Smruthi Organics Ltd.
|BSE: 540686||Sector: Health care|
|NSE: N.A.||ISIN Code: INE172E01011|
|BSE 00:00 | 14 Oct||306.00||
|NSE 05:30 | 01 Jan||Smruthi Organics Ltd|
|Mkt Cap.(Rs cr)||350|
|Mkt Cap.(Rs cr)||350.37|
Smruthi Organics Ltd. (SMRUTHIORGANIC) - Auditors Report
Company auditors report
The Members of Smruthi Organics Limited
REPORT ON THE STANDALONE FINANCIAL STATEMENTS
We have audited the accompanying standalone Ind AS financial statementsof Smruthi Organics Limited ("the Company") which comprise the Balance Sheet asat March 31 2021 the Statement of Profit and Loss (including other comprehensiveIncome) the Cash Flow Statement and the statement of changes of equity for the yearended and a summary of the significant accounting policies and other explanatoryinformation.
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 Ind AS financial statements that give a true and fair viewof the financial position profit or loss (financial performance)including othercomprehensive Income and cash flows and changes in the equity of the Company in accordancewith the accounting principles generally accepted in India including Indian AccountingStandards (Ind AS) specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.
This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding of the assets of theCompany and 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 Standalone Ind AS financial statements that give a true and fair view and are freefrom material misstatement whether due to fraud or error.
Our responsibility is to express an opinion on these Standalone Ind ASfinancial statements based on our audit.
We have taken into account the provisions of the Act the accountingand auditing standards and matters which are required to be included in the audit reportunder the provisions of the Act and the Rules made thereunder.
We conducted our audit of the Standalone Ind AS financial statement inaccordance with the Standards on Auditing specified under Section 143(10) of the Act.Those Standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the Standalone Ind AS financialstatements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence aboutthe amounts and the disclosures in the Standalone Ind AS financial statements. Theprocedures selected depend on the auditor's judgment including the assessment of therisks of material misstatement of the Standalone Ind AS financial statements whether dueto fraud or error. In making those risk assessments the auditor considers internalfinancial control relevant to the Company's preparation of the Standalone Ind AS financialstatements that give a true and fair view in order to design audit procedures that areappropriate in the circumstances.
An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the Standalone Ind ASfinancial statements.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Standalone Ind AS financialstatements.
In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone Ind AS 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 including Ind AS ofthe state of affairs (Financial Position) of the Company as at March 31 2021 and itsprofit (Financial performance including other comprehensive Income) and its cash flows andthe changes in equity for the year ended on that date
1. in case of the Balance Sheet of the state of affairs of the Companyas at 31st March2021
2. in the case of Statement of Profit and Loss of the profit for theyear ended on that date; and
3. in the case of Cash Flow Statement of the cash flows for the yearended on that date.
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 sub-section (11) ofsection 143 of the Act (hereinafter referred to the "Order") and on the basisof such checks of the books and records of the Company as we considered appropriate andaccording to the information and explanations given to us we give in Annexure A astatement on matters specified in paragraphs 3 and 4 of the said order.
2. As Required By Section 143 (3) Of Act
We report that
2.1 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.
2.2 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.
2.3 The Balance Sheet the Statement of Profit and Loss Cash FlowStatement and statement of changes in equity dealt with by this Report are in agreementwith the books of account.
2.4 In our opinion the afore said standalone Ind AS financialstatements comply with the Accounting Standards specified under Section 133 of the Actread with Rule 7 of the Companies (Accounts) Rules 2014.
2.5 In the course of our audit we have not come across any transactionsor matters which have any adverse effects on the functioning of the company.
2.6 On the basis of the written representations received from thedirectors as on March 31 2021 taken on record by the Board of Directors none of thedirectors are disqualified as on March 31 2021 from being appointed as a director interms of Section 164 (2) of the Act.
2.7 With respect to the adequacy of the internal financial control overfinancial reporting of the company and operating effectiveness of such controls. Asrequired by Section 143 (3) (i) of the Companies Act 2013 refer to our separate Reportin Annexure -B.
2.8 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:
2.8.1 The Company has disclosed the impact of pending litigations onits financial position in Standalone Ind AS financial statement.
2.8.2 In our opinion and as per the in formation and explanationsprovided to us the Company did not have any long-term contracts including derivativecontracts for which there were any material foreseeable losses.
2.8.3 There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.
Referred to in paragraph 1 under the heading of "Report on otherlegal and regulatory requirements of our report of even date "Report on Companies(Auditor's Report) Order 2016 (the Order) issued by the Central Government in terms ofsection 143 (11) of the Companies Act 2013
Smruthi Organics Limited
For the Year Ended March 31 2021
1. FIXED ASSETS [CLAUSE 3(1)]
1.1 Proper Records: The company is maintaining proper records showingfull particulars including quantitative details and situation of fixed assets.
1.2 Physical Verification: These fixed assets have been physicallyverified by the management at reasonable intervals;
Any material discrepancies were noticed on such verification and if sowhether the same have been properly dealt with in the books of account by the managementat regular intervals : NA
1.3 Title Deed: The title deeds of immovable properties are held in thename of the company.
2. INVENTORY [CLAUSE 3(11)]
Physical verification: Physical verification of inventory has beenconducted at reasonable intervals by the managements; Valuation of closing stock is takenas certified valued and verified by the management by the Company
No such material discrepancies were noticed on such verification.
3. LOAN GIVEN BY COMPANY [CLAUSE 3(111)]
3.1 The company has not granted any loans secured or unsecured tocompanies firms Limited Liability Partnerships (LLP) or other parties covered in theregister maintained under section 189 of the Companies Act 2013.
3.2 Terms and Conditions: The terms and conditions of the grant of suchloans are not prejudicial to the company's interest Not Applicable.
