Auditor Report of Equippp Social Impact Technologies Ltd.
Mar 31, 2023
EQUIPPP SOCIAL IMPACT TECHNOLOGIES LIMITED (Formerly Proseed India Limited)
REPORT ON AUDIT OF THE STANDALONE FINANCIAL STATEMENTS
OPINION
We have audited the accompanying standalone Financial Statements of EQUIPPP SOCIAL IMPACT TECHNOLOGIES LIMITED (Formerly Proseed India Limited) (âthe Companyâ), which comprise of the Balance Sheet as at 31st March 2023, the Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the statements of changes in equity for year then ended and a summary of the significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the state of affairs (financial position) of the Company as at March 31, 2023 and its loss (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing (SAs) as specified under Section 143(10) of the Companies Act 2013. Our responsibilities under those standards are further described in the Auditors Responsibilities for the Audit of the Financial Statements Section of our report. We are independent of the company in accordance with the code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the companies act 2013 and the Rules there under, and we have fulfilled our ethical responsibilities in accordance with those requirements and the code of Ethics. We believe that the audit evidence we have obtained is Sufficient and appropriate to provide a basis for our audit opinion on the Standalone Ind AS Financial Statements.
During the year under consideration, the management of the company has received the estimated useful life of its intangible assets from the existing 11 years to 34 & 40 years, as in the opinion of the management, the ESG, CSR, Social Technology space are expected to have a long useful life. Accordingly , the depreciation for the financial year was calculate from the beginning of the year on balance useful life of the said intangible assets. This change has resulted into lower charge of depreciation to the extent of Rs.46.99 Lakhs during the year and higher statement of profit to that extent during the year.
Our opinion on the Statement is not modified in respect of the above matter.
Key audit matters are those matters that, in our professional judgment, were 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 a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
The Companyâs management and board of directors are responsible for the preparation of the other information. The other information comprises the information included in the companyâs annual report but does not include the financial statements and our auditorâs report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information; we are required to report that fact. We have nothing to report in this regard.
MANAGEMENTâS RESPONSIBILITY FOR THE STANDALONE FINANCIAL STATEMENTS
The Companyâs Board of Directors are responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these financial statements that give a true and fair view of the state of affairs (financial position), profit or loss (financial performance including other comprehensive income) cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatements, whether due to fraud or error.
In preparing the financial statements, management and Board of Directors are responsible for assessing the companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing the companyâs financial Reporting process.
AUDITORâS RESPONSIBILITIES FOR THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act, 2013, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls system in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
⢠Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the 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 auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
01. As required by the Companies (Auditors Report) Order, 2020 (âthe orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in the âAnnexure Aâ a statement on the matters specified in paragraph 3 and 4 of the said order.
02. As required by Section 143(3) of the Act, we report that:
(i) We have sought and obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;
(ii) In our opinion, proper books of accounts as required by law been kept by the Company so far as it appears from our examination of those books;
(iii) The Balance Sheet, Profit and Loss Account including other comprehensive income the Cash flow Statement and statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(iv) In our opinion, the aforesaid financial statements comply with Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended.
(v) On the basis of written representations received from the directors, as on 31st March, 2023 and taken on record by the Board of Directors, we report that none of the directors are disqualified as on 31st March, 2023 from being appointed as a director in terms of section 164(2) of the Act.
(vi) With respect to the adequacy of the internal financial controls over financial reporting of the company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Bâ.
(vii) In our opinion, Section 197 of the companies Act, 2013 is in complied by the Company.
(viii) With respect to the other matters to be included in the Auditorsâ Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company does not have any pending litigations which would impact its financial position;
ii. The Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses; and
iii. There were no pending amounts which were, required to be transferred to the Investor Education and Protection Fund by the Company.
iv.
a) The management has represented that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the company to or in any other per-son(s) or entity(ies), including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
b) The management has represented, that, to the best of itsâ knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been received by the company from any person(s) or entity(ies), including foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
c) Based on audit procedures which we considered reasonable and appropriate in the circumstances, nothing has come to their notice that has caused them to believe that the representations under subclause (a) and (b) contain any material misstatement.
For ANJANEYULU& CO.,
Chartered Accountants FRN: 000180S
D V Anjaneyulu
Partner-MNo: 026012 UDIN- 23021036BGYXWG5231
Date: 29/05/2023 Place: Hyderabad
Mar 31, 2022
OPINION
We have audited the standalone Ind AS financial statements of EQUIPPP SOCIAL IMPACT TECHNOLOGIES LIMITED (Formerly PROSEED INDIA LIMITED) (âthe Companyâ), which comprise the Balance Sheet as at 31st March 2022, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity for the year then ended and a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the state of affairs (financial position) of the Company as at March 31st, 2022 and its loss (Financial Performance including other comprehensive income), its cashflows and the changes in equity for the year ended on that date.
We conducted our audit of the standalone IND AS financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditorâs Responsibilities for the Audit of the Standalone Ind AS financial statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (âICAIâ) together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional judgment, were 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 a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Except for the matter described in the material uncertainty related to going concern section, no other KAM needs to be addressed in our report.
OTHER INFORMATION
The companies management and Board of Directors are responsible for the other information. The other information comprises the information included in the Companies Annual Report, but does not include the Financial Statements and our auditors report there on. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with the audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If based on the work we have performed, we conclude that there is a material misstatement o this other information, we are required to report the fact. We have nothing to report in this regard.
