TO THE MEMBERS OF SILVER OAK (INDIA) LIMITED
REPORT ON THE STANDALONE IND AS FINANCIAL STATEMENTS OPINION
We have audited the accompanying standalone financial statements of SILVER OAK(INDIA) LIMITED (the Company) which comprise the Balance Sheet as atMarch 31 2020 the Statement of Profit and Loss (including Other Comprehensive Income)the Statement of Changes in Equity and the Statement of Cash Flows for the year ended onthat date and a summary of the significant accounting policies and other explanatoryinformation (hereinafter referred to as the standalone financial statements).
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 (the Act) in the manner so required and give a trueand fair view in conformity with the Indian Accounting Standards prescribed under section133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015 asamended (Ind AS) and other accounting principles generally accepted in Indiaof the state of affairs of the Company as at March 31 2020 the Loss and totalcomprehensive income changes in equity and its cash flows for the year ended on thatdate.
BASIS FOR OPINION
We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing specified under section 143(10) of the Act (SAs). Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Standalone Financial Statements section of ourreport. We are independent of the Company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India (ICAI) together with the independencerequirements that are relevant to our audit of the standalone financial statements underthe provisions of the Act and the Rules made thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI'sCode ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the standalone financial statements.
KEY AUDIT MATTERS
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current 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 separate opinion on these matters.
MANAGEMENT'S RESPONSIBILITY FOR THE STANDALONE FINANCIAL STATEMENT
The Company's Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 (the Act) with respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance changes in equity and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theaccounting Standards specified under section 133 of
the Act. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statement that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.
The Board of Directors are responsible for overseeing the Company's financial reportingprocess.
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 SA'Swill 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.
As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the standalonefinancial 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 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 events 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 audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.
From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.
EMPHASIS OF MATTER
We draw attention to the notes to the additional notes on accounts no. 22(B)(8) to thestandalone financial statements regarding the inventories amounting to Rs 7886121(PreviousYear -'26654455) which have been shown at cost. As per Ind AS 2 - Valuation ofInventories inventories should be valued at cost or net realizable value whicheveris lower.Such valuation requires technical judgments and consideration of market relatedfactors. Therefore we are unable to comment upon the fair value of such inventory anyprovision for diminution in value of stock and quantification of its impact on financialposition and results of the company. Our report is not qualified in the matter.
We also draw attention to the explanatory notes on accounts no. 22(B)(10) to thestandalone financial statements regarding no provision against loans and advancesamounting to Rs 30.00 lacs(Previous Year - Rs 75.10 lacs). Our report is not qualified inthe matter.
We also draw attention to the accounts of the company that have been prepared on agoing concern basis despite of the accumulated losses. The applicability of the goingconcern assumption is considered to be appropriate on the basis of the business activitiesof the company together with the factors likely to affect its future development and itsperformance along with its financial position and its cash flows. This has been reviewedby the board of directors of the company and the board has reasonable expectation thatthey have adequate resources to continue an operational existence for the foreseeablefuture and maintain Going Concern status of the Company. Our report is not qualified inthe matter.
INFORMATION OTHER THAN THE STANDALONE FINANCIAL STATEMENTS AND AUDITOR'S REPORT THEREON
The Company's Board of Directors is responsible for the preparation of the otherinformation.
The other information comprises the information included in the Management Discussionand Analysis Board's Report including Annexures to Board's Report BusinessResponsibility Report Corporate Governance and Shareholder's Information but does notinclude the standalone financial statements and our auditor's report thereon.
Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained during the course of our audit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude that there is a materialmisstatement of this other information; we are required to report that fact. We havenothing to report in this regard.
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 in terms of section 143 (11) of the Act we give in the AnnexureA a statement on the matters specified in the paragraph 3 and 4 of the Orderto the extent applicable.
2. As required by Section 143 (3) of the Act we report 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 Flows dealt with by thisreport are in agreement with the books of account.
(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Accounting Standards specified under section 133 of the Act read with Companies(Indian Accounting Standards) Rules 2015 as amended.
(e) On the basis of the written representations received from the directors as on March31st 2020 taken on record by the Board of Directors none of the director isdisqualified as on March 31st 2020 from being appointed as a director in terms of Section164 (2) of the Act.
(f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in Annexure B. Our report expresses an unmodifiedopinion on the adequacy and operating effectiveness of the company's internal financialcontrols over financial reporting; and
(g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:
a. The Company has disclosed the impact of pending litigations as at March 31st 2020on its financial position vide Additional Notes on Accounts no. 22(B)(2)(I) in itsstandalone financial statements.
b. Subject to the additional notes on accounts the Company has made adequate provisionas at March 31st 2020 as required under the applicable law or Indian accountingstandards for material foreseeable losses acknowledged by the company if any onlong-term contracts including derivative contracts
c. There is no amount required to be transfer to investor education and protection fundby the company.
| ||Statutory Auditors |
| ||FOR: MAHENDRA BADJATYA & CO |
| ||CHARTERED ACCOUNTANTS |
| ||ICAI FRN 001457C |
| || |
CA M.K BADJATYA
|PLACE: INDORE ||PARTNER |
|DATE:25.07.2020 ||ICAI MNO 070578 |
Annexure - "A" to the Independent Auditor's Report
The Annexure required under CARO 2016 referred to in our Report to the members of the SILVEROAK (INDIA) LIMITED( the Company) for the year ended March 31st 2020 andaccording to the information and explanations given to us we report as under:
(i) (a) The company has maintained adequate records showing general particularsincluding quantitative details and situation of Fixed Assets.
