TO THE MEMBERS OF YUVRAAJ HYGIENE PRODUCTS LIMITED REPORT ON THE AUDIT OF THE IND ASFINANCIAL STATEMENTS OPINION
We have audited the Ind AS Financial Statements of Yuvraaj Hygiene Products Limited ("theCompany") which comprise the Balance
Sheet as at March 31 2020 the Statement of Profit and Loss including the Statementof Other Comprehensive Income the Cash Flow Statement and the Statement of Changes inEquity for the year then ended and notes to the Ind AS Financial Statements including asummary of significant accounting policies and other explanatory information (hereinafterreferred to as "the Ind AS Financial Statements").
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS Financial Statements give the information required bythe Companies Act 2013 as amended ("the Act") in the manner so required andgive a true and fair view in
conformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at March 31 2020 its loss including other comprehensiveincome its cash flows and the changes in equity for the yearended on that date.
BASIS FOR OPINION
We conducted our audit of the Ind AS Financial Statements in accordance with theStandards on Auditing (SAs) as specified under section 143(10) of the Companies Act2013. Our responsibilities under those Standards are further described in the 'Auditor'sResponsibilities for the Audit of the Ind AS Financial Statements' section of our report.We are independent of the Company in accordance with the 'Code of Ethics' issued by theInstitute of Chartered Accountants of India (ICAI) together with the ethical requirementsthat are relevant to our audit of the Ind AS Financial Statements under the provisions ofthe Companies Act 2013 and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the ICAI's Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the Ind AS Financial Statements.
EMPHASIS OF MATTERS
We draw attention to following Notes to the Ind AS Financial Statements being matterspertaining to Yuvraaj Hygiene Products Limited requiring emphasis by us. Ouropinion is not qualified in respect of these matters:
1. Note no. 34 regarding Contingent Liabilities not provided for in the books ofaccounts of the company.
2. Note no. 2.3 (f) which describes the impacts of COVID-19 Pandemic on the Ind ASFinancial Statements as also on business operations of the Company assessment thereof bythe management of the Company based on its internal external and macro factors involvingcertain estimation uncertainties.
MATERIAL UNCERTAINTY RELATED TO GOING CONCERN
We draw attention to Note no. 2.1 of the Ind AS Financial Statements which indicatesthat the Company has accumulated losses and its net worth has been fully eroded theCompany has incurred net loss/net cash loss during the current and previous year(s) andthe Company's current liabilities exceeded its current assets as at 31 March 2020. Theabove factors indicate that a material uncertainty exists that may cast significant doubton the Company's ability to continue as a going concern.
However we were informed by the Management and the Board of Directors that the Companyis in the process of identifying alternative business plans which in the opinion of themanagement will enable the Company to have profitability and to have a turnaround. TheCompany is also in the process of identifying strategic business partners and alternativebusiness plans to improve the performance of the Company. The Company's ability togenerate positive cash flows depends on the successful implementation of such alternativebusiness plans. Pending the resolution of the above uncertainties the Company hasprepared the aforesaid Ind AS Financial Statements on a going concern basis.
The factors described above in our opinion may have an adverse effect on functioningof the Company.
KEY AUDIT MATTERS
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Ind AS Financial Statements for the year ended March 312020. These matters were addressed in the context of our audit of the Ind AS FinancialStatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. For each matter below our description of how our auditaddressed the matter is provided in that context.
