To
The Members of EFC (I) Limited
Report on the audit of the Ind AS financial statements Opinion
We have audited the accompanying Ind AS financial statements of EFC (I) Limited
("the Company"), which comprise the balance sheet as at March 31, 2023, and the
Statement of Profit and Loss and statement including other comprehensive income, statement
of cash flows and the statement of changes in Equity for the year then ended, and notes to
the Ind AS financial statements, including a summary of significant accounting policies
and other explanatory information.
In our opinion and to the best of our information and according to the explanations
given to us, the aforesaid Ind AS financial statements give the information required by
the Companies Act, 2013 (Act) in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in India, of the
state of affairs of the Company as at March 31, 2023, its profit including its
Comprehensive income, its cash flows and changes in equity for the year ended on that
date.
Basis for opinion
We conducted our audit in accordance with the Ind AS on auditing specified under
section 143 (10) of the Companies Act, 2013. Our responsibilities under those Standards
are further described in the auditors responsibilities for the audit of the Ind AS
financial statements section of our report. We are independent of the Company in
accordance with the code of ethics issued by the Institute of Chartered Accountants of
India together with the ethical requirements that are relevant to our audit of the Ind AS
financial statements under the provisions of the Act and the rules thereunder, and we have
fulfilled our other ethical responsibilities in accordance with these requirements and the
code of ethics.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the Ind AS financial statements of the current period. These
matters were addressed in the context of our audit of the Ind AS financial statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
Information other than the Ind AS 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, Business Responsibility Report but does not
include the Ind AS financial statements and our auditors report thereon.
Our opinion on the Ind AS 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 Ind AS 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 Ind AS 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.
Managements responsibility for the Ind AS financial statements
The Companys board of directors are responsible for the matters stated in section 134
(5) of the Act with respect to the preparation of these Ind AS financial statements that
give a true and fair view of the financial position, financial performance including other
comprehensive income, cash flows and changes in equity 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.
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 Ind AS financial statement that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
In preparing the Ind AS financial statements, management is responsible for assessing
the Companys ability to continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting unless management
either intends to liquidate the Company or to cease operations, or has no realistic
alternative but to do so.
The board of directors are also responsible for overseeing the Companys financial
reporting process.
Auditors responsibilities for the audit of the Ind AS financial statements
Our objectives are to obtain reasonable assurance about whether the Ind AS financial
statements as a whole are free from material misstatement, whether due to fraud or error,
and to issue an auditors report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with SAs
will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the
basis of these Ind AS financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and
maintain professional scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the Ind AS financial
statements, whether due to fraud or error, design and perform audit procedures responsive
to those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to
design audit procedures that are appropriate in the circumstances. Under section 143(3)(i)
of the Companies Act, 2013, we are also responsible for expressing our opinion on whether
the company has adequate internal financial controls system in place and the operating
effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness
of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of managements use of the going concern basis
of accounting and, based on the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant doubt on the Companys
ability to continue as a going concern. If we conclude that a material uncertainty exists,
we are required to draw attention in our auditors report to the related disclosures in
the Ind AS financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditors report. However, future events or conditions may cause the Company to cease to
continue as a going concern.
• Evaluate the overall presentation, structure and content of the Ind AS financial
statements, including the disclosures, and whether the Ind AS financial statements
represent the underlying transactions and events in a manner that achieves fair
presentation.
We communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied
with relevant ethical requirements regarding independence, and to communicate with them
all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those
matters that were of most significance in the audit of the Ind AS financial statements of
the current period and are therefore the key audit matters. We describe these matters in
our auditors report unless law or regulation precludes public disclosure about the matter
or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably
be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. The statement on matters specified in 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 Act, is provided in "Annexure" A, statement on the
matters specified in paragraph 3 and 4 of the Order.
