Vasa Retail and Overseas Ltd.
|BSE: 535045||Sector: Services|
|NSE: VASA||ISIN Code: INE068Z01016|
|BSE 05:30 | 01 Jan||Vasa Retail and Overseas Ltd|
|NSE 05:30 | 01 Jan||Vasa Retail and Overseas Ltd|
|BSE: 535045||Sector: Services|
|NSE: VASA||ISIN Code: INE068Z01016|
|BSE 05:30 | 01 Jan||Vasa Retail and Overseas Ltd|
|NSE 05:30 | 01 Jan||Vasa Retail and Overseas Ltd|
TO THE MEMBERS OF
VASA RETAIL AND OVERSEAS LIMITED
Report on the Audit of Financial Statements
We have audited the accompanying standalone financial statements ofVASA RETAIL AND OVERSEAS LIMITED ("the Company") which comprise the BalanceSheet as at 31 March 2020 and the Statement of Profit and Loss and Statement of CashFlows for the year then ended and notes to the financial statements including a summaryof significant accounting policies and other explanatory information (hereinafter referredto as the "standalone financial statements")..
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 Companies Act 2013 ("the Act") in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the state of affairs of the Company as at 31 March 2020and profit and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing(SAs) specified under Section 143(10) of the Act. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities section of our report.We are independent of the Company in accordance with the Code of Ethics issued by theInstitute of Chartered Accountants of India together with the ethical requirements thatare relevant to our audit of the standalone financial statements under the provisions ofthe Act and the Rules there under and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics.
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 Matters
Key Audit Matters ('KAM') are those matters that in our professionaljudgment were of most significance in our audit of the financial statements for thefinancial year ended March 31 2020. These matters were addressed in the context of ouraudit of the financial statements as a whole and in forming our opinion thereon and wedo not provide a separate opinion on these matters. For each matter below our descriptionof how our audit addressed the matter is provided in that context.
We have determined the matters described below to be the key auditmatters to be communicated in our report. We have fulfilled the responsibilities describedin the Auditor's responsibilities for the audit of the financial statements section of ourreport including in relation to these matters. Accordingly our audit included theperformance of procedures designed to respond to our assessment of the risks of materialmisstatement of the AS financial statements. The results of audit procedures performed byus including those procedures performed to address the matters below provide the basisfor our audit opinion on the accompanying financial statements.
Information Other than the Financial Statements and Auditor's ReportThereon
The Company's management and Board of Directors are responsible for thepreparation of other information. The other information comprises the information includedin the Company's annual report but does not include the financial statements and ourauditors' report thereon.
Our opinion on the standalone financial statements does not cover theother information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statementsour responsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone financial statements orour knowledge obtained in the audit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude that there is amaterial misstatement of this other information; we are required to report that fact. Wehave nothing to report in this regard.
Management's Responsibility for the Standalone Financial Statements
The Company's Board of Directors is responsible for the matters statedin Section 134(5) of the Companies Act 2013 ("the Act") with respect to thepreparation of these standalone financial statements that give a true and fair view of thefinancial position financial performance cash flows of the Company in accordance withthe accounting principles generally accepted in India prescribed under section 133 of theAct.
This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation offinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing the standalone financial statements management and Boardof Directors are responsible for assessing the Company's ability to continue as a goingconcern disclosing as applicable matters related to going concern and using the goingconcern basis of accounting unless management either intends to liquidate the Company orto cease operations or has no realistic alternative but to do so. The Board of Directorsis also responsible for overseeing the Company's financial reporting process.
Auditors' Responsibility for the Audit of Standalone FinancialStatements
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 assurance is a high level of assurance but is not aguarantee that an audit conducted in accordance with SAs will always detect a materialmisstatement when it exists. Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they could reasonably beexpected to influence the economic decisions of users taken on the basis of thesefinancial statements.
As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of thefinancial 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 control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. UnderSection 143(3)(i) of the Act we are also responsible for expressing our opinion onwhether the company has adequate internal financial controls with reference to standalonefinancial statements in place and the operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability 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 auditors' report. However future events or conditions maycause the Company to cease to continue as a going concern.
Evaluate the overall presentation structure and content of thestandalone financial statements including the disclosures and whether the standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.
Materiality is the magnitude of misstatements in the standalonefinancial statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the standalone financialstatements may be influenced. We consider quantitative materiality and qualitative factorsin (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 amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.
We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.
From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the standalonefinancial statements of the current period and are therefore the key audit matters. Wedescribe these matters in our auditors' report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.
Report on Other Legal and Regulatory Requirements:
1. As required by the Companies (Auditors' Report) Order 2016("the Order") issued by the Central Government of India in terms of Section 143(11) of the Act we give in "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.
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 purposes of ouraudit.
