To the Members of Amarjothi Spinning Mills Limited,
Report on the Audit of the Standalone Financial Statements Opinion
I have audited the accompanying STANDALONE financial statements of Amarjothi Spinning
Mills Limited, (hereinafter referred to as "the Company"), which comprise the
STANDALONE Balance Sheet as at 31st March, 2023, and the STANDALONE Statement of Profit
and Loss account, STANDALONE Statement of changes in equity and STANDALONE Statement of
CASH FLOWS for the year ended, and notes to the standalone financial statements, including
a summary of significant accounting policies and other explanatory information
(hereinafter referred to as "The STANDALONE Financial Statements").
In my opinion and to the best of my information and according to the explanations given
to me, the aforesaid Standalone financial statements give the information required by the
Companies Act, 2013 in the manner so required and give a true and fair view in conformity
with the 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 31st March, 2023, and its PROFIT, changes in equity and its CASH FLOWS for
the year ended on that date.
Basis for Opinion
I conducted my audit in accordance with the Standards of Auditing (SAs) specified under
section 143(10) of the Companies Act, 2013. My responsibilities under those Standards are
further described in the Auditors Responsibilities for the Audit of the Financial
Statements section of my report. I am 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 my audit of the Standalone financial statements
under the provisions of the Companies Act, 2013 and the Rules thereunder, and I have
fulfilled my other ethical responsibilities in accordance with these requirements and the
Code of Ethics. I believe that the audit evidence I have obtained is sufficient and
appropriate to provide a basis for my opinion.
Key Audit Matters
Key audit matters are those matters that, in my professional judgment, were of most
significance in my audit of the financial statements of the current period. These matters
were addressed in the context of my audit of the financial statements as a whole, and in
forming my opinion thereon, and I do not provide a separate opinion on these matters. I
have not identified any key audit matters to be communicated in my report.
Information Other than the Standalone Financial Statements and Auditors Report Thereon
The Companys Board of Directors is responsible for the Preparation of ,the other
information. The other information comprises the information included in the Management
Discussion and Analysis, Boards report including Annexures to Boards report, Corporate
Governance and Shareholders information, but does not include the Standalone financial
statements and my auditors report thereon.
My opinion on the Standalone financial statements does not cover the other information
and I do not express any form of assurance conclusion thereon.
In connection with my audit of the Standalone financial statements, my responsibility
is to read the other information and, in doing so, consider whether the other information
are materially inconsistent with the Standalone financial statements or my knowledge
obtained during the course of my audit or otherwise appears to be materially misstated.
If, based on the work I have performed, I conclude that there is a material
misstatement of this other information; I am required to report that fact. ,I have nothing
to report in this regard.
Responsibilities of Management for the Standalone Financial Statements
The Companys Board of Directors is responsible for the matters stated in section
134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of
these Standalone financial statements that give a true and fair view of the Standalone
financial position, Standalone financial performance, Standalone changes in equity and
Standalone cash flows of the company in accordance with the accounting principles
generally accepted in India, including the 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 of the assets of the Company and for
preventing and detecting frauds and other irregularities; selection and application of
appropriate accounting policies; making judgements 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 Standalone financial statements, the Board of Directors of the company
are responsible for assessing the Companys 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 of the Company is responsible for overseeing the Companys
financial reporting process.
Auditors Responsibilities for the Audit of the Standalone Financial Statements
My objective is to obtain reasonable assurance about whether the Standalone financial
statements as a whole are free from material misstatement, whether due to fraud or error,
and to issue an auditors report that includes my 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 financial statements.
As part of an audit in accordance with SAs, I exercise professional judgement and
maintain professional scepticism throughout the audit. I also:
• Identify and assess the risks of material misstatement of the Standalone
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 my 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, I am also responsible for expressing my 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 managements 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 Companys
ability to continue as a going concern. If I conclude that a material uncertainty exists,
I am required to draw attention in my auditors report to the related disclosures in the
Standalone financial statements or, if such disclosures are inadequate, to modify my
opinion. My conclusions are based on the audit evidence obtained up to the date of my
auditors 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 Standalone financial statements
represent the underlying transactions and events in a manner that achieves fair
presentation.
I 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 I identify during my audit.
I also provide those charged with governance with a statement that I 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 my independence,
and where applicable, related safeguards.
From the matters communicated with those charged with governance, I 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. I describe these matters in
my auditors report unless law or regulation precludes public disclosure about the matter
or when, in extremely rare circumstances, I determine that a matter should not be
communicated in my 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
1. As required by the Companies (Auditors Report) Order, 2020 ("the Order"),
issued by the Central Government of India in terms of subsection (ii) of section 143 of
the Companies Act, 2013, I give in the Annexure "A" a statement on the matters
specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. As required by section 197(16) of the Act, as amended, in my opinion and to the best
of my information and according to the explanations given to me, the remuneration paid by
the company to its directors during the year is in accordance with the provisions of the
Section 197 of the Act.
