To
The Members of
Capricorn Systems Global Solutions Limited Opinion
We have audited the accompanying standalone financial statements of
Capricorn Systems Global Solutions Limited ("the Company"), which comprises the
Balance Sheet as at March 31, 2023, the Statement of Profit and Loss (including Other
Comprehensive Income), the statement of changes in equity and the statement of Cash Flows
for the year then ended, and 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 standalone Ind 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 accounting principles generally accepted in India, of the state of
affairs of the Company as at March 31, 2023 and its Profit, total comprehensive income,
the changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the standalone financial statements in
accordance with the Standards on Auditing ("SA"s) specified under Section
143(10) of the Act. Our responsibilities under those Standards are further described in
the 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 the standalone
financial statements under the provisions of the Act and the Rules made thereunder, and we
have fulfilled our other ethical responsibilities in accordance with these requirements
and the ICAIs Code of Ethics. We believe that the audit evidence obtained by us is
sufficient and appropriate to provide a basis for our audit opinion on the standalone
financial statements.
Information Other than the Financial Statements and Auditors Report
Thereon
The Companys Board of Directors is responsible for the other
information. The other information comprises the information included in the Management
Discussion and Analysis, Boards Report including Annexures to Boards Report, Business
Responsibility Report, Corporate Governance and Shareholders Information, but does not
include the consolidated financial statements, standalone financial statements and our
auditors report thereon. Our opinion on the standalone 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 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 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 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 IndAS 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 accounting principles
generally accepted in India, including the Indian Accounting Standards (Ind AS) specified
under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 and
the Companies (Indian Accounting Standards) Rules, 2015, as amended.
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 the design, implementation and maintenance of adequate
internal financial controls that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and presentation of
the standalone financial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management is
responsible for assessing the 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 is also responsible for overseeing the Companys
financial reporting process.
Auditors Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit. We have taken into account the provisions of the
Act, the accounting and auditing standards and matters which are required to be included
in the audit report under the provisions of the Act and the Rules made thereunder. We
conducted our audit in accordance with the Standards on Auditing, issued by the Institute
of Chartered Accountants of India, as specified under Section 143(10) of the Act. Those
Standards require that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the standalone financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the Ind AS financial statements. The procedures selected
depend on the auditors judgment, including the assessment of the risks of material
misstatement of the Ind AS financial statements, whether due to fraud or error. In making
those risk assessments, the auditor considers internal financial control relevant to the
Companys preparation of the Ind AS financial statements that give a true and fair view in
order to design audit procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness
of the accounting estimates made by the Companys Directors, as well as evaluating the
overall presentation of the Ind AS financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis forour audit opinion on the standalone Ind AS financial
statements.
Report on Other Legal and Regulatory Requirements
1. 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 purpose of our audit;
(b) In our opinion proper books of account as required by law have been
kept by the Company sofaras it appears from our examination of those books;
(c) The Balance Sheet, the Statement of Profit and Loss including Other
Comprehensive Income, Statement of Changes in Equity and the Statement of Cash Flows dealt
with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid standalone Ind AS financial
statements comply with the Accounting standardsspecified under section 133 of the Act,
read with Rule 7 of the Companies (Accounts) Rules, 2014, Companies (Indian Accounting
Standards) Rules, 2015, as amended;
(e) Based on writtehn representations received from the directors as on
31st March 2023, andtaken on record by the Board of Directors, none of thedirectors
disqualified as on 31st March 2023, from being appointed as a director in terms of section
164 (2) of the Act.
(f) With respect to the adequacy of the internal financial controls
over financial reporting of theCompany and the operating effectiveness of such controls,
refer to our separate Report in Annexure B.
(g) With respect to the other matters to be included in the Auditors
Report in accordance withRule11 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) There are no pending litigations on the company as on the balance
sheet.
ii) The Company did not have any long-term contracts including
derivative contracts forwhichtherewere any material foreseeable losses.
iii) There were no amounts which were required to be transferred to the
Investor Education andProtection Fund by the Company.
2. As required by the Companies (Auditors report) Order, 2016
("the Order") issued by the Central Government of India in terms of sub-section
(11) of section 143 of the Act, we give in the Annexure A, a statement on the matters
specified in paragraphs 3 and 4 of the Order.
