To the Members of M/s. BPL Limited
Report on the Audit of the standalone Ind AS Financial Statements
Qualified Opinion
We have audited the accompanying Standalone Ind AS financial statements
of M/s BPL Limited ("the Company") which comprises the Balance Sheet as at March
31, 2023, the Statement of Profit and Loss (including other comprehensive income),
statement of changes in equity and statement of cash flows for the year then ended, and
notes to the financial statements, including a summary of material accounting policies and
other explanatory information.
In our opinion and to the best of our information and according to the
explanations given to us, and subject to the possible impact of matters mentioned in
" Basis for Qualified Opinion" paragraph below, the aforesaid standalone Ins AS
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, ("Ind AS") accounting principles generally
accepted in India, of the state of affairs of the Company as at March 31, 2023, and its
profit, changes in equity and its cash flows for the year ended on that date.
Basis for Qualified Opinion
The company is yet to redeemed preference shares amounting to Rs.
16958.68 lacs, which was due for redemption in August 2019 due to paucity of funds.
The Company is yet to contribute a sum of Rs.216.12 lacs (previous year
Rs.250.94 lacs) towards Group gratuity policy maintained with LIC as required under
Payment of Gratuity Act due to paucity of funds.
We conducted our audit in accordance with the Standards on Auditing
(SAs) 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 there
under, 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 Ind AS
financial statements for the financial year ended March 31, 2023. These matters were
addressed in the context of our audit of the standalone Ind AS financial statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
The following key audit matter was identified and communicated to
management
Revenue from Brand licensing agreement.
Revenue from Brand licensing is accounted based on minimum guarantee
terms of agreement with customer. Reconciliation is in progress to confirm the figures. We
have relied on confirmation of balance from party to obtain sufficient assurance that the
revenue booked is in agreement with amounts accounted by the party. Management has
represented to us the adequacy and accuracy of the amount of revenue accounted.
Other Information
The Companys Board of Directors is responsible for the other
information. The other information comprises the information included in the Annual report
but does not include the standalone Ind AS financial statements and our auditors report
thereon.
Our opinion on the standalone 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 standalone Ind AS financial
statements, our responsibility is to read the other information and, in doing so, consider
whether such other information is materially inconsistent with the financial statements or
our knowledge obtained in the 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.
Responsibility of Management for the Standalone 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 standalone financial statements that give a true and fair view of the
financial position, financial performance, changes in equity and cash flows of the Company
in accordance with the accounting principles generally accepted in India, including the
accounting Standards 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 implementation
and maintenance of 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
statement 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.
The Board of Directors are also responsible for overseeing the
companys financial reporting process
Auditors Responsibility 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:
l Identify and assess the risks of material misstatement of the
standalone 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.
l Obtain an understanding of internal control relevant to the audit in
order to design audit procedures that are appropriate in the circumstances. Under section
143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the
Company has adequate internal financial controls system in place and the operating
effectiveness of such controls.
l Evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures made by management.
l 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.
l Evaluate the overall presentation, structure and content of the
standalone Ind AS financial statements, including the disclosures, and whether the
standalone Ind AS 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.
From the matters communicated with those charged with governance, we
determine those matters that were of most significance in the audit of the standalone
financial statements of the current period and are therefore the key audit matters. We
describe these matters in our auditors report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a
matter should not be communicated in our report because the adverse consequences of doing
so would reasonably be expected to outweigh the public interest benefits of such
communication.
Report on Other Legal and Regulatory Requirements
As required by the Companies (Auditors Report) Order, 2020 ("the
Order"), issued by the Central Government of India in terms of subsection (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.
As required by Section 143(3) of the Act, we report that:
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.
a. 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
b. The Balance Sheet, the Statement of Profit and Loss, Statement of
Changes in equity and the Cash Flow Statement dealt with by this Report are in agreement
with the books of account.
c. In our opinion, the aforesaid standalone 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.
d. 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 are disqualified as on 31st March, 2023 from being appointed as a director in
terms of Section 164 (2) of the Act.
e. 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". Our report expresses an unmodified
opinion on the adequacy and operating effectiveness of the Companys internal financial
controls over financial reporting.
f. With respect to the other matters to be included in the Auditors
Report in accordance with the requirements of section 197(16) of the Act, as amended: In
our opinion and to the best of our information and according to the explanations given to
us, the remuneration paid by the Company to its directors during the year is in accordance
with the provisions of section 197 of the Act.
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:
1. The Company has disclosed the impact of pending litigations, if any,
on its financial position in its financial
2. The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable losses.
3. There were no amounts which were required to be transferred to the
Investor Education and Protection Fund by the Company.
