You are here » Home » Companies » Company Overview » VRL Logistics Ltd

VRL Logistics Ltd.

BSE: 539118 Sector: Others
NSE: VRLLOG ISIN Code: INE366I01010
BSE 00:00 | 11 Jun 296.85 29.20
(10.91%)
OPEN

271.70

HIGH

309.70

LOW

271.15

NSE 00:00 | 11 Jun 296.35 28.70
(10.72%)
OPEN

270.75

HIGH

309.90

LOW

270.75

OPEN 271.70
PREVIOUS CLOSE 267.65
VOLUME 486223
52-Week high 309.70
52-Week low 140.10
P/E 260.39
Mkt Cap.(Rs cr) 2,622
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 271.70
CLOSE 267.65
VOLUME 486223
52-Week high 309.70
52-Week low 140.10
P/E 260.39
Mkt Cap.(Rs cr) 2,622
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

VRL Logistics Ltd. (VRLLOG) - Auditors Report

Company auditors report

To the Members of VRL Logistics Limited Report on the Audit of the Financial StatementsOpinion

1. We have audited the accompanying financial statements of VRL Logistics Limited (the‘Company') which comprise the Balance Sheet as at 31 March 2020 the Statement ofProfit and Loss (including Other Comprehensive Income) the Cash Flow Statement and theStatement of Changes in Equity for the year then ended and a summary of the significantaccounting policies and other explanatory information.

2. 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 including IndianAccounting Standards (‘Ind AS') specified under Section 133 of the Act of the stateof affairs of the Company as at 31 March 2020 and its profit (including othercomprehensive income) its cash flows and the changes in equity for the year ended on thatdate.

Basis for Opinion

3. We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Our responsibilities under those standards are furtherdescribed in the ‘Auditor's Responsibilities for the Audit of the FinancialStatements' section of our report. We are independent of the Company in accordance withthe Code of Ethics issued by the Institute of Chartered Accountants of India (‘ICAI')together with the ethical requirements that are relevant to our audit of the financialstatements under the provisions of the Act and the rules thereunder and we have fulfilledour other ethical responsibilities in accordance with these requirements and the Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our opinion.

Emphasis of Matter

4. We draw attention to Note 46 in the accompanying financial statements whichdescribes management's assessment of uncertainty relating to the effects of the COVID-19pandemic on the Company's operations. Our opinion is not modified in respect of thismatter.

Key Audit Matters

5. 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.

6. We have determined the matters described below to be the key audit matters to becommunicated in our report.

Key audit matter How our audit addressed the key audit matter
Revenue recognition - Goods transport and Bus operations Our audit work included but was not limited to the following procedures:
(Refer Note 1(n) and Note 23 of the accompanying financial statements) • Understood the revenue and receivable business process for goods transport and bus operations and assessed the appropriateness of the accounting policy adopted by the Company for revenue recognition.
The Company has high volume of transactions each day recorded across various branches and through agencies using complex information technology systems which are linked to the financial reporting process. A high number of sale transactions in goods transport and bus operations business are settled in cash. Further Standards on Auditing mandate a presumed significant risk of fraud in revenue recognition.
• Evaluated the design and implementation of the key financial and Information Technology (IT) controls around the revenue recognition process including controls around issuance of invoices/ bus tickets to customers based on underlying goods consignment notes and other evidences around service delivery price approvals cash collections and timing of transaction recording in the books of account including cut off procedures.
• Tested operating effectiveness of above identified key controls over the recognition and measurement of revenue during the year and as at year end.
Further management is required to make certain key judgements relating to identifying contracts with customers performance obligations • Assessed the appropriateness of the accounting policy for revenue recognition from goods transport and bus operations business in accordance with Ind AS 115 ‘Revenue from Contracts with Customers'.
involved in contracts determining transaction price which involves variable consideration elements allocation of the transaction price to such performance obligations and satisfaction of performance obligations. • Inspected the internal audit reports for any observations reported based on such internal audits conducted at branches during the year on rotation basis to evaluate if any such observations materially impact the financial statements or impact our assessment of relevant key internal financial controls tested as above or otherwise materially impacts recognition and measurement of revenue.
• Performed test of details on a sample of revenue transactions recorded during the year including specific periods before and after year end. For the samples selected inspected supporting documents such as invoices contracts goods consignment notes evidence of delivery of service cash receipt etc.
Due to the significance of the item to the financial statements complexities involved including high inherent risk associated with cash transactions information technology systems relied on and management judgement involved for ensuring appropriateness of accounting treatment of revenue generated from goods transport and bus operations business this matter has been identified as a key audit matter for the current year's audit.
• Performed substantive analytical procedures like occupancy analysis for bus operations tonnage growth price yield growth etc.

