TO SHAREHOLDERS To the Members of GILADA FINANCE & INVESTMENTS LIMITED Report on
the Financial Statements
Opinion
We have audited the accompanying financial statements of "GILADA FINANCE
^INVESTMENTS LIMITED, which comprise the Balance Sheet as at March 31, 2023, the
Statement of Profit & Loss indicting comprehensive income, the statement of changes in
equity and the Statement of Cash Flow for the year then ended and a notes to financial
statement including summary of significant account;ng 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 financial statements give the information required by the
companies Act 2C13, 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 31s! March 2023, and its profit,the changes in
equity and cash flows for the year ended as on that date.
Basis For Opinion
We conducted our audit in accordance with the standards 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 financial
statements section of our report. We are independent of the Company in accordance with the
code of ethics issued by the Institute of Chartered Accountants of India together with the
ethical requirements that are relevant to our audit of the financial statements under the
provisions of the Companies Act, 2013 and the rules thereunder, and we have fulfilled our
other ethical responsibilities in accordance with these requirements and the code of
ethics.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provde a basis for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most
sign frcance in our audit of the financial statements of the current period. These matters
were addressed in the context of our audit of the financial statements as a whole, and in
forming our opinion thereon, and we do net provide a separate opinion on these matters,
Reporting of key audit natters as per SA 701 ;-(1) The Companys investment
inproperty at Vijayapur, Karnataka ;s not revalued from registered valuer as
required under amended Schedule III - Division III of the Companies Act, 2013 and also
under Companies Indian Accounting Standard find AS - 16V
(2) In the opinion of the Management Companies Indian Accounting Standard (Ind AS) - 19
on employee benefits is not yet applicable to the Company.
Information other than the financial statements and auditors report thereon
The Companys board of directors is respons be for the preparation of the other
information The other information comprises the information included in the Boards Report
including Annexires to Boards Report. Business Responsibility Report but does not include
the standalone financial statements and our auditors report thereon.
The Beards Repod 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
anc 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.
When we read Boards Report, If we conclude that there is a material misstatement of
this other information; we are required to communicate the matter to those charged with
governance
Responsibilitiesof Management and those charged with Governance for the Financial
Statements:
The Companys Board of Directors is responsible for the matters stated in section
134(5) of the Companies Act, 2013 with respect to the preparation of these financial
statements that give a true and fair view of the financial position and financial
performance including other comprehensive income, cash flows and changes in equity of the
Company in accordance with the Indian accounting standards (Ind AS) soecified under
section 133 of the Act, read with Companies (Ind AS) Rules, 2015 & 2016&
amendments if any. This responsibility includes maintenance of adequate accounting records
in accordance with the provisions of the Act for safeguarding 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 financ a statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the
Companys ability to continue as a going concern, d sclosing, as applicable, matters
related to going concern and using the gomg 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 responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to fraud or error,
and to issue an auditors report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with SAs
will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of materal misstatement of the financial
statements whether due to fraud or error, design and perform audit orocedures responsive
to those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for cur ooimon 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, misreoresentations or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to
desgn audit procedures that are appropriate in the circumstances Under section 143(3)(i)
of the Companies Act, 2013, we are also responsible for expressing our opinion on whether
the company has adequate internal financial controls system in place and the operating
effectiveness of such controls
• Evaluate the appropriateness of accounting policies used and the reasonableness
of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of managements use of the going concern basis
of accounting and, based on the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant doubt on the Companys
ability to continue as a going concern If we conclude that a material uncertainty exists
we are required to draw attention in our auditors report to the related
disclosures in the financial statements or, if such disclosures are inadequate, to modify
our opinion. Our conclusions are based on the audit evidence obtamed up to the date of our
auditors reoort. However, future events or conditions may cause the Company to cease to
continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial
statements, including the disclosures, and whether the financial statements represent the
underlying transactions and events in a manner that achieves fa r presentation.
• We communicate with those chargea 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.
• Materiality is the magnitude of misstatements in the financial statements that,
individually or in aggregate, makes it probable that the economic decisions of a
reasonably knowledgeable user of the financial statements may be influenced. We consder
quantitative materiality and qualitative factors in (i) olanning the scooe of our audit
work and in evaluating the results of our work; and (ii) to evaluate the effect of any
identified misstatements in the financial statements.
