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VST Industries Ltd.

BSE: 509966 Sector: Consumer
NSE: VSTIND ISIN Code: INE710A01016
BSE 13:45 | 29 Sep 3167.40 -11.85
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NSE 13:29 | 29 Sep 3164.30 -20.25
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OPEN 3151.10
PREVIOUS CLOSE 3179.25
VOLUME 285
52-Week high 3893.95
52-Week low 2786.00
P/E 14.51
Mkt Cap.(Rs cr) 4,890
Buy Price 3167.20
Buy Qty 1.00
Sell Price 3170.80
Sell Qty 1.00
OPEN 3151.10
CLOSE 3179.25
VOLUME 285
52-Week high 3893.95
52-Week low 2786.00
P/E 14.51
Mkt Cap.(Rs cr) 4,890
Buy Price 3167.20
Buy Qty 1.00
Sell Price 3170.80
Sell Qty 1.00

VST Industries Ltd. (VSTIND) - Auditors Report

Company auditors report

To the Members of VST Industries Limited

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS

OPINION

We have audited the financial statements of VST Industries Limited("the Company") which comprise the balance sheet as at 31st March 2022 and thestatement of profit and loss (including other comprehensive income) statement of changesin equity and statement of cash flows for the year then ended and notes to the financialstatements including a summary of the significant accounting policies and otherexplanatory information [in which are included financial information from VST ESOP Trust("Trust")].

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid financial statements give the information requiredby the Companies Act 2013 ("Act") in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at 31st March 2022 and its profit and othercomprehensive income changes in equity and its cash flows for the year ended on thatdate.

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 those SAs arefurther 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 believethat the audit evidence obtained by us is sufficient and appropriate to provide a basisfor our opinion on the financial statements.

KEY AUDIT MATTERS

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the financial statements of the current period.These matters were addressed in the context of our audit of the financial statements as awhole and in forming our opinion thereon and we do not provide a separate opinion onthese matters.

DESCRIPTION OF KEY AUDIT MATTER

The Key Audit matter How the matter was addressed in our audit
Litigations related to taxation and other claims In view of the significance of the matter we applied the following audit procedures in this area among others to obtain sufficient appropriate audit evidence :
Refer Note 6 17 and Note 25 to financial statements and "significant & material orders passed by the regulators or courts or tribunals" section in the Reports of the Board of Directors & Management Discussion and Analysis. • We understood the Company's process around the evaluation and continuous re-assessment of tax related liabilities accounting policy thereof and other claims.
The Company is subjected to a large number of central and state tax litigations/proceedings and other claims pending before various judicial forums which could have a significant impact on the results depending upon the outcome of the matter. • Assessed the appropriateness of design and implementation of the Company's key controls over assessment of litigations and appropriateness of disclosures.
The amounts involved are significant and the application of accounting standards to determine the amount if any to be provided as a liability or disclosed as a contingent liability is inherently subjective. • Performed substantive procedures on the underlying calculations supporting the liabilities recorded.
The Company regularly updates and assesses its legal positions with the use of internal and external legal experts. • Assessed the management's conclusion through understanding relevant judicial precedents in similar cases and the applicable rules and regulations.
We considered the tax related litigations and other claims a key audit matter given the size complexity and number of cases pending and contingency related to other claims. • Engaged subject matter specialists to gain an understanding of the current status of litigation and developments in the disputes if any through discussion with the management and by reading external advice received by the Company where relevant to validate management ‘s conclusion.
• Assessed the adequacy of the Company's disclosures in the financial statements made in relation to tax litigations and other claims.
The Key Audit matter How the matter was addressed in our audit
Revenue Recognition
Refer to Note 1 - Significant Accounting Policies to the financial statements. In view of the significance of the matter we applied the following audit procedures in this area among others to obtain sufficient appropriate audit evidence :
Revenue from sale of goods is recognized when effective control over goods is transferred to a customer as per the terms of the contract. This is usually evidenced by a transfer of all of the significant risks and rewards of ownership accounting policies and compliance with the applicable accounting standards. upon delivery of goods to the customer which in terms of timing is not materially different to the date of shipping. • Evaluated the appropriateness of the Company's revenue recognition
Revenue is measured at contracted price after deduction of any trade discount trade incentive and other similar discounts and any taxes or duties collected on behalf of the Government which are levied on sales such as Goods and Services Tax etc. • Tested the design implementation and operating effectiveness of the Company's key controls including IT controls over measurement and recognition of revenue in accordance with customer contracts.
We considered Revenue Recognition as a key audit matter because : Revenue is a key performance indicator of the Company. Accordingly there could be pressure to meet the expectation of investors/other stakeholders. We have considered that there is a risk of fraud related to revenue being overstated by recognition in the wrong period or before control has passed. • Performed substantive testing (including period end cut off testing) on selected samples of revenue transactions recorded during the year by testing the underlying documents which includes sales contract and shipping documents/customer acceptance to test evidence for transfer of control.
• Assessed the overall trade discounts/ trade incentive issued in the current year in comparison with previous year.
• Assessed the adequacy of accrual made as at year end toward trade incentive schemes.
• Other audit procedures specifically designed to address risk of Management override of controls including journal entry testing.
• Assessed the adequacy of the Company's disclosures in the financial statements.

