To the Members of ALKA INDIA LIMITED
Disclaimer of Opinion
We have audited the financial statements of Alka India Limited ("the
Company"), which comprise the balance sheet as at 31st March 2022, and the statement
of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in
Equity, the Statement of Cash Flows and notes to the standalone Ind AS financial
statements, for the year ended on that date, and a summary of the significant accounting
policies and other explanatory information (hereinafter referred to as "the
standalone financial statements").
In our opinion and to the best of our information and according to the explanations
given to us except for the effects of the matters described in the Basis for Disclaimer
of Opinion section of our report the aforesaid standalone financial statements give the
information required by the Companies Act 2013 as amended ("the Act") in the
manner so required and give a true and fair view in conformity with the accounting
principles generally accepted in India of the state of affairs of the Company as at
March31 2022 its loss including other comprehensive income its cash flows and the changes
in equity for the year ended on that date.
Basis for Disclaimer of Opinion
We draw to attention to:
We are unable to determine the consequential impact of certain specific transactions
/matters and disclosures on the Standalone Financial Statements. Such specific
transactions/ matters include:
a. During the financial year 2021-22, the company has booked Business Promotion Income
of Rs. 9,50,000. The said services were provided by Alka India Limited to K Sera Sera Box
Office Pvt Ltd, which was one of the Group Company. The management has explained over
email that "Alka India Ltd is engaged in the business of Textiles which produces
various cloth materials. Hence to promote the Dome business of KSS Box Office Pvt. Ltd,
there is an agreement between both the companies stating that "Alka India Ltd. will
advertise the dome business of KSS Box Office on its every cloth material, like print of
dome on the T-Shirts etc."
However, during our review, we were not provided with sufficient documentary evidence
being Agreement, proof of printing of Dome on cloth material by Alka India
Limited etc. to substantiate that the services were actually provided by Alka India
Limited.
Thus, due to lack of sufficient and appropriate audit evidence, we are unable to
comment on such income appearing in the accompanying audited standalone financial
statements for the year ended 31st March 2022.
b. The Company has advanced an amount of Rs. 14,75,000 during the FY 2020-21 in the
form of loans to Nityagata Advisor Management Consultancy for which we were not provided
with documentary evidence to validate the said transaction.
Further, it was also noted that Mr. Ashok Pancharia (director of Alka) is also a
director in Nityagata Advisor Management Consultancy and accordingly loans and advances to
an entity where the director of Alka India Limited is interested resulted in the violation
of the provisions under Section 185 of the Companies Act, 2013.
c. The company has gross outstanding loans and advances of Rs. 10,24,47,884 (Gross) as
on the year ended 31st March, 2022 from various companies, out of which the company has
created the provision for Doubtful Debts amounting to Rs. 2,25,19,000/- in the previous
financial years. We have circulated the independent balance confirmation for the majority
of the outstanding loans and advances; however, we have not received any confirmation
independently. Accordingly, due to lack of sufficient and appropriate audit evidence, we
are unable to comment on the recoverability and existence of such loans and advances.
d. The company had not conducted the Fair Value Assessment for the Investments held by
Alka India Limited of Rs. 2,43,94,962 (Net) in the shares of unlisted company as required
under Ind AS 109. Hence, we are unable to comment on the realizable value of such
investment.
e. As per Standards on Auditing (SA) - 505 External Confirmation, Independent Balance
confirmation for outstanding Bank Balances as on 31.03.2022 were sought during the course
of audit but the response to the said confirmations were not received by us till the date
of this report. Hence, the outstanding balances appearing as on 31 March, 2022 are based
on the account statement available and provided by those charge with governance.
f. The company has made available the minutes of the Board Meetings held during the FY
2021-22 for our inspection till the date of this report and hence we are unable to review
the same.
g. The company has not provided us with the internal Audit Report of the financial year
2021-22 as required under section 138 of the Companies Act, 2013 till the date of this
report and hence, we are unable to review the same.
Material uncertainty related to Going Concern
Due to the matters described under Basis on Disclaimer of Opinion and Emphasis of
Matter and possible impact thereof, we are unable to obtain sufficient appropriate audit
evidence as to whether the Company will be able to service its debts, realize its assets
and discharge its liabilities as and when they become due over the period of next 12
months, Accordingly, we are unable to comment on whether the Company will be able to
continue as Going Concern.
