To the Members of
SWARNA SECURITIES LIMITED.
Opinion
We have audited the accompanying financial statements of M/s Swarna Securities Limited
("the Company"), which comprise the Balance Sheet as at 31st March,
2023, the Statement of Profit and Loss, the Statement of Changes in Equity and the
Statement of Cash Flows for the 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 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 Indian
Accounting Standards prescribed under section 133 of the Act read with the Companies
(Indian Accounting Standards) Rules, 2015, as amended, 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
We conducted our audit of the financial statements in accordance with the Standards on
Auditing ("SA"s) specified under section 143(10) of the Act. Our
responsibilities under those Standards are further described in the Auditor’s
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 the Rules made 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 obtained by us is sufficient and
appropriate to provide a basis for our audit opinion on the standalone financial
statements.
Key Audit Matters
We have determined that there are no key audit matters to communicate in our report.
Information Other than the Financial Statements and Auditor’s Report Thereon
The Company’s Board of Directors is responsible for the other information. The
other information comprises the information included in the Management Discussion and
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 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.
Management’s Responsibilities 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, including other
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 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, 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 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 responsible for overseeing the Company’s financial
reporting process.
Auditor’s 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 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 judgment and
maintain professional scepticism 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 financial 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.
• Evaluate the appropriateness of accounting policies used and the reasonableness
of accounting estimates and related disclosures made by the 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
Company’s ability 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 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.
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 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.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor’s Report) Order, 2020 ("the
Order"), issued by the Central Government of India in terms of section 143(11) of the
Companies Act, 2013, we give in 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 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 Balance Sheet, the Statement of Profit and Loss, 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.
(d) In our opinion, the aforesaid financial statements comply with the Accounting
Standards specified under section 133 of the Act.
(e) On the basis of the written representations received from the directors as on 31st
March, 2023 taken on record by the Board of Directors, none of the directors is
disqualified as on 31stMarch, 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 our
separate report in Annexure-B; and
(g) 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, according to
the explanations given to us and as per the records of the Company examined by us, we
report that the Company has not paid any remuneration to its directors during the year.
(h) 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, 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 31st
March, 2023 on its financial position in its standalone financial statements. (Refer Notes
8 to the standalone financial statements).
ii. the Company does not have any long-term contracts including derivative contracts
for which there are any material foreseeable losses.
iii. there are no amounts which are 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 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; and
(b) The Management has represented that to the best of its knowledge and belief, 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.
(c) Based on audit procedures that have been 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 (a) and (b) contain any material misstatement.
v. The Company has not declared or paid any dividends during the year and accordingly
reporting on the compliance with section 123 of the Companies Act, 2013 is not applicable
for the year under consideration.
| PLACE: Vijayawada |
For SESHADRY & COMPANY |
| DATE: 30/05/2023 |
Chartered Accountants |
| UDIN: 23019946BHAND J4937 |
FRN: 004993S |
|
Sd/- |
|
(A. SESHADRY) |
|
Partner |
|
M.No.019946 |
ANNEXURE-A: Statement on the matters specified in paragraphs 3 &4 of the Companies
(Auditor’s Report) Order, 2020
(i) (a) (A) The Company has maintained proper records showing full particulars,
including quantitative details and situation of its Property, Plant and Equipment.
(B) The Company does not have any intangible assets. Hence, reporting under clause
3(i)(a)(B) of the Order is not applicable.
(b) The Property, Plant and Equipment are physically verified by the Management in a
phased manner so as to cover all the items over a period of five years, which in our
opinion is reasonable having regard to the size of the Company and the nature of its
assets. According to the information and explanations given to us and as per the records
of the Company examined by us no material discrepancies have been noticed on such
verification.
(c) As per the records of the Company examined by us the title deeds to all the
immovable properties disclosed in the financial statements are held in the name of the
Company.
(d) According to the information and explanations given to us and as per the records of
the Company examined by us the Company has not revalued its Property, Plant and Equipment
during the year. Hence, reporting under clause 3(i)(d) of the Order is not applicable.
