akar auto industries ltd share price Auditors report

To

The Members of akar auto Industries Ltd.

report oN the audit of standalone financial statements

opinion.

1. We have audited the accompanying Standalone Financial Statements of Akar Auto Industries Limited, ("the Company"), (CIN L29220MH1989PLC052305) which comprise the Balance Sheet as at 31st March,2023, the Statement of Profit and Loss (including other comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended and notes to the Standalone Financial Statements , including a summary of significant accounting policies and other explanatory information. (Herein after referred to as the "Standalone Financial Statements").

2. 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 Indian Accounting Standards specified 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 31 March 2023, and its total comprehensive income (comprising of profit and other comprehensive income), its Cash Flow and Changes In Equity for the year ended on that date.

Basis for opinion:

3. We conducted our audit of the Standalone Financial Statements 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 these Standalone Financial Statements under the provisions of the Act and the Rule made there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAIs code of ethics. We believe that the audit evidence we have obtained were sufficient and appropriate to provide a basis for our audit opinion on the Standalone Financial Statements.

key audit matters:

4. Key audit matters are those matters that, in our professional judgement, were of most significant 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 the matters described below to be the key audit matters to be communicated in our report; Foreign exchange fluctuation and export policies of the Government of India and other countries are considered to be Key Audit Matters. A significant portion of revenue is generated through export of products of the company. Any change in the duty structure, import and export policy has significant bearing on revenue realisation of the Company. Fluctuation in exchange rate of Indian currency has significant bearing on profitability of the company.

How our audit addressed the audit matter:

Our audit approach includes verification of balances outstanding (Debits and Credits) on account of foreign currencies; as at the end of the year and to assure that the same is adjusted to a value at the exchange rate that is prevailing at the close of last day of the current year.

Information other than the standalone financial statements and auditors report:

5. The companys management and Board of Directors are responsible for the preparation of other information. The other information comprises the information included in the management discussion and analysis, Boards Report including Annexures thereto. Business Responsibility Report, Corporate Governance and Share Holders Information, but does not include the Standalone Financial Statements and our auditors report there on.

6. Our opinion on the Standalone Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.

7. In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the Standalone Financial Statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

Managements responsibility for the standalone financial statements:

8. The Companys management and Board of Directors are responsible for the matters stated in Section 134(5) of the Act with respect to the preparation of these Standalone Financial Statements, that gives a true and fair view of the financial position, financial performance, total comprehensive income, changes in equity and cash flows of the Company in accordance with IND AS and other accounting principles generally accepted in India, This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act; for safeguarding of the assets of the Company; and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone

Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

9. In preparing the Standalone Financial Statements, management and 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.

10. The Board of directors is also responsible for overseeing the companys financial reporting process.

auditors responsibility for the audit of the standalone financial statements:

11. 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 exits. Misstatement 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.

12. 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, 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 sec-143(3)(i) of the Act. We are also responsible for expressing our opinion on whether the company has adequate internal financial control with reference to 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 management.

Conclude on appropriateness of managements use of the going concern basis of accounting and base on the audit evidence obtained, whether a material uncertainty exists related to events or commissions that may caste 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 modified 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 misstatement 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) to evaluate the effect of any identified misstatement in the Standalone Financial Statements.

Communication with those charged with the governance.

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 the 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 determined those matters that were of most significance in the audit of financial statements of the current year and are therefore the key audit matters. We described these matters in our auditors report unless law or regulations precludes public disclosure about the matter or when, in extremely rare circumstances, we determined that the matter should not be communicated in our report because the adverse consequences of doing so would reasonably we expected to overweight the public interest benefits of such communications.

report on other Legal and regulatory requirements:

13. As required by the Companies (Auditors Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of Section 143(11) of the Act, and the basis of such checks of books and records of the company as we considered appropriate and according to the information and explanations give to us, we give in the "Annexure 1" a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

14. 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; except the confirmations from debtors and creditors.