MANAGEMENTâS RESPONSIBILITY FOR THE STANDALONE FINANCIAL STATEMENTS
The Companyâs Board of Directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give a true and fair view of the state of affairs (financial position), Profit or loss (financial performance including other Comprehensive Income), cash flows and changes in equity and of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under Sec 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities, selection and application of appropriate accounting policies, making judgments and estimates that are reasonable and prudent and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the management and Board of Directors are responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
AUDITORS RESPONSIBILITIES FOR THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether the Standalone Ind AS financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Standalone Ind AS financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
1. Identify and assess the risks of material misstatement of the Standalone Ind AS financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
2. Obtain an understanding of internal control relevant to the audit in order to design 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 has adequate internal financial controls system in place and the operating effectiveness of such controls.
3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
4. Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our
5. Evaluate the overall presentation, structure and content of the Standalone Ind AS financial statements, including the disclosures, and whether the Standalone Ind AS financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Standalone Ind AS financial statements for the financial year ended March 31st, 2022 and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
For Navitha and Associates
Chartered Accountants
ICAI Firm Registration Number: 012026S
Sd/-
Navitha.K Proprietor M. No: 221085
UDIN:22221085AZVKAR3814 Place : Hyderabad Date : 29-05- 2022
Mar 31, 2021
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the standalone Ind AS financial statements of Equippp Social Impact Technologies Ltd(Formerly Proseed India Limited) ("the Company"), which comprise the Balance Sheet as at 31st March 2021, the Statement of Profit and Loss, Statement of Changes in Equity and Statement of Cash Flows for the year then ended and a summary of significant accounting policies and other explanatory information (hereinafter referred to as "the financial statements").
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Companies Act, 2013 (the "Act") in the manner so required and give a true and fair view in conformity with Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2021, loss, total comprehensive income, changes in equity and cash flows for the year ended on that date.
We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of the financial statements section of our report. We are independent of the Company in accordance with the 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 financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on the financial statements.
The Resolution Plan filed by the Resolution Professional (âRPâ) has been approved by the Hon''ble NCLT vide its order dated December 03, 2020.
The successful resolution applicant has infused the required investments as per the approved Resolution Plan and these financial results have been prepared after giving effect to the said Resolution Plan and based on the confirmation of the settlement of financial and operating creditors as approved by the RP.
In view of the implementation of the said plan, the standalone financial statements have been prepared and presented by the Company on a Going Concern basis.
We draw attention to Note 3.15 of the financial statements, which describes the extent to which the COVID-19 Pandemic will impact the Company''s results which depend on future developments that re highly uncertain. Our opinion is not modified in respect of this matter.
Key audit matters are those matters that, in our professional judgment, were 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 a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
In respect of de-recognition of operational and financial creditors, difference amounting to Rs, 1375.12 Lakh between the carrying amount of financial liabilities extinguished and consideration paid, is recognised in statement of profit or loss account in accordance with âInd AS - 109â on âFinancial Instrumentsâ prescribed under section 133 of the Companies Act, 2013 and accounting policies consistently followed by the Company and disclosed as an âExceptional itemsâ.
Accounting for the effects of the resolution plan is considered by us to be a matter of most significance due to its importance to intended users understanding of the Financial Statements as a whole and materiality thereof.
We have performed the following procedures to determine whether the effect of Resolution Plan has been appropriately recognised in the Financial Statements:
⢠Reviewed management''s process for review and implementation of the Resolution Plan.
⢠Reviewed the provisions of the Resolution Plan to understand the requirements of the said Plan and evaluated the possible impact of the same on the financial statements.
⢠Verified the balances of liabilities as on the date of approval of Resolution Plan from supporting documents and computations on a test check basis.
⢠Verified the payment of funds on test check basis as per the Resolution Plan.
⢠Tested the implementation of provisions of the Resolution Plan in computation of balances of liabilities owed to financial and operational creditors.
⢠Evaluated whether the accounting principles applied by the management fairly present the effects of the Resolution Plan in financial statements in accordance with the principles of Ind AS.
⢠Tested the related disclosures made in notes to the financial statements in respect of the implementation of the resolution plan.
Accounting treatment arising from implementation of resolution plan approved by the Hon''ble National Company Law Tribunal(âHon''ble NCLTâ)
As more fully explained in notes to the standalone financial statements, the successful resolution applicant(s) has infused the required investments as per the approved Resolution Plan and the Company has accounted for the transactions relating to the above as directed by the Hon''ble NCLT.
Information Other than the Financial Statements and Audit Report Thereon
The Company''s Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management and Discussion Analysis, Board''s Report including Annexures to Board''s Report, Business Responsibility Report, Corporate Governance and Shareholder''s Information, but does not include the financial statements and our auditor''s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information obtained prior to the date of this auditor''s report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance, total comprehensive income, changes in equity and cash flows of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities, selection and application of appropriate accounting policies, making judgments and estimates that are reasonable and prudent and design,implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.Auditors Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with SAs, we exercise professional judgement and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal financial controls relevant to the audit in order to design
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 has adequate internal financial controls system in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
⢠Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability of the Company to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the 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''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
The comparative financial information of the Company for the year ended 31st March, 2021 included in these standalone Ind AS financial statements, are based on the previously issued statutory financial statements prepared in accordance with Companies (Accounting Standards) Rules, 2016 audited by us on which we had expressed an unmodified opinion vide our Audit Reports dated June 30, 2021, as adjusted for the differences in accounting principles adopted by the company on transition to the Ind AS, which have been audited by us.
