INDEPENDENT AUDITORS REPORT ON THE STANDALONE FINANCIAL STATEMENTS
To the Members of Pricol Limited
Report on the Audit of the Standalone Financial Statements
Opinion
We have audited the accompanying Standalone financial statements of Pricol Limited ("the
Company"), which comprise the Balance Sheet as at March 31,2023, the Statement of
Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity
and the Statement of Cash Flows for the year then ended and notes to the Standalone
Financial Statements including a summary of significant accounting policies and other
explanatory information (hereinafter referred to as "Standalone Financial
Statements").
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 Companies Act, 2013 ("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 Indian Accounting Standards prescribed under section 133 of the Act read
with the Companies (Indian Accounting Standards) Rules , 2015, as amended ("Ind
AS"), of the state of affairs of the Company as at March 31,2023, its profit
including other comprehensive income, changes in equity and its cash flows for the year
ended on that date.
Basis for Opinion
We conducted our audit of the Standalone Financial Statement in accordance with the
Standards on Auditing (SAs) specified under section 143(10) of the Act. Our
responsibilities under those Standards are further described in the "Auditors
Responsibilities for the Audit of the Standalone 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 Standalone Financial Statements
under the provisions of the Act and 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 on the Standalone 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 Standalone Financial Statements of the current period. These matters were
addressed in the context of our audit of the Standalone 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 is no key audit matter to be communicated in our
report.
Information Other than the Standalone Financial Statements and Auditors Report
Thereon.
The Companys Management and the Board of Directors are responsible for the preparation
of the other information. The other information comprises the information included in the
annual report for example, Directors Report and Management Analysis including annexures
thereon, but does not include the Standalone / Consolidated Financial Statements and our
auditors report thereon.
The other information is expected to be made available to us after the date of this
auditors report.
Our opinion on the Standalone 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 Standalone Financial Statements, our responsibility
is to read the other information identified above when it becomes available and, in doing
so, consider whether the other information is materially inconsistent with the Standalone
Financial Statements, or our knowledge obtained during the course of our audit or
otherwise appears to be materially misstated.
When we read the other information, as stated above, which is expected to be received
after the date of our audit report, if we conclude that there is a material misstatement
therein, we are required to communicate the matter to those charged with governance and
take necessary actions, as applicable under applicable laws and regulations.
Managements and Board of Directors Responsibilities for the Standalone Financial
Statements
The Companys Management and the Board of Directors are responsible for the matters
stated in section 134(5) of the Act with respect to the preparation and presentation of
these Standalone Financial Statements that give a true and fair view of the Standalone
financial
position, Standalone financial performance and Standalone cash flows 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, read with
relevant rules issued thereunder. 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 Standalone 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 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 management either intends to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.
The Management and the Board of Directors are also responsible for overseeing the
Companys financial reporting process.
Auditors Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are 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 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 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 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 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 Act, we are also responsible for expressing our opinion on whether the company has
adequate internal financial controls with reference to Standalone Financial Statements 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 the management and the Board of
Directors.
• Conclude on the appropriateness of the Board of Directors 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 Standalone 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 Standalone
Financial Statements, including the disclosures, and whether the Standalone Financial
Statements represent the underlying transactions and events in a manner that achieves fair
presentation.
Materiality is the magnitude of misstatements in the
Standalone Financial Statements that, individually or in
aggregate, makes it probable that the economic decisions of a reasonably knowledgeable
user of the Standalone Financial Statements may be influenced. We consider quantitative
materiality and qualitative factors in (i) planning the scope of our audit work and in
evaluating the results of our work and (ii) evaluating the effect of any identified
misstatements in the Standalone Financial Statements.
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 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
(1) As required by the Companies (Auditors Report) Order, 2020 ("the Order")
issued by the Central Government of India in terms of section 143(11) of the Act, we give
in “Annexure 1”, a statement on the matters specified in paragraphs 3 and
4 of the Order.
(2) (A) 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 it appears from our examination of those books;
c. The Standalone Balance Sheet, the Standalone Statement of Profit and Loss, the
Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flows dealt
with by this report are in agreement with the books of account;
d. In our opinion, the aforesaid Standalone Financial Statements comply with the Indian
Accounting Standards (Ind As) specified under section 133 of the Act read with relevant
rules issued thereunder;
e. On the basis of the written representations received from the directors as on March
31, 2023, and taken on record by the Board of Directors, none of the directors is
disqualified as on March 31, 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 with reference to
Standalone Financial Statements of the C o m p a n y a n d th e o p e ra ti n g
effectiveness of such controls, we give our separate report in “Annexure 2”.
