TO THE MEMBERS OF TYROON TEA COMPANY LIMITED
Report on the Audit of the Financial Statements Opinion
We have audited the Ind AS Financial Statements of Tyroon Tea Company Limited("the Company") which comprise the Balance sheet as at March 31 2022 and thestatement of Profit and Loss (including other comprehensive income) statement of changesin equity and statement of Cash Flows for the year then ended and notes to the financialstatements including a summary of the significant accounting policies and otherexplanatory information (herein referred to as "financial statements").
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS financial statements give the information required bythe Companies Act 2013 ("Act") in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2022 its Profit (financialperformance including other comprehensive income) changes in equity and its cash flowsfor 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 Act. Our responsibilities under those SAs are furtherdescribed in the Auditor's Responsibilities for the Audit of the Financial Statementssection of our report. We are independent of the Company in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the 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.
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.
We have determined the matter described below to be the key audit matter to becommunicated in our report.
|The Key Audit Matter ||Auditors Response |
|Determination of fair value of biological assets and agricultural produce as at the year ended March 312022 ||We understood and tested the design and operating effectiveness of controls as established by the management in determination of the fair value of biological assets and agricultural produce used in the production of finished goods (Made Tea). |
|(Refer to the accompanying note no. 11 & 12 forming integral part of the Financial Statements). ||We considered various factors including the actual selling price prevailing around and subsequent to the year end including technical factors stated by management which determine the quality and hence the fair value of biological assets. |
|As on March 312022 the Company has biological assets with the carrying value of Rs. 40.38 lakhs and finished goods of made tea produced from green leaves harvested from own gardens ("agricultural produce") & finished goods of made tea produced from bought green leaves with carrying value of Rs. 79.13 lakhs. ||Based on the above procedures performed the management's determination of the fair value of biological assets and agricultural produce used in the production of finished goods (Made Tea) as at the year-end and comparison with net realisable value of inventory is considered to be reasonable. |
|The biological assets and agricultural produce used in the production of finished goods (Made Tea) are stated at fair value less costs to sell. Such Inventory of Made Tea is carried at the lower of cost and net realizable value. || |
|We considered the valuation of biological assets and agricultural produce used in the production of finished goods (Made Tea) as a key audit matter given the significant judgement involved in the consideration of factors used in the determination of fair value of such agricultural produce. || |
|Accuracy of recognition measurement presentation and disclosures of revenues and other related balances in view of adoption of Ind AS 116 "Leases". || |
|Ind AS 116 introduces a lease accounting model wherein lessees are required to recognise a right- of-use (ROU) asset and a lease liability arising from a lease on the balance sheet unless the lease term is 12 months or less or the underlying asset has a low value. The lease liabilities are initially measured by discounting future lease payments during the lease term as per the contract/ arrangement. Adoption of the standard involves significant judgements and estimates including determination of the discount rates and the lease term and hence considered as a key audit matter. ||Our audit procedures on adoption of Ind AS 116 include: |
|As described in Note no. 5 to the financial statements the Company has adopted Ind AS 116 Leases (Ind AS 116) in the financial year 2019-20. The application to this accounting standard is complex and is an area of focus in our audit since the Company's has a large number of leases with different contractual terms. ||- Assessed and tested new processes and controls in respect of the lease accounting standard (Ind AS 116). |
| ||- Assessed the Company's evaluation on the identification of lease based on the contractual agreements and our knowledge of the business. |
| ||- Involved our specialists to evaluate the reasonableness of the discount rates applied in determining the lease liabilities |
| ||- Tested completeness of the lease data by reconciling the Company's operating lease commitments to data used in computing ROU asset and lease liabilities. |
| ||- On a statistical sample we performed the following procedures: |
| ||- Assessed the key terms and conditions of lease with the underlying lease contracts; and |
| ||- Evaluated computation of lease liabilities and challenged the key estimates such as discount rates and the lease term. |
| ||Assessed and tested the presentation and disclosures relating to Ind AS 116. |
Information Other than the Financial Statements and Auditors Report Thereon
The Company's management and Board of Directors are responsible for the otherinformation. The other information comprises the information included in the Company'sannual report but does not include the financial statements and our auditors' reportthereon. Our opinion on the financial statements does not cover the other information andwe do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact. We have nothing to report in this regard.
Managements Responsibility for the Financial Statements
The Company's management and Board of Directors are responsible for the matters statedin Section 134(5) of the Act with respect to the preparation of these financial statementsthat give a true and fair view of the state of affairs ( financial position) profit orloss ( financial performance including other comprehen- sive income) changes in equityand cash flows of the Company in accordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards (Ind AS) specified underSection 133 of the Act. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding of theassets of the Company and for preventing and detecting frauds and other irregularities;selection and application of appropriate accounting policies; making judgments andestimates that are reasonable and prudent; and design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.
In preparing the financial statements management and Board of Directors areresponsible 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 is also responsible for overseeing the Company's financialreporting process.