We have determined the matters described below to be the key audit matters to becommunicated in our report. We have fulfilled the responsibilities described in theAuditor's Responsibilities for the Audit of the Ind AS Financial Statements section of ourreport including in relation to these matters. Accordingly our audit included theperformance of procedures designed to respond to our assessment of the risks of materialmisstatement of the Ind AS Financial Statements. The results of our audit proceduresincluding the procedures performed to address the matters below provide the basis for ouraudit opinion on the accompanying Ind AS Financial Statements.
|Key Audit Matter ||How the matter was addressed in our audit |
|Material Uncertainty relating to Going Concern: || |
|There is use of Going Concern Assumption basis of accounting in Ind AS Financial Statement but a material uncertainty exists. (Refer to Note no. 2.1 of Ind AS Financial Statements). ||We have analysed the management assumption of Going Concern basis of accounting and checked whether the fact has been appropriately disclosed in the Ind AS Financial Statement. Also we have commented on the same in our report under material uncertainty related to going concern paragraph above. |
|Revenue Recognition: || |
|Revenue is recognized when the significant risks and rewards of ownership of the goods have been passed to the buyer. ||Our audit procedures in respect of recognition of revenue included the following: |
|Revenue is a key performance indicator for the Company. There is risk of revenue being fraudulently recognized before control has passed to the customer resulting from pressure to meet external investor/ stake-holder expectations or to meet revenue targets set through performance incentive schemes. ||Assessed the Company's accounting policies relating to revenue recognition and accrual for rebates and discounts by comparing them with theapplicable accounting standards; |
|Determining the accrual for rebates and discounts (variable consideration) involves estimation based onapplicable promotional schemes and the potential claims expected to be raised by the customers. ||Tested design and operating effectiveness of the Company's internal controls over recognition of revenue and estimating accrual for rebates and discounts; |
|Accordingly recognition of revenue based on the transfer of control to customers and estimation of accrual for variable consideration including rebates and discounts have been considered to be key auditmatters. (Refer to Note no. 2.2 (l) of Ind AS Financial Statements). ||Examined sales invoices and dispatch/shipping documents for selected samples of revenue to verify that revenue has been recognised only oncecontrol has passed to the customer; |
| ||Performed retrospective review to identify any management bias with respect to accrual forrebates and discounts; |
|Provisions and Contingent Liabilities: || |
|There are a number of Indirect tax cases against the Company. High level of judgement is required in estimating the level of provisioning required. ||We analyzed the current status of the Indirect tax cases. |
|(Refer to Note no. 34 of Ind AS Financial Statements). ||Our procedures in respect of tax matters included the following: |
| ||Testing key controls over litigation regulatory and tax procedures; |
| ||Performing substantive procedures on the underlying calculations supporting the provisions (if any) recorded; |
| ||Where relevant reading external legal opinions obtained by management; |
| ||Meeting and discussing with the management and reading relevant Company correspondence. |
| ||Assessing management's conclusions through understanding precedents set in similar cases; and |
| ||Based on the evidence obtained and the related disclosures in Note no. 34 of the Ind AS Financial Statements conclude that the disclosure was sufficient. |
1. Due to the continuous spreading of COVID -19 across India the Indian Governmentannounced a strict 21-day lockdown on 24 March 2020 which was further extended till 30June 2020 across the India to contain the spread of the virus. This has resulted inrestriction on physical visit to the client locations and the need for carrying outalternative audit procedures as per the Standards on Auditing prescribed by the Instituteof Chartered Accountants of India (ICAI).
As a result of the above the entire audit was carried out based on remote access ofthe data as provided by the management. This has been carried out based on the advisory on"Specific Considerations while conducting Distance Audit/ Remote Audit/ Online Auditunder current Covid-19 situation" issued by the Auditing and Assurance StandardsBoard of ICAI.
We have been represented by the management that the data provided for our auditpurposes is correct complete reliable and are directly generated by the accountingsystem of the Company without any further manual modifications.
We bring to the attention of the users that the audit of the Ind AS FinancialStatements has been performed in the aforesaid conditions.
2. Balances in respect of trade receivables trade payables deposits and loans andadvances (debit or credit balances on whatever account) are subject to confirmation fromrespective parties. However in the opinion of the Management all the Current Assets andNon-current Financial Assets are approximately of the value stated in books if realizedin the ordinary course of business.
3. Income and Expenditure for current year inter alia includes amount pertaining toprior period(s). This has not been separately disclosed in the Ind AS financial statementsin a manner that their impact on the current year's profit can be perceived.