4. (a) The Management has represented that, to the best of its
knowledge and belief, no funds (which are material either individually
or in the aggregate) have been advanced or loaned or invested (either from borrowed funds
or share premium or any other sources or kind of funds) by the Company to or in any other
person or entity, including foreign entity ("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 (which are material either individually or in the aggregate) have
been received by the Company from any person or entity, including foreign entity
("Funding Parties"), with the understanding, whether recorded in writing or
otherwise, that the Company shall, 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 the 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.
5. Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for
maintaining books of account using accounting software which has a feature of recording
audit trail (edit log) facility is applicable to the Company with effect from April 1,
2023, and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules,
2014 is not applicable for the financial year ended March 31, 2023.
for MKUK & Associates
Chartered Accountants
Firms registration number: 050113S
|
Manoj Kumar UKN |
|
Partner |
| Bangalore |
M.No: 091730 |
| 29th May, 2023 |
UDIN: 22091730AJVRVE2384 |
Annexure - A to the Auditors Report
The Annexure referred to in Independent Auditors Report to the members
of the Company on the Ind AS financial statements for the year ended 31 March 2023, We
report that:
1. (a) The Company has maintained records showing full particulars
including quantitative details and situation of fixed assets.
(b) As informed by the management, the company has conducted physical
verification of its fixed assets and differences were noticedwere not material and have
been properly dealt with n books of account.
(c) Based on our examination of the property tax receipts and
registered sale deed / transfer deed / conveyance deed provided to us, we report that, the
title in respect of self-constructed buildings and title deeds of all other immovable
properties (other than properties where the company is the lessee and the lease agreements
are duly executed in favor of the lessee), disclosed in the financial statements included
under Property, Plant and Equipment are held in the name of the Company as at the balance
sheet date,
(d) The Company has not revalued any of its Property, Plant and
Equipment (including right of-use assets) and intangible assets during the year.
(e) No proceedings have been initiated during the year or are pending
against the Company as at March 31, 2023 for holding any benami property under the Benami
Transactions (Prohibition) Act, 1988 (as amended in 2016) and rules made thereunder..
2. (a) Physical verification at reasonable periods in respect of
finished goods, stores, spare parts and raw materials are reported to have been made by
the management and certified by them accordingly. In our opinion, the frequency of
verification is reasonable.
(b) In our opinion and according to the information and explanations
given to us and on the basis of our examination of the records of inventory, the
discrepancies between physical stock and book stock, which were not material have been
properly dealt with in the books of account. Discrepancies of 10% or more in the aggregate
for each class of inventory were not noticed.
(c) The Company has not been sanctioned working capital limits in
excess of 5 crore, in aggregate during the year, on primary security of current assets.
3. The Company has made investments in a subsidiary Company during the
year, but has not granted unsecured loans to other parties, during the year, in respect of
which:
(a) The Company has not provided any loans or advances in the nature of
loans or stood guarantee, or provided security to any other entity during the year, and
hence reporting under clause 3(iii)(a) of the Order is not applicable.
(b) In our opinion, the investments made are, prima facie, not
<
p >prejudicial to the Companys interest.
(c) Since the Company has not granted any loans during the year,
reporting under Clause 3(iii)(c) is not applicable.
(d) Since the Company has not granted any loans during the year,
reporting under Clause 3(iii)(d) is not applicable.
(e) No loan granted by the Company which has fallen due during the
year, has been renewed or extended or fresh loans granted to settle the overdues of
existing loans given to the same parties. (f) During the year, the Company has not granted
any loans or advances in the nature of loans either repayable on demand or without
specifying any terms or period of repayment during the year. Hence, reporting under clause
3(iii)(f) is not applicable.
The Company has not provided any guarantee or security or granted any
advances in the nature of loans, secured or unsecured, to companies, firms, Limited
Liability Partnerships or any other parties during the year.
4. In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of section 185 and 186 of the
Act, with respect to the loans and investments made and guarantees given by it, if any,
after the commencement of Companies Act 2013, if any.
5. In our opinion and according to the information and explanations
given to us, the Company has not accepted deposits from the public and therefore, the
directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or
any other relevant provisions of the Companies Act and the rules framed there under are
not applicable to the company.
6. According to the information and explanations provided by the
management, in respect of Printed Circuit Boards manufactured by the company, the Central
Government has prescribed the maintenance of cost records sub-section (1) of section 148
of the Companies Act. We have broadly reviewed the books of account and records maintained
by the Company in this connection 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 records with a view to determining whether they are accurate or
complete.