Auditors Responsibilities for the Audit of the 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 a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstate- ments can arise fromfraud 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 financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.
ii. Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under Section 143(3)(i)of the Act we are also respon- sible for expressing our opinion on whether the Companyhas adequate internal financial controls with reference to financial statements in placeand the operating effectiveness of such controls.
iii. Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
iv. Conclude on the appropriateness of management's use of the going concern basis ofaccounting 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 financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.
v. Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of mis-statements in the Financial Statements thatindividually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the Financial Statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the financial effectof any identified mis-statements in the Financial Statements.
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 we determine thosematters that were of most significance in the audit of the financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditors' report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reason- ablybe expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors' Report) Order 2020 ("the Order")issued by the Central Government in terms of Section 143 (11) of the Act we give in the "AnnexureA" a statement on the matters specified in paragraphs 3 and 4 of the Order asmay be applicable.
(A) 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) 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 financial statements comply with the Ind AS specifiedunder Section 133 of the Act.
e) On the basis of the written representations received from the directors as on March312022 taken on record by the Board of Directors none of the directors is disquali- fiedas on March 31 2022 from being appointed as a director in terms of Section 164(2) of theAct.
f) With respect to the adequacy of the internal financial controls with reference tofinancial statements of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure B".
g) The remuneration paid by the Company to its directors during the current year is inaccordance with the provisions of Section 197 of the Act. The remuneration paid to anydirector is not in excess of the limit laid down under Section 197 of the Act. TheMinistry of Corporate Affairs has not prescribed other details under Section 197(16) ofthe Act which are required to be given by us.
h) With respect to the other matters to be included in the Auditors' Report in accor-dance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion andto the best of our information and according to the explanations given to us:
i. The Company does not have any pending litigation which would impact its financialposition.
ii. The Company did not have any long-term contracts including derivatives contractsfor which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts required to be trans- ferred tothe Investor Education and Protection Fund by the Company.
vi. a. The management has represented that to the best of its knowledge and beliefother than disclosed in the notes to accounts no funds have been advanced or loaned orinvested (either from borrowed funds or share premium or any other sources or kind offunds) by the company to or in any other person(s) or entity (ies) including foreignentities ("Intermediaries") with the understanding whether recorded in writingor otherwise that the Intermediary shall whether directly or indirectly lend or investin other persons or entities identified in any manner whatsoever by or on behalf of thecompany ("Ultimate Beneficiaries") or provide any guarantee security or thelike on behalf of the Ultimate Beneficiaries.
b. The management has represented that to the best of its knowledge and belief otherthan as disclosed in the notes to accounts no funds have been received by the companyfrom any person(s) or entity(s) including foreign entities ("Funding Parties")with the under- standing whether recorded in writing or otherwise that the companyshall whether directly or indirectly lend or invest in other persons or entitiesidentified in any manner whatsoever by or on behalf of the Funding Party ("ultimateBeneficiaries") or provide any guarantee security or the like on behalf of theUltimate Beneficiaries; and
c. Based on audit procedures that we have considered reasonable and appropriate in thecircumstances nothing has come to our notice that has caused us to believe that therepresentations under vi. (a) and (b) above contain any material misstatement.
vii. The Company has not declared and paid dividend during the year.
ANNEXURE - A TO THE INDEPENDENT AUDITORS REPORT
Annexure to the Independent Auditors Report to the Members of TYROON TEA COMPANYLIMITED referred to in paragraph 1 of Report on Other Legal and Regulatory Requirements inour Report of even date.
(i). (a) (A) The company is maintaining proper records showing full particularsincluding quantitative details and situation of Property Plant and Equipment.
(B) The company has no intangible assets.
(b) These Property Plant and Equipment have been physically verified by the managementat reasonable intervals and no material discrepancies were noticed on such verification.
(c) The title deeds of immovable properties disclosed in the financial statements areheld in the name of the company.
(d) According to the information and explanations given to us the company has notrevalued its Property Plant and Equipment (including Right of Use assets) during the year.
(e) According to the information and explanations given to us no proceedings have beeninitiated or are pending against the company for holding any benami property under theBenami Transaction (Prohibition) Act 1988 (45 of 1988) and the rules made thereunder.
(ii) (a) The management has conducted physical verification of inventory at reasonableintervals. No discrepancies of 10% or more in the aggregate for each class of inventorywere noticed.
(b) Based on the audit procedures and according to the information and explanationsgiven to us working capital limit in excess of five crore rupees at any point of timeduring the year has not been sanctioned to the company.
(iii) During the year the company has not provided any guarantee security or advanceor granted any loans or advances in nature of loans secured or unsecured to thecompanies firms limited liability partnerships or any other parties. However the companyhas made investments during the year and the terms and conditions of such investments arenot prejudicial to the company's interest.
(iv) Based on the audit procedures carried out by us in respect of loans investmentsguarantees and security the provisions of section 185 and 186 of the companies act havebeen complied with.
(v) The company has not accepted any deposits or amounts which are deemed to bedeposits covered under section 73 to 76 or any other relevant provisions of the Act andthe rules framed thereunder.