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 & Loss including Other Comprehensive Income, the statement of Cash Flow and the statement of Change in Equity dealt with by this report are in agreement with the books of accounts;

d. in our opinion, the aforesaid Standalone Financial Statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended); save and except to the extent as stated in note no. 24 regarding AS 15 for employees benefits to the Standalone Financial Statements.

e. on the basis of written representations received from the directors as on 31 March, 2023 and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March, 2023 from being appointed as a director in terms of Section 164 (2) of the Act; and

f. with respect to the adequacy of internal financial controls over financial reporting of the Company with reference to financial statements of the company and the operative effectiveness of such controls, refer to our separate report in "Annexure 2" of this report.

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, 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 at 31.03.2023 on its financial position in its standalone IND-AS financial statements- refer Note 20 to the standalone IND AS financial statements; i

i. The Company did not have any long-term contracts including derivatives contract for which there were any material foreseeable losses; and ii

i. A sum of Rs 0.55 Lakhs relating to Financial Year 2014-15 is transferred to the credit of Investors Protection Fund and there is no due and outstanding for transfer to the credit of the Investors Protection Fund as on 31.03.2023 (Previous Year Rs 0.57 Lakhs).

Forges & associates LLP

CHARTERED ACCOUNTANTS

(FRN 000257N)

	(deep Jain)
Place : Delhi.	PARTNER
Dated : 30th May, 2023.	MEMBERSHIP NO. 119681

referred to in paragraph under the heading "report on other Legal and regulatory requirements" of our independent auditors report of even date

Based on the audit procedures performed for the purpose of reporting a true and fair view on the Standalone Financial Statements of the Company and taking into consideration the information and explanations given to us and the books of accounts and other records examined by us in the normal course of audit, we report that: (i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) The Company has a regular program of physical verification of its fixed assets under which fixed assets are verified in a phased manner during the year, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its business. According to the information and explanations given to us some portions of the fixed Assets of the company have been physically verified by the companys management during the year. We are informed that no material discrepancies were noticed on such verification. We have relied upon the managements representation for the same.

(c) Based on our audit procedure performed for the purpose of reporting the true and fair view of the Standalone Financial Statements and according to information and explanations given by the management, the title deeds of immovable properties are held in the name of the company.

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year except material in transit and stocks lying with third parties and in bonded warehouses, if any, which are verified with reference to the certification obtained and/or subsequent clearing of goods.

(b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory and no material discrepancies between physical inventory and book records were noticed on physical verification.

(iii) In our opinion and according to the information and explanations given to us, the Company has granted unsecured loan to companies, firms and other parties covered in the register maintained under Section 189 of the Act. (a) The terms and conditions of the grant of such loans are not prejudicial to the companys interest;

(b) the schedule of repayment of principal and payment of interest, where applicable, has been stipulated and the repayments or receipts are regular;

(c) No amount is overdue, and the company has taken necessary action for recovery of the principal and interest wherever applicable. (iv) In our opinion and according to the information and explanations given to us, the provisions of sections 185 and 186 of the Act in respect of loans and advances given, investments made and guarantees, and securities given to parities covered under the respective sections have been complied with by the company.

(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014, as amended.

(vi) The maintenance of cost record has been specified by the Central Government under Section 148 (1) of the Act. We 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 sub-section (1) of Section 148 of the Act in respect of companys products and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(vii) (a) According to the information and explanations given to us and the records of the company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues including provident fund, employees state insurance, income tax, sales tax including Value Added Tax, wealth tax, service tax, Goods and Service Tax, duty of customs, duty of excise, cess and other material statutory dues, as applicable, to each of them respectively with the appropriate authorities. There were no arrears of undisputed outstanding statutory dues as at the yearend for a period of more than six months from the date it became payable. (b) The dues outstanding in respect of income-tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax and cess, GST on account of any dispute, the amount involved and the forum where disputes are as follows:-