(e) According to the information and explanations given to us, no proceedings have been
initiated or pending against the Company under the Benami Transactions (Prohibition) Act,
1988 and the rules made there under. Therefore, the question of our commenting on whether
the Company has appropriately disclosed the details in its standalone financial statements
does not arise.
(ii) (a) According to the information and explanations given to us the business of the
Company does not involve holding any inventories. Hence, reporting under clause 3(ii)(a)
of the Order is not applicable.
(b) According to the information and explanations given to us and as per the records of
the Company examined by us, the Company has not been sanctioned any working capital limits
during the year on the basis of security of its current assets. Hence, reporting under
clause 3(ii)(b) of the Order is not applicable.
(iii) According to the information and explanations given to us and as per the records
of the Company examined by us, the Company has not made any investment in, provided any
security or granted any loans or advances in the nature of loans, secured or unsecured, to
any company, firm, LLP or any other party during the year. Hence, reporting under clause
3(iii) of the Order is not applicable.
(iv) According to the information and explanations given to us and as per the records
of the Company examined by us, the Company has not given any loans or made any investments
or given any guarantees or securities specified under sections 185 and 186 of the Act.
Hence, reporting under clause 3(iv) of the Order is not applicable.
(v) According to the information and explanations given to us and as per the records of
the Company examined by us the Company has not accepted any deposits or amounts which are
deemed to be deposits, from the public. Hence, reporting under clause 3(v) of the Order is
not applicable.
(vi) The Central Government has not prescribed the maintenance of any cost records in
respect to the activities of the Company. Hence, reporting under clause 3(vi) of the Order
is not applicable.
(vii) (a) According to the information and explanations given to us and as per the
records of the Company examined by us, the Company has generally been regular in
depositing undisputed statutory dues applicable to it with the appropriate authorities.
There are no undisputed amounts of any statutory dues that were in arrears as at the
Balance Sheet date, for a period of more than six months from the date they became
payable.
(b) According to the information and explanations given to us and as per the records of
the Company examined by us the particulars of the statutory dues as at 31st
March, 2023 which have not been deposited on account of dispute are as follows:
| Name of the statute |
Nature of dues |
Amount disputed (Rs.) |
Amount paid out of the disputed amount (Rs.) |
Period to which the amount relates (FY) |
Forum where dispute is pending |
| Income Tax Act, 1961 |
Income Tax |
1,53,78, 460 |
30,76,000 |
2014-15 |
Commission er (Appeals) |
(viii) According to the information and explanations given to us and as per the records
of the Company examined by us the Company has not surrendered or disclosed as income
during the year in any tax assessments under the Income Tax Act, 1961, in respect of any
transactions previously not recorded in the books of accounts.
(ix) (a) According to the information and explanations given to us and as per the
records of the Company examined by us, the Company did not have any loans or borrowings
from any lenders during the year. Hence, reporting under clause 3(ix)(a) of the Order is
not applicable.
(b) According to the information and explanations given to us and as per the records of
the Company examined by us, the Company has not been declared a wilful defaulter by any
bank, financial institution or other lender.
(c) According to the information and explanations given to us and as per the records of
the Company examined by us, the Company has not availed any term loans during the year.
Hence, reporting under clause 3(ix)(c) of the Order is not applicable.
(d) According to the information and explanations given to us, as per the records of
the Company examined by us and on an overall examination of the financial statements of
the Company, no funds have been raised on short term basis by the Company. Hence,
reporting under clause 3(ix)(d) of the Order is not applicable.
(e) According to the information and explanations given to us and as per the records of
the Company examined by us, the Company has not taken any funds from any entity or person
on account of or to meet the obligations of its subsidiaries, associates or joint
ventures.
(f) According to the information and explanations given to us and as per the records of
the Company examined by us, the Company has not raised any loans during the year on the
pledge of any securities held in its subsidiaries, joint ventures or associate companies.
(x) (a) According to the information and explanations given to us and as per the
records of the Company examined by us, the Company has not raised any moneys by way of
initial public offer or further public offer during the year. Hence, reporting under
clause 3(x)(a) of the Order is not applicable.