Our opinion is not modified in respect of this matter.
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 in terms of Section 143(11) of the Act, we give in "Annexure A" a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
i. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit of the financial statements.
ii. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books
iii. The Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of changes in Equity and the Statement of Cash Flows dealt with by this Report are in agreement with the books of account maintained for the purpose or preparation of the financial statements.
iv. In our opinion, the aforesaid financial statements comply with the Ind AS specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
v. On the basis of the written representations received from the directors as on 31st March, 2021 taken on record by the Board of Directors, none of the directors is disqualified as on 31stMarch, 2021 from being appointed as a director in terms of Section 164(2) of the Act.
vi. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B".
vii. With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of section 197(16) of the Act, as amended:
viii. In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its managing director during the year is in accordance with the provisions of section 197 of the Act.
ix. With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, In our opinion and to the best of our information and according to the explanations given to us:
The Company has disclosed the impact of pending litigations on its financial position in its financial statements- Refer Note No 2.18 of the financial statements The Company did not have any longterm contracts including derivative contracts for which there were any material foreseeable losses There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company
Chartered Accountants
ICAI Firm Registration Number: 012026S
Sd/-
Navitha.K Proprietor M. No: 221085
Place : Hyderabad Date :30-06- 2021
UDIN:21221085AAAAAU9902
Mar 31, 2015
Report on the Financial Statements
We have audited the accompanying financial statements of M/s Green Fire
Agri Commodities Limited (the 'Company'), which comprise the Balance
Sheet as at 31 March 2015, the Statement of Profit and Loss and the
Cash Flow Statement for the year then ended, and a summary of
significant accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters in
section 134(5) of the Companies Act, 2013 ("the Act") with respect to
the preparation and presentation of these financial statements that
give a true and fair view of the financial position, financial
performance and cash flows of the Company in accordance with the
accounting principles generally accepted in India, including the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility
also includes the maintenance of adequate accounting records in
accordance with the provision of the Act for safeguarding of the assets
of the Company and for preventing and detecting frauds and other
irregularities; selection and application of appropriate accounting
policies; making judgments and estimates that are reasonable and
prudent; and design, implementation and maintenance of adequate
internal financial control, that were operating effectively for
ensuring the accuracy and completeness of the accounting records,
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing
specified under section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor's judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal financial control relevant to the Company's
preparation of the financial statements that give a true and fair view
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on
whether the Company has in place an adequate internal financial
controls system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of
the accounting estimates made by Company's Directors, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the financial
statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid financial statements, give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India;
a) In the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2015;
b) In the case of the Statement of Profit and Loss, of the Loss for the
year ended on that date; and
c) In the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Emphasis of Matter
Attention is drawn to Note No.2.20(b) of the Notes to the Accounts with
respect to balances under Sundry Debtors/Loans and Advances/Sundry
Creditors/Other Liabilities which have not been confirmed by certain
parties.
Our opinion is not modified in this regard.
Report on other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2015 ("the
Order") issued by the Central Government of India in terms of
sub-section (11) of section 143 of the Act, we give in the Annexure a
statement on the matters specified in the Paragraph 3 and 4 of the
Order, to the extent applicable.
2. As required by section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations
which to the best of 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 the Company so far as appears from our examination of those
books;
(c) the balance sheet, the statement of profit and loss, and cash flow
statement dealt with by this Report are in agreement with the books of
account;
(d) in our opinion, the aforesaid financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014;
(e) on the basis of written representations received from the directors
as on 31 March, 2015, taken on record by the Board of Directors, none
of the directors is disqualified as on 31 March, 2015, from being
appointed as a director in terms of Section 164(2) of the Act; and
(f) with respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and 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
financial position in its financial statements
ii. the Company did have dues on account of Investor Education and
Protection Fund which have not been transferred during the year under
review, amounting to Rs. 3,12,324.
Annexure to the Auditors' Report
The Annexure referred to in our Independent Auditors' Report to the
members of M/s Green Fire Agri Commodities Limited ("the Company') on
the financial statements for the year ended on 31st March 2015, we
report that:
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets. (b) The Company has a regular program of physical verification
of its fixed assets by which all fixed assets are verified every year.
In accordance with this program, fixed assets were verified during the
year and no material discrepancies were noted on such verification. In
our opinion, this periodicity of physical verification is reasonable
having regard to the size of the Company and the nature of its assets
(ii) As per the information and explanations given to us, the Company
does not hold any inventories at any time during the year under review.
However, the Company is trading in agricultural commodities by way of
purchase and sale, wherein the physical goods are directly moved from
purchaser to the Company's customer. As there is no physical movement
of goods to/from the Company, we offer no comments under paragraph
3(ii) of the said Order.
(iii) The Company has not granted any loans, secured or unsecured to
companies, firms or other parties covered in the register maintained
under Section 189 of the Companies Act, 2013. Accordingly, paragraph
3(iii)(b) and (c) of the said Order are not applicable.