(B) 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, 2021, as amended 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 as on March 31,2023 on
its financial position in its Standalone Financial Statements - Refer Note 48 on
Contingent Liabilities;
(ii) The Company did not have any long-term contracts including derivative contracts.
Hence, the question of any material foreseeable losses does not arise;
(iii) There has been no delay in transferring amounts, 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,
as disclosed in the Note 70(ii)(A) to the Standalone Financial Statements, no funds
(which are material either individually or in the aggregate) 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 persons or entities, including foreign
entities (“Intermediaries"), with the understanding, whether recorded in writing
or otherwise, that the Intermediary shall:
• Directly or indirectly lend or invest in other persons or entities identified in
any manner whatsoever (“Ultimate Beneficiaries") by or on behalf of the Company
or
• Provide any guarantee, security or the like on behalf of the Ultimate
Beneficiaries.
b) The Management has represented that, to the best of its knowledge and belief, as
disclosed in Note 70(ii)(B) of Standalone Financial Statements, no funds (which are
material either individually or in the aggregate) have been received by the Company from
any person or entity, including foreign entity (“Funding Parties"), with the
understanding, whether recorded in writing or otherwise, that the Company shall:
• Directly or indirectly, lend or invest in other persons or entities identified
in any manner whatsoever (“Ultimate Beneficiaries") by or on behalf of the
Funding Party or
• Provide any guarantee, security or the like on behalf of the Ultimate
Beneficiaries.
c) Based on the audit procedures as considered reasonable and appropriate in the
circumstances, nothing has come to our notice that has caused us to believe that the
representations under sub-clause iv (a) and (b) contain any material mis-statement.
v) The company has not proposed / paid any dividend during the year.
(C) With respect to the other matters to be included in the Auditors Report in
accordance with the requirements of section 197(16) of the Act, as amended;
In our opinion and to the best of our information and according to the explanations
given to us, the remuneration paid/provided by the Company to its directors during the
year is in accordance with the provisions of section 197 of the Act: The remuneration paid
to any director is not in excess of the limit laid down under Section 197 of the Companies
Act.
|
For VKS Aiyer & Co |
|
Chartered Accountants |
|
ICAI Firm Registration No.000066S |
|
CS Sathyanarayanan |
|
Partner |
Coimbatore |
Membership No.028328 |
10th May 2023 |
UDIN: 23028328BGUEWZ6601 |
ANNEXURE 1 TO THE INDEPENDENT AUDITORS REPORT
[Referred to in paragraph 1 under Report on Other Legal and Regulatory Requirements
in the Independent Auditors Report of even date to the members of Pricol Limited on
the Standalone financial statements for the year ended 31.03.2023]
In our opinion and to the best of knowledge and belief, the books of accounts and
records examined by us and according to the information and explanations given to us, we
report that:
(i) (a) (A) The Company has maintained proper
records showing full particulars, including quantitative details and situation of
Property, Plant and Equipment.
(B) The Company has maintained proper records showing full particulars, including
quantitative details and situation of Intangible assets.
(b) The Company has a regular program of verification of property, plant and equipment,
by which all the property, plant and equipment are verified in a phased manner over a
period of 3 years. In accordance with the programme certain property, plant and equipment
were verified during the year. This periodicity of physical verification is reasonable
having regard to the size of the Company and the nature of its assets. No material
discrepancies were noticed on such verification.
(c) The title deeds of all the immovable properties, recorded as property, plant and
equipment and investment property (other than immovable properties where the Company is
the lessee and the lease agreements are duly executed in favour of the Company) are held
in the name of the Company.
(d) The Company has not revalued any of its property, plant and equipment and
intangible assets during the year.
(e) There were no proceedings initiated or pending against the Company for holding any
benami property under Prohibition of Benami Property Transactions Act, 1988 (as amended in
2016) and rules made thereunder.
(ii) (a) The inventories, except for goods-in-transit and materials with Third Party,
were physically verified during the year by the Management at reasonable intervals. The
coverage and procedure of such verification by the Management is appropriate having regard
to the size of the Company and the nature of its operations. No Discrepancies were noticed
on physical verification between the physical stock and the book records that were 10% or
more in the aggregate for each class of inventory. In respect of goods in transit, the
goods have been received subsequent to the year-end.
(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. There is no material deviation between the quarterly returns or statements filed
by the Company with such banks or financial institutions and the unaudited books of
account of the Company of the respective quarters.
(iii) The Company has made investments in companies during the year, but did not
provide any guarantee or security, or granted any loans or advances in the nature of
loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or any
other parties during the year.