3.3 Regular Recovery : The schedule of repayment of principal andpayment of interest has been stipulated and whether the repayments or receipts areregular; Not Applicable.
3.4 Steps for Recovery : If the amount is overdue state the totalamount overdue for more than 90 days and whether reasonable steps have been taken by thecompany for recovery of the principal and interest. Not Applicable.
4. LOAN TO THE DIRECTORS AND INVESTMENT BY COMPANY [CLAUSE 3(IV)]
The company has not granted or made any investments guarantees andsecurity to the parties covered under section 185 and 186 of the Companies Act 2013.
5. DEPOSITS [CLAUSE 3(V)]
The company has not accepted any deposits from the public within themeaning of section 73 to 76 or any other relevant provisions of the Companies Act 2013and the rules framed thereunder.
6. COST RECORDS [CLAUSE 3(VI)]
The Central Government has specified maintenance of cost records undersection 148 (1) of the Companies Act 2013 and hence such accounts and records have beenmade and maintained.
7. STATUTORY DUES [CLAUSE 3(VII>]
Following matters shall be reported for statutory dues and disputes fortax and duties.
7.1 Provident fund: No Such Dues
7.2 Employee's state insurance: No Such Dues
7.3 Income - tax: No Such Dues
7.4 Sales- tax: No Such Dues
7.5 Service tax: No Such Dues
7.6 Duty of customs: No Such Dues
7.7 Duty of excise: No Such Dues
7.8 Value Added Tax (VAT): No Such Dues
7.9 Cess: No Such Dues
7.10 Any other statutory dues: No Such Dues
If the company is not regular in depositing such statutory dues theextent of the arrears of outstanding statutory dues as at the last day of the financialyear concerned for a period of more than six months from the date they became payableshall be indicated by the auditor. No such dues are pending.
8. REPAYMENT OF LOANS [CLAUSE 3(VIII)]
The company has not defaulted in repayment of loans or borrowing to afinancial institution bank Government.
9. UTILIZATION OF IPO AND FURTHER PUBLIC OFFER [CLAUSE 3(IX)]
The Company has not raised money by way of initial public offer orfurther public offer and Term Loans where applied for the purposes for which those areraised.
If not the details together with delays or default and subsequentrectification if any as may be applicable are reported - Not applicable.
10. REPORTING OF FRAUD [CLAUSE 3(X)]
No fraud by the company or any fraud on the Company by its officers oremployees has been noticed or reported during the year.
11. APPROVAL OF MANAGERIAL REMUNERATION [CLAUSE 3(XI)]
Managerial remuneration has been paid or provided in accordance withthe requisite approvals mandated by the provisions of section 197 read with Schedule Vpart II of the Companies Act 2013.
12. NIDHI COMPANY [CLAUSE 3(XII>]
Whether the Nidhi Company has complied with the Net Owned Funds toDeposits in the ratio of 1:20 to meet out the liability and whether the Nidhi Company ismaintaining 10% unencumbered term deposits as specified in the Nidhi Rules 2014 to meetout the liability; Not Applicable
13. RELATED PARTY TRANSACTION [CLAUSE 3(XIII)]
All transactions with the related parties are in compliance withsections 177 and 188 Companies Act 2013. The details of such related party transactionhave been disclosed in the Financial Statements as required under Indian AccountingStandard (Ind AS) 24 related party disclosures specified under section IBB of the Act.
14. PRIVATE PLACEMENT OR PREFERENTIAL ISSUES [CLAUSE 3(XIV)]
The company has not made any preferential allotment or privateplacement of shares or fully or party convertible debentures during the year under review.Accordingly the provisions of Clause 3 (xiv)of the order are not applicable to thecompany.
15. NON- CASH TRANSACTIONS [CLAUSE 3 (XV)]
The company has not entered into any non-cash transactions withdirectors or persons connected with him hence reporting requirement on compliance withthe provisions of Section 192 of the Companies Act 2013 of [Clause 3(xv)] of the orderare not applicable to the company.
16. REGISTER UNDER RBI ACT 1934 [CLAUSE 3 (XVI)]
The company is not required to be registered under section 45-IA of theReserve Bank of India Act 1934. Accordingly provisions of Clause 3 (xvi) of the order arenot applicable to the company.
17. The company has issued and allotted 7630860 (Seventy-Six LacsThirty Thousand and Eight Sixty) equity shares of Rs. 10/- each as fully paid-up bonusequity shares by capitalization of General Reserve Securities Premium Account and Surplusin Profit & Loss Account in the ration of 2 (two) new bonus shares for every 1 (one)equity share to the eligible members whose names appeared in the register of members/list of beneficial owners as on Wednesday March 17 2021 (record date).
Referred to in paragraph 2(g) under the heading of "Report onother legal and regulatory requirements of our report of even date."
REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) OFSUBSECTION 3 OF SECTION 143 OF THE COMPANIES ACT 2013 ("THE ACT")
We have audited the internal financial controls over financialreporting of Smruthi Organics Ltd ("the Company") as of 31st March 2021 inconjunction with our audit of the standalone Ind AS financial statements of the Companyfor 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')(the"Guidance Note"). 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 safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.
Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting based on our audit.
We conducted our audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (the "Guidance Note") andthe Standards on Auditing issued by ICAI and deemed to be prescribed under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls both applicable to an audit of Internal Financial Controls and bothissued by the Institute of Chartered Accountants of India. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively 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 judgment including the assessment of therisks 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 subject to balance confirmation of the allparties including the accounts during the year.
MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
A 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. A company's internal financial control overfinancial reporting includes those policies and procedures 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 asnecessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorisations of management and directors of thecompany; and
(3) Provide reasonable assurance regarding prevention or timelydetection of unauthorised 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.
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 31 March 2021 based onthe 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.