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Victoria Enterprises Ltd.

BSE: 506103 Sector: Infrastructure
NSE: N.A. ISIN Code: INE082E01012
BSE 05:30 | 01 Jan Victoria Enterprises Ltd
NSE 05:30 | 01 Jan Victoria Enterprises Ltd

Victoria Enterprises Ltd. (VICTORIAENTERPR) - Auditors Report

Company auditors report

To

The Members of

VICTORIA ENTERPRISES LIMITED

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS

Opinion

We have audited the accompanying financial statements of Victoria EnterprisesLimited ("the Company") which comprise the balance sheet as at March 312021 the Statement of Profit and

Loss and statement of cash flows for the year then ended and notes to the financialstatements including a summary of significant accounting policies and other explanatoryinformation.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by theCompanies Act 2013 (‘Act') in the manner so required and give a true and fair viewin conformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at March 31 2021 its Profit / Loss and cash flows for the yearended on that date.

Basis for opinion

We conducted our audit in accordance with the standards on auditing specified undersection 143 (10) of the Companies Act 2013. Our responsibilities under those Standardsare further described in the auditor's responsibilities for the audit of the financialstatements section of our report. We are independent of the Company in accordance with thecode of ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the financial statements under theprovisions of the Act and the rules thereunder 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 and appropriate toprovide a basis for 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 matters below to be key audit matters to be communicated in ourreport:

Key audit matters How the matter was addressed in our Audit
Expected credit loss allowances- Recognition and measurement of impairment of financial assets involve significant management judgment. With the applicability of Ind AS 109 credit loss assessment is now based on expected credit loss (ECL) model. The Company's impairment allowance is derived from estimates including the historical default and loss ratios. Management exercises judgment in determining the quantum of loss based on a range of factors. The most significant areas are loan staging criteria calculation of probability of default / loss and consideration of probability weighted scenarios and forward looking macroeconomic factors. There is a large increase in the data inputs required by the ECL model. This increases the risk of completeness and accuracy of the data that has been used to create assumptions in the model. In some cases data is unavailable and reasonable alternatives have been applied to allow calculations to be performed. We evaluated management's process and tested key controls around the determination of extent of requirement of expected credit loss allowances including recovery process & controls implemented in the company for loans and advances and other financial assets. It was explained to us by the management that the control exists relating to the recovery of loans & advances and other assets and in the opinion of the board there is no requirement making expected credit loss allowance. We have also reviewed the management response and representation on recovery process initiated for sample receivables and based on the same we have place reliance on these key controls for the purposes of our audit.
As per management opinion there is no expected credit loss in several financial assets including the trade receivables of the Company and all are on fair value based on the assessment and judgment made by the board of the company.
Balances of Various Financial Assets and Liabilities: Refer Note No. 35 to the financial statements which describes that the balance of Receivables and Payables including unsecured loans taken loans & advances given payable to vendors client balances etc are subject to confirmation and consequent reconciliation and adjustments if any. Hence the effect thereof on Profit/ Loss Assets and Liabilities if any is not ascertainable. We evaluated the management procedure and tested key controls employed by the management to review over the reconciliation and recoverability of the long outstanding assets and payability of long outstanding liabilities. Based on the explanations and representations provided by the management it was explained to us that the Board is carrying out a regular review of balances of all outstanding assets and liabilities based on the formal/ informal agreements/ arrangements with the respective parties involved. As per their opinion there will be no substantial impact on their
reconciliation with their balance confirmations. Based on the same we have place reliance on these key controls for the purposes of our audit.
Inventories- Inventories comprising of construction work in progress represent majority of the Company's total assets. Till financial year 2020- 21 all the projects of the company were in the stage of construction since a long period except for part completion of one of the project achieved in FY 2019-20. As per the accounting policies the construction work in progress and finished goods are valued at lower of cost or net realisable value. Cost includes cost of land development rights rates and taxes construction costs borrowing costs other direct expenditure allocated overheads and other incidental expenses. Since the assessment of the net realisable value of the construction inventories is matter of technical nature which is also subjective to the various underlying assumptions. As such inappropriate assumptions in these forecasts can impact the assessment of the carrying value of inventories. Further estimation uncertainty and exposure to cyclicality exists within the long term projects. Forecast of future market conditions is difficult to predict and be influenced by political and economic factors. Our audit procedures to assess the net realisable value (NRV) of inventories included the following:
Further due to their materiality in the context of total assets of the Company this is considered significant to our overall audit strategy and planning. ? As explained by the management the Net Realisable Value is derived by the company based on the estimated project completion as per the internal assessment. As informed to us the board is periodically reviewing the progress of the each project and is of the opinion that the Net Realisable Value of all the projects of the company is much higher than their cost.
? Since the assessment of the net realizable value of the construction inventories is of purely technical nature we have relied on the management representation regarding the process and management understanding explained to us. The matter of evaluation of the net realizable value of such inventories is totally based on the forecast of future market conditions and assessment of the future selling prices and costs of completion for all the projects. We further suggest to further improve the management's valuation methodology including assessing the key estimates data inputs and assumptions adopted comparing expected future average selling prices with available market data such as recently transacted prices for similar properties located in the nearby vicinity of each project and the sales budget plans maintained by the Company.

