To the Members of
MANGALAM TIMBER PRODUCTS LIMITED
Report on the Audit of the Ind AS financial statements
Opinion
We have audited the Ind AS financial statements of Mangalam Timber Products 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 notes to the Ind AS financial statements, including 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 Ind AS 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, of the state of affairs of the Company
as at March 31, 2021, loss, changes in equity and its cash flows for the year ended on
that date.
Basis for Opinion
We conducted our audit 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 Auditors Responsibilities for the Audit of the Ind
AS financial statements section of our report. We are independent of the Company in
accordance with the Code of Ethics issued by the Institute of Chartered Accountants of
India together with the ethical requirements that are relevant to our audit of the Ind AS
financial statements under the provisions of the Companies Act, 2013 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 opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the Ind AS financial statements of the current period. These
matters were addressed in the context of our audit of the Ind AS financial statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
We have determined that there are no Key audit matters to communicate in our report.
Managements Responsibility for the Ind AS 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 Ind AS financial statements that give a true and fair view of the financial
position, financial performance, changes in equity 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. 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 implementation
and maintenance of 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
statement that give a true and fair view and are free from material misstatement, whether
due to fraud or error.
In preparing the Ind AS financial statements, management is 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 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 companys financial
reporting process.
Auditors Responsibilities for the Audit of the Ind AS financial statements
Our objectives are to obtain reasonable assurance about whether the Ind AS financial
statements as a whole are free from material misstatement, whether due to fraud or error,
and to issue an auditors 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 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:
• Identify and assess the risks of material misstatement of the 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.
• 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 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 we conclude that a material uncertainty exists,
we are required to draw attention in our auditors report to the related disclosures in
the Ind AS 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
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 Ind AS financial
statements, including the disclosures, and whether the 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 Ind AS financial statements of
the current period and are therefore the key audit matters. We describe these matters in
our auditors 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
As required by Companies (Auditors Report) Order, 2016("the order") issued by
the Central Government of India in terms of Sub Section (11) of Section 143 of the Act on
the matters specified in paragraph 3 and 4 of the said order, we further 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 verification of its fixed assets by
which fixed assets are verified in a phased manner over a period of three years. In
accordance with this programme, certain fixed assets were verified during the year and no
material discrepancies were noticed 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.
c) The title deeds of immovable properties, as disclosed in Note no 1 on Fixed Assets
to the financial statements, are held in the name of the company, except for
| Total number of cases Whether leasehold/ freehold |
Gross Block (Rs. in lacs) |
Net Block (Rs.in lacs) |
Remarks |
| 1 Freehold |
1.94 |
1.94 |
- |
ii) The management has conducted physical verification of inventory during the year at
reasonable intervals. The discrepancies between the physical stock and book records which
were material in respect of certain items of inventories, have been properly dealt in the
books of account.
iii) a) The Company has not granted any loans, secured or unsecured to companies, firms
Limited Liability Partnership or other parties covered in the register maintained under
section 189 of Companies Act, 2013.
b) Clause (iii)(a), (b), (c) of the aforesaid order are not applicable.
iv) In our opinion and according to information and explanations given to us, the
company has not granted any loan or provided any guarantee or security to the parties
covered under section 185 of the Act. In our opinion and according to information and
explanations given to us, the Company has complied with provisions of section 186 of the
Act in respect of investment made and guarantee or security provided.
v) The Company has not accepted any deposits from the public within the provisions of
section 73 to 76 or any other relevant provisions of the Act and rules framed there under.
vi) The Central Government of India has not specified the maintenance of cost records
under sub-section (1) of Section 148 of the Act for the products of the Company.
vii) a) According to the records of the company examined by us and according to the
information and explanations given to us, in our opinion the company has not been regular
in depositing undisputed Provident Fund and income tax. The extent of arrears of statutory
dues outstanding as at the 31st March, 2021 for a period of more than six months from the
date they become payable is as follows:
| Nature of dues |
Amount (Rs. In Lacs) |
| Provident Fund Dues |
26.61 |
| TDS |
2.81 |
b) According to the records of the company examined by us and according to information
and explanatory given to us, there are no dues in respect of income tax, sales tax,
service tax, duty of customs, duty of excise value added tax which have not been deposited
on account of any dispute except as detailed hereunder
| Name of Statute |
Nature of Dues |
Year |
Amount (Rs. in Lacs) |
Forum where dispute is pending |
| Central Excise Act,1944 |
Central Excise |
1988-92 |
126.57 |
Customs, Excise 8t Service Tax Appellate Tribunal and High Court |
| Central Sales Tax Act, 1956 |
Sales Tax |
2000-01 |
93.56 |
Sales Tax Tribunal, Odisha-Remanded to AO for re assessment. |
| Central Sales Tax Act, 1956 |
Sales Tax |
2002-03 |
70.12 |
Sales Tax Tribunal, Odisha-Remanded to AO for re assessment. |
| Central Sales Tax Act, 1956 |
Sales Tax |
2003-04 |
135.66 |
Before CST Appellate Authority, Delhi. |
| Sales Tax |
|
2010-11 to 2014-15 |
15.93 |
Delhi Sales Tax |
| Entry Tax |
|
2002-03 |
12.20 |
Jt.Comm (Appeal), Odisha |
| VAT |
|
2005-06 & 2006-07 |
17.20 |
Under revision no40020 before Odisha High court. |
| VAT |
|
2007-09 |
14.96 |
Before Sales Tax Tribunal, Odisha |
| VAT |
|
01.10.15 to 31.03.16 |
5.76 |
Before Sales Tax Tribunal, Odisha |
| VAT |
|
01.04.16 to 30.06.17 |
3.16 |
Before Sales Tax Tribunal, Odisha |
viii) According to the information and explanations given to us, the company has not
defaulted in repayment of any loans or borrowings to financial institutions, banks.