(iv) In our opinion and according to the information and explanations
given to us there is an adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of fixed assets and with regard to the sale of goods. We
have not observed any cases of continuing failure to correct major
weakness in the internal control system during the course of the audit.
(v) The Company has not accepted any deposits from the public.
Therefore, the provisions of Clause (v) of paragraph 3 of the said
Order are not applicable to the Company.
(vi) The Central Government of India has not prescribed the maintenance
of cost records under section 148(1) of the Act, for any of the
activities carried on by the Company.
(vii) (a) According to the information and explanations given to us and
on the basis of our examination of the records of the Company, amounts
deducted / accrued in the books of account in respect of undisputed
statutory dues including Provident Fund, Income Tax, Service tax, Value
added tax, Employees' State Insurance and other material statutory dues
have generally been regularly deposited during the year by the Company
with the appropriate authorities, except for certain cases of Tax
deducted at source. As explained to us, the Company did not have any
dues on account of Wealth Tax, Customs Duty and Excise Duty.
According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, income tax,
service tax, value added tax and other material statutory dues were in
arrears as at 31st March 2015 for a period of more than six months from
the date they become payable, except for statutory dues amounting to
Rs. 75,750.
(b) According to the information and explanations given to us, there
are no Material dues of Sales Tax, Wealth Tax, Customs Duty and Excise
Duty which have not been deposited with the appropriate authorities on
account of any dispute, except as stated hereunder:-
Sl. Period to
No Name of the Amount which the Forum where
Nature of dues
Statute Rs. amount dispute is
relates pending
1 Sales Tax,
Mumbai VAT-Mumbai 12,45,280 2012-13 Sales Tax,
Maharashtra
2 Sales Tax,
AP VAT 8,925 2012-13 Sales Tax,
AP
3 Income Tax Self assessment
tax 97,73,793 2011-12 DCIT
4 Income Tax Tax demand 64,16,141 2006-07 ITAT
5 Income Tax Tax demand 1,56,07,170 2010-11 ITAT
(c) According to the records of the Company, there are amounts of Rs.
3,12,324 that are due to be transferred to the Investor Education and
Protection Fund in accordance with the relevant provisions of the
Companies Act, 1956 (1 of 1956) and rules made there under. (viii) The
accumulated losses of the Company are more than fifty percent of its
net worth as at 31st March 2015. Further, the company had incurred cash
losses in the financial year and also in the immediately preceding
financial year.
(ix) According to the information and explanations given to us and
based on the documents and records produced to us, the company has
defaulted in repayment of dues to M/s Dhanalakshmi Bank, amounting
outstanding being Rs.13,97,35,615 as per the books of account at the
year end. However, no direct confirmation from Bank is on record and
the account has become NPA.
(x) In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions.
(xi) The Company had not obtained any term loans during the year under
review.
(xii) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For Sarath & Associates
Chartered Accountants
Firm Regn No.005120S
Date : 29/05/2015 S Srinivas
Place : Hyderabad Partner
M.No.202471
Mar 31, 2014
We have audited the accompanying financial statements of M/s. GREEN
FIRE AGRI COMMODITIES LIMITED ("the Company"), which comprise the
Balance Sheet as at 31st March, 2014, the Statement of Profit and Loss
and the Cash Flow Statement for the year then ended and a summary of
the significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
The Company''s Management is responsible for the preparation of these
financial statements that give a true and fair view of the financial
position, financial performance and cash flows of the Company in
accordance with the Accounting Standards notified under the Companies
Act, 1956 ("the Act"). (Which continue to be applicable in respect of
Section 133 of the Companies Act, 2013 in terms of General Circular
15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs)
This responsibility includes the design, implementation and maintenance
of internal controls relevant to the preparation and presentation of
the financial statements that give a true and fair view and are free
from material misstatement, whether due to fraud or error.
Auditors'' Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with the
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal controls relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company''s internal control. An audit also includes
evaluating the appropriateness of the accounting policies used and the
reasonableness of the accounting estimates made by the Management, as
well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31 March, 2014;
(b) in the case of the Statement of Profit and Loss, of the loss of the
Company for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Emphasis of Matter
(a) Attention is drawn to Note No.2.21(a) of the Notes to the Accounts
of the Company, relating to extensive damage due to the major fire
accident which completely destroyed the physical vouchers upto
10.2.2014 and also affected computers, Furniture and Fixtures, Office
Equipments, servers and the steps taken by the Company for recovering
the data from the Backup systems. We have conducted limited review of
the accounts for the nine months period ending 31.12.2013. We have also
conducted Audit for the year ending March 2014, based on data retrieved
from the systems including scanned/ soft copies and physical records
available.
(b) Attention is also drawn to Note No.2.21 (b) of the Notes to the
Accounts with respect to balances under Sundry Debtors/ Claims
Recoverable/Loans & Advances/ Sundry Creditors/ Other Liabilities which
have not been confirmed by the certain parties.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government in terms of Section 227(4A) of
the Act, we give in the Annexure a statement on the matters specified
in paragraphs 4 and 5 of the Order.
2. As required by Section 227(3) of the Act, we report that:
(a) We have obtained all the information and explanations which to the
best of 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 the Company so far as it appears from our examination of
those books
(c) The Balance Sheet, the Statement of Profit and Loss and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account.
