The Members of Star Delta Transformers Company Limited Report on the Audit of theStandalone Ind AS Financial Statements
We have audited the accompanying Standalone Ind AS Ind AS Financial Statements of StarDelta Transformers Company Limited ("the Company") which comprise theBalance Sheet as at 31 March 2021 the Statement of profit and loss (including othercomprehensive income) the cash flow statement and the statement of changes in equity forthe year then ended and a summary of significant accounting policies and otherexplanatory information (hereinafter referred to as the 'Standalone Ind AS FinancialStatements").
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS Ind AS Financial Statements give theinformation required by the Companies Act 2013 ('the Act') in the manner so required andgive a true and fair view in conformity with the accounting principles generally acceptedin India including the Indian Accounting Standards ("Ind AS") prescribed undersection 133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015as amended of the state of affairs of the Company as at March 31 2021 its losses totalcomprehensive income changes in equity and Its cash flow for the year ended on that date.
Basis for Opinion
We conducted our audit of the standalone Ind AS Ind AS Financial Statements inaccordance with the Standards on Auditing as prescribed under section 143 (10) of theAct. Our responsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Standalone Ind AS Financial Statements section ofour report. We are independent of the Company in accordance with the Code of Ethics issuedby the Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of the standalone Ind AS Financial Statements under theprovisions of the Act and the Rules there under and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our opinion.
Other Information (Information Other than the Standalone Ind AS Financial Statementsand Auditor's Report Thereon)
The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Management Discussion and AnalysisDirector's Report Business Responsibility Report Corporate Governance and Shareholder'sinformation but does not include the standalone Ind AS Financial Statements and ourauditor's report thereon. The annual report is expected to be made available to us afterthe date of this auditor's report.
Our opinion on the standalone Ind AS Financial Statements does not cover the otherinformation and we do not express any form of assurance/conclusion thereon.
In connection with our audit of the standalone Ind AS Financial Statements ourresponsibility is to read the other information identified above when it becomes availableand in doing so consider whether the other information is materially inconsistent withthe standalone Ind AS Financial Statements or our knowledge obtained in the audit orotherwise appears to be materially misstated.
When we read the other information included in the other reports if we conclude thatthere is material misstatement therein we are required to communicate the matter to thosecharged with governance and determine the action under the applicable laws andregulations.
Responsibilities of Management and Those Charged with Governance for the Standalone IndAS 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 Ind AS FinancialStatements that give a true and fair view of the financial position financial performanceincluding other comprehensive income changes in equity and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards (Ind AS) specified under Section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended. 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 Financial Statement that givea true and view and are free from material misstatement whether due to fraud or error.
In preparing the standalone Ind AS Financial Statements the Board of Directors isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern using the going concern basisof accounting unless the Board of Directors either intends to liquidate the Company or tocease operations or has no realistic alternative but to do so.
That Board of Directors are also responsible for overseeing the company's financialreporting process.
Auditor's Responsibilities for the Audit of the standalone Ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone Ind ASFinancial 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 Standards on Auditing will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material If Individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these standalone Ind AS Financial Statements.
As part of an audit in accordance with Standards on Auditing we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the standalone Ind ASFinancial 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 Ind AS financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.
Evaluate the overall presentation structure and content of the standalone IndAS Financial Statements including the disclosures and whether the standalone Ind ASFinancial Statements represent the underlying transactions and events in a manner thatachieves fair presentation.
We communicate with those charged with governance regarding among other matters theplanned scope and timing 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 we determine thosematters that were of most significant in the audit of the4 standalone Ind AS financialstatements of the current period and are therefore the key audit matters. We describethese matters in our Auditor's report unless law or regulations preclude completedisclosures about the matters or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonable be expected to outweigh the public interest benefits of suchcommunication.
Report on Other Legal and Regulatory Requirements
1) As required by the Companies (Auditor's Report) Order 2016 ('the Order') issued bythe Central Government of India in terms of sub-section (11) of Section 143 of the Act wegive in the Annexure-A a statement on the matters specified in paragraphs 3 and 4 of theOrder.