3. As required by Section 143(3) of the Act, I report that:
(a) I have sought and obtained all the information and explanations which to the best
of my knowledge and belief were necessary for the purposes of my audit of the aforesaid
Standalone financial statements.
(b) In my opinion, proper books of account as required by law relating to preparation
of the aforesaid Standalone financial statement have been kept by the Company so far as it
appears from my examination of those books.
(c) The Standalone Balance Sheet, the Standalone Statement of Profit and Loss, and the
Standalone Cash Flow Statement dealt with by this Report are in agreement with the
relevant books of account maintained for the purpose of preparation of Standalone
Financial Statements.
(d) In my opinion, the aforesaid Standalone financial statements comply with the Indian
Accounting Standards (Ind AS) specified under Section 133 of the Act, read with Rule7 of
the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the directors of the
company as on 31st March, 2023 taken on record by the Board of Directors of the Company,
none of the directors is disqualified as on 31st March, 2023 from being appointed as a
director in terms of Section 164(2) of the Act.
(f) 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 my
separate Report in "Annexure B".
(g) With respect to the other matters to be included in the Auditors Report in
accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in
my opinion and to the best of my information and according to the explanations given to
me:
a. The Company does not have any pending litigations which would impact its financial
position
b. The Company did not have any long-term contracts including derivative contracts for
which there were any material foreseeable losses.
c. There has been no delay in transferring amounts, required to be transferred, to the
Investor Education and Protection Fund by the Company
d. (i). 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 person(s) or entity(ies), including
foreign entities ("Intermediaries"), 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 ("Ultimate Beneficiaries") or provide any guarantee, security or the
like on behalf of the Ultimate Beneficiaries;
(ii). 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 received by the
company from any person(s) or entity(ies), including foreign entities ("Funding
Parties"), 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
("Ultimate Beneficiaries") or provide any guarantee, security or the like on
behalf of the Ultimate Beneficiaries; and
(iii). Based on such audit procedures that I have considered reasonable and appropriate
in the circumstances, nothing has come to my notice that has caused me to believe that the
representations under sub-clause (i) and (ii) contain any material misstatement.
e. The dividend declared or paid during the year by the company is in compliance with
section 123 of the Companies Act, 2013.
|
V. NARAYANASWAMI, M.A., F.C.A. |
|
Chartered Accountant |
| Place :- Coimbatore |
Membership No:- 023661 |
| Date:- 29th May 2023 |
UDIN:- 23023661BGYXBE9626 |
ANNEXURE - A To the Independent Auditors Report of even date on the Standalone
Financial
Statements of Amarjothi Spinning Mills Limited
(Referred to in paragraph 1 under Report on other legal and regulatory requirements
section of my report of even date)
In terms of the information and explanations sought by me and given by the company and
the books and records examined by me in the normal course of audit and to the best of my
knowledge and belief, I report the following:-
1. (a) (i) The company has maintained proper records showing full particulars including
quantitative details and situation of property, plant and equipment.
(ii) The company has maintained proper records showing full particulars of intangible
assets.
(b) The property, plant and equipment have been physically verified by the management
during the year, which in my opinion is reasonable having regard to the size of the
company and nature of its assets. No material discrepancies were noticed on such
verification.
(c) The title deeds of all immovable properties (other than lease hold land) shown
under the property, plant and equipment schedule are held in the name of the company
(d) The company has not revalued its property, plant and equipment (including right of
use of assets) or intangible assets or both during the year.
(e) No proceedings have been initiated or are pending against the company for holding
any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and
rules made thereunder.
2. (a) The inventory has been physically verified by the management at reasonable
intervals during the year. In my opinion, the coverage and procedure of such verification
is appropriate and no discrepancies of 10% or more in the aggregate for each class of
inventory were noticed at the time of verification.
(b) The company has been sanctioned working capital limits in excess of 5 crores in
aggregate from banks or financial institutions on the basis of security of current assets
and quarterly returns or statements filed by the company with such banks or financial
institutions are in agreement with the books of accounts of the company.
3. The company has not provided any guarantee or security or granted any loans or
advances in the nature of loans or advances, secured or unsecured, to companies, firms,
limited liability partnership or any other parties during the year. The company has made
investments in one wholly owned subsidiary company and invested more than 26% capital in
one associate partnership firm which prima facie are not prejudicial to the interests of
the company
4. In my opinion and according to the information and explanation given to me, the
company has not given any loans or provided any guarantee or security as specified under
section 185 and 186 of the Companies Act, 2013. In respect of the investments made by the
company, the provisions of section 186 of the Companies Act, 2013 have been complied with.