(d) In our opinion, the Balance Sheet, the Statement of Profit and Loss
and the Cash Flow Statement comply with the Accounting Standards
notified under the Act. (Which continue to be applicable in respect of
Section 133 of the Companies Act, 2013 in terms of General Circular
15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs).
(e) On the basis of the written representations received from the
directors as on 31 March, 2014 taken on record by the Board of
Directors, none of the directors is disqualified as on 31 March, 2014
from being appointed as a director in terms of Section 274(1) (g) of
the Act.
(f) Since the Central Government has not issued any notification as the
rate at which the cess is to be paid under section 441A of the
Companies Act, 1956 nor has it issued any Rules under the said section,
prescribing the manner in which such cess is to be paid, no cess is due
and payable by the Company.
Annexure referred to in paragraph 1 under the heading
"Report on other legal and regulatory requirements" of our report of
even date
1.1 According to the information and explanations furnished to us, the
Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
1.2 As informed to us, the Company had carried out the physical
verification of Fixed Assets during the year under review and such
verification did not reveal any material discrepancies.
1.3 During the year, there had been an instance of major fire accident
which completely destroyed Office Equipment, Computers, Servers,
Furniture and Fixtures. However, the Company could retrieve the lost
data from the Back up Systems and after the year end and before the
date of Audit Report, had replenished the physical systems and
accordingly, we are of the opinion that the impairment during the
financial year will not affect the Going Concern status of the Company
due to the steps taken by the Company.
2.1 As per the information and explanations given to us, as the Company
does not hold any inventories viz. Finished Goods, Stores, Spare Parts,
Goods in Process and Raw Materials at any time during the year, the
provisions of clause 4(ii)(a), 4(ii)(b) and 4(ii)(c) of the Order are
not applicable to the Company for the current year.
3.1 As per the information and explanations given to us, the company
has not granted any loans, secured or unsecured to Companies, Firms or
other parties covered in the register maintained under Section 301 of
the Act. Hence the provisions of Clause 4(iii)(a) to (d) are not
applicable to the Company for the current year.
3.2 As per the information and explanations given to us, the company
has taken loan from a company covered in the register under Section 301
of the Companies Act, 1956. The maximum amount outstanding during the
year was Rs. 92 Lakhs and the year end balance of such loan was Rs. 92
Lakhs
3.3 In our opinion, the rate of interest and other terms and conditions
for the above loan taken by the company listed in the register
maintained under section 301 of the Companies Act, 1956 are not, prima
facie, prejudicial to the interest of the Company.
3.4 According to the information and explanations given to us, the
tenure and repayment terms have not been specified for the above
mentioned loans. Consequently, we are unable to comment on paragraph
4(iii)(g) of the Order.
4 In our opinion and according to the information and explanations
given to us, there are adequate Internal Control Systems commensurate
with the size of the company and the nature of its business with regard
to purchase of fixed assets and sale of services. Further, during the
course of our audit, we have not come across any instances of
continuing failure to correct major weakness in internal control
system.
5.1 According to the information and explanations given to us and as
informed by the Management, the particulars of contracts or
arrangements of the Company which needs to be entered into the register
maintained under Section 301 of the Act, have been entered in the
register maintained Under Section 301 of the Act.
5.2 In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of an arrangement
referred to in (5.1) above and exceeding the value of Rs. 5 lakhs
during the year have been made at prices which are reasonable having
regard to the prevailing market price at the relevant time.
6 In our opinion and according to the information and explanations
given to us, as the company has not accepted any deposits from public
covered by directives issued by the Reserve Bank of India and the
provisions of Section 58A and 58AA or any other relevant provisions of
the Act and the rules made there under, the provisions of clause 4(vi)
of the Order are not applicable to the company for the current year.
7 In our opinion, the Company has an internal audit system commensurate
with the nature and size of its business
8 According to the information and explanations given to us,
maintenance of cost records has not been prescribed by the Central
Government under section 209 (1) (d) of the Companies Act, 1956, for
any of the activities of the Company, and hence, the provisions of
clause 4(viii) are not applicable to the Company for the current year.
9.1 According to records of the Company and as per the information and
explanations given to us, there are few delays in depositing with the
appropriate authorities, the undisputed statutory dues pertaining to
Income Tax, Sales Tax, Service Tax, Customs Duty and Other material
statutory dues applicable to it, and there were undisputed statutory
dues in arrears, as at the date of balance sheet under report, for a
period of more than six months from the date they become payable, which
are mentioned below:
9.2 As per the records of the Company there are no dues of Income Tax,
Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty or Cess
which have not been deposited on account of any dispute as on
31.03.2014, except as mentioned below.
Sl. No. Name of Asst. Year Amount Rs. Forum Where
Statute dispute is
pending
1 Income Tax 2006-07 5,61,74,100 CIT appeals &
ITAT
2 Income Tax 2007-08 87,57,770 ITAT
10 As per the information and explanations given to us and on overall
examination of the financial statements of the Company, for the current
and immediately preceding financial year, we report that accumulated
losses at the end of the current financial year, exceeds fifty percent
of its net worth and the company had incurred cash losses in the
current financial year. However, the Company had not incurred cash
losses in the immediately preceding financial year.
