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Sky Industries Ltd.

BSE: 526479 Sector: Industrials
NSE: N.A. ISIN Code: INE765B01018
BSE 00:00 | 19 Aug 82.00 -0.85
(-1.03%)
OPEN

81.20

HIGH

86.00

LOW

79.20

NSE 05:30 | 01 Jan Sky Industries Ltd
OPEN 81.20
PREVIOUS CLOSE 82.85
VOLUME 1880
52-Week high 108.75
52-Week low 61.25
P/E 14.11
Mkt Cap.(Rs cr) 64
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 81.20
CLOSE 82.85
VOLUME 1880
52-Week high 108.75
52-Week low 61.25
P/E 14.11
Mkt Cap.(Rs cr) 64
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sky Industries Ltd. (SKYINDUSTRIES) - Auditors Report

Company auditors report

To

The Members of

Sky Industries Limited

Report on the Audit of Financial Statements

Opinion

We have audited the accompanying financial statements of Sky IndustriesLimited ('the Company') which comprise the Balance Sheet as at 31st March 2021 theStatement of Profit and Loss (including Other Comprehensive Income) Statement of Changesin Equity and statement of cash flows for the year then ended and notes to financialstatements including a summary of the significant accounting policies and otherexplanatory information.

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid 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 Accounting Standards prescribed under section 133 onthe Act read with the Companies (Indian Accounting Standards) Rules 2015 as amended("Ind AS") and other accounting principles generally accepted in India of thestate of affairs of the Company as at 31st March 2021 and its profit othercomprehensive income the changes in equity and its cash flows for the year ended on thatdate.

Basis for Opinion

We conducted our audit of the financial statements in accordance withthe Standards on Auditing (SA's) specified under section 143(10) of the Act. Ourresponsibilities under those SA's 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 thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the ICAI's Code of Ethics. We believe that theaudit evidence we have obtained is sufficient and appropriate to provide a basis for ouropinion on the financial statements.

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 audit mattersto be communicated in our report.

Key Audit Matter How the matter was addressed in our audit
Revenue Recognition Our audit procedures included :
Revenue from sale of goods is recognized when control of the products being sold is transferred to the customer and when there are no longer any unqualified obligations. The performance obligations in the contracts are fulfilled at the time of dispatch delivery or upon formal customer acceptance depending on customer terms. • We assessed the appropriateness of the revenue recognition accounting policies including those relating to rebates and discounts by comparing with applicable accounting standards
• We performed substantive testing by selecting samples of revenue transactions recorded during the year by verifying the underlying documents which included goods dispatch notes and shipping documents
Revenue if one of the key profit drivers and is therefore susceptible to misstatement. Cut-off is the key assertion in so far as revenue recognition is concerned since an inappropriate cut-off can result in material misstatement of results for the year.
• We performed cut-off testing for samples of revenue transactions recorded before and after the financial year end date by comparing with relevant underlying documentation which included goods dispatch notes and shipping documents to assess whether the revenue was recognized in the correct period.
Revenue is measured at fair value of the consideration received or receivable after the deduction of any trade discounts volume rebates and any taxes or duties collected on behalf of the government such as goods and services tax etc. Accumulated experience is used to estimate the provisions for discounts and rebates. Revenue is only recognized to the extent that it is highly probable a significant reversal will not occur. • We tested the design implementation and operating effectiveness of controls over the calculations of discounts and ebates
• We assessed manual journals posted to revenue to identify unusual items.
Provision for taxation and other significant provisions Our audit procedures included :
Accrual for tax and other contingencies requires the management to make judgements and estimates in relation to the issues and exposures arising from a range of matters relating to direct tax indirect tax transfer pricing arrangements claims and other eventualities arising in the regular course of business • We tested the effectiveness of controls around the recognition of provisions
• We used our subject matter experts to assess the value of material provisions in light of the nature of the exposures applicable regulations and related correspondence with the authorities.
The key judgements lies in the estimations of the provisions where they may differ from the future obligations. By nature provision is difficult to estimate and includes many variables.
• We challenged the assumptions and critical judgements made by the management which impact their estimate of the provisions required considering judgments previously made by the authorities in the relevant jurisdictions or any relevant opinions given by the Company's advisors and assessing whether there was an indication of management bias.
• We discussed the status in respect of significant provisions with the Company's internal tax team and consultant as well.
• We performed retrospective review of management judgements relating to accounting estimate included in the financial statement of prior year and compared with the outcome.

Information Other than the Financial Statements and Auditor's ReportThereon

The Company's management and Board of Directors are responsible for theother information. The other information comprises the information included in theCompany's annual report but does not include the financial statements and ourauditor's report thereon.

Our opinion on the financial statements does not cover the otherinformation and we do not and will 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. 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.

Management's Responsibility for the Financial Statements

The Company's management and Board of Directors are responsible for thematters stated in Section 134(5) of the Companies Act 2013 ("the Act") withrespect to the preparation and presentation of these financial statements that give a trueand fair view of the financial position financial performance including othercomprehensive income cash flows and changes in equity of the Company in accordance withIndian Accounting Standards (Ind AS) prescribed under Section 133 of the Act read withCompanies (Indian Accounting Standards) Rules 2015 as amended and other accountingprinciples generally accepted in India. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.