7. (a) According to the records of the Company and information and
explanation given to us, the Company is generally regular in remittance of undisputed
statutory dues including Income Tax Deducted at Source, Provident Fund, Employees State
Insurance, Sales Tax, Service Tax, Goods And Service Tax (GST), excise Duty, Cess and
other statutory dues with the appropriate authorities during the year. According to the
information and explanations given to us, undisputed amounts payable in respect of customs
duty amounting to Rs.116.11Lacs + interest totaling Rs.289.88 lacs were outstanding, as at
31st March 2023, for a period of more than six months from the dates on which they became
payable.
(b) The following dues towards Value added tax, GST, customs duty,
excise duty, and service tax have not been deposited on account of
dispute/appeals:
| Name of Dues |
Nature of Dispute |
Amount (Rs. in Lakhs) |
Forum where pending |
| Central Excise |
Demand of duty on clearance
of CTV parts / components / sub-assemblies in SKD condition to OEMs |
271.48 |
Commissioner Appeals |
| Central Excise |
Demand of duty at Higher rate
for clearance of CENVAT availed inputs |
19.87 |
Commissioner Appeals |
| Central Excise |
Duty Exemption on DC Defibrillator |
56.42 |
Commissioner Appeals |
| Central Excise |
Penalty due to Non inclusion
of amortised cost in value of Plastic parts |
34.72 |
CESTAT |
| Service Tax |
Demand of Service Tax &
Penalty on manpower services provided by BPL to SBPL |
98.48 |
Tribunal |
| Customs duty |
Entitlement to exemption for parts of
Defibrillator |
328.48 |
High Court of Kerala |
| Customs duty |
Entitlement to exemption for parts of
Defibrillator |
299.14 |
Tribunal |
| Customs duty |
Levy of duty of Bonded goods since abandoned |
33.33 |
Tribunal |
| Sales tax/VAT |
Disallowance of Rebates &
Discounts |
239.64 |
MP Commercial Tax Appellate
Board |
| Sales tax/VAT |
Turnover differences, stock transfer
rejection |
703.21 |
Supreme Court |
| Sales tax/VAT |
Demand due to various disallowances which
ACT |
709.97 |
Revision Board |
| Sales tax/VAT |
Demand due to various disallowances which
ACT |
184.19 |
Additional Commissioner |
| Sales tax/VAT |
Assessment Demand which ACT |
145.16 |
DCCT (Appeals) |
| Sales tax/VAT |
Demand due to various disallowances which
ACT |
379.93 |
Tribunal |
| Sales tax/VAT |
Demand due to various disallowances which
ACT |
538.00 |
High Court of Kerala |
| FEMA |
Demand u/s. 10(6) & 7 |
140.00 |
Special Director (A), Chennai |
| FEMA |
Demand for non submission of Bill of Entry
to Banks |
50.00 |
Tribunal |
| Income Tax |
Various Disallowances on
assessment |
11562.40 |
Appeal before Income Tax
Authorities |
8. There were no transactions relating to previously unrecorded income
that have been surrendered or disclosed as income during the year in the tax assessments
under the Income Tax Act, 1961 (43 of 1961).
9. (a) The Company has not defaulted in repayment of loans or other
borrowings or in the payment of interest thereon to any lender except Preference shares as
reported in note no 2.9 of notes to financial statements.
(b) Based on information and explanation given to us by the management,
we report that The Company has not been declared willful defaulter by any bank or
financial institution or government or any government authority during the year. (c) The
Company has not taken any term loan during the year and there are no outstanding term
loans at the beginning of the year and hence, reporting under clause 3(ix)(c) of the Order
is not applicable.
(d) On an overall examination of the financial statements of the
Company, funds raised on short term basis have, prima facie, not been used during the year
for long-term purposes by the Company. (e) On an overall examination of the financial
statements of the Company, the Company has not taken any funds from any entity or person
on account of or to meet the obligations of its subsidiaries. (f) The Company has not
raised any loans during the year and hence reporting on clause 3(ix)(f) of the Order is
not applicable.
10. (a) The Company has not raised moneys by way of initial public
offer or further public offer (including debt instruments) during the year and hence
reporting under clause 3(x)(a) of the Order is not applicable.
(b) During the year, the Company has not made any preferential
allotment or private placement of shares or convertible debentures (fully or partly or
optionally) except under ESOP scheme and hence reporting under clause 3(x)(b) of the Order
is not applicable.
11. (a) No fraud by the Company and no material fraud on the
Company has been noticed or reported during the year.