11 According to the information and explanations given to us and based
on the documents and records produced to us, the company has defaulted
in repayment of dues to Banks as stated below.
12 According to the information furnished to us, as the Company has not
granted any loans or advances on the basis of security by way of pledge
of shares, debentures and other securities to anybody during the year,
the provisions of Clause 4(xii) of the Order are not applicable to the
company for the current year.
13 In our opinion, as the company is not a chit fund, nidhi or a mutual
benefit fund/society, the provisions of Clause 4(xiii) of the Order are
not applicable to the company for the current year.
14 As the Company is not dealing or trading in shares, securities,
debentures and other investments, the provisions of clause 4(xiv) the
Order are not applicable to the company for the current year
15 As per the information and explanations given to us, the company has
not given any guarantees for loans taken by others from banks or
financial institutions, the provisions of Clause 4(xv) of the Order are
not applicable to the company for the current year.
16 As the Company had not availed any term loans, the provisions of
Clause 4(xvi) of the Order are not applicable to the company for the
current year.
17 According to records and on an overall examination of the balance
sheet of the company, the funds raised on short term basis have not
been used for long term investment.
18 As per the information and explanations given to us, as the company
has not made any separate preferential allotment of shares to parties
and companies covered in the Register maintained under the section 301
of the Act during the year, the provisions of Clause 4(xviii) of the
Order are not applicable to the company for the current year. However,
the Company had allotted shares to one entity where principal
shareholders/ management personnel have control or significant
influence over this enterprise, pursuant to the scheme of arrangement
and amalgamation.
19 As the Company has not issued any debentures during the year, which
requires creation of security or charge, the provisions of Clause
4(xix) of the Order are not applicable to the Company for the current
year.
20 As the Company has not made any public issue during the year, the
provisions of clause 4 (xx) of the Order are not applicable to the
company for the current year.
21 During the course of examination of the books and records of the
Company carried out in accordance with the generally accepted auditing
practices in India, and as per the representation given by the Company
and relied on by us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
year, nor have we been informed of such cases by the management.
For Sarath & Associates
Chartered Accountants
Firm Regn. No. 0005120S
S. Srinivas
Place: Hyderabad Partner
Date: 30.05.2014 Membership No. 202471
Mar 31, 2011
1. We have audited the attached balance sheet of Northgate
Technologies Limited ("the Company") as at 31 March 2011 and the profit
and loss account and the cash flow statement of the Company for the year
ended on that date annexed thereto. These financial statements are the
responsibility of the Company's Management. Our responsibility is to
express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with auditing standards
generally accepted in India. those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. an audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by Management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditor's Report) Order, 2003 ('the
Order'), as amended, issued by the Ministry of Corporate Affairs in
terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we
enclose in the Annexure a statement on the matters specifed in
paragraphs 4 and 5 of the said Order.
4. Further to our comments in the annexure referred to in paragraph 3
above, we report that:
i) we have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
ii) in our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
iii) the balance sheet, profit and loss account and cash flow statement
dealt with by this report are in agreement with the books of account;
iv) in our opinion, the balance sheet, profit and loss account and cash
flow statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of Section 211 of the
Companies Act, 1956;
v) on the basis of written representations received from the directors,
as on 31 March 2011, and taken on record by the Board of Directors, we
report that none of the directors is disqualifed as on 31 March 2011
from being appointed as a director in terms of clause (g) of
sub-section (1) of Section 274 of the Companies Act, 1956;
vi) in our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India:
a. in the case of the balance sheet, of the state of affairs of the
Company as at 31 March 2011;
b. in the case of the profit and loss account, of the loss for the year
ended on that date; and
c. in the case of cash flow statement, of the cash flows of the Company
for the year ended on that date.
Annexure to Auditors' Report
the annexure referred to in paragraph 3 of our report of even date to
the members of Northgate technologies Limited ("the Company") for the
year ended 31 March 2011. We report that:
(i) (a) The Company is maintaining proper records showing full
particulars including quantitative details and situation of fixed
assets.
(b) The Company has a regular programme of physical verifcation of its
fixed assets by which all fixed assets are verifed every year. In our
opinion, this periodicity of physical verifcation is reasonable having
regard to size of the company and nature of its assets. In accordance
with this program, fixed assets were verifed during the year and no
material discrepancies were noted on such verifcation.
(c) Fixed assets disposed off during the year were not substantial, and
therefore, do not affect the going concern assumption.
(ii) The Company is a service company, primarily rendering Information
Technology services. Accordingly, it does not hold any physical
inventories. Thus, paragraph 4(ii) of the Order is not applicable.
(iii) The Company has neither granted nor taken any loans, secured or
unsecured, to or from companies, frms or other parties covered in the
register maintained under Section 301 of the Companies act, 1956.
(iv) In our opinion and according to the information and explanations
given to us, and having regard to the explanation that purchases of
certain items of fixed assets are for the Company's specialized
requirements and similarly certain services sold are for the
specialized requirements of the buyers and suitable alternative sources
are not available to obtain comparable quotations, there is an adequate
internal control system commensurate with the size of the Company and
the nature of its business with regard to purchase of fixed assets and
with regard to the sale of services. the activities of the Company do
not involve purchase of inventory and sale of goods. We have not
observed any major weakness in the internal control system during the
course of the audit.
(v) (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the act have been entered in the register
required to be maintained under that section.