2) As required by Section 143(3) of the Act based on our audit 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 purpose of our audit.
(b) In our opinion proper books of accounts as required by law have been kept by theCompany so far as it appears from our examination of those books.
(c) The Balance Sheet Statement of Profit and Loss (including other comprehensiveincome) the statement of changes in equity and the statement of cash flows dealt with bythis report are in agreement with the books of account.
(d) In our opinion the aforesaid Standalone Ind AS Financial Statements comply withthe Indian Accounting Standards specified under Section 133 of the Act read with Rule 7of the Companies (Accounts) Rules 2015 as amended.
(e) On the basis of the written representations received from the directors of theCompany as on 31st March 2021 taken on record by the Board of Directors none of thedirectors is disqualified as on 31st March 2021 from being appointed as a director interms of Section 164(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" to this report.
(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 in our opinionand to the best of our information and according to the explanations given to us:
i. The Company does not have any pending litigations which would impact its financialposition.
ii. The Company does not have any long-term contracts including derivative contractsfor which there are any material foreseeable losses.
iii. There has been no delay in transferring amounts required to be transferred toinvestor Education and Protection Fund by the Company.
"Annexure-A to the Independent Auditor's report"
(Referred to in Paragraph 1 under the heading "Report on Other Legal andRegulatory Requirements" of our report of even date on the Standalone Ind ASFinancial Statements of Star Delta Transformers Company Limited( "the Company")for the year ended March 31 2021)
(i) (a)On the basis of available information the company has maintained proper recordsshowing full particulars including quantitative details and situation of fixed assets.
(b) As explained to us all the assets have been physically verified by the managementas per a program of verification in a periodical manner which in our opinion isreasonable having regard to the size of the company and the nature of its assets. Nomaterial discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and the record examinedby us and based on the examination of the registered sale deed/ transfer deed/ conveyancedeed and other relevant records evidencing title provided to us we report that the titledeeds comprising all the immovable properties of land and building which are free holdare held in the name of the Company as at the balance sheet date.
In respect of immovable properties of land and buildings that have been taken on leaseand disclosed as fixed asset in the financial statements the lease agreements are in thename of the Company where the Company is the lessee in the agreement.
(ii) As explained to us the inventories were physically verified by the management asat the ye ar end. In our opinion the frequency of verification is reasonable. As informedto us no material discrepancies were noticed on physical verification.
(iii) (a) According to the information and explanations given to us during the yearthe Company has granted unsecured loan to a Company covered in the register maintainedunder section 189 of the Act. In our opinion and according to the information andexplanations given to us the terms and conditions of the grant of such loan is notprejudicial the interests of the Company.
(b) According to the information and explanations given to us the loan granted by theCompany is repayable on demand. There is no stipulation of schedule for payment ofPrinciple interest is paid as per specified repayment terms.
(c) According to the information and explanations given to us since the repaymentschedule for such loan is not stipulated there is no amount of loan which is overdue andoutstanding for more than ninety days.
(iv) In our opinion and according to the information and explanations given to uswherever applicable the Company has complied with the provisions of Section 185 and 186 ofthe Act in respect of grant of loans making investments and providing guarantees asapplicable.
(v) According to the information and explanations given to us the company has notaccepted any deposits during the year from public within the meaning of the directivesissued by Reserve Bank of India and the provisions of section 73 to 76 or any otherrelevant provisions of the Companies Act 2013 and rules framed thereunder and thus theprovisions of Clause 3(v) of the Order are not applicable.
(vi) The maintenance of cost records has been specified by the Central Government undersection 148(1) of the Companies Act 2013. We have broadly reviewed the cost recordsmaintained by the company pursuant to the Companies (Cost Records and Audit) Rules 2014as amended prescribed by the Central Government under sub section (1) of Section 148(1)of the Companies Act 2013 and are of the opinion that prima facie the prescribed costrecords have been made and maintained. We have however not made a detailed examinationof the records with a view to determine whether they are accurate and complete.