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 best of
our knowledge and belief were necessary for the purpose of our audit.
b) In our opinion, proper books of account as required by the law have been kept by the
Company, in electronic mode on servers physically located in India so far as it appears
from our examination of those books.
c) The Balance Sheet and the Statement of Profit and Loss including the Statement of
Comprehensive income, the cash flow statement and the changes in equity dealt with by this
Report are in agreement with the books of account.
d) In our opinion, the aforesaid Ind AS financial statements comply with the Ind AS
Accounting Standards 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 31
March 2023 taken on record by the Board of Directors, none of the existing Directors is
disqualified as on 31 March 2023 from being appointed as a director in terms of Section
164 (2) of the Act.
f) With respect to adequacy of the internal controls over financial reporting of the
Company and the operating effectiveness of such controls, refer to our separate report in
"Annexure B".
g) In our opinion and the based on the information presented to us, managerial
remuneration has been paid for the year ended 31 March 2023 hence reporting under section
197 read with schedule V to the act is required.
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 has disclosed the impact of pending litigations on its financial
position in its Ind AS financial statements - Refer Note 33 to the Ind AS financial
statements.
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 or
entities, 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 persons or entities, 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 performed 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. Company has not paid any dividend during the year.
vi. As proviso to rule 3(1) of the Companies (accounts) Rules, 2014 is applicable for
the Company only w.e.f April 1, 2023, reporting under this clause is not applicable.
For Mehra Goel & Co |
Chartered Accountants |
| Firms Registration Number: 000517N |
Roshan Daultani |
Partner |
| Membership Number: 137405 |
| Pune, 30 May 2023 |
| UDIN: 23137405BGSPTQ4604 |
Annexure - A referred to in our Independent Auditors Report to the member of EFC (I)
Limited on the Ind AS financial statements for the year ended 31 March 2023
Based on the audit procedures performed for the purpose of reporting a true and fair
view on the IND AS financial statements of the Company and taking into consideration the
information and explanations given to us and the books of account and other records
examined by us in the normal course of audit, we report that:
i) Fixed Asset Record:
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 of Intangible
Assets.
b) The major Property, Plant and Equipment of the company have been physically verified
by the management at reasonable intervals during the year and no material discrepancies
were noticed on such verification.
c) According to the information and explanation given to us, there are no immovable
properties held by the Company hence reporting under this clause is not applicable.
d) The Company has not revalued its Property, Plant and Equipment (including Right of
Use assets) or intangible assets or both during the year.
e) According to the information and explanation given to us, no proceedings have been
initiated or are pending against the company for holding any benami property under the
Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder during
the year.
ii) The company is a service company; accordingly, it does not hold any physical
inventories. Accordingly, paragraph 3(ii) of the order is not applicable to the Company.
iii) According to the information and explanations given to us, the company has made
investments during the year. The company has granted unsecured loans to companies, in
respect of which the requisite information is as below.
(a) A. Based on the audit procedures carried on by us and as per the information and
explanations given to us, the Company has given loans or advances in the nature of loans
to subsidiaries. The Company does not hold any investment in any joint ventures or
associates.
B. Based on the audit procedures carried on by us and as per the information and
explanations given to us, the Company has given unsecured loans to parties other than
subsidiaries as listed below. The Company has not stood guarantee or provided security.
Particulars |
Loans |
Aggregate amount during the year |
|
Subsidiaries |
1,918.99 Lakhs |
Others |
0.35 Lakhs |
Balance outstanding as at balance sheet date |
|
Subsidiaries |
1,503.89 Lakhs |
Others |
0.22 Lakhs |
(b) According to the information and explanations given to us and based on the audit
procedures conducted by us, in our opinion the investment made and the terms and
conditions of the grant of loans and advances in the nature of loans during the year are,
prima facie, not prejudicial to the interest of the Company.
(c) According to the information and explanations given to us and on the basis of our
examination of the records of the Company, in the case of loans given and in case of
advances in the nature of loans given, in our opinion the repayment of principal and
payment of interest has been stipulated and the repayments or receipts have been regular.