OTHER INFORMATION

The Company's Management and Board of Directors are responsiblefor the other information. The other information comprises the information included in theCompany's annual report but does not include the financial statements and ourauditors' report thereon. The Company's annual report is expected to be madeavailable to us after the date of this auditor's report.

financial statements does not cover Ouropiniononthe the otherinformation and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the financial statements our knowledgeobtained in the audit or otherwise appears to be materially misstated.

When we read the annual report if we conclude that there is a materialmisstatement therein we are required to communicate the matter to those charged withgovernance.

MANAGEMENT'S AND BOARD OF DIRECTORS'/ BOARD OF TRUSTEES'RESPONSIBILITIES FOR THE FINANCIAL STATEMENTS

The Company's Management and Board of Directors are responsiblefor the matters stated in Section 134(5) of the Act with respect to the preparation ofthese financial statements that give a true and fair view of the state of affairsprofit/loss and other comprehensive income changes in equity and cash flows of theCompany in accordance with the accounting principles generally accepted in Indiaincluding the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act.The respective Management and Board of Directors of the Company/Board of Trustees of theTrust are responsible for maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company/Trust and forpreventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring accuracy and completeness of theaccounting records relevant to the preparation and presentation of the financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the financial statements the Management and Board ofDirectors/Board of Trustees are responsible for assessing the ability of the Company/Trustto continue as a going concern disclosing as applicable matters related to goingconcern and using the going concern basis of accounting unless the Board ofDirectors/Board of Trustees either intends to liquidate the Company/Trust or to ceaseoperations or has no realistic alternative but to do so.

The respective Board of Directors/Board of Trustees are alsoresponsible for overseeing the financial reporting process of Company/Trust.

AUDITOR'S RESPONSIBILITIES FOR THE AUDIT OF THE 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. Reasonableassurance is a high level of assurance but is not a guarantee that an audit conducted inaccordance with SAs 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.

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 financialstatements 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 the Management andBoard of Directors.

• Conclude on the appropriateness of the Management and Board ofDirectors use of the going concern basis of accounting financial statements preparation ofand based on the audit evidence obtained whether a material uncertainty exists relatedto events or conditions that may cast significant doubt on the Company's ability tocontinue as a going concern. If we conclude that a material uncertainty exists we arerequired to draw attention in our auditor's report to the related disclosures in thefinancial statements or if such disclosures are inadequate to modify our opinion. Ourconclusions 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 thefinancial statements including the disclosures and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

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 financialstatements of the current period and are therefore the key audit matters. We describethese 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 2020("the Order") issued by the Central Government of India in terms of section 143(11) of the Act we give in the "Annexure A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

2. (A) 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 (including othercomprehensive income) the statement of changes in equity and the statement of cash flowsdealt with by this Report are in agreement with the books of account.

d) In our opinion the aforesaid financial statements comply with theInd AS specified under Section 133 of the Act.

e) On the basis of the written representations received from thedirectors as on 31st March 2022 taken on record by the Board of Directors noneof the directors is disqualified as on 31st March 2022 from being appointed as a directorin terms of 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".