• On a sample basis compared the daily cash collection with the bank deposit reconciliation prepared by each branch and agency and submitted to head office periodically by tracing the same to relevant bank statements.

• Tested the appropriateness and rationale for specific manual journal entries impacting revenue as well as other adjustments made in the preparation of the financial statements selected through a combination of risk-based and high-value transactions selection criteria
• Evaluated the appropriateness and adequacy of the related disclosures made in the financial statements for revenue recorded during the year.
Adoption of Ind AS 116 effective from 1 April 2019 Our audit work included but was not limited to the following procedures:
(Refer Note 1(g) Note 2(a) and Note 40 of the accompanying financial statements) • Obtained an understanding of the management's process for identification of leasing arrangements which are considered to be within the scope of Ind AS 116 Leases and tested the design and effectiveness of management's controls relating to identification and accounting of lease contracts the impact of transition to Ind AS 116 and disclosures;
The Company has adopted Ind AS 116 ‘Leases' effective 1 April 2019 which replaces the existing standard Ind AS 17. The Company has chosen to apply the ‘modified retrospective approach' on the date of initial recognition and recognised the cumulative adjustments to retained earnings.
• Reviewed the overall impact analysis prepared by the Company including completeness of lease contracts lease term and application of practical expedients
• Tested the reasonableness of key assumptions used including discount rate lease terms and measurement principles using auditor's experts.
The Company has discounted lease payments using the incremental borrowing rate as at 1 April 2019 for measuring lease liabilities at '
• Tested the inputs and calculations of the right-of-use assets and lease liability prepared by the management for each material lease contract.
27047.16 lakhs and accordingly recognised right-of-use assets at ' 24623.53 lakhs by adjusting retained earnings by ' 1911.20 lakhs (net of tax) including adjustments for prepaid/accrued rent and lease equalisation reserve as at the aforesaid date. • Verified the accuracy of the underlying lease data used to calculate the transitional impact by agreeing a representative sample of leases to original contracts or other supporting information;
• Verified the integrity and arithmetical accuracy of Ind AS 116 calculations for each sample through recalculation of the Ind AS 116 adjustments.
• Evaluated the appropriateness and adequacy of disclosures made in the financial statements with respect to lease liability and right-of- use assets recorded during the year in accordance with Ind AS 116.
In order to compute the transition impact of Ind AS 116 a significant data extraction exercise was undertaken by management to summarize all property and equipment lease data. The determination of transition impact involved application of significant judgements and estimates including determination of leases lease term including termination and renewal option use of practical expedients and discount rates for each lease.
Owing to the materiality of the impact of implementation of this new standard together with the inherent subjectivity related to principal assumptions such as discount rates we have identified the adoption of Ind AS 116 as a key audit matter for the current year audit.

Information other than the Financial Statements and Auditor's Report thereon

7. The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Annual Report but does not includethe 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 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.

Responsibilities of Management and Those Charged with Governance for the FinancialStatements

8. The accompanying financial statements have been approved by the Company's Board ofDirectors. The Company's Board of Directors is responsible for the matters stated inSection 134(5) of the Act with respect to the preparation of these financial statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income changes in equity and cash flows of the Company in accordancewith the accounting principles generally accepted in India including the Ind AS specifiedunder Section 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.

9. 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.

10. The Board of Directors are also responsible for overseeing the Company's financialreporting process. Auditor's Responsibilities for the Audit of the Financial Statements

11. 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 withStandards on Auditing will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these financial statements.

