To the members of GFL Limited
Report on the Audit of the Standalone Financial Statements
Opinion
We have audited the accompanying standalone financial statements of GFL Limited
("the Company"), which comprise the Standalone Balance Sheet as at 31 March
2023, the Standalone Statement of Profit and Loss (including Other Comprehensive Income),
the Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flows
for the year then ended, and notes to the standalone financial statements, including a
summary of significant accounting policies and other explanatory information ("the
standalone financial statements").
In our opinion and to the best of our information and according to the explanations
given to us, the aforesaid standalone financial statements give the information required
by the Companies Act, 2013 ("the Act") in the manner so required and give a true
and fair view in conformity with the Indian Accounting Standards prescribed under section
133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015
("Ind AS") and other accounting principles generally accepted in India, of the
state of affairs of the Company as at 31 March 2023, the profit and total comprehensive
income, changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specified
under section 143(10) of the Act. Our responsibilities under those Standards are further
described in the ‘Auditors Responsibilities for the Audit of the Standalone
Financial Statements section of our report. We are independent of the Company in
accordance with the Code of Ethics issued by the Institute of Chartered Accountants of
India ("ICAI") together with the ethical requirements that are relevant to our
audit of the standalone financial statements under the provisions of the Act and the Rules
made there under, and we have fulfilled our other ethical responsibilities in accordance
with these requirements and the ICAIs Code of Ethics. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide a basis for our opinion on the
standalone financial statements.
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 matter described below to be the
key audit matter to be communicated in our report.
| Sr. |
Key Audit Matter |
Auditors Response |
| 1 |
In respect of merger of subsidiary, erstwhile INOX Leisure Limited with PVR Limited
(now known as PVR INOX Limited): |
To address this key audit matter, our audit procedures included the following: |
|
As detailed in note 8, as per a scheme of amalgamation ("the Scheme"), the
Companys subsidiary, erstwhile INOX Leisure Limited is merged with PVR Limited with
effect from 1 January 2023 viz. the appointed date. The Company has received 1,58,35,940
fully paid-up equity shares, representing 16.16% of the total paid-up equity capital, of
PVR INOX Limited. |
• Examination of the Scheme and the NCLT Order. |
|
Accordingly, the Company has derecognised its investment in erstwhile INOX Leisure
Limited, recognised the resultant investment in PVR INOX Limited at fair value and the
resulting gain amounting to H 2,46,673.67 lakhs, is recognized in the statement of profit
and loss as an exceptional item. Further, the resultant investment in PVR INOX Limited is
classified as investment in an associate. |
• Testing managements assessment relating to valuation of the investment in PVR
INOX Limited received pursuant to the Scheme and its classification as an
"associate". |
|
This has been identified as a key audit matter since it is a significant event,
involving complexities in determining the accounting treatment under Ind AS and requiring
significant judgements for classification and presentation in the financial statements. |
• Evaluation of the appropriateness of the accounting treatment followed by the
Company in this regard, with reference to the requirements of Ind AS and the accounting
principles generally accepted in India. |
|
|
• Examination of the disclosures given in the standalone financial statements for
adequacy and appropriateness. |
Information Other than the Standalone 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 Annual Report,
for example, Boards Report, including Annexures to Boards Report, Management Discussion
and Analysis, Business Responsibility Report, Corporate Governance etc., but does not
include the standalone financial statements and our auditors report thereon. The Boards
Report, including Annexures to Boards Report, Management Discussion and Analysis,
Business Responsibility Report, and Corporate Governance etc. is expected to be made
available to us after the date of this auditors report.
Our opinion on the standalone financial statements does not cover the other information
and we will 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 identified above when it becomes available and, in doing
so, consider whether the other information is materially inconsistent with the standalone
financial statements or our knowledge obtained in the audit or otherwise appears to be
materially misstated.
When we read the Boards Report, including Annexures to Boards Report, Management
Discussion and Analysis, Business Responsibility Report, and Corporate Governance etc., if
we conclude that there is a material misstatement therein, we are required to communicate
the matter to those charged with governance and take necessary actions as per the
applicable laws and regulations.