(vii) According to the information and explanations given to us in respect ofstatutory dues:
(a) The Company has generally been regular in depositing with appropriate authoritiesundisputed statutory dues including provident fund employees state insurance incometax goods and service tax custom duty excise duty value added tax cess and any othermaterial statutory dues.
(b) There were no undisputed amounts payable in respect of provident fund employees'state insurance income tax goods and services tax custom duty excise duty cess andother material statutory dues in arrears as at March 31 2021 for a period of more thansix months from the date they became payable.
(c) According to the records of the company examined by us and information andexplanations given to us the following statutory dues were outstanding on account of adispute as on 31st March 2021.
|Name of the Statute ||Nature of Demand ||Amount of demand unpaid as on 31/03/2021 (Rs.) (In Lakhs.) ||Period to which the amount relates (Assessment Yr) ||Forum where dispute is pending |
|The Income Tax Act 1961 ||Income Tax and/or interest ||0.21 ||2015-16 ||Appellate Authorities |
|Service Tax Act ||Service tax ||11.84 ||April-2009 to December- 2011 ||CESTAT New Delhi |
|Central Sales Tax Act ||CST ||1.51 ||2015-16 ||Comm. Commercial Tax Bhopal |
|Central Sales Tax Act ||CST ||4.22 ||2014-15 ||Comm. Commercial Tax Bhopal |
|Central Sales Tax Act ||CST ||1.83 ||2012-13 ||Comm. Commercial Tax Bhopal |
(viii) In our opinion and according to the information and explanations given to usthe company has not defaulted in repayment of loans or borrowings to financialinstitutions government and banks.
(ix) The Company did not raise any moneys by way of initial public offer (includingdebt instruments) during the year. In our opinion and according to the information andexplanations given to us the term loans have been applied by the Company during the yearfor the purposes for which they were raised.
(x) T o the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company and no material fraud on the Company by its officersor employees have been noticed or reported during the year.
(xi) In our opinion and according to the information and explanations given to us theCompany has paid/ provided managerial remuneration in accordance with the requisiteapprovals managed by the provisions of section 197 read with schedule V to the CompaniesAct 2013.
(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of theCARO 2016 Order is not applicable.
(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company and on the basis of review and approvals by theBoard of Directors the transactions with the related parties are in compliance withsection 177 and 188 of the Act where applicable and the details have been disclosed inthe standalone Ind AS financial statements as required by the applicable accountingstandard.
(xiv) During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures and hence reporting underclause (xiv) of the CARO 2016 Order is not applicable to the Company.
(xv) In our opinion and according to the information and explanations given to us andbased on our examination of the records of the Company during the year the Company hasnot entered into any noncash transactions with its directors associate company or personsconnected with them. Accordingly paragraph 3(xv) of the Order is not applicable.
(xvi) According to the information and explanations given to us the Company is notrequired to be registered under section 45-IA of the Reserve Bank of India Act 1934.
ANNEXURE B to the Independent Auditor's Report Of Even Date On The Standalone Ind ASFinancial Statements Of Star Delta Transformers Company Limited Bhopal
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls over financial reporting of Star DeltaTransformers Company Limited ("the Company") as of March 31 2021 in conjunctionwith our audit of the Standalone Ind AS Financial Statements of the Company for the yearended 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 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 Companies Act 2013.
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 issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. 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 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 standalone Ind AS Financial Statements whether due to fraudor error.
We believe that the audit evidence we have obtained sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.
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 standalone Ind AS 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:
a) Pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
b) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of standalone Ind AS Financial Statements in accordance with generallyaccepted accounting principles and
that receipts and expenditures of the Company are being made only in accordance withauthorizations of management and directors of the company; and
c) Provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial effect on the standalone Ind AS 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.
In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlsystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2021 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.
| ||For S.L.Khabya & Co. |
| ||Chartered Accountants |
| ||FRN.000004C |
|Place: BHOPAL ||CA. SUMIT KHABYA |
|Date :28/06/2021 ||Partner |
|UDIN: 21414887AAAAAJ8962 ||M.NO.414887 |