(d) According to the information and explanations given to us and on the basis of our
examination of the records of the Company, there is no overdue amount for more than ninety
days in respect of loans given and advances in the nature of loan given.
(e) According to the information and explanations given to us and on the basis of our
examination of the records of the Company, there is no loan or advance in the nature of
loan granted falling due during the year, which has been renewed or extended or fresh
loans granted to settle the over dues of existing loans given to same parties.
(f) According to the information and explanations given to us and on the basis of our
examination of the records of the Company, the Company has granted loans or advances in
the nature of loans either repayable on demand or without specifying any terms or period
of repayment which are as below:
|
All Parties |
Promoters |
Related Parties |
Aggregate amount of loans/advances in nature of loans:
-Repayable on demand -Repayable within one year |
0.35 Lakhs 1,918.99 Lakhs |
|
0.35 Lakhs 1,918.99 Lakhs |
Percentage of loans/advances in nature of loans to total loans |
100% |
|
100% |
iv) According to the information and explanation given to us, 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 deposits or amounts which are deemed to be deposits
under the directives of the Reserve Bank of India and the provisions of Sections 73 to 76
or any other relevant provisions of the Companies Act, 2013 and the rules framed
thereunder, where applicable. Accordingly, the provisions of clause 3(v) of the Order are
not applicable.
vi) To the best of our knowledge and belief, the Central Government has not specified
maintenance of cost records under sub-section (1) of Section 148 of the Act, in respect of
Companys products/ service. Accordingly, the provisions of clause 3(vi) of the Order are
not applicable.
vii) a)The Company is regular in depositing undisputed statutory dues including Goods
and Services Tax, provident fund, employees state insurance, income-tax, sales-tax,
service tax, duty of customs, duty of excise, value added tax, cess and any other
statutory dues, as applicable, with the appropriate authorities. Further, no undisputed
amounts payable in respect thereof were outstanding at the year-end fora period of more
than six months from the date they became payable.
b)There are no dues in respect of Goods and Services Tax, provident fund, employees
state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise,
value added tax, cess and any other statutory dues that have not been deposited with the
appropriate authorities on account of any dispute.
viii) According to the information and explanation given to us, company has no
transactions, not recordedin the books of account have been surrendered or disclosed as
income during the year in the tax assessments under the Income Tax Act, 1961 (43 of 1961);
ix) According to the information and explanation given to us, the Company does not have
any loans or borrowings from any financial institution, banks, government or debenture
holders during the year. Accordingly, paragraph 3(ix) of the order is not applicable to
the Company.
x) (a) The Company has not raised any money by way of initial public offer or further
public offer (including debt instruments) during the year, further, based on the records
examined by us and according to information and explanations given to us, the Company has
not raised money by way of term loans during the year. Accordingly, paragraph 3 (x) of the
Order is not applicable.
(b) The Company has made preferential allotment of shares during the year and have
complied with the provisions of section 42 and 62 of the Act read with applicable rules
thereto and relevant provisions of the SEBI Regulations. According to information and
explanations given to us and on the basis of our examination of the records of the
Company, the company has not made any private placement of shares and has not raised funds
by way of issue of fully, partly or optionally convertible debentures. during the year.
Further, the funds raised to preferential allotment of shares were utilized for the
purposes for which such funds were raised.
(a) According to the information and explanation given to us, any fraud by the company
or any fraud on the company has not been noticed or reported during the year;
(b) According to the information and explanation given to us, no report under
sub-section (12) of section 143 of the Companies Act has been filed by the auditors in
Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014 with
the Central Government;
(c) According to the information and explanation given to us, no whistle-blower
complaints, received during the year by the company;
xii) In our opinion and according to the information and explanations given to us, the
Company is not a Nidhi company. Accordingly, paragraph 3(xii) of the Order is not
applicable.
xiii) Transactions with the related parties are in compliance with sections 177 and 188
of Companies Act 2013 where applicable and the details have been disclosed in the notes to
the financial statements, as required by the applicable standards.