(B) With respect to the other matters to be included in theAuditors' Report in accordance with Rule 11 of the Companies (Audit andAuditor's) Rules 2014 in our opinion and to the best of our information andaccording to the explanations given to us:

a) The Company has disclosed the impact of pending litigations as at31st March 2022 on its financial position in its financial statements - Refer Note 6 17and 25 to the financial statements.

b) The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses.

c) There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.

d) i. The Management has represented that to the best of its knowledgeand belief no funds have been advanced or loaned or invested (either from borrowed fundsor share premium or any other sources or kind of funds) by the Company to or in any otherpersons or entities including foreign entities ("Intermediaries") with theunderstanding whether recorded in writing or otherwise that the Intermediary shall :

• directly or indirectly lend or invest in other persons orentities identified in any manner whatsoever ("Ultimate Beneficiaries") by or onbehalf of the Company or • provide any guarantee security or the like to or onbehalf of the Ultimate Beneficiaries.

ii. the Management has represented that to the best of its knowledgeand belief no funds have been received by the Company from any persons or entitiesincluding foreign entities ("Funding Parties") with the understanding whetherrecorded in writing or otherwise that the Company shall :

• directly or indirectly lend or invest in other persons orentities identified in any manner whatsoever ("Ultimate Beneficiaries") by or onbehalf of the Funding Party or • provide any guarantee security or the like From oron behalf of the Ultimate Beneficiaries.

iii. Based on such audit procedures as considered reasonable andappropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the representations under sub-clause (d)(i) and (d)(ii) contain any materialmisstatement.

e) the dividend declared or paid during the year by the Company is incompliance with Section 123 of the Act.

(C) With respect to the matter to be included in the auditors reportunder Section 197(16) of the Act :

In our opinion and according to the information and explanations givento us the remuneration paid by the Company to its directors during the current year is inaccordance with the provisions of Section 197 of the Act. The remuneration paid to anydirector is not in excess of the limit laid down under Section 197 of the Act. TheMinistry of Corporate Affairs has not prescribed other details under Section 197(16) ofthe Act which are required to be commented upon by us.

for B S R & Associates LLP
Chartered Accountants
Firm's Registration Number: 116231W/ W-100024
Arpan Jain
Partner
Place: Hyderabad</td> Membership Number: 125710
Date: 26th April 2022 UDIN: 22125710AHUHIQ1310

Annexure A to the Independent Auditors' report on the financialstatement of VST Industries Limited for the year ended 31st March 2022

(Referred to in paragraph 1 under ‘Report on Other Legal andRegulatory Requirements' section of our report of even date)

To the best of our information and according to the explanationsprovided to us by the Company and the books of account and records examined by us in thenormal course of audit we state that:

i. (a) (A) The Company has maintained proper records showing fullparticulars including quantitative details and situation of Property Plant andEquipment;

(B) The Company has maintained proper records showing full particularsof intangible assets.

(b) The Company has a regular programme of physical verification of itsProperty Plant and Equipment by which all property plant and equipment are verified in aphased manner over a period of three years. In accordance with this Programme certainproperty plant and equipment were verified during the year. In our opinion thisperiodicity of physical verification is reasonable having regard to the size of theCompany and the nature of its assets. According to the information and explanations givento us no material discrepancies were noticed on such verification.

