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Sri Amarnath Finance Ltd.

BSE: 538863 Sector: Financials
NSE: N.A. ISIN Code: INE985Q01010
BSE 05:30 | 01 Jan Sri Amarnath Finance Ltd
NSE 05:30 | 01 Jan Sri Amarnath Finance Ltd

Sri Amarnath Finance Ltd. (SRIAMARNAFIN) - Auditors Report

Company auditors report

TO THE MEMBERS OF SRIAMARNATH FINANCE LIMITED

Report on the Audit of Standalone Financial Statements

Opinion

We have audited the accompanying Standalone financial statements of SriAmarnath Finance Limited ("the company") which comprises the Balance Sheet asat 31stMarch 2020 the Statement of Profit and Loss and the Cash Flow Statementfor the year ended and notes to the financial statements including a summary ofsignificant accounting policies and other explanatory information.

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 Act in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at 31st March 2020 and its profit/loss and its cashflows for the year ended on that date.

Basis of 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 Rules thereunder and we have fulfilled our other ethical responsibilities in accordance with theserequirements and the Code of Ethics. We believe that the audit evidence we have obtainedis 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 financial statements of the current period.These matters were addressed in the context of our audit of the financial statements as awhole and in forming our opinion thereon and we do not provide a separate opinion onthese matters.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters statedinsection 134(5)of the Companies Act 2013 ("the Act")with respect to thepreparation and presentation of theses and alone financial statements that give a true andfair view of the financial position financial performance and cash flows of the Companyin accordance with the accounting principles generally accepted in India including theAccounting Standards specified under Section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safe guarding 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 control that were operatingeffectively for ensuring the accuracy and completeness of the accounting records relevantto the preparation and presentation of the financial statements that give a true and fairview and are free from material misstatement whether due to fraud or error.

In preparing the financial statements management is responsible forassessing the 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.

Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibility for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether thefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these financial statements.

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 of India in terms of sub -section (11) of section 143 of the Act we give in the Annexure A a statement on theMatters specified in the paragraph 3 and 4 of the Order.

2. As required by Section 143(3) of the Act we report that:

a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purpose so four audit

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 and Cash FlowStatement deal with by this Report are in agreement with the books of account

d) In our opinion the aforesaid standalone financial statements complywith the Indian Accounting Standards specified under Section 133 of the Act read withRule 7 of the Companies (Accounts) Rules 2014.

e) The basis of the written representations received from the directorsas on 31 March 2020 taken on record by the Board of Directors none of the directors isdisqualified as on 31 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 overfinancial reporting of the Company and the operating effectiveness of such controls referto our separate report in "Annexure B"; and

g) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11of the Companies (Audit and Auditors) Rules 2014 in ouropinion and to the best of our information and according to the explanations given to us:

i. The Company does not have any pending litigation which would impactits financial position.

ii. The Company did not have any long-term contracts including derivatecontracts for which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to theInvestor Education and Protection Fund by the Company.

Annexure - A to the Auditors' Report

The Annexure referred to in Independent Auditors' Report to the membersof the Company on the standalone financial statements for the year ended 31st March2020 we report that:

(i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets

(b) According to explanation given to us fixed assets have beenphysically verified by the management at reasonable intervals and no materialdiscrepancies were noticed on such verification.

(c) According to the information and explanations given to us thecompany has not held any immovable property as on 31.03.2020.

(ii) The Company is a service company primarily rendering Financeservices. Accordingly it does not hold any physical inventories. Thus paragraph 3(ii) ofthe Order is not applicable to the Company

(iii) The Company has granted loans to bodies corporate covered in theregister maintained under section 189 of the Companies Act 2013 ('the Act').

(a) according to information given to us rate of interest and otherterms and conditions of grant of such loan to bodies corporate listed in registeredmaintained under section 189 of the act is not prejudicial to the interest of the Company.

(b) according to information given to us the loan granted to the bodiescorporate listed in the registered maintained under section 189 of the company act 2013the borrowers have been regular in the payment of principal and interest as stipulated.

(c) according to information given to us there is no overdue amountsin respect of the loan granted to a bodies corporate listed in the register maintainedunder section 189 of the Act.

(iv) In our opinion and according to the information and explanationsgiven to us the Company has complied with the provisions of section 185 and 186 of theAct with respect to the loans and investments made.

(v) The company has not accepted any deposited from the public

(vi) According to the information and explanation given to us theprovision of the clause (3)(vi) are not applicable to the company as the company is notengaged in the production of goods or providing services covered by the companies (costrecords and audit) rules 2014.

(vii) a) According to the information and explanations given to us andon the basis of our examination of the records of the Company is regular in depositingundisputed statutory dues including provident fund employees' state insuranceincome-tax sales tax service tax duty of customs duty of excise value added tax cessand other statutory dues to the appropriate authority.

According to the information and explanations given to us noundisputed amounts payable in respect of provident fund income tax sales tax servicetax duty of customs duty of excise value added tax cess and other material statutorydues were in arrears as at 31 March 2020 for a period of more than six months from thedate they became payable.

b) According to information and explanations given to us there are nomaterial dues of income tax or sales tax or service tax or duty of custom or duty ofexcise or value added tax have not been deposited by the Company on account of any dispute

(viii) Based on our audit procedure and as per the information andexplanation given to us we are of the opinion that the company has not defaulted inrepayment of loan or borrowing to a financial institution or bank.

(ix) The Company did not raise any money by way of initial public offeror further public offer (including debt instruments) and the term loan.

(x) According to the information and explanations given to us nomaterial fraud by the Company or on the Company by its officers or employees has beennoticed or reported during the course of our audit.

(xi) According to the information and explanations given to usmanagerial remuneration has been paid or provided in accordance of requisite approvalsmandated by the provisions of section 197 read with Schedule V to the Companies Act.

(xii) In our opinion and according to the information and explanationsgiven to us the Company is not a nidhi company. Accordingly paragraph 3(xii) of theOrder is not applicable.

(xiii) According to the information and explanations given to us andbased on our examination of the records of the Company transactions with the relatedparties are in compliance with sections 177 and 188 of the Act where applicable anddetails of such transactions have been disclosed in the financial statements as requiredby the applicable accounting standards.

(xiv) According to the information and explanations give to us andbased on our examination of the records of the Company the Company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the year. Accordingly paragraph 3(xiv) of the Order is not applicable.

(xv) According to the information and explanations the company has notentered into any non cash transactions with directors or persons connected with him.Accordingly paragraph 3(xv) of the Order is not applicable.

(xvi) The Company is required to be registered under section 45-IA ofthe Reserve Bank of India Act 1934 and the registration has been obtained.

Annexure - B to the Auditors' Report

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

We have audited the internal financial controls over financialreporting of Sri Amarnath Finance Limited ("the Company") as of 31 March 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 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').These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to 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.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls over FinancialReporting (the "Guidance Note") and the Standards on Auditing issued by ICAIand deemed to be prescribed under section 143(10) of the Companies Act 2013 to theextent applicable to an audit of internal financial controls both applicable to an auditof Internal Financial Controls and both issued by the Institute of Chartered Accountantsof India. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's 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 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 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.

Opinion

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 31stMarch2020 based on the internal control over financial reporting criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India.

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