In preparing the financial statements management and Board ofDirectors are responsible for assessing the Company's ability to continue as a goingconcern disclosing as applicable matters related to going concern and using the goingconcern basis of accounting unless management either intends to liquidate the Company orto cease operations or has no realistic alternative but to do so.

The Board of Directors is also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibility for the Ind AS 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. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken 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 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 in the standalone financialstatements made by management and Board of Directors.

• Conclude on the appropriateness of management's and Boardof Director use of the going concern basis of accounting and based on the audit evidenceobtained whether a material uncertainty exists related to events or conditions that maycast significant doubt on the Company's ability to continue as a going concern. If weconclude that a material uncertainty exists we are required to draw attention in ourauditor's report to the related disclosures in the financial statements or if suchdisclosures are inadequate to modify our opinion. Our conclusions are based on the auditevidence obtained up to the date of our auditor's report. However future events orconditions may cause the Company to cease to continue as a going concern.

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

Materiality is the magnitude of misstatements in the financialstatements that individually or in aggregate makes it probable that the economicdecisions of a reasonably knowledgeable user of the financial statements may beinfluenced. We consider quantitative materiality and qualitative factors in (i) planningthe scope of our audit work and in evaluating the results of our work; and (ii) toevaluate the effect of any identified misstatements in the financial statements.

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 standalonefinancial statements of the current period and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.

Report on Other Legal and Regulatory Requirements

1. As required by Section 197(16) of the Act we report that theCompany has paid remuneration to its directors during the year in accordance with theprovisions of and limits laid down under Section 197 read with Schedule V to the Act.

2. 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 section 143 of the Act we give in the 'Annexure A" a statement on thematters specified in the paragraph 3 and 4 of the order to the extend applicable.

3. 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 have beenkept by the Company so far as it appears from our examination of those books;

(c) The standalone balance sheet the standalone statement of profitand loss (including other comprehensive income) standalone statement of changes in equityand standalone statement of cash flow dealt with by this Report are in agreement with thebooks of account;

(d) In our opinion the aforesaid standalone financial statementscomply with the Indian Accounting Standards prescribed under Section 133 of the Act

(e) On the basis of the written representations received from thedirectors as on 31st March 2021 taken on record by the Board of Directors none of thedirectors is disqualified as on 31st March 2021 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"; and

(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 has disclosed the impact of pending litigations (if any)as at 31st March 2021 on its financial position in its standalone financial statements -Refer Note 33 to the standalone financial statements;

ii. The Company has made provision as required under the applicablelaw or accounting standards for material foreseeable losses if any on long-termcontracts including derivative contracts.

iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund.

For CGCA & Associates
Chartered Accountants
Firm Regn No.: 123393W
sd/-
Champak K. Dedhia
Mumbai Partner
27th April 2021 Membership No: 101769
UDIN: 21101769AAAAJE8071

Annexure - A to the Independent Auditors' Report

The Annexure referred to in Independent Auditors' Report to the membersof the Company on the financial statements for the year ended 31st March 2021 we reportthat:

1. Fixed Assets

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

b. As explained to us the Company has a phased program for physicalverification of the fixed asset of the company to cover all locations. In our opinion thefrequency of verification is reasonable considering the size of the Company. No materialdiscrepancies were noticed on such verification carried on during the year as comparedwith the available records.

c. According to the information and explanation given to us and on thebasis of our examination of the records of the Company the title deeds of immovableproperties are held in the name of the company.

2. Inventory

The inventory of finished goods raw materials components stores andspare parts except those lying with third parties and in transit has been physicallyverified by the management at regular intervals which we consider to be reasonable. Thediscrepancies noticed during the physical verification of inventories as compared to bookrecords were not material and have been property dealt with in the books of account.

3. Loans and Advances granted

The Company has granted an advance to a Company covered in the registermaintained under section 189 of the Companies Act 2013 ('the Act').

(a) In respect of the aforesaid loan the rate of interest and otherterms and conditions on which the loans had been granted are not prima facie prejudicialto the interest of the Company.

(b) The said loans are repayable on demand and are not overdue. Thepayment of principal and interest from the said parties are regular in nature.

(c) There are no overdue amounts in respect of the loan granted to theCompany listed in the register maintained under section 189 of the Act.

4. Compliances with Sections 185 and 186 in case of loans investmentsguarantees and security:

According to the information and explanation given to us the companyhas complied with the provisions of section 185 and 186 of the Companies Act 2013 withrespect to the loans given and investments made.

5. Deposits:

The Company has not accepted any deposit from the public and hence thedirectives issued by Reserve Bank of India and provision of section 73 to 76 or any otherrelevant provisions of the Act and the Rule framed there under are not applicable.

6. Cost Records:

We have broadly reviewed the books of account maintained by the companypursuant to the Rules made by the Central Government of India maintenance of cost recordshas been prescribed under sub-section (1) of section 148 of the Companies Act 2013 andare of the opinion that prima facie the prescribed accounts and records have been madeand maintained. However we have not made detailed examination of the records.