12. As part of an audit in accordance with Standards on Auditing we exerciseprofessional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control;

• 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 responsible for expressing our opinion on whether the Company hasadequate internal financial controls with reference to financial statements in place andthe operating effectiveness of such controls;

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management;

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe 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 financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.

13. We communicate with those charged with governance regarding among other mattersthe planned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

14. We also provide those charged with governance with a statement that we havecomplied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may reasonably be thought to bear onour independence and where applicable related safeguards.

15. From the matters communicated with those charged with governance we determinethose matters that were of most significance in the audit of the financial statements ofthe current period and are therefore the key audit matters. We describe these matters inour auditor's report unless law or regulation precludes public disclosure about the matteror when 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

16. As required by Section 197(16) of the Act based on our audit we report that theCompany has paid remuneration to its directors during the year in accordance with theprovisions of and limits laid down under Section 197 read with Schedule V to the Act.

17. As required by the Companies (Auditor's Report) Order 2016 (the ‘Order')issued by the Central Government of India in terms of Section 143(11) of the Act we givein Annexure A a statement on the matters specified in paragraphs 3 and 4 of the Order.

18. Further to our comments in Annexure A as required by Section 143(3) of the Actbased on our audit we report to the extent applicable that:

a) we have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purpose of our audit of theaccompanying financial statements;

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 financial statements dealt with by this report are in agreement with the booksof account;

d) in our opinion the aforesaid financial statements comply with Ind AS specifiedunder Section 133 of the Act;

e) on the basis of the written representations received from the directors and taken onrecord by the Board of Directors none of the directors is disqualified as on 31 March2020 from being appointed as a director in terms of Section 164(2) of the Act;

f) we have also audited the internal financial controls with reference to financialstatements of the Company as on 31 March 2020 in conjunction with our audit of thefinancial statements of the Company for the year ended on that date and our report dated20 June 2020 as per Annexure B expressed an unmodified opinion;

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 (as amended) inour opinion and to the best of our information and according to the explanations given tous:

i. the Company as detailed in note 33 to the financial statements has disclosed theimpact of pending litigations on its financial position as at 31 March 2020;

ii. the Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses as at 31 March 2020;

iii. there has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company during the year ended 31 March2020;

iv. the disclosure requirements relating to holdings as well as dealings in specifiedbank notes were applicable for the period from 8 November 2016 to 30 December 2016 whichare not relevant to these financial statements. Hence reporting under this clause is notapplicable.

For Walker Chandiok & Co LLP
Chartered Accountants
Firm Registration No. 001076N / N500013
UDIN No:20106815AAABP7084
per Bharat Shetty
Partner
Membership No.: 106815
Place : Hubballi
Date: 20 June 2020

Annexure A to the Independent Auditor's Report of even date to the members of VRLLogistics Limited on the financial statements for the year ended 31 March 2020

Based on the audit procedures performed for the purpose of reporting a true and fairview on the financial statements of the Company and taking into consideration theinformation and explanations given to us and the books of account and other recordsexamined by us in the normal course of audit and to the best of our knowledge and beliefwe report that:

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets (Property plant and equipment).

(b) The fixed assets (Property plant and equipment) have been physically verified bythe management during the year and no material discrepancies were noticed on suchverification. In our opinion the frequency of verification of the fixed assets (Propertyplant and equipment) is reasonable having regard to the size of the Company and the natureof its assets.

(c) The title deeds of all the immovable properties (which are included under the head‘Property plant and equipment') are held in the name of the Company.

(ii) In our opinion the management has conducted physical verification of inventory atreasonable intervals during the year and no material discrepancies between physicalinventory and book records were noticed on physical verification.

(iii) The Company has not granted any loan secured or unsecured to companies firmsLimited Liability Partnerships (LLPs) or other parties covered in the register maintainedunder Section 189 of the Act. Accordingly the provisions of clauses 3(iii)(a) 3(iii)(b)and 3(iii)(c) of the Order are not applicable.