Responsibilities of Management and Those Charged with Governance for the Standalone
Financial Statements
The Companys Board of Directors is responsible for the matters stated in section
134(5) of 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 including
other comprehensive income, changes in equity and cash flows of the Company in accordance
with the Ind AS and other accounting principles generally accepted in India. This
responsibility also includes maintenance of adequate accounting records in accordance with
the provisions of the Act for safeguarding of the assets of the Company and for preventing
and detecting frauds and other irregularities; selection and application of appropriate
accounting policies; making judgments and estimates that are reasonable and prudent; and
design, implementation and maintenance of adequate internal financial controls, that were
operating effectively for ensuring the accuracy and completeness of the accounting
records, relevant to the preparation and presentation of the standalone financial
statements that give a true and fair view and are free from material misstatement, whether
due to fraud or error.
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.
Those Board of Directors are also responsible for overseeing the Companys financial
reporting process.
Auditors Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone
financial statements as a whole are free from material misstatement, whether due to fraud
or error, and to issue an auditors report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with SAs will always detect a material misstatement when it 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 standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgement and
maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the standalone
financial statements, whether due to fraud or error, design and perform audit procedures
responsive to those risks, 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 financial controls 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 with reference to financial
statements in place and the operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness
of accounting estimates and related disclosures made by management.
• Conclude on 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 standalone 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 standalone
financial statements, including the disclosures, and whether the standalone financial
statements represent the underlying transactions and events in a manner that achieves fair
presentation.
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
1. As required by the Companies (Auditors Report) Order, 2020 ("the Order"),
issued by the Central Government of India in terms of section 143(11) of the Act, we give
in the Annexure I 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, based on our audit, 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 Standalone Balance Sheet, the Standalone Statement of Profit and Loss
(including Other Comprehensive Income), the Standalone Statement of Changes in Equity, and
the Standalone Statement of Cash Flows dealt with by this Report are in agreement with the
books of account.
(d) In our opinion, the aforesaid standalone financial statements comply with the Ind
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 31
March 2023 taken on record by the Board of Directors, none of the directors is
disqualified as on 31 March 2023 from being appointed as a director in terms of Section
164(2) of the Act.
(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 II. Our report expresses an unmodified opinion on
the adequacy and operating effectiveness of the Companys internal financial controls with
reference to financial statements.
(g) With respect to the other matters to be included in the Auditors Report in
accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion
and to the best of our information and according to the explanations given to us:
i. The Company 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 are no delays in transferring the amounts, 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 persons
or entities, including foreign entities ("Intermediaries"), with the
understanding, whether recorded in writing or otherwise, that the Intermediary shall,
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
entity ("Funding Parties"), with the understanding, whether recorded in writing
or otherwise, that the Company shall, 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 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.
v. The Company has neither declared nor paid any dividend during the year.
vi. 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 facility
is applicable to the Company w.e.f. 1 April 2023, and accordingly, reporting under Rule
11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial
year ended 31 March 2023.
Other Matters
The standalone financial statements of the Company for the year ended 31 March 2022
were audited by another auditor who expressed an unmodified opinion on those statements on
6 May 2022.
For Patankar & Associates
Chartered Accountants
Firms Registration No. 107628W
S S Agrawal
Partner Membership No. 049051
UDIN: 23049051BGXDES9823
Place: Pune Date: 30 May 2023
Annexure I to Independent auditors report to the members of GFL Limited on the
standalone financial statements for the year ended 31 March 2023 – referred to in
paragraph 1 under the heading "Report on Other Legal and Regulatory
Requirements" of our report of even date.
In term of the Companies (Auditors Report) Order, 2020 ("the Order"), on the
basis of information and explanation given to us and the books and records examined by us
in the normal course of audit and such checks as we considered appropriate, to the best of
our knowledge and belief, we state as under:
i. (a) (A) The Company has maintained proper records showing full particulars including
quantitative details and situation of Property, plant and equipment.
(a) (B) The Company does not have any intangible assets.
(b) The Property, plant and equipment have been physically verified by the management
at reasonable intervals and no material discrepancies have been noticed on such
verification.
(c) The Company does not have any immovable properties and hence requirement to report
on clause 3(i)(c) is not applicable to the Company.
(d) The Company has not revalued its property, plant and equipment during the year.
(e) 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.
ii. (a) The Company does not have any inventory and accordingly, the requirement to
report on clause 3(ii) (a) of the Order is not applicable to the Company.