7. Statutory Dues:

According to the information and explanations given to us in respectof statutory dues:

a. The Company has been regular in depositing undisputed statutorydues including Provident Fund Employee's State Insurance Income-Tax Custom Duty CessExcise Duty Goods and Service Tax and other material statutory dues applicable to it tothe appropriate authorities.

b. There were no undisputed amounts payable in respect of ProvidentFund Employee's State Insurance Income-Tax Custom Duty Cess Excise Duty Goodsand Service Tax and other material statutory dues in arrears as at 31st March 2021 for aperiod of more than six months from the date they become payable except the following:

Name of the statute Nature of dues Amount (in Rs) Period to which the amount relates
Navi Mumbai Municipal Corporation Property Tax 515859/- Various Years
Navi Mumbai Municipal Corporation Cess 2648397/- Various Years

c. Details of statutory dues which have not been deposited as on 31stMarch 2021 on account of disputes are given below :

Name of the statute Nature of dues Amount (in Rs) Period to which the amount relates
Navi Mumbai Municipal Corporation Property Tax 30535635/- Various Years

8. Dues To Financial Institutions/Banks

Based on our audit procedures and on the basis of information andexplanations given by the management we are of the opinion that the Company has notdefaulted in the repayment of dues to financial institutions banks governments ordebenture holders.

9. Application of Initial Public Offer / Term Loans

The Company has not raised any moneys by way of initial public offerfurther public offer (including debt instruments). The Company has during the year availeda term loan from Kotak Mahindra Bank Ltd. under the Emergency Credit Line Guarantee Schemeof National Credit Guarantee Trustee Company Ltd. in order to meet its working capitalrequirements. Based on our audit procedures and on the basis of information andexplanations given by the management we are of the opinion that the said loan has beenapplied for the purpose for which it was raised.

10. Frauds:

According to the information and explanations given to us no materialfraud by the Company or on the Company by its officers or employees has been noticed orreported during the course of our audit.

11. Managerial Remuneration:

According to the information and explanations give to us and based onour examination of the records of the Company the Company has paid/provided formanagerial remuneration in accordance with the requisite approvals mandated by theprovisions of section 197 read with Schedule V to the Act.

12. Nidhi Companies:

In our opinion and according to the information and explanations givento us the Company is not a Nidhi company. Accordingly paragraph 3(xii) of the Order isnot applicable.

13. Compliances with Sections 177 and 188 in case of transactions withrelated parties:

According to the information and explanations given to us and based onour examination of the records of the Company transactions with the related parties arein compliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the standalone financial statements as required by theapplicable Indian Accounting Standards.

14. Preferential allotment or private placement of shares/debentures:

According to the information and explanations given to us the Companyhas made preferential allotment of equity shares and convertible warrants during the yearunder audit in compliance with the requirements of Section 42 of Companies Act 2013. Theamounts raised have not been utilised during the year.

15. Compliances with Sections 192 in case of non cash transactions withDirectors:

According to the information and explanations given to us and based onour examination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

16. The Company is not required to be registered under section 45-IA ofthe Reserve Bank of India Act 1934. Accordingly paragraph 3(xvi) of the Order is notapplicable to the Company.

For CGCA & Associates
Chartered Accountants
Firm Regn No.: 123393W
sd/-
Champak K. Dedhia
Mumbai Partner
27th April 2021 Membership No: 101769
UDIN: 21101769AAAAJE8071

Annexure - B to the Auditors' Report

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

Opinion

We have audited the internal financial controls over financialreporting of Sky Industries Limited ("the Company") as of 31st March 2021 inconjunction with our audit of the financial statements of the Company for the year endedon that date.

In our opinion the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31st March 2021 basedon 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.

Management's Responsibility for Internal Financial Controls

The Company's management and the Board of Director are responsible forestablishing and maintaining internal financial controls based on the internal financialcontrols with reference to financial statements 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 ('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 theCompanies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company'sinternal financial controls over financial reporting based on our audit. We have conductedour audit in accordance with the Guidance Note on Audit of Internal Financial Controlsover Financial Reporting (the "Guidance Note") and the Standards on Auditingissued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act2013 to the extent applicable to an audit of internal financial controls both applicableto an audit of Internal Financial Controls and both issued by the Institute of CharteredAccountants of India. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate 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 financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgement including the assessment ofthe risks of material misstatement of the standalone financial statements whether due tofraud 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 with reference to FinancialStatements

A company's internal financial controls with reference to financialstatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposesin accordance with generally accepted accounting principles. A company's internalfinancial controls with reference to financial statements include those policies andprocedures 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 as necessary topermit preparation of financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and (3)provide reasonable assurance regarding prevention or timely detection of unauthorisedacquisition use or disposition of the company's assets that could have a material effecton 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.

For CGCA & Associates
Chartered Accountants
Firm Regn No.: 123393W
sd/-
Champak K. Dedhia
Mumbai Partner
27th April 2021 Membership No: 101769
UDIN: 21101769AAAAJE8071

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