(iv) In our opinion the Company has not entered into any transaction covered underSections 185 and 186 of the Act. Accordingly the provisions of clause 3(iv) of the Orderare not applicable.

(v) In our opinion the Company has not accepted any deposits within the meaning ofSections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules 2014 (asamended). Accordingly the provisions of clause 3(v) of the Order are not applicable.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the Rules made by the Central Government for the maintenance of cost records undersub-section (1) of Section 148 of the Act in respect of sale of power and are of theopinion that prima facie the prescribed accounts and records have been made andmaintained. However we have not made a detailed examination of the cost records with aview to determine whether they are accurate or complete.

(vii) (a) The Company is regular in depositing undisputed statutory dues includingprovident fund employees' state insurance income-tax sales-tax goods and services taxduty of customs duty of excise value added tax cess and other material statutory duesas applicable to the appropriate authorities. Further no undisputed amounts payable inrespect thereof were outstanding at the year-end for a period of more than six months fromthe date they become payable.

(b) The dues outstanding in respect of income-tax sales-tax service-tax goods andservices tax duty of customs duty of excise and value added tax on account of anydispute are as follows:

Statement of disputed dues

Name of the statute Nature of dues Amount (Rs in Lakhs) Amount paid under Protest (Rs in Lakhs) Period to which the amount relates Forum where dispute is pending
Income Tax Act 1961 Disallowance of prior period expenses expenses incurred towards construction of building and Interest levied under Section 234B and 234C 149.06 149.06 2003-04 (Assessment year) Income Tax Appellate Tribunal
Demand of tax not deducted at source on body building charges contribution to power evacuation facilities etc. 105.73 105.73 2007-08 (Assessment year) Commissioner of Income Tax (Appeals)
Revenue from sale of power considered as Section 80IA income disallowance of communication expenses disallowance of certain expenses treating them as personal expenses etc. 220.46 Nil 2008-09 (Assessment year) Income Tax Appellate Tribunal
Demand of tax not deducted at source on body building charges 1.75 1.75 2008-09 (Assessment year) Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Disallowance of lease rent paid for leased land amortisation of leasehold improvements and disallowance of certain expenses treating them as personal expenses 3.18 Nil 2010-11 (Assessment year) Income Tax Appellate Tribunal
Disallowance of certain expenses treating them as personal expenses 40.25 Nil 2011-12 (Assessment year) Assistant Commissioner of Income Tax
Disallowance of certain expenditure such as advances claimed as bad debts and disallowance of certain expenses treating them as personal expenses 25.01 Nil 2012-13 (Assessment year) Income Tax Appellate Tribunal
Disallowance of certain expenses treating them as personal expenses 14.23 Nil 2016-17 (Assessment year) Commissioner of Income Tax (Appeals)
Disallowance of employer's contribution to gratuity fund leave salary and bonus deduction in respect of new employees and certain expenses treating them as personal expenses. Addition on account of fall in net profit ratio 1226.02 245.20 2017-18 (Assessment year) Commissioner of Income Tax (Appeals)
Customs Act 1962 Customs duty on import of aircraft and related interest/ penalties/fines 1569.02 688.05 2007-08 (Financial year) Customs Excise and Service Tax Appellate Tribunal (Ahmedabad)
Finance Act 1994 Non-refund of service tax paid 242.88 2000-01 to 2001-02 Customs Excise and Service Tax Appellate Tribunal (Bengaluru)
Service tax arising due to reclassification of services 328.45 April 2014 to February 2017 Customs Excise and Service Tax Appellate Tribunal (Bengaluru)
Goods and Services Tax Act 2017 Refund of excess GST paid 19.34 19.34 July 2017 to October 2017 Office of the Commissioner (Appeals)
Employees' Contribution on drivers' wages 12.92 3.17 October 2005 High Court of
State to January Karnataka
Insurance 2006
Act1948

(viii) The Company has not defaulted in repayment of loans or borrowings to any bankduring the year. The Company has no loan or borrowing payable to government or financialinstitution and no dues payable to debenture holders during the year.

(ix) The Company did not raise moneys by way of further public offer (including debtinstruments). In our opinion the term loans were applied for the purposes for which theloans were obtained.