(b) The fixed assets have been physically verified by the management during the year inaccordance with a regular programme of verification which in our opinion is reasonablehaving regard to the size of the company and the nature of its assets. The discrepanciesnoticed on such verification which were not material have been properly dealt with in thebooks of account.
(c) On the basis of our examination of records of the Company we report that TheTitle Deeds comprising all the immovable properties of land & buildings which arefree hold are held in the name of company as at the balance sheet date. In respect oflease hold immovable properties of land and building that have been taken on and disclosedas fixed assets in the standalone financial statements the lease agreements are in thename of the company.
(ii) In our opinion on the basis of our examination of the records of the company theinventories have been physically verified by the management at the reasonable intervalsand the material discrepancies noticed if any has properly been dealt with in the booksof account.
(iii) The company has not granted any loans secured or unsecured companies firmsLimited Liability Partnership or other parties covered in the register maintained undersection 189 of the Companies Act 2013. Therefore clauses (iii) (a) (b) and (c) of theaforesaid order are not applicable.
(iv) During the year the company has not granted any loans guarantees or securities toany party covered under section 185 of the Companies Act 2013 therefore the reportingrequirement of this clause is not applicable to the company. During the year the companyhas not made any investment therefore the provisions of section 186 of the Companies Act2013 are not applicable to the company.
(v) The company has neither invited nor accepted any deposits from the public duringthe year therefore the reporting requirement of the clause is not applicable to thecompany.
(vi) The Company is mainly carrying on the business of Manufacturing of Liquor andaccording to the size of operations the requirements of maintenance of cost records undersub section (1) of section 148 of the Companies Act 2013 are not applicable to theCompany.
(vii) (a) According to the records of the Company it is generally regular indepositing undisputed statutory dues including Provident Fund Employees state insuranceIncome Tax Goods & Service Tax Duty of Custom Duty of Excise Value Added Tax andany other statutory dues whichever is applicable to the company with the appropriateauthorities during the year and no undisputed amounts were outstanding as at March 31st2020 for a period of more than six months from the date they become payable.
(b) There are no dues of Provident Fund Employees state insurance Income Tax Goods& Service Tax Duty of Custom Duty of Excise Value Added Tax and any otherstatutory dues which have not been deposited on account of any dispute.
(viii) The Company has not defaulted in repayment of dues to banks and financialinstitution. There are no debenture holders and loan from government.
(ix) During the year under report the company has not raised any money by way ofinitial public offer or further public offer (including debt instruments) and also notobtained any term loan.
(x) Based upon the audit procedures performed no fraud by the company or any fraud onthe Company by its officers or employees has been noticed or reported during the course ofour Audit.
(xi) The company has not paid any remuneration to any of its directors; therefore thereporting requirement under this clause is not applicable.
(xii) The Company is not a Nidhi company. Accordingly paragraph 3(xii) of the order isnot applicable.
(xiii) In our opinion all transactions with the related parties are in compliance withsection 177 and 188 of Companies Act 2013 wherever applicable and the details have beendisclosed in the standalone financial statements as required by the applicable standards.
(xiv) Based on our examination of the record of the company the company has not madeany preferential allotment or private placement of shares or fully or partly convertibledebentures during the year.
(xv) In our opinion the company has not entered into any non cash transaction withdirectors or persons connected with him; therefore the reporting requirement of the clauseis not applicable to the company.
(xvi) In our opinion and as per the transactions of the company the company is notrequired to be registered u/s 45IA of the Reserve Bank of India Act1934 therefore thereporting requirement of the clause is not applicable to the company.
| ||Statutory Auditors |
| ||FOR: MAHENDRA BADJATYA & CO |
| ||CHARTERED ACCOUNTANTS |
| ||ICAI FRN 001457C |
| || |
CA M.K BADJATYA
| ||PARTNER |
| ||ICAI MNO 070578 |
|PLACE: INDORE || |
|DATE: 25.07.2020 || |
Annexure - "B to the Independent Auditor's Report
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act)
We have audited the internal financial controls over financial reporting of SILVEROAK (INDIA) LIMITED( the Company) as on March 31st 2020 in conjunctionwith our audit of the standalone Ind AS financial statements of the Company for the yearended on that date.
MANAGEMENT'S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
The Company's Management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to the Company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.
Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting with reference to these standalone financial statementsbased on our audit. We conducted our audit in accordance with the Guidance Note on Auditof Internal Financial Controls Over Financial Reporting (the Guidance Note)and the Standards on Auditing as specified under section 143(10) of the Companies Act2013 to the extent applicable to an audit of internal financial controls and both issuedby the Institute of Chartered Accountants of India. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting with reference to these standalone financial statements 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 over financial reporting with reference to thesestandalone financial statements and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting with reference to these standalonefinancial statements assessing the risk that a material weakness exists and testing andevaluating the design and operating effectiveness of internal control based on theassessed 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 and appropriate toprovide a basis for our audit opinion on the internal financial controls over financialreporting with reference to these standalone financial statements.
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) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of thecompany's assets that could have a material 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 explanation givento us the Company has in all material respects a reasonable internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31st 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 FinanceControls Over Financial Reporting issued by The Institute of Chartered Accountants ofIndia.
|Statutory Auditors |
|FOR: MAHENDRA BADJATYA & CO |
|CHARTERED ACCOUNTANTS |
|ICAI FRN 001457C |
|CAM.K BADJATYA |
|ICAI MNO 070578 |
|PLACE: INDORE |
|DATE: 25.07.2020 |