(b) The Company has not been sanctioned any working capital limit in excess of five
crore rupees, in aggregate, at any point of time during the year, from banks or financial
institutions on the basis of security of current assets and accordingly, the requirement
to report on clause 3(ii)(b) of the Order is not applicable to the Company.
iii. (a) The Company has not provided any guarantee or security or granted any loans or
advances in the nature of loans, secured or unsecured, to companies, firms, Limited
Liability Partnerships or any other parties during the year.
(b) The investments made during the year are not, prima-facie, prejudicial to the
Companys interest.
(c) The Company has not granted any loans or advances in nature of loans and
accordingly, the requirement to report on clause 3(iii)(c) to 3(iii)(f) of the Order is
not applicable to the Company.
iv. The Company has complied with the provisions of section 186 of the Act in respect
of investments made. The Company has not granted any loans or provided any security or
guarantees in respect of which provisions of sections 185 and section 186 of the Act are
applicable.
v. The Company has not accepted any deposits or amounts which are deemed to be deposits
within the meaning of sections 73 to 76 of the Act, and the Rules framed thereunder.
Accordingly, the requirement to report on clause 3(v) of the Order is not applicable to
the Company.
vi. The Central Government has not prescribed maintenance of cost records under section
148(1) of the Act, for the activities of the Company. Accordingly, the requirement to
report on clause 3(vi) of the Order is not applicable to the Company.
vii. (a) The Company is generally regular in depositing with appropriate authorities
undisputed statutory dues including Goods and Services Tax, provident fund, income-tax,
cess and any other material statutory dues applicable to it. There are no undisputed dues
relating to employees state insurance, duty of customs, sales tax, service tax, duty of
excise or value added tax. There are no undisputed amounts payable in respect of such
statutory dues which were in arrears as at 31 March 2023 for a period of more than six
months from the date they become payable.
(b) There are no statutory dues referred to in sub-clause (a) above which have not been
deposited on account of disputes. The statutory dues in respect of the chemical business
undertaking and the renewable energy business, demerged in earlier years, have been
transferred and vested with the resulting companies as sanctioned by the Honble National
Company Law Tribunal and hence the same are not included for reporting under this clause.
viii. There are 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.
ix. (a) The Company has not taken any loans or other borrowings from any lender and
accordingly, the requirement to report on clause 3(ix)(a) of the Order is not applicable
to the Company.
(b) The Company has not been declared a wilful defaulter by any bank or financial
institution or other lender.
(c) The Company did not have any term loans outstanding during the year. Accordingly,
the requirement to report on clause 3(ix)(c) of the Order is not applicable to the
Company.
(d) There are no funds raised on short term basis and accordingly, the requirement to
report on clause 3(ix) (d) of the Order is not applicable to the Company.
(e) The Company has not taken any funds from any entity or person on account of or to
meet the obligations of its subsidiary and associate.
(f) The Company has not raised loans during the year on the pledge of securities held
in its subsidiary and associate.
x. (a) The Company did not raise moneys by way of initial public offer or further
public offer (including debt instruments) during the year.
(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).
xi. (a) No fraud by the Company or on the Company has been noticed or reported during
the year.
(b) During the year, no report has been filed by the auditor, under sub-section (12) of
section 143 of the Act in Form ADT-4 as prescribed under rule 13 of Companies (Audit and
Auditors) Rules, 2014 with the Central Government.
(c) There are no whistle-blower complaints received by the Company during the year.
xii. The Company is not a Nidhi Company and accordingly, the requirement to report on
clause 3(xii) of the Order is not applicable to the Company.
xiii. All transactions with the related parties are in compliance with sections 177 and
188 of Act, and the details have been disclosed in the standalone financial statements as
required by the applicable accounting standards.
xiv. (a) The Company has an internal audit system commensurate with the size and nature
of its business.
(b) The internal audit reports of the Company issued till the date of the audit report,
for the period under audit have been considered by us.
xv. The Company has not entered into any non-cash transactions with directors or
persons connected with them and accordingly the requirement to report on clause 3(xv) of
the Order is not applicable to the Company.
xvi. (a) The Company is a Core Investment Company and on the basis of legal opinion
obtained by the management the Company is not required to be registered under section
45-IA of the Reserve Bank of India Act, 1934.
