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Shradha Infraprojects Ltd.

BSE: 535035 Sector: Infrastructure
NSE: SHRADHA ISIN Code: INE715Y01015
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Shradha Infraprojects Ltd. (SHRADHA) - Auditors Report

Company auditors report

To the Members of

Shradha Infraprojects Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements ofShradha Infraprojects Limited ("the Company") which comprise the Balance Sheetas at 31st March 2020 and the Statement of Profit and Loss Statement of Changes inEquity and Statement of Cash Flows for the year then ended and notes to the financialstatements including a summary of significant accounting policies and other explanatoryinformation (hereinafter referred to as "Standalone Financial Statements").

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone financial statements give theinformation required by 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 March 312020 and profit and its cash flows for the yearended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing(SAs) specified under section 143(10) of the Companies Act 2013. Our responsibilitiesunder those Standards are further described in the Auditor's Responsibilities for theAudit of the Financial Statements section of our report. We are independent of the Companyin accordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the financial statements of the current period.These matters were addressed in the context of our audit of the financial statements as awhole and in forming our opinion thereon and we do not provide a separate opinion onthese matters.

We have determined the matters described below to be the key auditmatters to be communicated in our report:

Sr. No. Key Audit Matter How our audit addressed the key audit matter
1 Recognition of Revenue measurement presentation and disclosure as per AS-9 "Revenue Recognition". (Refer Note 2.4 of Accounting policy) • We performed walkthroughs to understand the key processes and identify key controls related to AS 9 "Revenue from operation" and "Other Income"
• On a sample basis we performed the testing to verify that revenue from services are recognised when services are completed.
• Selected a sample of service contracts and read analyse & identified the distinct performance obligations in these contracts. Based on our audit procedures we have concluded that revenue is appropriately recognised that there was no evidence of management bias.
2 Inventories (Refer Note 2.3 of Accounting policy): • Discuss the management to understand the basis of calculation and justification for the estimated recoverable amounts of the unsold units ("the NRV assessment");
Inventories comprising work-inprogress stock-in-trade units in building represents a significant portion of the Company's total assets.
• Evaluating the management's valuation methodology and assessing the key estimates data inputs and assumptions adopted in the valuations which included comparing expected future average selling prices with available market data such as recently transacted prices for similar properties located in the nearby vicinity of each property development project and the sales budget plans maintained by the Company; and
Forecasts of future sales are dependent on market conditions which can be difficult to predict and be influenced by political and economic factors.
Further due to their materiality in the context of total assets of the Company this is considered significant to our overall audit. • Verifying the NRV assessment and comparing the estimated construction costs to complete each development with the Company's updated budgets.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters statedin section 134(5) of the Companies Act 2013 ("the Act") with respect to thepreparation of these standalone financial statements that give a true and fair view of thefinancial position financial performance changes in equity and cash flows of the Companyin accordance with the accounting principles generally accepted in India including theaccounting Standards specified under section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation 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 statement that givea 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 as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

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

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether theStandalone Financial Statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditors' report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these Standalone Financial Statements.

As 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 theStandalone Financial Statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control.

• Obtain an understanding of internal control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. UnderSection 143(3)(i) of the Act we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls with reference to financialstatements 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 management.

• Conclude on the appropriateness of management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditors' report to therelated disclosures in the financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditors' report. However future events or conditions may cause the Companyto cease to continue as a going concern.

• Evaluate the overall presentation structure and content of theStandalone Financial Statements including the disclosures and whether the StandaloneFinancial Statements represent the underlying transactions and events in a manner thatachieves fair presentation.

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

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards. From the matterscommunicated with those charged with governance we determine those matters that were ofmost significance in the audit of the Standalone Financial Statements for the financialyear ended March 312020 and are therefore the key audit matters. We describe thesematters in our auditors' report unless law or regulation precludes public disclosure aboutthe matter or when in extremely rare circumstances we determine that a matter should notbe communicated in our report because the adverse consequences of doing so wouldreasonably be 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 ("theOrder") issued by the Central Government of India

in terms of sub-section (11) of section 143 of the Companies Act 2013we give in the "Annexure A" a statement on the

matters specified in paragraphs 3 and 4 of the Order to the extentapplicable.

As required by Section 143(3) of the Act we report that:

(a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit.

(b) In our opinion proper books of account as required by law havebeen kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet the Statement of Profit and Loss and the CashFlow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion the aforesaid standalone financial statementscomply with the Accounting Standards specified under Section 133 of the Act read withRule 7 of the Companies (Accounts) Rules 2014.

(e) On the basis of the written representations received from thedirectors as on 31st March 2020 taken on record by the Board of Directors none of thedirectors is disqualified as on 31st March 2020 from being appointed as a director interms of Section 164 (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 controlsrefer to our separate Report in "Annexure B".

(g) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 inour opinion and to the best of our information and according to the explanations given tous:

i. The Company does not have any pending litigations which would impactits financial position.

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

iii. There were no amounts which were required to be transferred to theInvestor Education and Protection Fund by the Company.