(b) According to the information and explanations given to us and as per the records of
the Company examined by us, the Company has not made any preferential allotment or private
placement of shares or convertible debentures during the year. Hence, reporting under
clause 3(x)(b) of the Order is not applicable.
(xi) (a) 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, noticed or
reported during the year, nor have we been informed of any such case by the Management.
(b) According to the information and explanations given to us and as per the records of
the Company examined by us, no report in Form ADT-4 under sub-section (12) of section 143
has been filed during the year.
(c) According to the information and explanations given to us and as per the records of
the Company examined by us no whistle blower complaints have been received by the Company
during the year. Hence, reporting under clause 3(xi)(c) of the Order is not applicable.
(xii) The Company is not a Nidhi Company. Hence, reporting under clause 3(xii) of the
Order is not applicable.
(xiii) According to the information and explanations given to us and based on our
examination of the records of the Company, the transactions with the related parties are
in compliance with sections 177 and 188 of the Act, where applicable; and the details of
such transactions have been disclosed in the financial statements as required by the
applicable accounting standards.
(xiv) (a) In our opinion and according to the information and explanations given to us
and as per the records of the Company examined by us, the Company has an internal audit
system commensurate with the size and nature of its business. (b) The reports of internal
audit for the period under audit have been considered by us.
(xv) According to the information and explanations given to us and as per the records
of the Company examined by us, the Company has not entered into any non-cash transactions
with any director or any person connected with him. Hence, reporting under clause 3(xv) of
the Order is not applicable.
(xvi) (a) The Company is no longer in to non-banking finance business since it
surrendered its certificate of registration under section 45-IA of the Reserve Bank of
India Act, 1934 on 15/10/2015. Hence, the Company is not required to registered under the
said section 45-IA of the RBI Act.
(b) According to the information and explanations given to us and as per the records of
the Company examined by us the Company has not conducted any Non-Banking Financial or
Housing Finance activities during the year.
(c) The Company is not a Core Investment Company as defined in the regulations made by
the Reserve Bank of India. Hence, reporting under clause 3(xvi)(c) of the Order is not
applicable.
(d) According to the information and explanations given to us, the Company does not
belong to any Group that has any Core Investment Company as part of the Group. Hence,
reporting under clause 3(xvi)(d) of the Order is not applicable.
(xvii) The Company has not incurred any cash losses during the financial year under
audit, nor during the immediately preceding financial year.
(xviii) There has been no resignation of statutory auditors during the year under
audit. Hence, reporting under clause 3(xviii) of the Order is not applicable.
(xix) On an analysis of the financial ratios, ageing and expected dates of realisation
of financial assets and payment of financial liabilities, other information accompanying
the financial statements, our knowledge of the Board of Directors and management plans and
based on the 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 that the 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) According to the information and explanations given to us and as per the records
of the Company examined by us the provisions of section 135 are not applicable to the
Company for the year under audit. Hence, reporting under clause 3(xx) of the Order is not
applicable.
(xxi) The Company does not have any subsidiaries or associate companies so as to
require preparation of consolidated financial statements under sub-section (3) of section
129. Hence, reporting under clause 3(xxi) of the order is not applicable.
| PLACE: Vijayawada |
For SESHADRY & COMPANY |
| DATE: 30/05/2023 |
Chartered Accountants |
| UDIN: 23019946BHAND J4937 |
FRN: 004993S |
|
Sd/- |
|
(A. SESHADRY) |
|
Partner |
ANNEXURE-B: Report on the Internal Financial Controls under clause (i) of sub-section 3
of Section 143 of the Companies Act, 2013
We have audited the internal financial controls over financial reporting of M/s Swarna
Securities Limited ("the Company") as of 31st March, 2023 in
conjunction with our audit of the 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 standalone Ind AS 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 Company’s 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 authorisations of
management and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized 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 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.
| PLACE: Vijayawada |
For SESHADRY & COMPANY |
| DATE: 30/05/2023 |
Chartered Accountants |
| UDIN: 23019946BHAND J4937 |
FRN: 004993S |
|
Sd/- |
|
(A. SESHADRY) |
|
Partner |
|
M.No.019946 |
+91-9892691696