(a) The Company has not provided any loans or advances in the nature of loans or stood
guarantee or provided security to any other entity during the year, and hence reporting
under clause (iii)(a),
(c) ,(d), (e) and (f) of the Order are not applicable.
(b) The investments made are not prejudicial to the Companys interests.
(iv) The Company has complied with the provisions of Sections 185 and 186 of the
Companies Act, 2013 in respect of loans granted, investments made and guarantees and
securities provided, as applicable.
(v) The Company has not accepted any deposit or amounts which are deemed to be
deposits. Hence, reporting under clause (v) of the Order is not applicable.
ANNEXURE 1 TO THE INDEPENDENT AUDITORS REPORT (Contd.,)
(vi) The maintenance of cost records has been specified by the Central Government under
section 148(1) of the Companies Act, 2013. We have broadly reviewed the books of account
maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014,
as amended, prescribed by the Central Government for maintenance of cost records under
Section 148(1) of the Companies Act, 2013, and are of the opinion that, prima facie, the
prescribed cost records have been made and maintained by the Company. We have, however,
not made a detailed examination of the cost records with a view to determine whether they
are accurate or complete.
(vii) In respect of statutory dues:
(a) Undisputed statutory dues, including Goods and Service tax, Provident Fund,
Employees
State Insurance, Income-tax, Sales Tax, Service Tax, duty of Custom, duty of Excise,
Value Added Tax, cess and other material statutory dues applicable to the Company have
been regularly deposited by it with the appropriate authorities during the year.
There were no undisputed amounts payable in respect of Goods and Service tax, Provident
Fund, Employees State Insurance, Income- tax, Sales Tax, Service Tax, duty of Custom,
duty of Excise, Value Added Tax, cess and other material statutory dues in arrears as at
March 31,2023 for a period of more than six months from the date they became payable.
(b) Details of statutory dues referred to in subclause (a) above which have not been
deposited as on March 31,2023 on account of disputes are given below:
Name of the Statute |
Nature of dues |
Amount |
Period to which the amount relates |
Forum where dispute is pending |
Remarks / Deposits paid under Protest, if any |
| Central Excise Act / Customs Act |
Excise Duty |
281.34 |
|
CESTAT (Tribunal) |
16.77 |
|
Customs Duty |
426.16 |
1997-98 to 2014-15 |
|
66.42 |
|
Customs Duty |
8.95 |
|
Joint Secretary - Ministry of Finance |
— |
|
Excise Duty |
124.34 |
|
Departmental |
4.57 |
|
Customs Duty |
57.84 |
|
adjudication |
— |
| Central Sales Tax Act |
CST |
301.83 |
2009-10 to 2013-14 |
Additional Commissioner |
— |
|
VAT |
76.81 |
2012-13 |
Appellate Tribunal |
4.00 |
|
VAT |
87.04 |
2011-12 to 2015-16 |
Joint Commissioner Appeals |
10.96 |
|
CST |
8.97 |
2012-13 to 2017-18 |
Assistant Commissioner |
— |
|
CST |
3.49 |
2007-08 |
Appellate Authority |
— |
|
CST |
1.51 |
2017-18 |
Superintendent, Audit Circle |
— |
|
CST |
3.95 |
2015-16 |
Departmental adjudication |
— |
| Goods and Services Tax Act |
|
18.54 |
2017-18 |
The Deputy Commissioner, state tax (Appeals) |
2.34 |
|
GST |
38.65 |
2017-18 & 2018-19 |
Commissioner (Appeals) |
0.85 |
|
|
2.34 |
2022-23 |
The Deputy Commissioner, state tax (Appeals) |
— |
|
|
50.29 |
2017-18 |
Departmental adjudication |
— |
|
|
3.97 |
2017-18 |
The Superintendent of GST |
— |
|
|
19.18 |
2017-18 |
The Assistant commissioner of GST |
— |
| Employees State Insurance Act, 1948 |
ESI |
88.52 |
2010-11 |
ESI Corporation |
25.31 |
|
Total |
1,603.72 |
|
|
131.22 |
(viii) There were no transactions relating to previously unrecorded income that were
surrendered or disclosed as income in the tax assessments under the Income Tax Act, 1961
(43 of 1961) during the year.
(ix) (a) In our opinion, the Company has not
defaulted in the repayment of loans or other borrowings or in the payment of interest
thereon to any lender during the year.
(b) The Company has not been declared willful defaulter by any bank or financial
institution or government or any government authority.
(c) The Company has not taken any term loan during the year and there are no unutilized
term loans at the beginning of the year and hence, reporting under clause (ix)(c) of the
Order is not applicable.
