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Sovereign Diamonds Ltd.

BSE: 523826 Sector: Consumer
NSE: N.A. ISIN Code: INE959D01013
BSE 00:00 | 07 Dec 10.48 0
(0.00%)
OPEN

10.62

HIGH

11.15

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10.10

NSE 05:30 | 01 Jan Sovereign Diamonds Ltd
OPEN 10.62
PREVIOUS CLOSE 10.48
VOLUME 4249
52-Week high 12.44
52-Week low 4.52
P/E 43.67
Mkt Cap.(Rs cr) 6
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 10.62
CLOSE 10.48
VOLUME 4249
52-Week high 12.44
52-Week low 4.52
P/E 43.67
Mkt Cap.(Rs cr) 6
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sovereign Diamonds Ltd. (SOVERDIAMONDS) - Auditors Report

Company auditors report

To the Members of SOVEREIGN DIAMONDS LIMITED Report on the Audit of the FinancialStatements Opinion

We have audited the accompanying standalone financial statements of SOVEREIGN DIAMONDSLIMITED ("the Company") which comprises the Balance Sheet as at March 312021 the Statement of Profit and Loss (including Other Comprehensive Income) statementof changes in Equity and statement of cashflowsfor the year then ended and notes to thefinancial statements including a summary of significant accounting policies and otherexplanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS standalone financial statements give the informationrequired by the Companies Act 2013 (the Act) in the manner so required and give a trueand fair view in conformity with the accounting principles generally accepted in Indiaincluding Indian Accounting Standards ("Ind AS) specified under section 133 of theAct of the state of affairs of the Company as at March 31 2021 and its totalcomprehensive income (comprising of profit and other comprehensive income) its cash flowsand the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor’s Responsibilities for the Audit ofthe Financial Statements of our report. We are independent of the Company in accordancewith the Code of Ethics issued by the Institute of Chartered Accountants of India and wehave fulfilled our other ethical responsibilities in accordance with the provisions of theCompanies Act 2013. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion on the standalone financial statements.

Key Audit matter :

We have determined that there are no key audit matters to communicate in our report.

Other Information :

The Company’s Board of Directors is responsible for the other information. Theother information comprises the information included in the Management Discussion andAnalysis Board’s Report including Annexures to Board’s Report Report onCorporate Governance Business Responsibility Report and Shareholder’s Informationbut does not include the consolidated financial statements standalone financialstatements and our auditor’s report thereon.

Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained during the course of our audit or otherwise appears to be materially misstated.

If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.

Management’s and Board of Directors’ Responsibility for the StandaloneFinancial Statements :

The Company’s Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 ("The Act") with respect to the preparation ofthese Ind AS standalone financial statements that give a true and fair view of thefinancial performance (including Other Comprehensive Income) changes in equity and cashflows of the Company in accordance with the accounting principles generally accepted inIndia including the accounting Standards specified in the companies ( Indian AccountingStandard) rules 2015 ( as amended ) under section 133 of the Companies Act 2013. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateimplementation and maintenance of accounting policies; making judgments and estimates thatare reasonable and prudent; and design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS financial statement that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

In preparing the Ind AS financial statements management is responsible for assessingthe Company’s ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

The Board of Directors is also responsible for overseeing the company’s financialreporting process.

Auditor’s Responsibility for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor’s report that includes our opinion. Reasonable assurance is ahigh level of assurance but is not a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when it exists. Misstatements can arisefrom fraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

(i) Identify and assess the risks of material misstatement of the standalone financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

(ii) Obtain an understanding of internal controls relevant to the audit in order todesign audit procedures that are appropriate in the circumstances but not for the purposeof expressing an opinion on whether the Company has in place an adequate internalfinancial controls system over financial reporting and the operating effectiveness of suchcontrols

(iii) Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures in the standalone financial statementsmade by the Management.

(iv) Conclude on the appropriateness of management’s use of the going concernbasis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theability of the company to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor’s report to therelated disclosures in the standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor’s report. However future events or conditionsmay cause the Company to cease to continue as a going concern.

(v) Evaluate the overall presentation structure and content of the Ind AS financialstatements including the disclosures and whether the standalone financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

Materiality is the magnitude of misstatements in the standalone financial statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the standalone financial statements may be quantitativemateriality and qualitative factors in

(i) planning the scope of our audit work and in evaluating the results of our work; and

(ii) to evaluate the effect of any identified misstatements in the standalone financialstatements

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance the auditordetermines those matters that were of most significance in the audit of the financialstatements of the current period and are therefore the key audit matters. In accordancewith the requirements of SA 701 the auditor describes these matters in the auditor’sreport unless law or regulation precludes public disclosure about the matter or when inextremely rare circumstances the auditor determines that a matter should not becommunicated in the auditor’s report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor’s Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Companies Act 2013 we give in the "Annexure A" statement onthe matters specified in paragraphs 3 and 4 of the Order to the extent applicable.

As required by Section 143(3) of the Act we report that: a. We have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purposes of our audit. b. In our opinion proper books ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books.

c. The Balance Sheet the Statement of Profit and Loss (including other comprehensiveincome) and the Cash Flow Statement dealt with by this Report are in agreement with thebooks of account.

d. In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.

e. On the basis of the written representations received from the directors as on 31stMarch 2021 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2021 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 the requirements of Section 197(16) of the Act as amended In our opinionand to the best of our information and according to the explanations given to us theremuneration paid by the Company to its directors during the year is in accordance withthe provisions of Section 197 of the Act

h. With respect to the other matters to be included in the Auditor’s Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i) The company has disclosed the impact of pending litigations as at 31stMarch 2021 on its financial position in its Ind AS financial position in its standalonefinancial statements refer Note No. 24 to the Ind AS financial statements.

ii) The Company did not have any long term contracts including derivate contracts as at31st March 2021.

iii) There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection fund by the company during the year ended 31stMarch 2021.