Government or dues to debenture holders as at the Balance Sheet date.
ix) The Company has not raised any moneys by way of initial public offer, further
public offer (including debt instruments) and term loans. Accordingly, the provisions of
Clause 3(ix) of the Order are not applicable to the Company.
x) During the course of our examination of the books and records of the Company,
carried out in accordance with the generally accepted auditing practices in India, and
according to the information and explanations given to us, we have neither come across any
instance of material fraud by the Company or on the Company by its officers or employees,
noticed or reported during the year, nor have we been informed of any such case by the
Management.
xi) The Company has not paid/provided for managerial remuneration except sitting fees,
hence in accordance with the requisite approvals mandated by the provisions of section 197
read with Schedule V to the Act is not applicable..
xii) As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable
to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii) According to the information and explanations given to us and based on our
examination of the records of the Company, the Company has entered into transactions with
related parties in compliance with the provisions of Sections 177 and 188 of the Act. The
details of such related party transactions have been disclosed in the financial statements
as required under Accounting Standard (AS) 18, Related Party Disclosures specified under
Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
xiv) According to the information and explanations give to us and based on our
examination of the records of the Company, the Company has not made any preferential
allotment or private placement of shares or fully or partly convertible debentures during
the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not
applicable to the Company.
xv) The Company has not entered into any non-cash transactions with its directors or
persons connected with him. Accordingly, the provisions of Clause 3(xv) of the Order are
not applicable to the Company.
xvi) The Company is not required to be registered under Section 45-IA of the Reserve
Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not
applicable to the Company.
As required by Section 143 (3) of the Act, we report that:
1. 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.
2. 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.
3. The Balance Sheet, the Statement of Profit and Loss, the Cash Flow Statement and
Statement of Changes in Equity dealt with by this Report are in agreement with the books
of account
4. In our opinion, the aforesaid Ind AS financial statements comply with the Accounting
Standards specified under Section 133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules, 2014.
5. 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 31st March, 2021 from being appointed as a director in terms of Section
164 (2) of the Act.
6. 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 "A"; and
7. 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, in our opinion
and to the best of our information and according to the explanations given to us:
a) The Company has disclosed the impact of pending litigations on its financial
position in its Ind AS financial statements.
b) The Company did not have any long term contracts including derivative contracts for
which there were any material foreseeable losses.
c) There is no amount required to be deposited/transferred to the Investor Education
and Protection Fund by the Company during the year ended 31st March, 2021.
Annexure A to Independent Auditors Report
Referred to in the Independent Auditors Report of even date to the member of Mangalam
Timber Products Limited on the financial statements for the year ended 31st March. 2021
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section
143 of the Companies Act, 2013 ("the Act")
We have audited the internal financial controls over financial reporting of Mangalam
Timber Products Limited ("the Company") as at 31st March 2021 in conjunction
with our 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 (ICAI). 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 its
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
Our responsibility is to express an opinion on the Companys internal financial
controls over financial reporting based on our audit. We conducted our audit in accordance
with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting
(the "Guidance Note") and the Standards on Auditing, issued by ICAI 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 applicable to an audit of
Internal Financial Controls and, both issued by the Institute of Chartered Accountants of
India. Those Standards and the Guidance Note require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether
adequate internal financial controls over financial reporting was established and
maintained and if such controls operated effectively in all material respects. Our audit
involves performing procedures to obtain audit evidence about the adequacy of the internal
financial controls system over financial reporting and their operating effectiveness. Our
audit of internal financial controls over financial reporting included obtaining an
understanding of internal financial 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 judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our 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 the 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 authorisations 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 not be detected.
Also, projections of any evaluation of the internal 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 or procedures may deteriorate.
Opinion
In our 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 2021, 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.
| For Manish Goyal & Associates Chartered Accountants |
| Firm Registration No. 007152C |
| Manish Goyal Proprietor |
| Membership Number: 076096 |
| Place: Kolkata |
| Date: 28th June, 2021 |
| UDIN:- 21076096AAAABN3136 |
+91-9892691696
