TO THE MEMBERS OF SOLID STONE COMPANY LIMITED
We have audited the accompanying standalone Financial statements of SOLID STONECOMPANY LIMITED("the Company") which comprise the Balance Sheet as at 31stMarch 2020 the Statement of Profit and Loss including the statement of OtherComprehensive Income the Cash Flow Statement and Statement of Changes in Equity for theyear then ended and a summary of significant accounting policies and other explanatoryinformation.
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 (Ind AS) prescribed underSection 133 of the Act read with Companies (Indian Accounting Standards) Rules 2015 andamended and other accounting principles generally accepted in India of the state ofaffairs (Financial position) of the Company as at 31st March 2020 and itsprofit(Financial performance including other comprehensive income) its cash flows and thechanges in equity for the year ended on that date.
2. Basis for Opinion
We conducted our audit of the standalone Financial statements in accordance with theStandards on Auditing (SAs) as specified under Section 143(10) of the Act. 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 thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code 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.
3. Emphasis of Matter
We draw your attention to Note 1-B-(iii) to the accompanying standalone Financialstatements which explains the uncertainties and the management's assessment of theFinancial impact due to the lock-downs and other restrictions and conditions related toCOVID-19 pandemic situation for which a definitive assessment of the impact in subsequentperiod is dependent upon circumstances as they evolve. Our opinion is not modified inrespect of this matter.
4. 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.
|Sr. No. Key Audit Matters ||How the matter was addressed by us. |
|1 IndAS 116 "Leases" introduced a new lease accounting model whereby lessees are required to recognize right to use (ROU) asset and a lease liability arising from a lease on its balance sheet. ||Principal Audit Procedures |
|Significant judgement is required in determining whether a contract is appropriately identified as being within the scope of Ind AS 116 assessment of lease term and determination of appropriate incremental borrowing rate thereby affecting the measurement of lease liability and corresponding ROU asset. || Evaluated the design and implementation of the processes and internal controls relating to implementation of the new lease standard. |
|In view of the above we have identified measurement of lease liability and corresponding ROU asset determination as a key audit matter. || Based on our evaluation of the contractual agreements entered into and our knowledge of the business assessed the appropriateness of the leases identified by the Company. |
| || Evaluated the reasonableness of the discount rates used in computing the lease liabilities. |
| || Evaluated the disclosures in the Standalone Ind AS Financialstatements for compliance with Ind AS 116. |
5. Information Other than the Standalone Financial statements and Auditor'sReport thereon
The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the Board'sReport including Annexures to Board's Report Management Discussion and Analysis Reporton Corporate Governance but does not include the Standalone Financial statements and ourauditor's report thereon. Our opinion on the Standalone Financial statements does notcover the other information and we do not express any form of assurance conclusionthereon.
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.
6. Management's Responsibility for the Standalone Financial Statements
The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these standalone Financial statementsthat give a true and fair view of the Financial position Financial performance includingother comprehensive income cash flows and changes in equity of the Company in accordancewith accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under Section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal Financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the Standalone Financialstatements that give a true and fair view and are free from material misstatement whetherdue 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 areresponsible for overseeing the Company's Financial reporting process.
7. Auditor's Responsibility for the audit of the Standalone Financial statements
Our objectives are to obtain reasonable assurance about whether the standaloneFinancial 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 standalone Financial statements.
As part of an audit in accordance with SAs we exercise professional judgement andmaintain professional scepticism 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 upto 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.
Materiality is the magnitude of misstatements in the Standalone 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 among othermatters 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 we havecomplied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may reasonably be thought to bear onour independence and where applicable related safeguards.
From the matters communicated with those charged with governance we determinethose matters that were of most significance in the audit of the Standalone Financialstatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.
8. Report on Other Legal and Regulatory Requirements
8.1 As required by the Companies (Auditor's Report) Order 2016("theOrder") issued by the Central Government in terms of Section 143 (11) of the Act wegive in "Annexure A" - a statement on the matters specified in paragraphs 3 and4 of the Order.
8.2 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 Cash Flow Statement dealt with by thisReport are in agreement with the books of account.
d) In our opinion the aforesaid standalone Financial statements comply with the IndianAccounting Standards prescribed under Section 133 of the Act.
e) On the basis of the written representations received from the directors as on 31stMarch 2020 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 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".
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 as amended 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 on its Financialposition in its Standalone Financial statements Refer Note 28 (A)to the standaloneFinancial statements;
ii. The Company has no long-term contracts including derivative contracts for whichthere were no material foreseeable losses; and
iii. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the company
8.3 With respect to the matter to be included in the Auditors' Report under Section 197(16) of the Act we report that: In our opinion and according to the information andexplanations given to us the remuneration paid by the Company to itsdirectors during thecurrent year is in accordance with the provisions of Section 197 of the Act. Theremuneration paid toany director is not in excess of the limit laid down under Section 197of the Act; and the Ministry of Corporate Affairs hasnot prescribed other details underSection 197(16) which are required to be commented upon by us.