Deferred Tax Assets- Recognition and In view of the significance of the mattermeasurement of deferred tax assets. The Company we applied the following audit hasdeferred tax assets in respect of temporary differences and Carried Forward Losses.

The recognition of deferred tax assets involves judgment regarding the likelihood ofthe reasonable certainty of realisation of these assets in particular whether there willbe taxable profits in future periods that support recognition of these assets.

Management records deferred tax assets in respect of temporary differences and carriedforward business losses in cases where it is reasonably certain based on the presumedprofitability determined on the basis of management estimation that sufficient taxableincome will be available to absorb the differed tax assets in future.

Loans to group companies

The Company has given loans to various group entities which are considered to beassociated with significant risk in respect of recovery of such loans. These loans arecarried at cost. Management has given us confirmation that the loans are reviewed forimpairment at each reporting date. This assessment is based on the presumed futurefinancial performance of these underlying entities which involve significant estimatesand judgment due to the inherent uncertainty involved in forecasting future cash flows.There is significant judgment in estimating the timing of the cash flows and theappropriate discount rate.

In addition considering the materiality of the loans in group companies vis--visthe total assets of the Company this is considered to be significant to our overall auditstrategy and planning. procedures in this area among others to obtain reasonable auditassurance:

? Through discussions with management we understood the

Company's process for recording deferred tax assets; ? Performed study and inquiredinto the basis of the management estimations of the future revenue for the reasonablecertainty of utilisation of the Carried Forward Losses and therefore recognition ofdeferred tax assets; and ? Tested the underlying data for the key deferred tax and taxprovision calculations.

In view of the significance of the matter we applied the following audit procedures inthis area among others to obtain reasonable audit assurance:

? Understanding the return prospects from the group entities based on our discussionwith the management regarding the markets in which the group entities operate; and ?Review of the controls in place for issuing new loans and evidenced the board approvalobtained. ? We obtained management's assessment of the recoverability of the loans ?Obtained independent confirmations to ensure completeness and existence of loans andadvances held by related parties as on reporting date.

Information other than the financial statements and auditors' report thereon

The Company's board of directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the Board'sReport including Annexures to Board's Report Business Responsibility Report but does notinclude the financial statements and our auditor's report thereon.

Our opinion on the financial statements does not cover the other information and we donot 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 standalone financial statements or our knowledge obtainedduring the course of our audit or otherwise appears to be materially misstated.

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

Management's responsibility for the financial statements

The Company's board of directors are responsible for the matters stated in section 134(5) of the

Act with respect to the preparation of these 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 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 fair view and are free from material misstatement whether due to fraud orerror.

In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.

The board of directors are also responsible for overseeing the Company's financialreporting process.

Auditor's 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. Misstatements 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:

? 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.

? Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theCompanies Act 2013 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 usedand the reasonableness of accounting estimates and related disclosures made by management.

? 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.

? Evaluate the overall presentation structure and content of the financial statementsincluding the disclosures and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements 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 effect of anyidentified misstatements 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 ourauditor's 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 reasonablybe expected to outweigh the public interest benefits of such communication.

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 ofthe

Companies Act 2013 we give in the Annexure "A" a statement on the mattersspecified in paragraphs 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 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 and the cash flow statementdealt with by this report are in agreement with the books of account;

(d) In our opinion the aforesaid financial statements comply with the accountingstandards specified under section 133 of the Act read with rule 7 of the Companies(Accounts) Rules 2014 subject to the noncompliance by the company of the IND AS 19(relating to non-provision of gratuity on actuarial assessment basis as per Note 24 toFinancial Statements) and IND AS 109 (relating to measurement requirements for all thefinancial assets and liabilities as per Note 40 to Financial Statements)

(e) On the basis of the written representations received from the directors as on March31 2021 taken on record by the board of directors none of the directors is disqualifiedas on March 31 2021 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 over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in "Annexure B". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting;

(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;

a. The Company does not have any pending litigations which would impact its financialposition other than those mentioned in Note 28(Contingent Liabilities) to the FinancialStatements;

Annual Report 2020-21

b. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses; and c. There has not been an occasion incase of the Company during the year under report to transfer any sums to the InvestorEducation and Protection Fund. The question of delay in transferring such sums does notarise

For TAORI SANDEEP & ASSOCIATES
Chartered Accountants
Firm Registration No. : 007414C
CA. Atul Jain
(Partner)
M. No. : 048920
UDIN: 21048920AAAACE3989
Place: Mumbai
Date: 30thJune 2021

ANNEXURE A TO AUDITORS' REPORT

[Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements' in the

Independent Auditors Report of even date]

On the basis of such checks as we considered appropriate and according to theinformation and explanations given to us during the course of our audit we report that:

1. In respect of its fixed assets

a) The Company is in the process of updating the records to show full particularsincluding quantitative details and situation of fixed assets on the basis of availableinformation. b) As explained to us fixed assets have been physically verified by themanagement at regular intervals; as informed to us no material discrepancies were noticedon such verification;

c) As explained to us the title deeds of all the immovable properties are held in thename of the company;

2. In respect of its inventories

As explained to us inventories have been physically verified during the year by themanagement at reasonable intervals. As informed to us no material discrepancies werenoticed on physical verification of inventories by the management as compared to bookrecords.