(b) In our opinion, and according to the information and explanations
given to us, the transaction made in pursuance of an arrangement
referred to in (a) above and exceeding the value of Rs 5 lakhs during
the year have been made at prices which are reasonable having regard to
the prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) The Central Government of India has not prescribed the
maintenance of cost records under Section 209(1)(d) of the Companies
act, 1956 for any of the services rendered by the Company. the
activities of the Company do not involve sale of goods.
(ix) (a) According to the information and explanations given to us and
on the basis of our examination of the records of the Company, amounts
deducted / accrued in the books of account in respect of undisputed
statutory dues including provident Fund, employees' state insurance,
Income-tax, Wealth tax and other material statutory dues have generally
been regularly deposited during the year by the Company with the
appropriate authorities though there have been a slight delay in a few
cases. Further as explained to us, the Company did not have any dues on
account of Sales tax, Service tax, Customs duty, excise duty and
Investor education and protection Fund.
Further, there were no dues on account of Cess under Section 441a of
the Companies act, 1956 since the date from which the aforesaid Section
comes into force has not yet been notifed by the Central Government of
India.
according to the information and explanations given to us, no
undisputed amounts payable in respect of provident Fund, employees'
state insurance, Income-tax, Wealth tax and other material statutory
dues were in arrears as at 31 March 2011 for a period of more than six
months from the date they became payable.
(b) According to the information and explanations given to us, there
are no dues of Sales tax, We tax, Customs duty, excise duty and Cess
which have not been deposited with the appropria account of any
dispute. however, the Company disputes the following Income tax dues:
Name of the Statute Nature of the Amount (Rs.) Period to which the
Forum where dispute is Dues amount relates pending
Income-tax act, 1961 tax/ Interest 1,580,037 2003 -2004 Income tax
appellate
(1,580,037)* tribunal, hyderabad.
Income-tax act, 1961 tax/ Interest 101,918,628 2006 -2007 Commissioner
of Income
(500,000)* Tax (Appeals), Hyderabad.
* the amounts in parenthesis represent the payment made under protest.
(x) The accumulated losses of the Company are more than ffity percent of
its net worth as at 31 March 2011. However, the Company has not
incurred cash losses in the financial year and in the immediately
preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company did not have any outstanding dues to any
financial institution, banks or debenture holders during the year.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion, and according to the information and
explanations given to us, the Company is not a chit fund or a nidhi /
mutual benefit fund / society.
(xiv) According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
(xv) In our opinion and according to the information and explanations
given to us, the terms and conditions on which the Company has given
guarantees for loans taken by others from banks are not prejudicial to
the interest of the Company.
(xvi) The Company did not have any term loans outstanding during the
year.
(xvii) according to information and explanations given to us, and on an
overall examination of the balance sheet of the Company, we are of the
opinion that the funds raised on short-term basis have not been used
for long-term investment.
(xviii) The Company has not made any preferential allotment of shares
to companies/ frms/ parties covered in the register maintained under
Section 301 of the Companies act, 1956.
(xix) the Company did not have any outstanding debentures during the
year.
(xx) The Company has not raised any money by public issues.
(xxi) according to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
for B S R and Company
Chartered accountants
Firm registration No:128900W
Zubin Shekary
partner
Membership No: 48814
place : hyderabad
Date : May 19, 2011
Mar 31, 2010
1. We have audited the attached balance sheet of Northgate
Technologies Limited ("the Company") as at 31 March 2010 and the profit
and loss account and the cash flow statement of the Company for the
year ended on that date annexed thereto. These Financial statements are
the responsibility of the Companys management. Our responsibility is
to express an opinion on these Financial statements based on our audit.
2. We conducted our audit in accordance with auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
Financial statements are free of material misstatement. an audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the Financial statements. An audit also includes
assessing the accounting principles used and significants estimates
made by management, as well as evaluating the overall Financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 (Ãthe
Order), as amended, issued by the Central Government of India in terms
of sub-section (4A) of section 227 of the Companies Act, 1956, we
enclose in the Annexure a statement on the matters specified in
paragraphs 4 and 5 of the said Order.
4. Further to our comments in the annexe referred to in paragraph 3
above, we report that:
(i) we have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
(ii) in our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(iii) the balance sheet, profit and loss account and cash flow
statement dealt with by this report are in agreement with the books of
account;
(iv) in our opinion, the balance sheet, profit and loss account and
cash flow statement dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of section 211 of
the Companies Act, 1956;
(v) on the basis of written representations received from the
directors, as on 31 March 2010, and taken on record by the Board of
Directors, we report that none of the directors is disqualifed as on 31
March 2010 from being appointed as a director in terms of clause (g) of
sub-section (1) of section 274 of the Companies Act, 1956;
(vi) without qualifying our opinion, we draw attention to Note (c) to
Schedule 1 of the accompanying Financial statements which sets out the
basis on which management believes that the going concern assumption is
appropriate. Notwithstanding the significant operating losses, erosion
of net-worth and substantial write- down in the value of long-term
investments, which have arisen on account of the ongoing restructuring
of its internet-based advertisement segment, the management believes
that the scaling down of these operations has reached a sustainable
level which would enable the Company to generate cashflows sufficient
to meet its liabilities as and when they fall due; and
(vii) in our opinion and to the best of our information and according
to the explanations given to us, the said accounts give the information
required by the Companies act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India:
a. in the case of the balance sheet, of the state of affairs of the
Company as at 31 March 2010; and
b. in the case of the profit and loss account, of the loss for the
year ended on that date.
c. in the case of cash flow statement, of the cash flows of the
Company for the year ended on that date.