(vi) According to the information and explanations given to us maintenance of costrecords has not been specified by the central government under sub section 1 of thesection 148 of the Act.
(vii) (a) According to the information and explanations given to us and the recordsexamined by us the company is regular in depositing with the appropriate authoritiesundisputed statutory dues including Provident Fund Employees State Insurance IncomeTax Goods and Service Tax Sales tax Duty of customs Duty of Excise Value Added TaxCess and other material statutory dues applicable to it and there are no outstandingStatutory Dues as at the last day of the financial Year for the period of more than sixmonths from the date the became payable.
(b) According to the information and explanations given to us there are no duesmentioned in Clause 3(vii)(a) above which have not been deposited on account of anydispute.
(viii) Based on our checking and according to the information and explanation given tous no transaction not recorded in the books of accounts have been surrendered or disclosedas income during the year in the tax assessment under Income tax Act 1961 (43 of 1961).
(ix) (a) The company has not defaulted in repayments of loans or other borrowings or inthe payments of interest thereon to any lender.
(b) As per information and explanation given to us and records maintained by thecompany is not a declared willful defaulter by any bank or financial institution or otherlender.
(c) The term loans have been applied by the company for the purpose for which they wereobtained.
(d) Funds raised on short term basis by the company have not been utilized for longterm purposes.
(e) The company has no subsidiaries joint ventures or associates.
(f) The company has no subsidiaries joint ventures or associates.
(x) (a) According to the information and explanation given to us the company has notraised moneys by way of initial public offer or further public offer including debtinstruments during the year.
(b) The company has not made any preferential allotment or private placement of sharesor convertible debentures (fully partially or optionally convertible) during the year.
(xi) (a) According to the information and explanations given to us no fraud on or bythe company has been noticed or reported during the course of audit.
(b) No report has been filed by us under sub section (12) of Section 143 of the Act inForm ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules 2014 withthe Central Government.
(c) The company has not received any whistle blower complaints during the year.
(xii) According to the information and explanation given to us the company is not aNidhi Company.
(xiii) According to the explanation and information given to us all transactions withthe related parties are in compliance with sections 177 and 188 of the Act whereapplicable and the details have been disclosed in the Ind AS Financial Statements etc. asrequired by the applicable accounting standards.
(xiv) (a) The company has an internal audit system commensurate with the size andnature of its business.
(b) The reports of the Internal Auditor for the period under audit has been consideredby us.
(xv) The company has not entered into any non-cash transaction with the directors orpersons connected with him.
(xvi) The company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934 (2 of 1934) and is not a Core Investment Company as defined in theregulations made by the Reserve Bank of India.
(xvii) The company has not incurred cash losses in the financial year and in theimmediately preceding financial year.
(xviii) There has been no resignation of statutory auditors during the year.
(xix) According to the information and explanations given to us and on the financialratios ageing and expected dates of realization of financial assets and payment offinancial liabilities other information accompanying the financial statements ourknowledge of the Board of Directors and management plans and based on our examination ofthe evidence supporting the assumptions nothing has come to our attention which causesus to believe that any material uncertainty exists as on the date of the audit report thatcompany is not capable of meeting its liabilities existing at the date of balance sheet asand when they fall due within a period of one year from the balance sheet. We howeverstate that this is not an assurance as to the future viability of the company. We furtherstate that our reporting is based on the facts up to the date of the audit report and weneither give any guarantee nor any assurance that all liabilities falling due within aperiod of one year from the balance sheet date will get discharged by the company as andwhen they fall due.
(xx) According the information and explanations given to us no amount is required tobe transferred for any unspent amount on other than ongoing projects to a Fund Specifiedin the Schedule VII to the Companies Act within a period of six months of the expiry ofthe financial yearin compliance with second proviso to section 135(5) of the Act. and noamount is remaining unspent under 135(5) of the Act pursuant to any ongoing project to betransferred to special account in compliance with section 135(6) of the Act.
(xxi) Consolidated financial statements are not required to be prepared by the company.
As stated in paragraph 2 (f) of Report on Other Legal and Regulatory Requirements
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 TYRO ONTEA COMPANY LIM- ITED ("the Company") as at March 312022 in conjunctionwith our audit of the Ind As financial statements of the Company for the year ended onthat date.
Managements 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 (ICAI). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including 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.
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 extent applicableto an audit of internal financial controls both applicable to an audit of InternalFinancial Controls and both issued by the ICAI. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in allmaterial 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 judgement including the assessment of the risks ofmaterial misstatement of the Ind As 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.
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 Ind As 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 themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of Ind Asfinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the Ind Asfinancial 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 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 2022 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 K. N. Gutgutia & Co. |
| ||Chartered Accountants |
| ||Firm Registration No.:304153E |
| ||CA. SUBHASISH PORE |
| ||Partner |
|Place: Kolkata ||Membership No.: 55862 |
|Date : May 30 2022 ||UDIN: 22055862AJZLIR6913 |