(b) No report under sub-section (12) of section 143 of the Companies
Act has been filed in Form ADT-4 as prescribed under rule 13 of Companies (Audit and
Auditors) Rules, 2014 with the Central Government, during the year and upto the date of
this report. (c) We have taken into consideration the whistle blower complaints, if any,
received by the Company during the year (and upto the date of this report), while
determining the nature, timing and extent of our audit procedures..
12. The Company is not a Nidhi Company and hence reporting under
clause(xii) of the Order is not applicable. 13. In our opinion, the Company is in
compliance with Section 177 and 188 of the Companies Act, 2013 with respect to applicable
transactions with the related parties and the details of related party transactions have
been disclosed in the standalone financial statements as required by the applicable
accounting standards. 14. (a) In our opinion the Company has an adequate internal audit
system commensurate with the size and the nature of its business.
(b) We have considered, the internal audit reports for the year under
audit, issued to the Company during the year and till date, in determining the nature,
timing and extent of our audit procedures.
15. In our opinion during the year the Company has not entered into any
non-cash transactions with its Directors or persons connected with its directors. and
hence provisions of section 192 of the Companies Act, 2013 are not applicable to the
Company.
16. (a) In our opinion, the Company is not required to be registered
under section 45-IA of the Reserve Bank of India Act, 1934. Hence, reporting under clause
3(xvi)(a), (b) and (c) of the Order is not applicable.
(b) In our opinion, there is only one Core Investment Company (CIC)
within the Group (as defined in the Core Investment Companies (Reserve Bank) Directions,
2016) and accordingly reporting under clause 3(xvi)(d) of the Order is not applicable.
17 The Company has not incurred cash losses during the financial year
covered by our audit and the immediately preceding financial year. 18. There has been no
resignation of the statutory auditors of the Company during the year. 19. On the basis of
the financial ratios, ageing and expected dates of realisation of financial assets and
payment of financial liabilities, other information accompanying the financial statements
and our knowledge of the Board of Directors and Management plans and based on our
examination of the evidence supporting the assumptions, nothing has come to our attention,
which causes us to believe that any material uncertainty exists as on the date of the
audit report indicating that Company is not capable of meeting its liabilities existing at
the date of balance sheet as and when they fall due within a period of one year from the
balance sheet date. We, however, state that this is not an assurance as to the future
viability of the Company. We further state that our reporting is based on the facts up to
the date of the audit report and we neither give any guarantee nor any assurance that all
liabilities falling due within a period of one year from the balance sheet date, will get
discharged by the Company as and when they fall due.
20. There are no unspent amounts towards Corporate Social
Responsibility (CSR), requiring a transfer to a Fund specified in Schedule VII to the
Companies Act in compliance with second proviso to sub-section (5) of Section 135 of the
said Act. Accordingly, reporting under clause 3(xx)(a) of the Order is not applicable for
the year. for MKUK & Associates
Chartered Accountants
Firms registration number: 050113S
|
Manoj Kumar UKN |
|
|
Partner |
|
| Bangalore |
M.No: 091730 |
|
| 29th May, 2023 |
UDIN: 22091730AJVRVE2384 |
|
|
|
47 |
Annexure - B to the Auditors Report
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 BPL Limited ("the Company") as of 31 March 2023 in conjunction with
our audit of the Ind AS 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 financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the Companys internal financial
controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A companys internal financial control over financial reporting is a
process designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles. A companys internal financial control over
financial reporting includes those policies and procedures that (1) pertain to the
maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that receipts
and expenditures of the company are being made only in accordance with authorisations of
management and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorised acquisition, use, or disposition of the
companys assets that could have a material effect on the financial statements.
Inherent limitations of Internal Financial Controls over Financial
Reporting
Because of the inherent limitations of internal financial controls over
financial reporting, including the possibility of collusion or improper
management override of controls, material misstatements due to error or fraud may occur
and not be detected. Also, projections of any evaluation of the internal financial
controls over financial reporting to future periods are subject to the risk that the
internal financial control over financial reporting may become inadequate because of
changes in conditions, or that the degree of compliance with the policies or procedures
may deteriorate.
Opinion
In our opinion, based on the internal control over financial reporting
criteria established by the Company considering essential components of
internal control stated in the Guidance Note On Audit Of Internal Financial Controls over
Financial Reporting issued by the Institute Of Charted Accountants of India, needs to be
improved.
for MKUK & Associates
Chartered Accountants
Firms registration number: 050113S
|
Manoj Kumar UKN |
|
Partner |
| Bangalore |
M.No: 091730 |
| 29th May, 2023 |
UDIN: 22091730AJVRVE2384 |
+91-9892691696
