TO THE MEMBERS OF SOFTSOL INDIA LIMITED
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements ofM/s.SOFTSOL INDIA LIMITED ("the Company") which comprise the Balance Sheet asat March 31 2020 the Statement of Profit and Loss (including Other ComprehensiveIncome) the Statement of Changes in Equity and the Statement of Cash Flows for the yearended on that date and a summary of 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 theexplanations given to us the aforesaid standalone financial statements give theinformation required by the Companies Act 2013 ("the Act") in the manner sorequired and give a true and fair view in conformity with the Indian Accounting Standardsprescribed under section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended ("Ind AS") and other accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 31 2020the profit and total comprehensive income changes in equity and its cash flows for theyear ended 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 standalone financial statements of thecurrent period. These matters were addressed in the context of our audit of the standalonefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report
S.no Key Audit matter
1. 1. The valuation and existence of the portfolio of investments is considered as akey audit matter as the portfolio of investments represents the principal element of thenet asset of the Scheme.
2. As per Ind AS 36 - Impairment of assets' the standard is applicable tofinancial assets classified as subsidiaries. Accordingly in assessing whether there isany indication that an asset may be impaired an entity shall consider as a minimum theexternal and internal sources of information any other indications or evidences frominternal reporting that indicates that the assets may be impaired
Principal Audit Procedure
1. We gained an understanding of the internal control structure and operatingeffectiveness of key controls surrounding valuation and existence of investments.
We tested the existence of the Investments by obtaining and reconciling the directconfirmations of the holdings from Custodians of the Scheme.
2. Obtained and read the financial statements of Softsol Resources Inc. to identify ifany disclosure is made for impairment of assets in its standalone financial statements.Obtained the impairment indicator assessment performed by management considering theinternal/ external sources of information.
2 Accuracy of recognition measurement presentation and disclosures of revenues andother related balances in view of adoption of INDAS115 "Revenue from contracts withcustomers. The application of the new revenue accounting standard involves certain keyjudgments relating to identification of distinct performance obligations determination oftransaction price of the identified performance obligations the appropriateness of thebasis used to measure revenue recognized over a period. Additionally new revenueaccounting standard contains disclosures which involves collation of information inrespect of disaggregated revenue and periods over which the remaining performanceobligations will be satisfied subsequent to the balance sheet date.
PRINCIPAL AUDIT PROCEDURE PERFORMED
We assessed the Company's process to identify the impact of adoption of the newrevenue accounting standard. Our audit approach consisted testing of the design andoperating effectiveness of the internal controls and substantive testing as follows :
Evaluated the design of internal controls relating to implementation of the newrevenue accounting standard.
Selected a sample of continuing and new contracts and tested the operatingeffectiveness of the internal control relating to identification of the distinctperformance obligations and determination of transaction price. We carried out acombination of procedures involving enquiry and observation reperformance and inspectionof evidence in respect of operation of these controls.
Tested the relevant information technology systems' access and changemanagement controls relating to contracts and related information used in recording anddisclosing revenue in accordance with the new revenue accounting standard.
Selected a sample of continuing and new contracts and performed the followingprocedures :
- Read analyzed and identified the distinct performance obligations in thesecontracts.
- Compared these performance obligations with that identified and recorded by theCompany.
- Considered the terms of the contracts to determine the transaction price includingany variable consideration to verify the transaction price used to compute revenue and totest the basis of estimation of the variable consideration.
- Sample of revenues disaggregated by type and service offerings was tested with theperformance obligations specified in the underlying contracts.
- Performed analytical procedures for reasonableness of revenues disclosed by type andservice offerings.
We reviewed the collation of information and the logic of the report generated from thebudgeting system used to prepare the disclosure relating to the periods over which theremaining performance obligations will be satisfied subsequent to the balance sheet date.
Information Other than the Standalone Financial Statements andAuditor's Report Thereon
The Company's Board of Directors are responsible for thepreparation of the other information. The other information comprises the informationincluded in the Management Discussion and Analysis Board's Report includingAnnexures to Board's Report Business Responsibility Report Corporate Governance andShareholder's Information but does not include the standalone financial statementsand our auditor's report thereon.
Our opinion on the standalone financial statements does not cover theother information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statementsour responsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone financial statements orour knowledge obtained during the course of our audit or otherwise appears to bematerially misstated.
If based on the work we have performed we conclude that there is amaterial misstatement of this other information we are required to report that fact. Wehave nothing to report in this regard.
Management's Responsibility for the Standalone FinancialStatements
The Company's Board of Directors is responsible for the mattersstated in section 134(5) of the Companies Act2013 with respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance total comprehensive income changes in equity and cashflows of the Company in accordance with the Ind AS and other accounting principlesgenerally accepted in India including The Indian Accounting Standard specified undersec.133 of the act. This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding 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 financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.
In preparing the standalone financial statements management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.
The Board of Directors are responsible for overseeing theCompany's financial reporting process Auditor's Responsibilities for theAudit of the Standalone 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 auditor's 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 financial controls relevantto the audit in order to design audit procedures that are appropriate in thecircumstances. Under section 143(3)(i) of the Act we are also responsible for expressingour opinion on whether the Company has adequate internal financial controls system inplace 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 thegoing concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the Company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor'sreport to the related disclosures in the standalone 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 standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.