For Pulindra Patel & Co.
Chartered Accountants
Firm Registration No.115187W
Sd/-
Pulindra Patel
Proprietor
Place : Mumbai Membership No. 048991
Date : 26th June 2021 UDIN. : 21048991AAAAIP3245

Annexure (A) to the independent Auditor’s Report

[Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements’ in the Independent Auditor’s Report of even date to the members ofSOVEREIGN DIAMONDS LIMITED on the standalone financial statements for the year ended 31 stMarch 2021]

1. (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) All fixed assets have been physically verified by the management in a phasedperiodical manner which in our opinion is reasonable having regard to the size of theCompany and the nature of its assets. According to the information and explanations givento us no material discrepancies were noticed on such verification.

(c) As per the information and explanations given to us the immovable properties ownedby the company are held in the name of the company. In respect of immovable propertydisclosed as fixedassets in financial statements the title deed is in the name of theCompany.

2. The Inventories have been physically verified during the year by the management. Inour opinion frequency of verification of inventory is reasonable. There are no materialdiscrepancies noticed by the management.

3. According to the information and explanations given to us the company has notgranted any loans secured or unsecured to companies firmsLimited Liability Partnershipsor other parties covered in the register maintained under section 189 of the CompaniesAct. Accordingly the provisions of clause 3(iii) (a) (b) and (c) of the Order are notapplicable to the Company and hence not commented upon.

4. As per the information and explanations provided to us there is no loansinvestments guarantees and securities given by the company In our opinion and accordingto the information and explanations given to us the Company has complied with theprovisions of Section 186 of the Companies Act 2013 in respect of grant of loans makinginvestments and providing guarantees and securities as applicable.

5. In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public within the provisions of Section 73to 76 of the Companies Act 2013 and the rules framed there under.

6. The maintenance of cost records has not been prescribed by the Central Governmentunder section 148 (1) of the Companies Act 2013.

7. a) According to the information and explanations given to us and on the basis of theexamination of the books of account the Company has been regular in depositing undisputedstatutory dues including Provident Fund Investor Education and Protection FundEmployees’ State Insurance Income-tax Sales-tax Good and Service tax Service taxValue Added Tax Customs Duty Excise Duty and other statutory dues applicable to it withthe appropriate authorities.

b) According to the information and explanations given to us no undisputed amountspayable in respect of Provident Fund Investor Education and Protection FundEmployees’ State Insurance Income tax Sales tax Goods and Service tax CustomsDuty Excise Duty and other undisputed statutory dues were outstanding at the year endfor a period of more than six months from the date they became payable.

8. Based on our audit procedures and on the information and explanations given by themanagement we are of the opinion that the company has not defaulted in repayment of loansor borrowings to banks. The Company does not have any borrowings by way debentures.

9. The Company has not raised money by way of initial public offer including debtinstruments during the year and did not have any term loans outstanding during the year.

10. During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practice in India andaccording to the information and explanations given by the management we report that nofraud by the Company but fraud on the Company by its officers or employees has beennoticed or reported during the course of our audit and the same is reported in Note No. 34to the notes to accounts to Standalone Financial Statement.

11. As per the information and explanations given to us the managerial remuneration hasbeen paid or provided in accordance with the requisite approvals mandated by theprovisions of section 197 read with schedule V of the Companies Act 2013.

12. As per the information and explanations given to us the company is not a NidhiCompany.

13. As per the information and explanations given to us the company all transactionswith the related parties are in compliance with section 177 and 188 of the Companies Act2013 where applicable and details have been disclosed in the Financial Statements etc.as required by the applicable accounting standards.

14. As per the information and explanations given to us the company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the year review.

15. As per the information and explanations given to us the company has not enteredinto any non- cash transactions with the directors or persons connected with him.

16. As per the information and explanations given to us the company is not required toget it registered under section 45-IA of the Reserve Bank of India Act 1934.

For Pulindra Patel & Co.
Chartered Accountants
Firm Registration No.115187W
Sd/-
Pulindra Patel
Proprietor
Place : Mumbai Membership No. 048991
Date : 26th June 2021 UDIN. : 21048991AAAAIP3245

ANNEXURE ‘B’ TO THE INDEPENDENT AUDITOR’S REPORT

Independent Auditor’s Report on the Internal Financial Controls 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 SOVEREIGNDIAMONDS LIMITED ("the Company") as of March 31 2021 in conjunction with ouraudit of the financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company’s policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.

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") and the Standards on Auditing to the extent applicable toan audit of internal financial controls both issued by the Institute of CharteredAccountants of India.

Those Standards and the Guidance Note require that we comply with ethical requirementsand plan and perform the audit to obtain reasonable assurance about whether adequateinternal financial controls over financial reporting was established and maintained and ifsuch controls operated effectively 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 reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor’s judgment including the assessment of the risks ofmaterial 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 adverse audit opinion on the Company’s internal financialcontrols system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting:

A company’s internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally 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 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 authorizations of management and directors of the company; and

(3) Provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company’s assets that could havea material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

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 312021 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 Pulindra Patel & Co.
Chartered Accountants
Firm Registration No.115187W
Sd/-
Pulindra Patel
Proprietor
Place : Mumbai Membership No. 048991
Date : 26th June 2021 UDIN. : 21048991AAAAIP3245

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