (Ind AS) prescribed under Section 133 of the Companies Act 2013 readwith relevant rules issued there under.
The respective Board of Directors of the companies included in the Company areresponsible for maintenance of adequate accounting records in accordance with theprovisions of the Act for safeguarding the assets of the Company and for preventing anddetecting frauds and other irregularities; the selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; andthe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the Ind AS financial statementsthat give a true and fair view and are free from material misstatement whether due tofraud or error which have been used for the purpose of preparation of the Ind ASfinancial statements by the Directors of the Company as aforesaid. The respective Boardof Directors of the Company are responsible for overseeing the Company's financialreporting process.
Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act we report to the extent applicable basedon our audit that:
a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.
c) The Balance Sheet the Statement of Profit and Loss including Other ComprehensiveIncome Statement of Changes in Equity and the Statement of Cash Flow dealt with by thisReport are in agreement with the relevant books of account.
d) In our opinion the aforesaid financial statements comply with the Ind AS specifiedunder Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.
e) On the basis of the written representations received from the directors as on March312021 taken on record by the Board of Directors none of the directors is disqualifiedas on March 312021 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". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.
g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended:
h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:
1. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements.
ii. The Company did not have any derivative contracts but have provided as requiredunder the applicable law or accounting standards for material foreseeable losses if anyon long-term contracts.
iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
2. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"Annexure B" a statement on the matters specified in paragraphs 3 and 4 of theOrder.
ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT
(Referred to in paragraph 1(f) under 'Report on Other Legal and RegulatoryRequirements' section of our report to the Members of SHETRON LIMITED of even date)
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of SHETRONLIMITED ("the Company") as of March 312021 in conjunction with our audit of thefinancial statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to respective company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.
Our responsibility is to express an opinion on the internal financial controls overfinancial reporting of the Company based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") issued by the Institute of Chartered Accountantsof India and the Standards on Auditing prescribed under Section 143(10) of the CompaniesAct 2013 to the extent applicable to an audit of internal financial controls. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects.
Our audit involves 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 judgement 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 internal financial controls system overfinancial reporting of the Company.
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that
(1) pert ain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.
Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.
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 March 312021 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 Institute of Chartered Accountants ofIndia.
Annexure B to Independent Auditors' Report of Shetron Limited (on financial statements)for the Year Ended 31.3.2021.
(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) The Company has a regular programme of physical verification of its fixed assets bywhich all fixed assets are verified in a phased manner over a period of two years. Inaccordance with this programme a portion of the fixed assets has been physically verifiedby the management during the year and no material discrepancies have been noticed on suchverification. In our opinion this periodicity of physical verification is reasonablehaving regard to the size of the Company and the nature of its assets. All title deedsrelating to immovable properties of the Company are held in the name of the Company.
(ii) (a) The inventory except goods-in-transit has been physically verified by themanagement during the year. In respect of inventory lying with third parties these havesubstantially been confirmed by them. In our opinion the frequency of such verificationis reasonable.
(b) The procedures for the physical verification of inventories followed by themanagement are reasonable and adequate in relation to the size of the Company and thenature of its business.
(c) The Company is maintaining proper records of inventory. The discrepancies noticedon verification between the physical stocks and the book records were not material.
(iii) The Company has not granted any loans secured or unsecured to companies firmsor other parties covered in the register maintained under Section 189 of the Act duringthe year under review.
(iv) The company has not granted any loans or provided guarantees and security forwhich section 185 and 186 of the Companies Act 2013 are applicable during the year underreview. The investments made were in compliance of Section 185 and 186 of the CompaniesAct 2013.
(v) The Company has not accepted any deposits from the public in accordance with theprovisions of sections 73 to 76 of the Act and the rules framed there under.
(vi) We have broadly reviewed the records maintained by the Company pursuant to therules prescribed by the Central Government for maintenance of cost records undersub-section 1 of Section 148 of the Act and are of the opinion that prima facie theprescribed accounts and records have been made and maintained. However we have not made adetailed examination of the records.
(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 Employees' StateInsurance Income tax Sales tax Wealth tax Service tax Customs duty Excise dutyValue added tax Cess Professional tax and other material statutory dues have beenregularly deposited during the year by the Company with the appropriate authorities.
According to the information and explanations given to us no undisputed amountspayable in respect of Provident Fund Employees' State Insurance Income-tax Sales taxWealth tax Service tax Customs duty Excise duty Value added tax Cess ProfessionaltaxGST and other material statutory dues were in arrears as at March 312021 for a periodof more than six months from the date they became payable.
(b) According to the information and explanations given to us there are no dues ofIncome tax Wealth tax Sales tax Value added tax Service tax Customs duty Excise dutyand CessGST which have not been deposited with the appropriate authorities on account ofany dispute
(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of dues to its bankers or financialinstitutions or Government. The Company did not have any outstanding to debentures holdersduring the year.
(xi) The Company has not raised moneys by way of further public offer (including debtinstruments). In our opinion and according to the information and explanations given tous terms loans raised have been applied by the company for the purpose for which theywere obtained.
(x) According to the information and explanations given to us no instances of materialfraud on or by the Company has been noticed or reported during the course of our audit.
(xi) The company had paid/provided managerial remuneration with requisite approvals ifany under Section 197 read with Schedule V of the Companies Act 2013.
(xii) The Company is not a Nidhi company and hence the provisions of Clause (xii) ofCARO 2016 are not applicable.
(xiii) All transactions with the related parties are in compliance with Section 177 and188 of the Companies Act 2013 wherever applicable and the details of all thosetransactions have been disclosed in Financial Statements and other documents as requiredby the applicable accounting standards.
(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review.
(xv) The Company has not entered into any non-cash transactions with directors orpersons connected with them.
(xvi) The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.