Our opinion is not qualified in respect of above matters.
INFORMATION OTHER THAN THE IND AS FINANCIAL STATEMENTS AND AUDITOR'S REPORT THEREON
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 Ind AS Financial Statements and our auditors' report thereon ('Other Information').The Other Information is expected to be made available to us after the date of thisAuditors' Report. Our opinion on the Ind AS Financial Statements does not cover the OtherInformation and we do not express any form of assurance conclusion thereon.
In connection with our audit of the Ind AS Financial Statements our responsibility isto read the Other Information when it becomes available and in doing so consider whetherthe Other Information is materially inconsistent with the Ind AS Financial Statements orour knowledge obtained during the course of our audit or otherwise appears to bematerially misstated. When we read the Other Information and if we conclude that there isa material misstatement therein we are required to communicate the matter to thosecharged with governance as required under SA 720 'The Auditor's responsibilities Relatingto Other Information'.
MANAGEMENT'S RESPONSIBILITY FOR THE IND AS FINANCIAL STATEMENTS
The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese Ind AS Financial Statements that give a true and fair view of the financial positionand financial performance of the Company in accordance with the accounting principlesgenerally accepted in India including the Accounting Standards specified under Section133 of the Companies Act 2013.
This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Companies Act 2013 for safeguarding the assets ofthe Company and for preventing and detecting frauds and other irregularities; selectionand application of appropriate accounting policies; making judgments and estimates thatare reasonable and prudent; and design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS Financial Statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing these Ind AS Financial Statements management is responsible for assessingthe company'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.
Those Board of Directors are also responsible for overseeing the Company's financialreporting process.
AUDITOR'S RESPONSIBILITIES FOR THE AUDIT OF THE IND AS FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether the Ind AS 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 Ind AS 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 Ind AS 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 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 used and the reasonableness ofaccounting 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 Ind AS Financial Statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.
Evaluate the overall presentation structure and content of the Ind AS FinancialStatements including the disclosures and whether the Ind AS Financial Statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.
Materiality is the magnitude of misstatement in the Ind AS Financial Statements thatindividually or in aggregate makes it probable that the economic decisions of areasonable knowledgeable user of the Ind AS Financial Statements may be influenced. Weconsider quantitative materiality and qualitative factors in:
(i) Planning the scope of our audit work and in evaluating the results of our work: and
(ii) To evaluate the effect of any identified misstatements in the Ind AS FinancialStatements.
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 Ind AS 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
1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in term of subsection (11) of Section 143 of theCompanies Act 2013 we give in the Annexure "A" a statement on thematters specified in paragraphs 3 and 4 of the Order.
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 including Other ComprehensiveIncome the Statement of Changes in Equity and the Cash Flow Statement dealt with by thisReport are in agreement with the books of account;
d. In our opinion the aforesaid Ind AS Financial Statements comply with the AccountingStandards specified under Section 133 of the Act read with Companies (Indian AccountingStandards) Rules 2015 as amended;
e. The matter described under Material Uncertainty Related to Going Concern paragraphabove in our opinion may have an adverse effect on functioning of the Company.
f. On the basis of the written representations received from the directors as on March31 2020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2020 from being appointed as a director in terms of Section 164(2) of theAct.
g. 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".
h. With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended:
In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its directors during the year is inaccordance with the provisions of section 197 of the Act.
i. 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:
i. The Company has disclosed the impact of pending litigations on its financialposition in its Ind AS Financial Statements - Refer Note No. 34 to the Ind AS FinancialStatements;
ii. The Company did not have any long - term contracts including derivative contractsfor which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.