For Paresh Jairam Tank & Co.
Chartered Accountants
Firm Reg. No. 139681W
CA. Paresh Jairam Tank
Partner
Membership No.: 103605
Nagpur June 29 2020 UDIN: 20103605AAAACL5137

Annexure A to the Independent Auditors' Report

Report Referred to in paragraph 1 under the heading 'Report on OtherLegal & Regulatory Requirement' of our report of even date to the members of M/s.Shradha Infraprojects Limited ("the Company") financial statements of theCompany for the year ended March 312020:

I) In respect of the Company's Fixed Assets

a) The Company has maintained proper records showing full particularsincluding quantitative details and situation of fixed assets.

b) In our opinion these fixed assets have been physically verified bythe management at reasonable intervals having regard to the size of the company and thenature of its assets. No material discrepancies between the book records and the physicalinventory were noticed.

c) The title deeds of immovable properties are held in the name of thecompany.

ii) As explained to us the inventories were physically verified duringthe year by the management at reasonable intervals and no material discrepancies werenoticed on such physical verification.

iii) The Company has not granted loans secured or unsecured to thecompanies firm LLP and other parties covered in the register maintained under Section189 of the Act. Therefore reporting requirement under Para 3 (iii) (a) to (c) of theOrder is 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 to the loans and investments made and/or guarantee and securityprovided to that extent applicable.

v) The Company has not accepted any deposits from the public. Thereforereporting requirement under Para 3 (v) of the Order is not applicable to the Company.

vi) To the best of our knowledge the maintenance of cost records undersub-section (1) of Section 148 of the Companies Act 2013 prescribed by the CentralGovernment is not required for the Company.

vii) a) According to the records of the Company the Company is regularin depositing with appropriate authorities

undisputed statutory dues including income-tax Goods and Service taxand other statutory dues as applicable to it. There are no outstanding statutory dues at31st March 2020 for a period of more than 6 months from the date they becamepayable.

b) According to the Information and explanation given to us there areno dues of income tax Goods and Service tax and other statutory dues which have not beendeposited on account of any dispute.

viii) The Company has not borrowed any amount from financialinstitution bank Government or issued any debentures therefore reporting requirementunder Para 3 (viii) of the Order is not applicable to the Company.

ix) The Company has not raised any money by way of initial public offeror further public offer (including debt instruments) during the year and there is no termloans which was borrowed by the company. Therefore reporting requirement under Para 3(ix) of the order is not applicable.

x) According to the information and explanations given to us nomaterial fraud by the Company or on the Company by its officers or employees has beennoticed or reported during the course of our audit. Therefore reporting requirement underPara 3 (x) of the order is not applicable to the Company.

xi) Since no managerial remuneration has been paid during the periodreporting requirement under Para 3 (xi) of the Order is not applicable to the Company.

xii) In our opinion and according to the information and explanationsgiven to us the Company is not a Nidhi Company. Therefore reporting requirement underPara 3 (xii) of the order is not applicable to the Company.

xiii) According to the information and explanations given to us andbased on our examination of the records of the Company the Company is in compliance withSection 177 and 188 of the Companies Act 2013 where applicable for all transactions withthe related parties and the details of related party transactions have been disclosed inthe standalone financial statements as required by the applicable accounting standards.

xiv) According to the information and explanations give to us and basedon our examination of the records of the Company the Company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the year. Therefore reporting requirement under Para 3 (xiv) of theOrder is not applicable to the Company.

xv) According to the information and explanations given to us and basedon our examination of the records of the Company the Company has not entered intonon-cash transactions with directors or persons connected with it. Therefore reportingrequirement under Para 3 (xv) of the Order is not applicable to the Company.

xvi) The Company is not required to be registered under Section 45-IAof the Reserve Bank of India Act 1934. Therefore reporting requirement under Para 3(xvi) of the Order is not applicable to the Company.

For Paresh Jairam Tank & Co.
Chartered Accountants
Firm Reg. No. 139681W
CA. Paresh Jairam Tank
Partner
Membership No.: 103605
Nagpur June 29 2020 UDIN: 20103605AAAACL5137

Annexure - B to the Independent Auditors' Report

Report on the Internal Financial Controls under Clause (i) ofSub-Section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financialreporting of M/s. Shradha Infraprojects Limited ("the Company") as of 31stMarch 2020 in conjunction with our audit of the Standalone Financial Statements of theCompany for the year 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 issued by the Institute of Chartered Accountants of India("ICAI"). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence tocompany's policies the safe guarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Control over FinancialReporting (the "Guidance Note") and the Standards on Auditing issued by ICAIand deemed to be prescribed under Section 143(10) of the Companies Act 2013 to theextent applicable to an audit of internal financial controls both applicable to an auditof Internal Financial Controls and both issued by the Institute of Chartered Accountantsof India. Those Standards and the Guidance Not 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 aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over 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 procedures selected depend on the auditor's judgment including theassessment of the risks of material misstatement of the financial statements whether dueto fraud or error. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

The Company's internal financial control over financial reporting is aprocess 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. The Company's internal financial controlover financial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the Company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financial

statements in accordance with generally accepted accounting principlesand that receipts and expenditures of the Company are being made only in accordance withauthorizations of management and directors of the Company; and

(3) provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition use or disposition of the Company's assets thatcould have a material effect on the 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 31st March 2020based on the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the Institute ofChartered Accountants of India.

For Paresh Jairam Tank & Co.
Chartered Accountants
Firm Reg. No. 139681W
CA. Paresh Jairam Tank
Partner
Membership No.: 103605
Nagpur June 29 2020 UDIN: 20103605AAAACL5137

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