xiv) (a) According to the information and explanations given to us, the company has an
internal audit system commensurate with the size and nature of its business;
(b) We have considered the reports of the Internal Auditors for the period under audit;
xv) According to the information and explanations given to us and based on our
examination of the records of the Company, the Company has not entered into non-cash
transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of
the Order is not applicable to the Company.
xvi) According to the information and explanations given to us, we are of the opinion
that
i) The provision of section 45-IA of the Reserve bank of India Act, 1934 (2 of 1934)
are not applicable to the Company. Accordingly, the requirement to report on clause xvi
(a) of the order is not applicable to the Company
ii) The Company has not conducted any Non-Banking Financial or Housing Finance
activities without obtaining a valid Certificate of Registration (COR) from the Reserve
Bank of India as per the Reserve Bank of India Act, 1934.
iii) The Company is not a Core Investment Company as defined in the regulations made by
Reserve Bank of India. Accordingly, the requirement to report on clause 3(xvi)(c) of the
Order is not applicable to the Company
iv) The company do not have any CICs which are registered with the Reserve Bank of
India as per the Reserve Bank of India Act, 1934.
xvii) According to the information and explanations given to us and based on the audit
procedures conducted we are of opinion that the company has not incurred any cash losses
in the financial year andthe immediately preceding financial year;
xviii) There has been resignation of the statutory auditors during the year and there
were no issues, concerns or objections raised by the outgoing auditors.
xix) On the basis of the financial ratios, ageing and expected dates of realization 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 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 incapable 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 fromthe balance
sheet date, will get discharged by the company as and when they fall due.
xx) According to explanation and information given to us, company has transferred
unspent amount to a fund specified n schedule VIII to the companies Act, within a period
of 6 months from the expiry of financial year in accordance with the provision of section
135 of the companies Act 2013.
xxi) The reporting under clause (xxi) is not applicable in respect of audit of
standalone financial statements of the Company. Accordingly, no comment has been included
in respect of said clause under this report.
For Mehra Goel & Co |
Chartered Accountants |
| Firm registration number: 000517N |
Roshan Daultani |
Partner |
| Membership no: 137405 |
| Pune,30th May 2023 |
| UDIN: 23137405BGSPTQ4604 |
Annexure "B" to the Independent Auditors Report
(Referred to in paragraph 2 (f) under Report on other legal and regulatory
requirements section of our report to the Members of EFC (I) Limited of even date)
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 EFC (I)
Limited ("the Company") as at March 31, 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 board of directors of the Company 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. 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, 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 internal financial controls over
financial reporting of the Company 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") issued by the Institute of Chartered Accountants
of India and the standards on auditing prescribed under Section 143 (10) of the Companies
Act, 2013, to the extent applicable to an audit of internal financial controls. 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 in 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 control 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 (i) pertain to the
maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (ii) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of IND AS
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 (iii) 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 IND AS
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 of 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.
Basis of Disclaimer of Opinion
According to the information and explanations given to us and based on our audit, the
reporting under internal financial controls over financial reporting is applicable to the
company from the current financial year. To strengthen the internal control system Company
has started implementing new internal control policies during the year. The new policies
are under implementation. As the new policies are not effective completely till the
conclusion of audit, we have considered the disclaimer in forming opinion on new policies.
We have considered disclaimer reported above in determining the nature, timing, and extent
of audit financial statements of the Company, and disclaimer does not affect our opinion
on the financial statements of the Company.
Opinion
We have considered disclaimer reported in basis of disclaimer of opinion paragraph in
determining the nature, timing, and extent of audit financial statements of the Company,
and disclaimer does not affect our opinion on the financial statements of the Company.
For Mehra Goel & Co |
Chartered Accountants |
Firm registration no: 000517N Roshan Daultani |
Partner |
Membership no: 137405 |
Pune, 30 May 2023 |
UDIN: 23137405BGSPTQ4604 |
+91-9892691696