For N. S. Gokhale & Co. Chartered Accountants (Firm Registration No. 103270W)
CA Abhay Sidhaye (Partner) Membership No.: 033502
Date: 31 July 2020
TO THE INDEPENDENT AUDITORS' REPORT ON THE IND AS FINANCIAL STATEMENTS:
Referred to in paragraph 1 under the heading 'Report on Other Legal & RegulatoryRequirement' of our report of even date to the Member of Yuvraaj Hygiene ProductsLimited on the Ind AS Financial Statements for the year ended 31 March 2020 we herebygive below the statement on matters specified in paragraph 3 & 4 of the Companies(Auditor's Report) Order 2016:
i) Fixed Assets:
a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
b) As explained to us the management carries out the physical verification of fixedassets periodically. In our opinion the frequency of physical verification is reasonablehaving regard to the size of the company and nature of its assets. As explained to us nomaterial discrepancies were noticed by the management on such physical verificationnecessitating any adjustment.
c) According to information and explanations given to us by the management and on thebasis of our examination of the record of the Company no immovable properties are held bythe Company in its name.
The inventory except goods-in-transit and stock lying with third parties has beenphysically verified by the management during the year. For inventory lying with thirdparties at the year-end written confirmations have been obtained. In our opinion thefrequency of such verification is reasonable.The discrepancies noticed on verificationbetween the physical stocks and the book records were not material and have beenappropriately dealt with in the books of accounts.
iii) Unsecured Loans Given:
As explained to us and verified from books and records the Company has not granted anyloans secured or unsecured to Companies firms or other parties covered in the registermaintained under Section 189 of the Companies Act 2013. Thus clauses 3(iii) (a) (b) and(c) of the Companies (Auditor's Report) Order 2016 are not applicable to the Company.
iv) Loans Investments Guarantees and Security given to directors others:
As explained to us and verified from books and records The Company has not given anyloans investment guarantees and securities which may be covered under section 185 and186 of the Companies Act 2013.
v) Public Deposit:
According to the information and explanations given to us the Company has not acceptedany deposit from public during the year within the meaning of section 73 to 76 or anyother relevant provision of the companies Act 2013 and the Companies (Acceptance ofDeposits) Rules 2014. Accordingly paragraph 3(v) of the Order is not applicable to theCompany.
vi) Cost Record:
The Central Government has not prescribed the maintenance of cost records underSub-section 1 of Section 148 of the Companies Act 2013 for any of the activities carriedon by the company. Accordingly clause 3(vi) of the Companies (Auditor's Report) Order2016 is not applicable to the Company.
vii) Statutory Dues:
In respect of statutory dues on the basis of information and explanations given to usand on the basis of our examination of the records of the company we report that:
a) According to information and explanations given to us and on the basis of ourexamination of the books of account and records the Company is not regular in depositingwith appropriate authorities undisputed statutory dues including Provident FundEmployees' State Insurance Income Tax (TDS) Goods & Service Tax and other materialstatutory dues as applicable to it. Details of undisputed
dues payable as at 31 March 2020 for a period of more than six months from the date onwhen they become payable are as follows:
|Particular ||Amount In ` |
|Goods and Service Tax# ||1318568 |
|Profession Tax# ||118231 |
|Interest on Stamp Duty ||1418860 |
|Penalty/Interest on Cess ||314860 |
|Total ||3170519 |
#Dues amount does not include interest and penalty.
O ESIC of contracted factory labour is neither provided nor paid for the financial year2019-20.
O Above Interest on Stamp Duty and Penalty/Interest on Cess has not been provided inthe books and not deposited with the concerned authorities request letter for the waiveris submitted.
b) According to the records of the company and on the basis of information andexplanation given to us the dues outstanding to any
statutory authority on account dispute as on 31 March 2020 are as follows:
|Name of the Statute ||Nature of the dues ||Amount in ` ||Period to which the amounts relates ||Forum Where dispute is pending |
|CST Act 1956 and MVAT Act 2002 ||Sales Tax and Interest ||652672 ||2008-09 ||Deputy Commissioner Appeals |
| || ||530445 ||2009-10 || |
| || ||1880121 ||2010-11 || |
| || ||322483 ||2010-11 ||Under Amnesty Scheme |
| || ||112207 ||2011-12 || |
| || ||4092103 ||2012-13 ||AO for Rectification |
| || ||85059 ||2012-13 ||Under Amnesty Scheme |
| || ||634480 ||2013-14 || |
| || ||14868871 ||2014-15 ||AO for Rectification |
|Total || ||23178441 ||- ||- |
viii) Default in Repayment of Dues:
Based on our examination and on the basis of information and explanations given by themanagement we are of the opinion that the company has not defaulted in repayment of duesto a financial institutions or banks.