(d) On an overall examination of the financial statements of the Company, funds raised
on short-term basis have, prima facie, not been used during the year for long-term
purposes by the Company.
(e) The Company has not made any investment in or given any new loan or advances to any
of its subsidiaries, associates or joint ventures during the year and hence, reporting
under clause (ix) (e) of the Order is not applicable.
(f) The Company has not raised loans during the year on the pledge of securities held
in its subsidiaries or joint ventures or associate companies.
(x) (a) The Company has not raised moneys by way of initial public offer or further
public offer (including debt instruments) during the year and hence reporting under clause
(x)(a) of the Order is not applicable.
(b) During the year the Company has not made any preferential allotment or private
placement of shares or convertible debentures (fully or partly or optionally) and hence
reporting under clause (x)(b) of the Order is not applicable to the Company.
(xi) (a) No fraud by the Company and no material fraud on the Company has been noticed
or reported during the year.
(b) No report under sub-section (12) of section 143 of the Companies Act has been filed
in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014
with the Central Government, during the year and upto the date of this report.
(c) There were no whistleblower complaints received by the Company during the year.
(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of the
Order is not applicable.
(xiii) The Company is in compliance with Section 177 and 188 of the Companies Act,
where applicable, for all transactions with the related parties and the details of related
party transactions have been disclosed in the financial statements etc., as required by
the applicable accounting standards.
(xiv) (a) The Company has an adequate internal audit
system commensurate with the size and the nature of its business.
(b) We have considered, the internal audit reports issued till date for the period
under audit.
(xv) The Company has not entered into any non-cash transactions with its directors or
persons connected with its directors and hence, reporting under clause (xv) of the Order
is not applicable.
(xvi) (a) The Company is not required to be registered under section 45-IA of the
Reserve Bank of India Act, 1934. Hence, reporting under clause (xvi)(a) and (b) of the
Order is not applicable.
(c) The company is not a core-investment- company as defined by regulations made by
RBI. Hence, reporting under clause (xvi)(c) of the Order is not applicable.
(d) The Group does not have any CIC as part of the group. Hence, reporting under clause
(xvi)(d) of the Order is not applicable.
(xvii) The Company has not incurred cash losses during the financial year covered by
our audit and the immediately preceding financial year.
(xviii) There has been no resignation of the statutory auditors of the Company during
the year.
(xix) On the basis of the financial ratios, ageing and expected dates of realization of
financial assets and payment of financial liabilities, (Asset Liability Maturity (ALM)
pattern) other information accompanying the financial statements and our knowledge of the
Board of Directors and Management plans and based on our examination of the evidence
supporting the assumptions, nothing has come to our attention, which causes us to believe
that any material uncertainty exists as on the date of the audit report indicating that
Company is not capable of meeting its liabilities existing at the date of balance sheet as
and when they fall due within a period of one year from the balance sheet date. We,
however, state that this is not an assurance as to the future viability of the Company. We
further state that our reporting is based on the facts up to the date of the audit report
and we neither give any guarantee nor any assurance that all liabilities falling due
within a period of one year from the balance sheet date, will get discharged by the
Company as and when they fall due.
(xx) The Company has fully spent the required amount towards Corporate Social
Responsibility (CSR) and there is no unspent CSR amount for the year.
|
For VKS Aiyer & Co |
|
Chartered Accountants |
|
ICAI Firm Registration No.000066S |
|
CS Sathyanarayanan |
|
Partner |
Coimbatore |
Membership No.028328 |
10th May 2023 |
UDIN: 23028328BGUEWZ6601 |
ANNEXURE 2 TO THE INDEPENDENT AUDITORS REPORT
[Referred to in paragraph 2 under Report on Other Legal and Regulatory Requirements
in the Independent Auditors Report of even date to the members of Pricol Limited on
the standalone financial statements for the year ended 31.03.2023]
Report on the Internal Financial Controls over Financial Reporting 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 Pricol
Limited ("the Company") as of March 31, 2023 in conjunction with our audit
of the standalone financial statements of the Company for the year ended on that date.
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 March 31, 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 (the "Guidance Note").
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. 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 specified under section
143(10) of the Act to the extent
applicable to an audit of internal financial controls, both issued by the ICAI. 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 judgement, 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
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
ANNEXURE 2 TO THE INDEPENDENT AUDITORS REPORT (Contd.,)
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.
For VKS Aiyer & Co
Chartered Accountants ICAI Firm Registration No.000066S CS Sathyanarayanan
|
Partner |
Coimbatore |
Membership No.028328 |
10th May 2023 |
UDIN: 23028328BGUEWZ6601 |
+91-9892691696