(c) The title deeds of immovable properties (other than immovableproperties where the Company is the lessee and the leases agreements are duly executed infavour of the lessee) disclosed in the financial statements are held in the name of theCompany. Refer Note 2A of the financial statements.

(d) The Company has not revalued its Property Plant and Equipment orintangible assets or both during the year.

(e) There are no proceedings initiated or pending against the Companyfor holding any benami property under the Prohibition of Benami Property Transactions Act1988 and rules made thereunder.

ii. (a) The inventory has been physically verified by the Managementduring the year. In our opinion the frequency of such verification is reasonable andprocedures and coverage as followed by management were appropriate.

No discrepancies were noticed on verification between the physicalstocks and the book records that were more than 10% in the aggregate of each class ofinventory.

(b) The Company has not been sanctioned any working capital limits inexcess of five crores rupees in aggregate from banks and financial institutions on thebasis of security of current assets at any point of time of the year. Accordingly clause3(ii)(b) of the Order is not applicable to the Company.

iii. The Company has not made any investments provided guarantee orsecurity secured or unsecured to companies firms limited liability partnership or anyother parties during the year. The Company has granted loans and advances in the nature ofloans secured or unsecured to other parties in respect of which the requisite informationis as below :

(a) Based on the audit procedures carried on by us and as per theinformation and explanations given to us the Company has provided loans or providedadvances in the nature of loans to any other entity as below :

Rs in Lakhs

Particulars Aggregate amount during the year Balance outstanding as at balance sheet date
Loan to Employees (including Employee societies) 47.50 46.09

(b) We are of the opinion that the investments made and the terms andconditions of the grant of loans are prima facie not prejudicial to the interest of thecompany. The Company has not provided guarantee or security given or advances in thenature of loans to companies firms limited liability partnership or any other partiesduring the year.

(c) In the case of loans given the repayment of principal and paymentof interest has been stipulated and the repayments or receipts have been regular. Furtherthe Company has not given any advance in the nature of loan to any party during the year.

(d) In respect of loans granted by the Company there is no overdueamount for more than ninety days in respect of loans give. Further the Company has notgiven any advances in the nature of loans to any party during the year.

(e) There is no loan or advance in the nature of loan granted fallingdue during the year which has been renewed or extended or fresh loans granted to settlethe overdues of existing loans given to same parties.

(f) The Company has not granted any loans or advances in the nature ofloans either repayable on demand or without specifying any terms or period of repayment.

iv. The Company has not given any loans or provided guarantees orsecurities as specified under Section 185 of the Companies Act 2013. The Company has notprovided any loans or provided guarantees or securities as specified under Section 186of the Companies Act 2013. In respect of the investments made by the Company in ouropinion the provisions of Section 186 of the Act have been complied with.

v. The Company has not accepted any deposits or amounts which aredeemed to be deposits from the public. Accordingly clause 3(v) of the Order is notapplicable.

vi. The Central Government has not prescribed the maintenance of costrecords under Section 148(1) of the Companies Act 2013 for the products manufactured byit. Accordingly clause 3(vi) of the Order is not applicable.

vii. In respect of statutory dues :

(a) The Company does not have liability in respect of Service TaxSales Tax and Value Added Tax during the year since effective 1 July 2017 thesestatutory dues has been subsumed into Goods and Services Tax ("GST").

In our opinion amounts deducted/accrued in the books of account inrespect of undisputed statutory dues including GST Provident fund Employees' StateInsurance Income-Tax duty of Customs duty of Excise Cess and other statutory dues havebeen regularly deposited by the Company with the appropriate authorities.