Due to the possible effects of the matters described in the Basis for Disclaimer of
Opinion paragraph in our main audit report, we are unable to obtain sufficient appropriate
audit evidence to provide a basis for our opinion on whether the Company had adequate
internal financial controls over financial reporting with reference to these Standalone
Ind AS financial statements as at March 31, 2022 and whether such internal financial
controls were operating effectively. Accordingly, we do not express an opinion on Internal
Financial Controls Over Financial Reporting with reference to these Standalone Ind AS
financial statements.
We conducted our audit in accordance with the Accounting Standards (AS) specified under
section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are
further described in the Auditors Responsibilities for the Audit of the Financial
Statements section of our report. We are independent of the Company in accordance with the
Code of Ethics issued by the Institute of Chartered Accountants of India together with the
ethical requirements that are relevant to our audit of the financial statements under the
provisions of the Companies Act, 2013 and the Rules thereunder, and we have fulfilled our
other ethical responsibilities in accordance with these requirements and the Code of
Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the 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.
Information other than the financial statements and auditors report thereon
The Companys board of directors is responsible for the preparation of the other
information. The other information comprises the information included in the Boards
Report including Annexures to Boards Report but does not include the financial statements
and our auditors 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.
Responsibilities of Management and Those Charged with Governance for the Financial
Statements
The Companys Board of Directors is responsible for the matters stated in section
134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of
these financial statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with the accounting
principles generally accepted in India, including the Accounting Standards (AS) specified
under section 133 of the Act. This responsibility also includes maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding of the
assets of the Company and for preventing and detecting frauds and other irregularities;
selection and application of appropriate accounting policies; making judgments and
estimates that are reasonable and prudent; and design, implementation and maintenance of
adequate internal financial controls, that were operating effectively for ensuring the
accuracy and completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the
Companys ability to continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting unless management
either intends to liquidate the Company or to cease operations, or has no realistic
alternative but to do so.
Those Board of Directors are also responsible for overseeing the Companys financial
reporting process.
Auditors Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the 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 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 financial
statements, whether due to fraud or error, design and perform audit procedures responsive
to those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to
design audit procedures that are appropriate in the circumstances. Under section 143(3)(i)
of the Companies Act, 2013, we are also responsible for expressing our opinion on whether
the company has adequate internal financial controls system in place and the operating
effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness
of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of managements use of the going concern basis
of accounting and, based on the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant doubt on the Companys
ability to continue as a going concern. If we conclude that a material uncertainty exists,
we are required to draw attention in our auditors report to the related disclosures in
the 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 financial
statements, including the disclosures, and whether the 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) to evaluate 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.
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 sub-section (11) of section 143 of
the
Companies Act, 2013, we give in the ‘Annexure A, a statement on the
matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. As required by Section 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 and the Cash Flow Statement
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 (AS) specified under Section 133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules, 2014.
e) On the basis of the written representations received from the directors as on 31st
March, 2022 taken on record by the Board of Directors, none of the directors is
disqualified as on 31st March, 2022 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
financial statements of the Company and the operating effectiveness of such controls,
refer to our separate Report in ‘Annexure B.
g) With respect to the matter to be included in the Auditors Report under section
197(16), In our opinion and according to the information and explanations given to us, the
remuneration paid by the Company to its directors during the current 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 Act. The Ministry of
Corporate Affairs has not prescribed other details under section 197(16) which are
required to be commented upon by us.
h) 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 does not have any pending litigations which would impact its financial
position.
ii. The Company did not have any long-term contracts including derivative contracts for
which there were any material foreseeable losses.
iii. There were no amounts which were 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,
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;
(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; and
(c) Based on such 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 (i) and (ii) of Rule 11(e), as provided under (a) and
(b) above, contain any material misstatement.
v. No dividend have been declared or paid during the year by the company.
| For AMIT RAMAKANT & CO. |
| Chartered Accountants |
| Firm Reg. No. 009184C |
| CA AMIT AGRAWAL |
| Partner |
| Membership No. 077407 |
| UDIN: 22077407AJWUKR4585 |
| Date: 30th May, 2022 |
| Place: Mumbai |
+91-9892691696