Name of statute	Nature of dues	forum where dispute is Pending	Period to which the amount relates	amount Unpaid Rs ( in Lakh)
Income Tax Act	Income Tax	Chief Commissioner of Income Tax	A.Y.2002-2003	5.90
1961			A.Y.2003-2004	11.45
			A.Y.2004-2005	0.05
	Income Tax	Assessing officer for rectification	A.Y.2005-2006	8.57
			A.Y.2006-2007	2.84
			A.Y.2007-2008	1.81
			A.Y.2008-2009	1.60
			A.Y.2011-2012	1.38
			A.Y.2012-2013	11.97
	Income Tax	Commissioner of Income	A.Y.2013-2014	64.56
		Tax (Appeals)	A.Y.2014-2015	134.86
			A.Y.2015-2016	0.18
			A.Y.2016-2017	15.12
			A.Y.2018-2019	31.04
			A.Y.2019-2020	34.80
	Income Tax	Deputy Commissioner of	A.Y. 2017-18	32.22
		Income Tax (Appeals)
	Income Tax (TCS)	Commissioner of Income	A.Y. 2012-13 to	9.96
		Tax (Appeals)	A.Y. 2018-19
The Goods and	GST	Joint Commissioner of	FY 2017-2018 to	39.89
Service Tax Act		CGST	FY 2019-2020
2017

(viii) According to the records of the company examined by us and information and explanations given to us, in our opinion, the Company has not defaulted in repayment of dues to any financial institution or a bank or Government during the year. The company did not have any outstanding debentures during the year.

(ix) In our opinion and according to the information and explanation given to us the company did not raise money by way of initial public offer or further public offer (including debt instruments) during the year. In our opinion and according to the information and explanation given to us, the money raised by way of term loan by the company, have, prima-facie, been applied for the purposes for which the loans were obtained.

(x) To the best our knowledge and according to the information and explanations given to us no fraud on or by the Company or by its Officers or employees has been noticed or reported during the period covered by our audit.

(xi) In our opinion and according to the information and explanations given to us, the company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 of the Act read with Schedule V to the Act.

(xii) In our opinion, the Company is not a Nidhi Company and accordingly, Clause 3 (xii) of the Companies (Auditors report), Order, 2016 is not applicable.

(xiii) In our opinion and according to the information and explanations given to us, all transactions with the related parties are in compliance with sections 177 and 188 of Act, where applicable, and the requisite details have been disclosed in the standalone ND AS financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us; during the year the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under paragraph 3 (xiv) of the Order is not applicable to the company. (xiv) According to the information and explanations given to us, the Company has not entered into any non-cash transactions with directors or persons connected with them therefore the provisions of Clause 3 (xv) of the Companies (Auditors report), Order, 2016 is not applicable to the Company. (xv) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.

For gas & associates LLP

CHARTERED ACCOUNTANTS

(FRN 000257N)

	(deepa Jain)
	PARTNER
Place : Delhi.	UDIN : 23119681BGXBHO2531
Dated : 30th May, 2023.	MEMBERSHIP NO.119681

to the Independent auditors report on financial statements of even date of akar auto Industries Limited 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 AKAR AUTO INDUSTRIES LIMITED ("the Company") as of March, 31st 2023 in conjunction with our audit of the IND-AS 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 the 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 of the company based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the 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 over financial reporting, and the guidance note on internal financial controls over financial reporting (the guidance Note) 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 were 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 Standalone 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 IND AS 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 Standalone Financial Statements in accordance with generally accepted accounting principles and that receipts and expenditures of the company are being made only in accordance with authorizations 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 Standalone 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 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.

For gsa & associates LLP

CHARTERED ACCOUNTANTS

(FRN 000257N)

	(deepa Jain)
Place : Delhi.	PARTNER
Dated : 30th May, 2023.	MEMBERSHIP NO. 119681