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 the CashFlow Statement dealt with by this Report are in agreement with the books of account.
d) In our opinion the aforesaid standalone financial statements complywith the accounting standards specified under section 133 of the Act read with rule 7 ofthe Companies (Accounts) Rules 2014;
e) On the basis of the written representations received from thedirectors as on 31 March 2020 taken on record by the Board of Directors none of thedirectors is disqualified as on 31 March 2020 from being appointed as a director in termsof Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls withreference to financial statements of the Company and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure B". Our report expresses anqualified opinion on the adequacy and operating effectiveness of the Company's internalfinancial controls over financial reporting;
g) With respect to the other matters to be included in the Auditors'Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 inour opinion and to the best of our information and according to the explanations given tous:
i. The Company has disclosed the impact of pending litigations as at 31March 2020 on its financial position in its financial statements - Refer Note 28 of thefinancial statements.
ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company during the yearended 31 March 2020; and
iv. The disclosures in the standalone financial statements regardingholdings as well as dealings in Specified Bank Notes during the period from 8 November2016 to 30 December 2016 have not been made in these standalone financial statements sincethey do not pertain to the financial year ended 31 March 2020.
h) With respect to the other matters to be included in the Auditor'sReport in accordance with the requirements of section 197(16) of the Act as amended :
In our opinion and to the best of our information and according to theexplanations given to us the remuneration paid by the Company to its directors during theyear is in accordance with the requisite approvals mandated by the provisions of section197 of the Act.
ANNEXURE A TO THE INDEPENDENT AUDITORS' REPORT - 31 MARCH 2020
With reference to the Annexure A referred to in the IndependentAuditors' Report to the members of the Company on the standalone financial statements forthe year ended 31 March 2020 we report the following:
1. In respect of Property Plant and Equipments
(a) The Company has maintained proper records showing full particularsincluding quantitative details and situation of property plant and equipment andinvestment properties.
(b) The Company has a regular programme of physical verification of itsproperty plant and equipment and investment properties by which the property plant andequipment and investment properties are verified by the management according to a phasedprogramme designed to cover all the items over a period of three years. In our opinionthis periodicity of physical verification is reasonable having regard to the size of theCompany and the nature of its assets. In accordance with the policy the Company hasphysically verified certain property plant and equipment and investment properties duringthe year and no discrepancies were noticed in respect of assets verified during the year.
(c) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the title deeds of immovableproperties are held in the name of the Company. However there were no immovableproperties held in the name of the Company as on 31 March 2020.
2. In respect of Inventories
In our opinion the company does not maintain adequate inventoryrecords; therefore we are unable to give our opinion on discrepancies between book recordsand physical inventory. We have relied upon the certificate provided by the internalauditor and management of the company for the quantity as well as the amount of inventoryand accordingly the same has been considered by us.
3. Compliance under section 189 of the Companies Act 2013
As informed by the company company has not granted any loans securedor unsecured to companies firms or other parties covered in the register maintained undersection 189 of the Companies Act 2013.
(a) Company has not granted such loan during the period.
(b) As informed to us the Company has not granted any loans secured orunsecured hence the question of repayment of loans does not arise. Consequently the saidsub clause of the Order is not applicable to the Company.
(c) As informed to us the Company has not granted any loans secured orunsecured during the year under audit hence the question of overdue amount of loans doesnot arise. Consequently the said sub clause of the Order is not applicable to the Company
4. Compliance under section 185 and 186 of the Companies Act 2013
In our opinion and according to the information and explanations givento us the company has notgranted any loans or made investments or issued any guaranteesor provided any securities during the yearto the parties covered under Sections 185 and186 of the Act. Accordingly compliance under Section 185 and 186 of the Act in respect ofgrant of loans making investments providing guarantees and securities is not applicableto the Company.
5. Compliance under section 73 to 76 of the Companies Act 2013 andRules framed thereunder while accepting deposits
In our opinion and according to the information and explanations givento us the Company has not accepted deposits as per the directives issued by the ReserveBank of India and the provisions of Sections 73 to 76 or any other relevant provisions ofthe Act and the rules framed there under. Accordingly paragraph 3 (v) of the Order is notapplicable to the Company.
6. Maintenance of cost records
According to the information and explanations given to us and on thebasis of our examination of books of account the Company is not required to maintain costrecords as per the Companies (Cost Accounting Records) Rules 2011 prescribed by theCentral Government under Section 148(1) of the Act.
7. Deposit of Statutory Dues
(a) According to the information and explanations given to us and onthe basis of our examination of records of the Company amounts deducted / accrued in thebooks of account in respect of undisputed statutory dues including provident fundemployees' state insurance goods and service tax custom duty labour cess property taxcess and other material statutory dues except professional tax applicable to it have beenregularly deposited during the year by the Company with the appropriate authorities.
Amounts deducted / accrued in the books of account in respect ofundisputed statutory dues of Income tax have generally been regularly deposited during theyear by the Company with the appropriate authorities though there have been nominaldelays on occasions. As explained to us the Company did not have any dues on account ofwealth tax.