• We also provide those charged with governance with a statement that
we have complied with relevant ethical requirements regarding independence ana to
communicate with them all relationships and other matters tnat 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 financial statements of the current perod 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 sub-section (11) of section 143 of
the companiesAct, we give in the Annexure - A statement on the matters specified in
paragraphs 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 the best
of our knowledge and belief were necessary for the purpose of our audit;
b) In our opinion pioper books of account as required by lav; have been kept by the
Company so far as it appears from our examination of these books.
c) the Balance Sheet, the Statement of Profit and Loss, and the Casn Flow Statement the
statement of changes in equity, dealt with by this Report are in agreement with the books
of account.
a) In our opinion, except for the matter described in ‘Key audit
Matters paragraph" the aforesaid financial statements comply with the Accounting
Standards specified under section 133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules, 2014;
e) On the basis of written representations received from the directors as cnMarch 31,
2023, and taken on record by the Board of Directors, none ofthe directors is disqualified
as cn March 31, 2023. from being appoirtedas a director in terms of section 164(2) ofthe
Act;
f) With respect to the adequacy of the internal financial control over
financial reporting of the Company and the operating effectiveness of such
controls, -efer to our separate repod in Annexure - B ana our report expresses an
unmodified opinion on the adequacy and operat.ng effectiveness of company s internal
control over financal reporting
g) With respect to the other matters to be included in tie 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 pad by the company to its directors during the year is in accordance witn the
provisions of Section 197 of the Act and
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 toe explanations given to us
(i) The Company has disclosed the impact of pending litigations on its financial
position in its financial statements - Refer Note 18 (B) (5) (A) to the financial
statements;
(ii) The Company did not have any long-term contracts including derivative contracts,
for which there were no material foreseeable losses provision is required.
(iii) There has been no delay in transferring amounts, required to be transferred to
the Investor Education and Protection Fund by the Company.
| For BENNURXAGARAJA &CO |
| CHARTERED ACCOUNTANTS |
| FR No. 000419S |
| (BENNUR NAGARXjA) |
| PROPRIETOR |
| M. No, 024163 |
| Place: Bangalore |
| Date: 26.05 2023 |
| UDIN 23024163BGXDRL8795 |
GILADA FINANCE AND INVESTMENTS LIMITED ANNEXURE -A TO THE AUDITORS REPORT
1. (a) Ihe Company has maintained proper records showing full particulars including
quantitative details & situation of the property, plant & equipment and intangible
assets.
(b) All the fixed assets have been physically verified by the management during the
year under audit, and there is a regular programme of verification which, in our opinion,
is reasonable having regard to the size of the company & the nature of its fixed
assets. No material discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and on the basis of our
examination of the records of the Company, the title deed of immovable property is held in
the name of the Company.
(d) The Company has not revalued its property, plant & equipment by the registered
valuer during the year under audit.
(e) We are informed by the Management that any kind of proceedings have not been
initiated during the year & not pending against the Company for holding any benami
property under the benami transactions (Prohibition) Act, 1988 and rules made there under.
2. (a) The nature of the Companys business / activities during the year does not
involve inventories. Accordingly clauses (II)(a) of paragraph 3 of the Companies (Auditors
Report) order 2020 is not applicable to the Company.
(b) Since the Company has not been sanctioned working capital limits in excess of five
crore rupees, in aggregate during the year under audit, our comments on details submitted
in quarterly returns to banks or financial institutions not required.
3. As explained in Note No.l 8 to the financial statements, the Company is a Non
Deposit-taking Non-Banking Financial Company (NBFC) registered with the Reserve Bank of
India (RBI) and as a part of its business activities is engaged in the business of
lending across various types of loans.
During the year, in the ordinary course of its business, the Company has made
investments in, provided guarantee/security to and granted loans and advances in the
nature of loans, secured and unsecured, to companies, firms, limited liability
partnerships and other parties, with respect to such investments, guarantees/security and
loans and advances:
(a) The provisions of paragraph 3(iii)(a) of the Order are not applicable to the
Company as its principal business is to give loans;
(b) In our opinion, having regard to the nature of the Companys business, the
investments made, guarantees provided, security given and the terms and conditions of the
grant of all loans and advances in the nature of loans and guarantees provided are not
prejudicial to the Companys interest;
(c) In respect of loans and advances in the nature of loans (together referred to as
loan assets), the schedule of repayment of principal and payment of interest has been
stipulated. Note No. 18(4) to the financial statements explains the Companys accounting
policy relating to impairment of financial assets which include loan assets. In accordance
with that policy, loan assets with balance as at 31 March 2023, aggregating Rs.NIL were
categorised as credit impaired (Stage 3) and Rs. 175696/- were categorised as those
where the credit risk has increased significantly since initial recognition (Stage 2).
Additionally, out of loans and advances in the nature of loans with balances as at the
year end aggregating Rs.5529701/-, where credit risk has not significantly increased since
initial recognition (categorised as Stage 1), delinquencies in the repayment of
principal and payment of interest were also identified. In all other cases, the repayment
of principal and interest is regular. Having regard to the nature of the Companys
business and the volume of information involved, it is not practicable to provide an
itemised list of loan assets where delinquencies in the repayment of principal and
interest have been identified.