Annexure A TO THE INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 2 under Report on Other Legal and Regulatory
Requirements section of our report to the Members of Capricorn System Global Solutions
Limited of even date):
i. In respect of the Companys fixed Assets:
The Company has maintained proper records showing full particulars,
includingquantitative details and situation of fixed assets.
Fixed assets have been physically verified by the management during the
period and nomaterial discrepancies were identified on such verification.
Based upon the audit procedure performed and according to the records
of the Company,title deeds of all the immovable properties are held in the name of the
Company.
ii. (a) The Company is in the business of providing software services
and does not have any physical inventories. Accordingly, reporting under clause 3 (ii)(a)
of the Order is not applicable to the Company.
(b) The Company has not been sanctioned working capital limits in
excess of ? 5 crore, in aggregate, at any points of time during the year, from banks or
financial institutions on the basis of security of current assets and hence reporting
under clause 3(ii)(b) of the Order is not applicable
iii. The Company has not granted any loans to partiescovered in the
register maintained under section 189 of the companies Act,2013.
iv. 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 Act,
in respect of loans, investments, guarantees, and security to the extent applicable to it.
v According to the information and explanations given to us, the
company has not accepted any deposit from the public within the meaning of section 73 to
76 of the Act and the rules framed thereunder. Therefore, the provision of clause 3(v) of
the order is not applicable to theCompany.
vi. The maintenance of cost records has not been specified by the
Central Government under sub-section (1) of section 148 of the Companies Act, 2013 for the
business activities carried out by the Company. Hence, reporting under clause (vi) of the
Order is not applicable to the Company.
vii. According to the information and explanations given to us, in
respect of statutory dues:
a. The company is regular in depositing with appropriate authorities
undisputed statutorydues including Provident Fund, Employees State Insurance, Income tax
and other applicable statutory dues with the appropriate authorities.
b. According to the information and explanations given to us no
undisputed amounts payable in respect of outstanding statutory dues as at the last day of
the year ending 31st March, 2023 for period exceeding 6 months from the date they became
payable.
c. There are no statutory dues which are pending to be paid on account
of any litigation as at 31stMarch, 2023.
viii. 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).
ix. According to the records of the Company examined by us and the
information andexplanations given to us, the Company has not defaulted in repayment of
dues to any financial institution, bank, and Government orDebenture holders as at the
Balance Sheet date.
x. (a) According to the information and explanations given to us and
based on our verification, theCompany has not raised moneys by way of public issue and
company has not raised any Termloans during the year and hence reporting under clause 3
(x)(a) of the Order is not applicable to the Company.
(b) During the year, the Company has not made any preferential
allotment or private placement of shares or fully or partly paid convertible debentures
and hence reporting under clause 3 (x)(b) of the Order is not applicable to the Company.
xi. To the best of our knowledge and according to the information and
explanations given to us, no fraud by the Company or no material fraud on the Company by
its officers or employees has been noticed or reported during the year.
xii. The Company is not a Nidhi Company and hence reporting under
clause 3 (xii) of the Order is not applicable to the Company.
xiii. In our opinion, all the transactions with the related parties are
in compliance with section 177 and 188 of the Act, where applicable and the details have
been disclosed in the financial statements as required by applicable accounting standard.
xiv. (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.
xv. According to the information and explanations given to us and on an
overall examination of the financial statements of the Company, we report that the Company
has not entered into any non-cash transaction with directors or persons connected with
him.
xvi. (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 no core investment company 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.
xvii. The Company has not incurred cash losses during the financial
year covered by our audit and the immediately preceding financial year there is a cash
loss of Rs.42,17,004.
xviii. There has been no resignation of the statutory auditors of the
Company during the year.
xix. 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.
xx. (a) There are no unspent amounts towards Corporate Social
Responsibility (CSR) on other than ongoing projects 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.
(b) In respect of ongoing projects, the Company has transferred unspent
Corporate Social Responsibility (CSR) amount as at the end of the previous financial year,
to a Special account within a period of 30 days from the end of the said financial year in
compliance with the provision of section 135(6) of the Act. Accordingly, reporting under
clause 3(xx)(b) of the Order is not applicable for the year.