According to the information and explanations given to us noundisputed amounts payable in respect of provident fund employees' state insurance goodsand service tax custom duty labour cess property tax cess and other material statutorydues except professional tax of INR 83670/-which was in arrears as on 31stMarch2020 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us thereare no dues of income- tax sales tax service tax value added tax custom duty and goodsand service tax as at 31 March 2020 which have not been deposited with the appropriateauthorities on account of any dispute.
8. Repayment of Loans and Borrowings
In our opinion and according to the information and explanations givento us the Company has not defaulted during the year in repayment of loans or borrowingsto banks or financial institutions or dues to debenture holders. The Company does not haveany loans or borrowings from government during the year.
9. Utilization of money raised by public offers and term loan for whichthey raised
The Company has not raised any money by way of initial public offer orfurther public offer (including debt instruments). In our opinion and according to theinformation and explanations given to us the proceeds of term loans have been applied bythe Company for the purposes for which they were raised other than temporary deploymentpending application of proceeds.
10. Reporting of fraud during the period
During the course of our examination of the books and records of theCompany carried out in accordance with the generally accepted auditing practices inIndia and according to the information and explanations given to us we have neither comeacross any instance of material fraud by the Company or on the Company by its officers oremployees noticed or reported during the year nor have we been informed of any such caseby the management.
11. Managerial Remuneration
In our opinion and according to the information and explanations givento us the Company has paid / provided managerial remuneration in accordance with therequisite approvals mandated by the provisions of section 197 read with Schedule V to theCompanies Act 2013.
12. Compliance by Nidhi Company regarding Net Owned Fund to DepositsRatio
In our opinion and according to the information and explanations givento us the Company is not a Nidhi company and the Nidhi Rules 2014 are not applicable toit. Accordingly paragraph 3 (xii) of the Order is not applicable to the Company.
13. Related party compliance with Section 177 and 188 of Companies Act2013
In our opinion and according to the information and explanations givento us the Company has entered into transactions with related parties in compliance withthe provisions of Sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the financial statements as required by AccountingStandard (AS) 18 Related Party Disclosures specified under Section 133 of the Act.
14. Compliance under section 42 of the Companies Act 2013 regardingprivate placement of shares or debentures
According to the information and explanations given to us and on thebasis of 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 and hence reporting under clause (xiv) of paragraph 3 of theOrder is not applicable to the Company.
15. Compliance under section 192 of Companies Act 2013
According to the information and explanations given to us and on thebasis of our examination of the records of the Company the Company has not entered intoany non-cash transactions with directors or persons connected with them. Accordinglyparagraph 3 (xv) of the Order is not applicable to the Company.
16. Requirement of Registration under 45-IA of Reserve Bank of IndiaAct 1934
In our opinion and according to the information and explanations givento us the Company isnot required to be registered under Section 45-IA of the Reserve Bankof India Act 1934. Accordingly paragraph 3 (xvi) of the Order is not applicable to theCompany.
ANNEXURE B TO THE INDEPENDENT AUDITORS' REPORT - 31 MARCH 2020
Report on the Internal Financial Controls with reference to theaforesaid standalone financial statements under Clause (i) of Sub-section 3 of Section 143of the Companies Act 2013 ("the Act")
(Referred to in paragraph (A) (f) under 'Report on Other Legal andRegulatory Requirements' section of our report of even date)
We have audited the internal financial controls over financialreporting of VASA RETAIL AND OVERSEAS LIMITED ("the Company") as of 31stMarch 2020 in conjunction with our audit of the standalone financial statements of theCompany for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Company's management and the Board of Directors are responsible forestablishing and maintaining internal financial controls based on the internal controlswith reference to standalone financial statements criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note.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 the 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.
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") issued by the Institute of Chartered Accountantsof India and the Standards on Auditing prescribed under Section 143(10) of the Act to theextent applicable to an audit of internal financial controls. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively in all material respects.
Our audit involves performing procedures to obtain audit evidence 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 authorizations of management and directors of thecompany; and
3. Provide reasonable assurance regarding prevention or timelydetection of unauthorized 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.
According to the information and explanation given to us and based onour audit the following material weakness has been identified as at March 31 2020:
(a) The company has designed and implemented internal financialcontrols in the organization and the same are operating effectively. However as informeddocumentation of such control framework is in progress at the year end.
A material weakness is a deficiency or a combination of deficienciesin internal financial control over financial reporting; such that there is reasonablepossibility that a material misstatement of the company's annual financial statements willnot be prevented or detected on a timely basis.
In our opinion except for the effects / possible effects of thematerial weakness described above on the achievement of the objectives of the controlcriteria the company has maintained an adequate and effective internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at 31 March 2020 based on "the internalcontrol over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India".