(x) No fraud by the Company or on the Company by its officers or employees has beennoticed or reported during the period covered by our audit.

(xi) Managerial remuneration has been paid and provided by the Company in accordancewith the requisite approvals mandated by the provisions of Section 197 of the Act readwith Schedule V to the Act.

(xii) In our opinion the Company is not a Nidhi Company. Accordingly provisions ofclause 3(xii) of the Order are not applicable.

(xiii) In our opinion all transactions with the related parties are in compliance withSections 177 and 188 of the Act where applicable and the requisite details have beendisclosed in the financial statements etc. as required by the applicable Ind AS.

(xiv) During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures.

(xv) In our opinion the Company has not entered into any non-cash transactions withthe directors or persons connected with them covered under Section 192 of the Act.

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

For Walker Chandiok & Co LLP
Chartered Accountants
Firm Registration No. 001076N / N500013
UDIN No:20106815AAABP7084
per Bharat Shetty
Partner
Membership No.: 106815
Place : Hubballi
Date: 20 June 2020

Annexure B to the Independent Auditor's Report of even date to the members of VRLLogistics Limited on the financial statements for the year ended 31 March 2020

Independent Auditor's report on the Internal Financial Controls with reference to thefinancial statements under Clause (i) of sub-section 3 of Section 143 of the CompaniesAct 2013 (the ‘Act')

• In conjunction with our audit of the financial statements of VRL LogisticsLimited (the ‘Company') as at and for the year ended 31 March 2020 we have auditedthe internal financial controls with reference to financial statements of the Company asat that date.

Responsibilities of Management and Those Charged with Governance for Internal FinancialControls

• The Company's Board of Directors is responsible for establishing and maintaininginternal financial controls based on the internal financial controls with reference tofinancial statements criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls over Financial Reporting issued by the Institute of Chartered Accountants ofIndia (the ‘ICAI'). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of the Company's business including adherenceto the Company's policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditors' Responsibility for the Audit of the Internal Financial Controls withreference to Financial Statements

• Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to financial statements based on our audit. We conducted our auditin accordance with the Standards on Auditing issued by the ICAI prescribed under Section143(10) of the Act to the extent applicable to an audit of internal financial controlswith reference to financial statements and the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting (‘the Guidance Note') issued by the ICAI.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls with reference to financial statements were established and maintainedand if such controls operated effectively in all material respects.

• Our audit involves performing procedures to obtain audit evidence about theadequacy of the internal financial controls with reference to financial statements andtheir operating effectiveness. Our audit of internal financial controls with reference tofinancial statements includes obtaining an understanding of such internal financialcontrols 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 judgement 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 with reference to financial statements.

Meaning of Internal Financial Controls with reference to Financial Reporting

• A company's internal financial controls with reference to financial statementsis a process designed to provide reasonable assurance regarding the reliability offinancial reporting and the preparation of financial statements for external purposes inaccordance with generally accepted accounting principles. A company's internal financialcontrols with reference to financial statements include those policies and procedures that(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted

Annexure B to the Independent Auditor's Report of even date to the members of VRLLogistics Limited on the financial statements for the year ended 31 March 2020 accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and (3) providereasonable assurance regarding prevention or timely detection of unauthorised acquisitionuse or disposition of the company's assets that could have a material effect on thefinancial statements.

Inherent Limitations of Internal Financial Controls with reference to FinancialReporting

7. Because of the inherent limitations of internal financial controls with reference tofinancial statements 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 withreference to financial statements to future periods are subject to the risk that theinternal financial controls with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.

Opinion

8. In our opinion the Company has in all material respects adequate internalfinancial controls with reference to financial statements and such controls were operatingeffectively as at 31 March 2020 based on the internal financial controls with referenceto financial statements criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on audit of Internal FinancialControls over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.

For Walker Chandiok & Co LLP
Chartered Accountants
Firm Registration No. 001076N / N500013
per Bharat Shetty
Partner
Membership No.: 106815
UDIN No:20106815AAABP7084
Place : Hubballi
Date: 20 June 2020