5. The Company has not accepted any deposits to which the provisions of section 73 to
76 or any other relevant provisions of the act and rules framed thereunder and the
directions issued by the RBI are applicable. Hence paragraph no, 3(v) of CARO is not
applicable to the company.
6. I have broadly reviewed the books of account maintained by the company pursuant to
the rules made by the Central Government for the maintenance of cost records under
subsection (1) of section 148 of the Act and I am of the opinion prima facie the
prescribed accounts and records have been made and maintained. However, I have not made a
detailed examination of the Cost records with a view to determining whether they are
accurate or complete.
7. (a) Undisputed statutory dues including provident fund, employees state insurance,
income-tax, goods and service tax, customs duty, cess etc. have been generally regularly
deposited by the company with the appropriate authorities in all the cases during the
year.
(b) There are no dues of income-tax, goods and service tax, customs duty, or cess etc.,
which have not been deposited on account of any dispute except a sum of Rs. 70,53,163 has
not been paid, being generation tax payable on electricity charges. The matter is under
dispute and is pending with the Honourable High Court of Madras.
8. There are no transactions which were not recorded in the books of accounts, and have
been surrendered or disclosed as income during the year in the tax assessments under the
Income tax act, 1961 (43 of 1961).
9. (a) The company has not defaulted in repayment of loans or other borrowings taken
from or in the payment of interest thereon to any lender.
(b) The company is not a declared defaulter for any banks or financial institutions or
other lender.
(c) The term loans were applied for the purpose for which the loans were obtained by
the company.
(d) No funds raised on short-term basis have been utilised for long-term purposes by
the company.
(e) The company has not taken any funds from any entity or person on account of or to
meet the obligations of its subsidiaries or associate entities.
(f) The company has not raised loans during the year on pledge of securities held in
its subsidiaries or associate entities.
10. (a) The company has not raised any money by way of initial public offer or follow
on public offer during the year
(b) The company has not made any preferential allotment or private placement of shares
(both preference and equity) or fully or partly or optionally convertible debentures
during the year.
11. (a) Based on the audit procedures performed and according to the information and
explanations given to me, no fraud by the company or on the company has been noticed or
reported during the year that causes the financial statements to be materially misstated.
(b) According to the information and explanations given to me, No report under sub-
section (12) of section 143 of the Companies Act has been filed by the auditors in Form
ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014 with the
Central Government.
(c) According to the information and explanations given to me, no whistle-blower
complaints were received during the year by the company.
12. The Company is not a Nidhi Company and hence clause 3(xii) of the order is not
applicable.
13. According to the information and explanations given to me and based on the
examination of records of the company, transactions with the related parties are in
compliance with section 177 and 188 of the Act. Where applicable, the details of such
transactions have been disclosed in the financial statements as required by the applicable
accounting standards.
14. (a) According to the information and explanations given to me, and based on my
examination of the records of the company, the company has an internal audit system
commensurate with the size and nature of its business.
(b) The reports of the Internal Auditors of the company for the period under audit are
considered by me and no material adverse points are there in that report.
15. According to the information and explanations given to me and based on my
examination of the records of the company, the company has not entered into non-cash
transactions with directors or persons connected with them.
16. (a) & (b) According to the information and explanations given to me and based
on my examination of the records of the company, the company is not required to be
registered under section 45-IB of the Reserve bank of India Act of 1934 as the company is
not a nonbanking financial company. Accordingly, clause 3(xvi(a)) and clause 3(xvi(b)) of
the order are not applicable.
(c) & (d) According to the information and explanations given to me and based on my
examination of the records of the company, the company is not a Core Investment Company
(CIC) as defined in the regulations made by the Reserve Bank of India. Accordingly, clause
3(xvi(c)) and clause 3(xvi(d)) of the order are not applicable.
17. According to the information and explanations given to me and based on my
examination of the records of the company, the company has not incurred cash losses in the
financial year and in the immediately preceding financial year.
18. According to the information and explanations given to me and based on my
examination of the records of the company, the provision of sub-section 2 of section 139
of the Companies Act, 2013 with regard to the appointment of Statutory Auditors have been
complied with.
19. According to the information and explanations given to me and on the basis of the
financial ratios, ageing and expected dates of realisation of financial assets and payment
of financial liabilities, other information accompanying the financial statements, my
knowledge of the board of directors, and the management plans, I am of the opinion that no
material uncertainty exists as on the date of audit report that the company is capable of
meeting its liabilities existing at the date of balance sheet as and when they fall due
within a period of 1 year from the balance sheet date. I further state that this is not an
assurance as to the future viability of the company. I further state that my reporting is
based on the facts up to the date of the audit report and I neither give any guarantee nor
any assurance that all liabilities falling due within a period of 1 year from the date of
balance sheet, will get discharged by the company as and when they fall due.