Materiality is the magnitude of misstatements in the standalonefinancial statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the financial statements may beinfluenced. We consider quantitative materiality and qualitative factors in
(i) planning the scope of our audit work and in evaluating the resultsof our work; and
(ii) to evaluate the effect of any identified misstatements in thefinancial 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 precludespublic disclosure about the matter or when in extremely rare circumstances we determinethat a matter should not be communicated in our report because the adverse consequences ofdoing so would reasonably be expected to outweigh the public interest benefits of suchcommunication.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act based on our audit wereport 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 Balance Sheet the Statement of Profit and Loss including OtherComprehensive Income Statement of Changes in Equity and the Statement of Cash Flow dealtwith by this Report are in agreement with the relevant books of account.
d. In our opinion the aforesaid standalone financial statements complywith the Ind AS specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014.
e. On the basis of the written representations received from thedirectors as on March 31 2020 taken on record by the Board of Directors none of thedirectors is disqualified as on March 31 2020 from being appointed as a director in termsof Section 164 (2) of the Act.
f. With respect to the adequacy of the internal financial controls overfinancial reporting of the Company and the operating effectiveness of such controls referto our separate Report in "Annexure A". Our report expresses an unmodifiedopinion on the adequacy and operating effectiveness of the Company's internalfinancial controls over financial reporting.
g. With respect to the other matters to be included in theAuditor's Report in accordance with the requirements of section 197(16) of the Actas amended In our opinion and to the best of our information and according to theexplanations given to us the remuneration paid by the Company to its directors during theyear is in accordance with the provisions of section 197 of the Act.
h. With respect to the other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 as amended in our opinion and to the best of our information and according tothe explanations given to us :
i. The Company has disclosed the impact of pending litigations on itsfinancial position in its standalone financial statements.
ii. The Company didnot have any long-term contracts includingderivative contracts for which there arefor material foreseeable losses.
iii. There were no amounts which were required to be transferred to theto the Investor Education and Protection Fund by the Company.
2. As required by the Companies (Auditor's Report) Order 2016("the Order") issued by the Central Government in terms of Section 143(11) ofthe Act we give in "Annexure B" a statement on the matters specified inparagraphs 3 and 4 of the Order
| ||For PAVULURI&Co. Chartered Accountants Firm Reg. No: 012194S |
|Place: Hyderabad Date: 30.06.2020 ||(CA V N DEEPTHI KONERU) PARTNER M.No: F-228424 UDIN: 20228424AAAACT2471 |
ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT
(Referred to in paragraph 1(f) under Report on Other Legal andRegulatory Requirements' section of our report to the Members of Softsol IndiaLimited of even date)
Report on the Internal Financial Controls Over Financial Reportingunder Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("theAct")
We have audited the internal financial controls over financialreporting of M/s. Softsol India limited ("the Company") as of March 31 2020 inconjunction with our audit of the standalone financial statements of the Company for theyear ended on that date.
Management's Responsibility for Internal Financial Controls
The Board of Directors of the Company is responsible for establishingand maintaining 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. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to respective company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.
Our responsibility is to express an opinion on the internal financialcontrols over financial reporting of the Company based on our audit. We conducted ouraudit in accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") issued by the Institute of CharteredAccountants of India and the Standards on Auditing prescribed under Section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controls.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence 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 financial statements whether due to 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 internal financial controlssystem over financial reporting of the Company
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial control over financial reporting isa process 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 controlover financial 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 authorizations of management and directors of thecompany; and
(3) provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition use or disposition of the company's assetsthat could have a material effect on the financial statements.
Limitations of Internal Financial Controls over Financial Reporting
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 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 March 31 2020 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.
| ||For PAVULURI&Co. Chartered Accountants Firm Reg. No: 012194S |
|Place: Hyderabad |
|(CA V N DEEPTHI KONERU) PARTNER M.No: F-228424 UDIN: 20228424AAAACT2471 |
"ANNEXURE B" TO THE INDEPENDENT AUDITORS' REPORT
Referred to in paragraph 1 under the heading Report on OtherLegal & Regulatory Requirement' of our report of even date to the financialstatements of the Company for the year ended March 31 2020:
1. (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets.
(b) The Fixed Assets have been physically verified by the management ina phased manner designed to cover all the items over a period of three years which inour opinion is reasonable having regard to the size of the company and nature of itsbusiness. Pursuant to the program a portion of the fixed asset has been physicallyverified by the management during the year and no material discrepancies between the booksrecords and the physical fixed assets have been noticed.
(c) The title deeds of immovable properties are held in the name of thecompany.
2. The company has not acquired/handled/dealt in/held any inventory.Hence clause (ii) of paragraph 3 of the order is not applicable to the company for theyear under report.
3. The Company has not granted any loans secured or unsecured tocompanies firms Limited Liability partnerships or other parties covered in the Registermaintained under Section 189 of the Act. Accordingly paragraph 3 (iii) (a) to (C) of theOrder are not applicable.