In respect of ongoing projects, the Company has not transferred the
unspent Corporate Social Responsibility (CSR) amount as at the Balance Sheet date out of
the amounts that was required to be spent during the year, to a Special Account in
compliance with the provision of sub-section (6) of section 135 of the said Act till the
date of our report since the time period for such transfer i.e. 30 days from the end of
the financial year has not elapsed till the date of our report. Accordingly, reporting
under clause 3(xx)(b) of the Order is not applicable for the year.
ANNEXURE B TO THE INDEPENDENT AUDIT REPORT
(Referred to in paragraph 1(f) under Report on Other Legal and
Regulatory Requirements section of our report to the Members of Capricorn Systems Global
Solutions Limited of even date)
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 Capricorn Systems Global Solutions Limited ("theCompany") as of
March 31,2023 in conjunction with our audit of the financial statements of the Company for
the year ended onthat date.
Managements Responsibility for Internal Financial Controls
The Companys management is responsible for establishing and
maintaining internal financial controls based on the internalcontrol over financial
reporting criteria established by the Company considering the essential components of
internal controls stated in the Guidance Note on Audit of Internal Financial Controls over
Financial Reporting issued by the Institute of CharteredAccountants of India. These
responsibilities include the design, implementation and maintenance of adequate internal
financialcontrols that were operating effectively for ensuring the orderly and efficient
conduct of its business, including adherence tocompanys policies, the safeguarding of its
assets, the prevention and detection of frauds and errors, the accuracy andcompleteness 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 ouraudit. We conducted our audit in
accordance with the Guidance Note on Audit of Internal Financial Controls Over
FinancialReporting (the "Guidance Note") and the Standards on Auditing, issued
by ICAI and deemed to be prescribed under section143(10) of the Act, to the extent
applicable to an audit of internal financial controls, both applicable to an audit
ofInternal FinancialControls and, both issued by the Institute of Chartered Accountants of
India. Those Standards and the Guidance Note require thatwe comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether
adequateinternal financial controls over financial reporting was established and
maintained and if such controls operated effectively in allmaterial respects.
Our audit involves performing procedures to obtain audit evidence about
the adequacy of the internal financial controls systemover financial reporting and their
operating effectiveness. Our audit of internal financial controls over financial reporting
includedobtaining an understanding of internal financial controls over financial
reporting, assessing the risk that a material weaknessexists, and testing and evaluating
the design and operating effectiveness of internal control based on theassessed risk.
Theprocedures selected depend on the auditors Judgement, including the assessment of the
risks of material misstatements of thefinancial 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 theCompanys 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 regardingthe reliability of financial
reporting and the preparation of financial statements for external purposes in accordance
with generallyaccepted accounting principles. A companys internal financial controls over
financial reporting includes those policies andprocedures that (1) pertain to the
maintenance of records that , in reasonable detail, accurately and fairly reflect the
transactionsand dispositions of the assets of the company; (2) provide reasonable
assurance that transaction are recorded as necessaryto permit preparation
of financial statements in accordance with generally accepted
accounting principles, and that receipts andexpenditures of the company are being made
only in accordance with authorisations of management and directors of theCompany; and (3)
provide reasonable assurance regarding prevention or timely detection of unauthorised
acquisitions, use, ordisposition 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 limitation of internal financial controls over
financial reporting, including the possibility of collusion orimproper management override
of controls, material misstatements due to error or fraud may occur and not to be
detected. Also,projections of any evaluation of the internal financial controls over
financial reporting to future periods are subject to the risk thatthe internal financial
control over financial reporting may become inadequate because of changes in conditions,
or that thedegree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, to the best of our information and according to the
explanations given to usthe company has, in all material respects, an adequate internal
financial controls system over financial reportingand such internal financial controls
over financial reporting were operating effectively as at March 31,2023, based on
theinternal controls over financial reporting criteria established by the Company
considering the essential components of internalcontrol stated in the Guidance Note on
Audit of Internal Financial Controls Over Financial Reporting issued by the Institute
ofChartered Accountants of India.
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