(b) The Company has not conducted any Non-Banking Financial or Housing Finance
activities during the year.
(c) The Company is Core Investment Company (CIC) as defined in the regulations made by
the Reserve Bank of India, and it continues to fulfill the criteria of a CIC. The Company
is exempted from registration and it continues to fulfill such criteria.
(d) The Group of which the Company is a part has only one CIC.
xvii. The Company has not incurred any cash losses in the current financial and
immediately preceding year.
xviii. There has been no resignation of the statutory auditors during the year.
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 plans of the Board of Directors and management
and based on our examination of 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 that the 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 upto the date of the audit report and we neither give any guarantee nor any
assurance that all the liabilities following 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. In respect of expenditure on Corporate Social Responsibility (CSR)
(a) In respect of other than ongoing projects, the Company has not transferred the
amount remaining unspent in respect of other than ongoing projects, to a Fund specified in
Schedule VII to the Companies Act, 2013 till the date of our report. However, the time
period for such transfer i.e. six months of the expiry of the financial year as permitted
under the second proviso to sub-section (5) of section 135 of the Act, has not elapsed
till the date of our report.
(b) The Company did not have any ongoing project and accordingly, the requirement to
report on clause 3(xx) (b) of the Order is not applicable to the Company.
For Patankar & Associates
Chartered Accountants
Firms Registration No. 107628W
S S Agrawal
Partner Membership No. 049051
UDIN: 23049051BGXDES9823
Place: Pune Date: 30 May 2023
Annexure II to Independent auditors report to the members of GFL Limited on the
standalone financial statements for the year ended 31 March 2023 - referred to in
paragraph 2(f) under the heading ‘Report on Other Legal and Regulatory Requirements
of our report of even date
Report on the Internal Financial Controls with reference to financial statements under
Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the
Act")
We have audited the internal financial controls with reference to financial statements
of GFL Limited ("the Company"), as of 31 March 2023 in conjunction with our
audit of the standalone financial statements of the Company for the year ended on that
date.
Managements Responsibility for Internal Financial Controls
The Companys management is responsible for establishing and maintaining internal
financial controls based on the internal control over financial reporting criteria
established by the Company considering the essential components of internal controls
stated in the Guidance Note on Audit of Internal Financial Controls Over Financial
Reporting (the "Guidance Note") issued by the Institute of Chartered Accountants
of India ("the 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 Act.
Auditors Responsibility
Our responsibility is to express an opinion on the Companys internal financial
controls with reference to financial statements based on our audit. We conducted our audit
in accordance with the Guidance Note and the Standards on Auditing, deemed to be
prescribed under section 143(10) of the Act 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 ICAI. Those Standards and the Guidance Note require that we comply
with ethical requirements and plan and perform the audit to obtain reasonable assurance
about whether adequate internal financial controls with reference to financial statements
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 with reference to financial statements and their
operating effectiveness.
Our audit of internal financial controls with reference to financial statements
included obtaining an understanding of internal financial controls with reference to
financial statements, assessing the risk that a material weakness exists, and testing and
evaluating the design and operating effectiveness of internal control based on the
assessed risk. The procedures selected depend on the auditors judgement, including the
assessment of the risks of material misstatement of the 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
with reference to financial statements.
Meaning of Internal Financial Controls with reference to Financial Statements
A companys internal financial control with reference to financial statements 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 controls
with reference to financial statements 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
authorizations of management and directors of the company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the companys assets that could have a material effect on the financial
statements.
Inherent Limitations of Internal Financial Controls with reference to Financial
Statements
Because of the inherent limitations of internal financial controls with reference to
financial statements, 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 with
reference to financial statements to future periods are subject to the risk that the
internal financial controls with reference to financial statements 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, to the best of our information and according to the explanations given
to us, the Company has, in all material respects, an adequate internal financial controls
system with reference to financial statements and such internal financial controls with
reference to financial statements were operating effectively as at 31 March 2023 based on
the internal controls over financial reporting criteria established by the Company
considering the essential components of internal control stated in the Guidance Note
issued by the ICAI.
For Patankar & Associates
Chartered Accountants
Firms Registration No. 107628W
S S Agrawal
Partner Membership No. 049051
UDIN: 23049051BGXDES9823
Place: Pune
Date: 30 May 2023
+91-9892691696