4. In our opinion and according to the information and explanationsgiven to us the company has not given any loans guarantees and provided any securityduring the year under audit. In respect of investments made the company has complied withthe provisions of section 186 of companies Act 2013.
5. The Company has not accepted any deposits from the public and hencethe directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76or any other relevant provisions of the Act and the Companies (Acceptance of Deposit)Rules 2015 with regard to the deposits accepted from the public are not applicable.
6. According to the information and explanations furnished to us thecentral government has not prescribed maintenance of cost records U/s.148(1)(d) of theCompanies Act 2013 to this company.
7. (a) According to the information and explanations given to us andthe records of the company examined by us the company is regular in depositing undisputedstatutory dues including Provident fund Employee State Insurance Income tax sales taxcustoms duty goods and service tax and any other statutory dues as applicable withappropriate authorities. There were no arrears of outstanding statutory dues as on lastday of the financial year concerned for a period of more than six months from the date onwhen they become payable.
(b) According to the information and explanation given to us there areno material dues of Income Tax Goods and service Tax Duty of customs which have notbeen deposited on account of any dispute.
However according to the information and explanations given to us thefollowing service tax amounts have not been deposited on account of disputes:
|Sl. No Name of statute ||Nature of dues ||Period to which the amount relates ||Total amount of disputed dues (Rs.) ||Forum where dispute is pending ||Amount deposited (Rs.) |
|i) Finance Act 1994 (Service tax Provisions ) ||Service tax ||2007-18 to 2011-12 ||618962/- ||CESTAT Bangalore ||223544/- |
8. In our opinion and according to the information and explanationsgiven to us the company has not defaulted in repayment of loans or borrowing to financialinstitution bank and Government. The company has not issued debentures.
9. According to the information and explanations given by themanagement the company has not raised moneys by way of initial public offer or furtherpublic offer including debt instruments and term Loans. Accordingly paragraph 3 (ix) ofthe Order are not applicable.
10. According to the information and explanations given by themanagement to us no material fraud by the Company or on the company by its officers oremployees has been noticed or reported during the course of audit.
11. According to the information and explanations 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 Companies Act;
12. In our opinion and according to information and explanations givento us the Company is not a Nidhi Company. Accordingly paragraph 3 (xii) of the Order isnot applicable.
13. According to the information and explanations to us and based onour examination of the records of the company transactions with the related parties are incompliance with section 177 and 188 of Companies Act2013 where applicable and the detailsof such transactions have been disclosed in the Financial Statements as required by theapplicable accounting standards.
14. According to the information and explanations to us and based onour examination of the records of the company the company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. Accordingly paragraph 3 (xiv) of the Order are not applicable.
15. According to the information and explanations to us and based onour examination of the records of the company the company has not entered into anynon-cash transactions with directors or persons connected with him. Accordingly paragraph3 (xv) of the Order are not applicable.
16. In our opinion the company is not required to be registered undersection 45-IA of the Reserve Bank of India Act 1934 and accordingly paragraph 3 (xvi) ofthe Order are not applicable.
| ||For PAVULURI&Co. Chartered Accountants Firm Reg. No: 012194S |
|Place: Hyderabad |
|(CA V N DEEPTHI KONERU) PARTNER M.No: F-228424 UDIN: 20228424AAAACT2471 |
INDEPENDENT AUDITOR'S COMPILATION REPORT
To the Board of Directors and Stockholders of Softsol Resources Inc.
We have audited the accompanying financial statements of SoftsolResources Inc. (A California Corporation) which comprise the statement of financialpositionas of March 31 2020 and 2019 and the related statements of profit and losschanges inequity and cash flows for the year then ended and the related notes to thefinancial statements.
Management's responsibility for the financial statements
Management is responsible for the preparation and fair presentation ofthese financial statements in accordance with International Financial Reporting Standardsas issued by the International Accounting Standards Board; this includes the designimplementation and maintenance of internal control relevant to the preparation and fairpresentation of financial statements that are free from material misstatement whether dueto fraud or error.
Our responsibility is to expressan opinion on these financialstatements based on our audit. We conducted our audit in accordance with InternationalStandards generally accpeted in the United State of America. Those standards require thatwe plan and perform the audit to obtain reasonable assurance about whether the financialstatements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence aboutthe amounts and disclosures in the financial statements. The procedures selected depend onthe auditors judgement including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor consider internal control relevant to the entity's preparation and fairpresentation of the financial statements in order to design audit procedures that areappropriate in the circumstances but not for the purpose of expressing an opinion on theeffectiveness of the entity's internal control. Accordingly we express nosuchopinion. An audit also includes evaluating the appropriateness of accounting policies usedand the reasonableness of significant accounting estimates made by management as well asevaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion.
In our opinion the financial statements referred to above presentfairly in all material respect the financial position of Softsol Rebsources Inc. as atMarch 31 2020 and 2019 and the result of its operations changes in equity and its cashflows for the years then ended in accordance with International Financial ReportingStandards as issued by the International Accounting Standards Board.
CerritosCA June 10 2020