ix) End Use of moneys raised:
Based upon the audit procedures performed and the information and explanations given bythe management the company has not raised moneys by way of initial public offer orfurther public offer including debt instruments and term loans. Accordingly the clause 3(ix) of the Order is not applicable to the Company and hence not commented upon.
During the course of our examination of the books and records of the Company carriedout in accordance with the generally accepted auditing practices in India and accordingto the information and explanations given to us no fraud by the Company or on the Companyby its officers or employees has been noticed or reported during the year nor have webeen informed of any such case by the Management.
xi) Managerial Remuneration:
In our opinion and according to the information and explanations given to us theCompany has paid / provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the Act.
xii) Nidhi Company:
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.
xiii) Related Party Transactions:
In our opinion transactions with the related parties are in compliance with section177 and 188 of Companies Act 2013 where applicable and the details of such transactionshave been disclosed in the Ind AS Financial Statements as required by the applicableaccounting standards. (Refer Note No. 32 of Ind AS Financial Statements).
xiv) Preferential Allotment / Private Allotment:
According to the information and explanations given to us and based on our examinationof the records of the Company The Company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the year.Hence reporting requirement under paragraph 3 (xiv) of the order is not applicable andhence not commented upon.
xv) Non-cash transactions with related party:
Based upon the audit procedures performed and the information and explanations given bythe management the company has not entered into any non-cash transactions with directorsor persons connected with them which are covered under Section 192 of Companies Act 2013.Accordingly the provisions of clause 3 (xv) of the Order are not applicable to theCompany and hence not commented upon.
xvi) Non-Banking Financial Company Registration:
According to the information and explanation given to us the company is not requiredto be registered under section 45-IA of the Reserve Bank of India Act 1934. Hence Clause3 (xvi) of the Order is not applicable to the Company.
For N. S. Gokhale & Co. Chartered Accountants (Firm Registration No. 103270W)
CA Abhay Sidhaye (Partner) Membership No.: 033502
Date: 31 July 2020
TO THE INDEPENDENT AUDITORS' REPORT ON THE IND AS FINANCIAL STATEMENTS:
Referred to in paragraph 2(g) under the heading 'Report on other Legal and RegulatoryRequirements' of our report of even date to The Members of Yuvraaj Hygiene ProductsLimited on the Ind AS Financial Statements for the year ended 31 March 2020.
Report on the Internal Financial Controls with reference to Ind AS Financial Statementsunder Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("theAct")
We have audited the internal financial controls with reference to Ind AS FinancialStatements of Yuvraaj Hygiene Products Limited ("the Company") as of 31March 2020 in conjunction with our audit of the Ind AS Financial Statements of the Companyfor 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 Reporting (the"Guidance Note")issued by the Institute of Chartered Accountants of India('ICAI'). These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company's policiesthe safeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.
Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls 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 includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the Ind AS Financial Statements whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of Ind AS Financial Statements for external purposes in accordance withgenerally accepted accounting principles.
A company's internal financial control over financial reporting includes those policiesand 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) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of Ind AS Financial Statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorizations of management and directors of the company; and
3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial effect on the Ind AS 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.
In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2020 based on the internal controlover financial reporting 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 N. S. Gokhale & Co. Chartered Accountants
(Firm Registration No. 103270W)
CA Abhay Sidhaye (Partner)
Membership No.: 033502
Date: 31 July 2020