(b) Statutory dues relating to Goods and Services Tax Service TaxEntry Tax or other statutory dues which have not been deposited on account of any disputeare as follows :

Name of statute Nature of dues Amount in lakhs (Rs)* Period to which the amount relates Forum where the dispute is pending
The Central Excise Act 1944 Service tax credit ineligibility under Cenvat Credit Rules 2002 260.20 (18.89)* August 2015 to March 2016; April 2014 to March 2015; October 2012 to September 2013; April 2016 to March 2017 Customs Excise & Service Tax Appellate Tribunal
Goods and Services Tax Goods & Services Tax 101.76 (5.09)* Financial year 2019-20 Allahabad High Court
West Bengal Tax on Entry of Goods into Local Areas Act 2012 Entry Tax 1751.62 Dec 2014 to June 2017 Kolkata High Court
UP Tax on entry of Goods into Local Areas Act 2007 Entry Tax 848.24 (275.00)* January 2007 to March 2011 Supreme Court of India
Jharkhand Entry Tax on Consumption or Use of Goods Act 2011 Entry Tax 87.15 August 2006 to March 2007 Jharkhand High Court
Assam Entry Tax Act 2008 Entry Tax 151.08 October 2006 to March 2007 Gauhati High Court

* Represents amount paid under protest/pre-deposit. Above amount aredisclosed as per assessment/demand order and includes interest/penalty wherever specifiedin the order.

viii. The Company has not surrendered or disclosed any transactionspreviously unrecorded as Income in the books of account in the tax assessments under theIncome Tax Act 1961 as Income during the year.

ix. (a) The Company has not taken any loans or other borrowings fromany lender during the year. Hence reporting under clause 3(ix)(a) of the Order is notapplicable.

(b) The Company has not been declared willful defaulter by any bank orfinancial institution or government or any government authority.

(c) The Company has not taken any term loan during the year and thereare no outstanding term loans at the beginning of the year and hence reporting underclause 3(ix)(c) of the Order is not applicable.

(d) The Company has not raised any funds on short-term basis and hencereporting under clause 3(ix)(d) of the Order is not applicable.

(e) The Company has no subsidiaries associates or joint ventures andhence reporting under clause 3(ix)(e) of the Order is not applicable.

(f) The Company has not raised any loans during the year and hencereporting on clause 3(ix)(f) of the Order is not applicable.

x. (a) The Company has not raised any moneys by way of initial publicoffer or further public offer (including debt instruments). Accordingly clause 3(x)(a) ofthe Order is not applicable.

(b) The Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year.Accordingly clause 3(x)(b) of the Order is not applicable.

xi. (a) No fraud by the Company or material fraud on the Company hasbeen noticed or reported during the course of the audit.

(b) No report under sub-section (12) of Section 143 of the CompaniesAct 2013 has been filed by the auditors in Form ADT-4 as prescribed under Rule 13 ofCompanies (Audit and Auditors) Rules 2014 with the Central Government.

(c) We have taken into consideration the whistle blower complaintsreceived by the Company during the year while determining the nature timing and extent ofour audit procedures.

xii. The Company is not a Nidhi Company. Accordingly clause 3(xii)(a)(b) and (c) of the Order is not applicable

xiii. In our opinion the transactions with related parties are incompliance with Section 177 and 188 of the Companies Act 2013 where applicable and thedetails of the related party transactions have been disclosed in the financial statementsas required by the applicable accounting standards.

xiv. (a) In our opinion the Company has an internal audit systemcommensurate with the size and nature of the business.

(b) We have considered the internal audit reports of the Company issuedtill date for the period under audit.

xv. In our opinion the company has not entered into any non-cashtransactions with its directors or persons connected to its directors and henceprovisions of Section 192 of the Companies Act 2013 are not applicable to the Company.

xvi. (a) The Company is not required to be registered under Section45-IA of the Reserve Bank of India act 1934. Accordingly clause 3(xvi)(a) and (b) of theOrder is not applicable.

(b) The Company is not a Core Investment Company

(CIC) as defined in the regulations made by the Reserve Bank of India.Accordingly clause 3(xvi) (c) of the Order is not applicable.