ANNEXURE "A" TO THE INDEPENDENTAUDITOR'S REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS OF SOLID STONE COMPANY LIMITED
i) In respect of its Fixed Assets:
a) The company has maintained proper records showing full particulars includingquantitative details and situation of Fixed Assets;
b) As explained to us the Assets have been physically veri ed by the management inaccordance with a regular programme of veri cation which in our opinion is reasonableconsidering the size and the nature of its business. The frequency of veri cation isreasonable and no material discrepancies have been noticed on such physical veri cation;
c) According to the information and explanations given to us and on the basis of ourexamination of the records of the company the title deeds of immovable properties areheld in the name of the Company.
ii) The inventory has been physically veri ed by the management during the year. In ouropinion the frequency of veri cation is reasonable. No material discrepancies werenoticed on such physical veri cation.
iii) The company has not granted any loans secured or unsecured during the year tocompanies rms limited liability partnerships or other parties covered in the registermaintained under section 189 of the Act. Accordingly the clauses 3(iii) (a) (b) and (c)of the Order are not applicable to the Company.
iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 185 and 186 of the Act with respectto loans and investments made during the year.
v) The Company has not accepted any deposits within the meaning of Provisions ofSection 73 to 76 of the Act and the rules framed thereunder from the public.
vi) According to the information and explanations given to us Central Government hasnot prescribed maintenance of cost records under section 148 (1) of the Act.
vii) i. a) The company is regular in depositing undisputed statutory dues includingProvident Fund Employees' State Insurance Income Tax Sales-Tax Service Tax Goods& Services Tax duty of customs duty of excise value added tax cess and any otherstatutory dues with appropriate authorities where applicable. According to theinformation and explanations given to us there are no undisputed amounts payable inrespect of such statutory dues which have remained outstanding as at 31st March 2020 fora period of more than six months from the date they became payable.
b) According to the records of the company the dues outstanding of income-taxsales-tax service tax duty of customs duty of excise goods and services tax and valueadded tax on account of any dispute are as follows:
|Name of the Statute ||Nature of Dues ||Financial Year ||Amount (Rs. in Lakhs) ||Forum where dispute is pending |
|Income Tax ||IT Matter Under Dispute ||2010-11 (A.Y. 2011-12) ||8.25 Lakhs ||Income Tax Commissioner (Appeals) |
viii) The company has not defaulted in repayment of its loans or borrowings to banks.The Company does not have any borrowings by way of debentures.
ix) The Company has not raised any moneys by way of Initial public offer or furtherPublic offer (Including debt instruments).
Moneys raised by way of Term Loan were applied for the purpose for which those areraised.
x) On the basis of our examination and according to the information and explanationsgiven to us no fraud by the Company or any material fraud on the company by its of cersor employees has been noticed or reported during the year nor have we been informed ofany such case by the management.
xi) The managerial remuneration has been paid/provided in accordance with the requisiteapprovals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii) The company is not a nidhi Company and accordingly provisions of clause (xii)ofPara 3 of the order are not applicable to the Company.
xiii) On the basis of our examination and according to the information and explanationsgiven to us we report that all the transaction with the related parties are in compliancewith Section 177 and 188 of the Act and the details have been disclosed in the Financialstatements in Refer Note 28-E as required by the applicable accounting standards.
xiv) The company has not made any preferential allotment or private placement of shareor fully or partly paid convertible debentures during the year and accordingly provisionsof clause (xiv) of Para 3 of the Order are not applicable to the Company.
xv) According to the information and explanations given to us and based on ourexamination of the records of the company the company has not entered into any non-cashtransactions with directors or persons connected with the directors. Accordinglyprovisions of clause (xv) of Para 3 of the Order are not applicable to the company.
xvi) The company is not required to be registered under section 45-IA of the ReserveBank of India Act1934 and accordingly provisions clause (xvi) of Para 3 of the Order arenot applicable to the Company.
"ANNEXURE B" TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS OF SOLID STONE COMPANY LIMITED.
1. REPORT ON THE INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING UNDER CLAUSE(I) OF SUB-SECTION 3 OF SECTION 143 OF THE COMPANIES ACT 2013 ("the Act")
We have audited the internal Financial controls over Financial reporting of SOLID STONECOMPANY LIMITED ("the Company") as of March 31 2020 in conjunction with ouraudit of the standalone Financial statements of the Company for the year ended on thatdate.
2. 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 company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable Financial information as required underthe Act.
3. AUDITORS' RESPONSIBILITY
Our responsibility is to express an opinion on the Company's internal Financialcontrols over Financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") issued by Institute of Chartered accountants of India andthe Standards on Auditing prescribed under section 143(10) of the Companies Act 2013 tothe extent applicable to an audit of internal Financial controls. 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 about the adequacy ofthe internal Financial controls system over Financial reporting and their operatingeffectiveness. Our audit of internal Financial controls over Financial reporting includedobtaining an understanding 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 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 and appropriate toprovide a basis for our audit opinion on the Company's internal Financial controls systemover Financial reporting.
4. 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 of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of Financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the Financial statements.
5. 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 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 issued by theInstitute of Chartered Accountants of India.