Annexure to the Auditors Report
The Annexure referred to in the auditors report to the members of
Northgate Technologies Limited ("the Company") for the year ended 31
March 2010. We report that:
1. the Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
2. The Company has a regular program of physical verification of its
fixed assets by which all fixed assets are verified over a period of
three years. In our opinion, the periodicity of physical verification
is reasonable having regard to the size of the Company and the nature
of its assets. In accordance with this program, fixed assets were
verified during the previous year and no material discrepancies were
noted on such verification.
3. Fixed assets disposed of during the year were not substantial, and
therefore, do not affect the going concern assumption.
4. the Company is a service company, primarily rendering Information
technology services. accordingly, it does not hold any physical
inventories. Thus, paragraph 4(ii) of the Order is not applicable.
5. The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under section 301 of the Companies act, 1956.
6. the Company has taken a loan from a company covered in the register
maintained under section 301 of the Companies act, 1956. the maximum
amount outstanding during the year as well as the year end balance of
the loan was rs. 124,149,586.
7. In our opinion, the rate of interest and other terms and conditions
on which loan has been taken from the party listed in the register
maintained under section 301 of the Companies act, 1956 are not, prima
facie, prejudicial to the interest of the Company.
8. We are informed that the principal and interest on the aforesaid
loan is repayable / payable on demand and no demand has been raised on
the Company till the balance sheet date, either for principal or for
interest. accordingly, paragraph 4(iii) (g) of the Order is not
applicable.
9. In our opinion and according to the information and explanations
given to us, and having regard to the explanation that purchases of
certain items of fixed assets are for the Companys specialized
requirements and similarly certain services sold are for the
specialized requirements of the buyers and suitable alternative sources
are not available to obtain comparable quotations, there is an adequate
internal control system commensurate with the size of the Company and
the nature of its business with regard to purchase of fixed assets and
with regard to the sale of services. The activities of the Company do
not involve purchase of inventory and sale of goods. We have not
observed any major weakness in the internal control system during the
course of the audit.
10. In our opinion and according to the information and explanations
given to us, the particulars of contracts or arrangements referred to
in section 301 of the Companies act, 1956 have been entered in the
register required to be maintained under that section.
11. In our opinion, and according to the information and explanations
given to us, the transaction made in pursuance of an arrangement
referred to in (10) above and exceeding the value of Rs 5 lakhs during
the year have been made at prices which are reasonable having regard to
the prevailing market prices at the relevant time.
12. In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
13. The Central Government has not prescribed the maintenance of cost
records under section 209(1)(d) of the Companies act, 1956 for any of
the services rendered by the Company.
14. according to the information and explanations given to us and on
the basis of our examination of the records of the Company, amounts
deducted / accrued in the books of account in respect of undisputed
statutory dues including Provident Fund, Employees State Insurance,
Income-tax, Wealth tax and other material statutory dues have been
generally regularly deposited during the year by the Company with the
appropriate authorities though there have been slight delays in few
cases. as explained to us, the provisions of service tax are not
applicable to the Company. Further as explained to us, the Company did
not have any dues on account of Sales tax, excise duty, Customs duty,
Service tax and Investor education and protection Fund.
Further, there were no dues on account of Cess under section 441a of
the Companies act, 1956 since the date from which the aforesaid section
comes into force has not yet been notified by the Central Government of
India.
according to the information and explanations given to us, no
undisputed amounts payable in respect of provident Fund, Employees
State Insurance, Income-tax, Wealth tax and any other material
statutory dues were in arrears as at 31 March 2010 for a period of more
than six months from the date they became payable.
According to the information and explanations given to us, there are no
dues of Income-tax, and Wealth tax which have not been deposited with
the appropriate authorities on account of any dispute.
15. The accumulated losses of the Company are more than fifty percent
of its net worth as at 31 March 2010. however, the Company has not
incurred cash losses in the financial year and in the immediately
preceding financial year.
16. In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to its
bankers. The Company did not have any outstanding debentures or dues to
any financial institutions during the year.
17. the Company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
18. In our opinion, and according to the information and explanations
given to us, the Company is not a chit fund or a nidhi / mutual benefit
fund / society.
19. according to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
20. In our opinion and according to the information and explanations
given to us, the terms and conditions on which the Company has given
guarantees for loans taken by others from banks are not prejudicial to
the interest of the Company.
21. the Company did not have any term loans outstanding during the
year.
22. according to information and explanations given to us, and on an
overall examination of the balance sheet of the Company, we are of the
opinion that the funds raised on short-term basis have not been used
for long-term investment.
23. the Company has not made any preferential allotment of shares to
companies and parties covered in the register maintained under section
301 of the Companies act, 1956.
24. the Company did not have any outstanding debentures during the
year.
25. the Company did not raise any money by public issues.
26. according to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
for B S R and Company
Chartered Accountants
Firm Registration No:128900W
Zubin Shekary
Partner
Membership No: 48814
Place: Hyderabad
Date: 26 May 2010
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