3. The company has granted loans secured or unsecured to companies firms LimitedLiability Partnerships or other parties covered in the register maintained under section189 of the Companies Act 2013:

a) The terms and conditions of the grant of such loans are not prejudicial to thecompany's interest except for non-charging on interest on such loans;

b) According to the information and explanations given to us the loans given by thecompany are repayable on demand. As informed repayment of Principal amount and interest(if agreed) has been received during the year whenever demanded by the company.

c) According to the information and explanations given to us there is no overdueamount for more than ninety days in respect of loans to the parties covered in the aboveregister.

4. According to the information and explanations given to us and based on ourexamination of the records of the Company in respect of loans investments guaranteesand security given/ made by the company during the year the company has complied withthe provisions of section 185 & 186 of the Companies Act 2013.

5. The Company has not accepted any deposits from the public covered under thedirectives issued by the Reserve Bank of India and the provisions of Section 73 to 76 orany other relevant provisions of the Companies Act 2013 and the rules framed thereunder.Further no order has been passed by Company Law Board or National Company Law Tribunal orReserve Bank of India or any court or any other tribunal on the company. Hence Paragraph3(v) of the Order is not applicable.

6. The Central Government of India has not prescribed the maintenance of cost recordsunder sub-section (1) of Section 148 of the Companies Act 2013 for any of the products ofthe Company.

7. In respect of Statutory Dues:

a) According to the information and explanations given to us and based on the recordsof the company examined by us the company is generally regular in depositing theundisputed statutory dues including provident fund employees' state insuranceincome-tax sales-tax service tax duty of customs duty of excise value added tax cessand any other statutory dues to the appropriate authorities in India. According to theinformation and explanation given to us there was no outstanding statutory dues as on thelast day of the financial year concerned for a period of more than six months from thedate they became payable except for non-payment of professional tax liability forRs.83825/- (Rs. 78825/- towards employees deduction and Rs. 5000/- towards companycontribution).

b) According to the information and explanations given to us and based on the recordsof the company examined by us there are no dues of income tax or sales tax or service taxor duty of customs or duty of excise or value added tax which have not been deposited onaccount of any disputes.

8. According to the records of the company examined by us and as per the informationand explanations given to us the company has not defaulted in repayment of loans orborrowings to any financial institution banks or government. The company has also notissued debentures. Hence Paragraph 3 (viii) of the Order is not applicable.

9. According to the records of the company examined by us and as per the informationand explanations given to us the Company did not raise any money by way of initial publicoffer or further public offer (including debt instruments) during the year and the termloans raised during the year were applied for the purpose for which those were raised.

10. During the course of our examination of the books and records of the companycarried in accordance with the auditing standards generally accepted in India we haveneither come across any instance of fraud on or by the Company noticed or reported duringthe course of our audit nor have we been informed of any such instance by the Management.

11. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has paid/ provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions of Sec197 read with Schedule V to the Act.

12. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable.

13. According to the information and explanations given to us and based on ourexamination of the records of the Company all transactions with the related parties arein compliance with sections 177 and 188 of Companies Act 2013 where applicable and thedetails have been disclosed in the Financial Statements etc. as required by theapplicable accounting standards

14. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year.

15. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) isnot applicable.

16. The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.

For TAORI SANDEEP & ASSOCIATES
Chartered Accountants
Firm Registration No..: 007414C
CA. Atul Jain
(Partner)
M. No. : 048920
UDIN: 21048920AAAACE3989
Place: Mumbai
Date: 30thJune 2021

ANNEXURE B TO AUDITORS' REPORT

[Referred to in Clause (f) in paragraph 2 under ‘Report on Other Legal andRegulatory Requirements' in the Independent Auditors Report of even date]

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 M/s. VICTORIAENTERPRISE LTD. ("the Company") as of March 31 2021 in conjunction with ouraudit of the financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India (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.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance

Note on Audit of Internal Financial Controls Over Financial Reporting (the"Guidance Note") and the Standards on Auditing issued by ICAI and deemed to beprescribed under section 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols 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 included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the Company's internal financial controls system over financialreporting.

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 financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

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

Opinion

In our opinion the Company has in general in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were found operating effectively as at March 31 2021based on the internal control over financial reporting criteria established by theCompany. However the same needs to be further improved and formally documented in view ofthe size of the company and nature of its business considering the essential componentsof internal control stated in the Guidance Note on Audit of Internal Financial Controlsover Financial Reporting issued by the Institute of Chartered Accountants of India.

For TAORI SANDEEP & ASSOCIATES
Chartered Accountants
Firm Registration No..: 007414C
CA. Atul Jain
(Partner)
M. No. : 048920
UDIN: 21048920AAAACE3989
Place: Mumbai
Date: 30thJune 2021.

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