(c) The Company is not part of any Group (as defined in the CoreInvestment Companies (Reserve Bank) Directions 2016). Accordingly the requirements ofclause 3(xvi)(d) are not applicable.

xvii. The Company has not incurred cash losses in the current and inthe immediately preceding financial year.

xviii. There has been no resignation of the statutory auditors duringthe year. Accordingly clause 3(xviii) of the Order is not applicable.

xix. On the basis of the financial ratios ageing and expected dates ofrealization of financial assets and payment of financial liabilities other informationaccompanying the financial statements our knowledge of the Board of Directors andManagement plans and based on our examination of the evidence supporting the assumptionsnothing has come to our attention which causes us to believe that any materialuncertainty exists as on the date of the audit report that company is not capable ofmeeting its liabilities existing at the date of balance sheet as and when they fall duewithin a period of one year from the balance sheet date. We however state that this isnot an assurance as to the future viability of the company. We . further state that ourreporting is based on the facts up to the date of the audit report and we neither give anyguarantee nor any assurance that all liabilities falling due within a period of one yearfrom the balance sheet date will get discharged by the Company as and when they fall due.

xx. In our opinion there is no unspent amount under sub-section (5) ofSection 135 of the Companies Act 2013 pursuant to any project. Accordingly clause3(xx)(a) and 3(xx)(b) of the Order are not applicable.

for B S R & Associates LLP
Chartered Accountants
Firm's Registration Number: 116231W/ W-100024
Arpan Jain
Partner
Place: Hyderabad Membership Number: 125710
Date: 26th April 2022 UDIN: 22125710AHUHIQ1310

Annexure B to the Independent Auditors' report on the financialstatements of VST Industries Limited for the year ended 31st March 2022

Report on the internal financial controls with reference to theaforesaid financial statements under Clause (i) of Sub-section 3 of Section 143 of theCompanies Act 2013

(Referred to in paragraph (f) under ‘Report on Other Legal andRegulatory Requirements' section of our report of even date)

OPINION

We have audited the internal financial controls with reference to("the Company") as of 31st March 2022 in conjunction with our audit of thefinancial statements of the Company for the year ended on that date.

In our opinion the Company has in all material respects adequateinternal financial controls with reference to fi financial statements and such internalwere operating effectively as at 31st March 2022 based on the internal financial controlswith reference to financial statements 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 (the "Guidance Note").

MANAGEMENT'S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS

The Company's management and the Board of Directors areresponsible for establishing and maintaining internal with reference to financialstatements criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note. These responsibilities include the designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring the orderly and efficient conduct of its business includingadherence to company's policies the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial information as required under theCompanies Act 2013 (hereinafter referred to as "the Act").

AUDITORS' RESPONSIBILITY

Our responsibility is to express an opinion on the Company'sinternal financial controls with reference to financial statements based on our audit. Weconducted our audit in accordance with the Guidance Note and the Standards on Auditingprescribed under Section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls with reference to financial statements. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols with reference to financial statements were established and maintained andwhether such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls with reference to financial statements andtheir operating effectiveness. Our audit of internal financial controls with reference tofinancial statements included 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 ofthe risks of material misstatement of the financial statements whether due to fraud orerror.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internalfinancial controls with reference to financial statements.

MEANING OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO FINANCIALSTATEMENTS

A company's internal financial controls with reference tofinancial statements is a process designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles. Acompany's internal financial controls with reference to financial statements includethose policies and procedures that (1) pertain to the maintenance of records that inreasonable detail accurately and fairly reflect the transactions and dispositions of theassets of the company; (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 authorisations of management and directors of thecompany; and (3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could havea material effect on the financial statements.

INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TOFINANCIAL STATEMENTS

Because of the inherent limitations of internal financial controls withreference to financial statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to financial statements to future periods are subject to the riskthat the internal financial controls with reference to financial statements may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.

for B S R & Associates LLP
Chartered Accountants
Firm's Registration Number: 116231W/ W-100024
Arpan Jain
Partner
Place: Hyderabad Membership Number: 125710
Date: 26th April 2022 UDIN: 22125710AHUHIQ1310

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