20. According to the information and explanations given to me and based on my
examination of the records of the company, the company is contributing to the Prime
Ministers National Relief Fund for the purpose of CSR compliance and hence there is no
requirement of transfer of unspent amount to the fund specified in schedule VII of the
Companies Act.
|
V. NARAYANASWAMI, M.A., F.C.A. |
|
Chartered Accountant |
| Place :- Coimbatore |
Membership No:- 023661 |
| Date:- 29th May 2023 |
UDIN:- 23023661BGYXBE9626 |
ANNEXURE - B To The Independent Auditors Report of even date on the Standalone
Financial Statements of Amarjothi Spinning Mills Limited.
(Referred to in paragraph 3(f) under Report on other regulatory requirements of my
report of even date)
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section
143 of the Companies Act, 2013 ("the Act")
I have audited the internal financial control over financial reporting of M/s Amarjothi
Spinning Mills Limited ("the Company") as of 31st March 2023 in conjunction with
my audit of the standalone financial statements of the company for the year ended on that
date.
Managements Responsibility for Internal Financial Controls
The companys management is responsible for establishing and maintaining internal
financial controls based on the internal control over financial reporting criteria
established by the company considering the essential components of internal control stated
in the guidance note on audit of internal financial controls over financial reporting
issued by the Institute of Chartered Accountants of India. These responsibilities include
the design, implementation and maintenance of adequate internal financial controls that
were operating effectively for ensuring the orderly and efficient conduct of business,
including adherence to companys policies, the safeguarding of its assets, the prevention
and detection of frauds and errors, the accuracy and completeness of the accounting
records, and the timely preparation of reliable financial information, as required under
the Companies Act, 2013.
Auditors Responsibility
My responsibility is to express an opinion on the Companys internal controls over the
financial reporting based on my audit. I conducted my audit in accordance with the
guidance note of internal financial controls over financial reporting ("the guidance
note") and the standards on auditing issued by the Institute of Chartered Accountants
of India and deemed to be prescribed under section 143 (10) of the Companies Act, 2013, to
the extent applicable to an audit of internal financial controls, both issued by the
Institute of Chartered Accountants of India. Those standards and guidance notes require
that I comply with ethical requirements and plan and perform the audit to obtain
reasonable assurance of whether adequate internal financial controls over financial
reporting was established and maintained and if such controls operated effectively in all
material respects.
My audit involves performing procedure to obtain audit evidence about the adequacy of
the internal financial controls system over financial reporting and their operating
effectiveness.
My audit of internal financial controls over financial reporting included obtaining an
understanding of internal controls over financial reporting, assessing the risk that a
material weakness exists, and testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk. The procedures selected
depend on the auditors judgement, including the assessment of the risks and material
misstatement of the financial statements, whether due to fraud or error.
I believe that the audit evidence obtained is sufficient and appropriate to provide a
basis for my audit opinion on the companys internal financial controls system over
financial reporting.
Meaning of Internal financial controls over financial reporting
A companys internal financial control over financial reporting is a process designed
to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with Generally
Accepted Accounting Principles. A companys internal financial control over financial
reporting includes those policies and procedures that
1. Pertain to the maintenance of records that, in reasonable detail, accurately and
fairly reflect the transactions and dispositions of the assets of the company.
2. Provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with Generally Accepted Accounting
Principles, and that receipts and expenditures of the company are being made only in
accordance with authorisation of management and directors of the company and;
3. Provide reasonable assurance regarding prevention or timely detection of
unauthorised acquisition, use or disposition of the companys assets that could have a
material effect on the financial statements.
Inherent limitations of internal financial controls over financial reporting
Because of the inherent limitations of internal financial controls over financial
reporting, including the possibility of collusion or improper management override of
controls, material misstatements due to error or fraud may occur and may not be detected.
Also projections of any evaluations of the financial controls over financial reporting to
future periods are subject to the risk that the internal financial control over financial
reporting may become inadequate because of changes in conditions, or that the degree of
compliance with the policies and procedures may deteriorate.
Opinion
In my opinion the company has, in all material respects, an adequate internal financial
controls system over financial reporting and such internal financial controls over
financial reporting were operating effectively as at 31st March 2023, based on the
internal control over financial reporting criteria established by the company considering
the essential components of internal control stated in the guidance note on audit of
internal financial controls over financial reporting issued by the Institute of Chartered
Accountants of India.
|
V. NARAYANASWAMI, M.A., F.C.A. |
|
Chartered Accountant |
| Place :- Coimbatore |
Membership No:- 023661 |
| Date:- 29th May 2023 |
UDIN:- 23023661BGYXBE9626 |
+91-9892691696