(d) The total amount overdue for more than 365 days, in respect of loans and advances
in the nature of loans, as at the year-end is Rs.5705397/-. Reasonable steps arc being
taken by the Company for recovery of the principal and interest.
(e) The provisions of paragraph 3(iii)(e) of the Order arc not applicable to the
Company as its principal business is to give loans.
(f) In the ordinary course of business of financing, the company has given loans to few
related parties covered in the register maintained under section 189 of the Companies Act,
2013 on the basis of oral agreement since the Companies are under the same management. The
maximum amount involved during the year was not determined by the management, since they
are in the nature of current accounts and repayable on demand. The yearend balance of
loans given to such parties was Rs.195.30 lakhs, which is within the maximum limits
prescribed under section 185 & 186 of the Companies Act 2013 and under RBI Directions
to Non Banking Financial Companies (NBFC-ND-NS1) and not prejudicial to the Companys
interest.
(i 0 12% of total loans outstanding).
4. In our opinion & according to informations and explanations given to us, the
Company has complied with the provisions of Section 185 and 186 of the Companies Act, with
respect to loans and investment made and corporate guarantees given.
5. Since no deposits have been accepted from public, in our opinion & according to
the information & explanations given to us, the company is not required to comply with
the directions issued by Reserve Bank ot India under Non Banking Financial Companies
(Reserve Bank) Directions, 1998, with respect to public deposits, No order has been passed
by the Company Law Board or National Company Law Tribunal or Reserve Bank ol India or any
court or any other Tribunal.
6. The Central Government has not prescribed the maintenance of cost records under
section 148 (1) of the Companies Act, 2013 for the nature of business of the Company,
Since the Company is not into manufacturing activity.
7. (a) The company is generally regular in depositing with appropriate authorities
undisputed statutory dues including provident fund, employees state insurance, income tax,
sales tax, service tax, custom duty, excise duty, value added tax, Goods & Service
Tax, cess & other material statutory dues applicable to it. However, wc are informed
that the provisions ot the Employees Provident Fund & Employees State Insurance Scheme
are not yet applicable to the Company.
According to the information & explanations given to us, no undisputed amounts
payable in respect of provident fund, employees state Insurance income tax, sales tax,
service tax, customs duty, excise duty, value added tax, Goods & Service Tax , cess
& other material statutory dues were in arrears, as at 31-3-2023 for a period of more
than 6 months from the date they became payable.
(b) According to the information & explanations given to us, except income tax,
there is no dues of sale tax, customs duty, service tax, excise duty, value added tax,
Goods & Service Tax & cess which have not been deposited on account of any
dispute.
(1) There is a disputed income tax liability of Rs.20,51,022/- for A Y 201718 which is
under appeal with commissioner of Income Tax (Appeals)-l, Bangalore. The Dispute is on
account of additions made u/s 68 for cash deposited in Banks during demonetization period.
K. Wc arc informed by the management that any kind of transactions not recorded in the
books of account have not been surrendered or disclosed as income during the year in tax
assessments under the Income Tax Act, 1961.
9. (a) In our opinion & according to the information & explanations given to
us, the company had generally not defaulted in repayment of dues to a Financial
Institution, Bank or debenture holders.
(b) We arc informed by the management of the company that the company is not declared
wilful defaulter by any bank or financial institution or other lender
(c) In our opinion, term loans availed by the Company during the year were applied by
the Company for the purposes for which the loans were obtained.
(d) No funds raised on short term basis have been utilised for long term purposes.
(c) The company has not taken any funds from any entity or person on account of or to
meet the obligations of its subsidiaries, associates or joint ventures
(0 Since the company do not have any subsidiaries, joint ventures or associate
companies, the question of company raising any loans on the pledge of securities held in
its subsidiaries does not arise.
10.(a) The Company did not raise any money by way of initial public, offer or further
public offer (including debt instruments) during the year. Accordingly, Paragraph 3 (X) of
the order is not applicable.
(b) The company has not made any preferential allotment or private placement of shares
or fully or partly convertible debentures during the year under audit.
11 .(a) According to the information & explanations given to us, no fraud by the
Company or on the company by its officers or employees has been noticed or reported during
the course of our audit.
(b) We have not filed any report under subsection 12 of Section 143 ot the Companies
Act in Form ADT4 as prescribed under Rile 13 of the Companies (Audit & Auditors)
Rules, 2014 with the Central Government.
(c) We are informed by the management of the company that any kind of complaints from
whistle blower had not been received by the company during the year under audit.
12. in our opinion and according to the information and explanations given to us, the
Company is not a nidhi Company. Accordingly paragraph 3(xii)(a) and (b) and (c) of the
order is not applicable.
13. According to the information and explanations given to us and based on our
examination of the records of the Company, transactions with the related parties are in
compliance with section 177 and 188 of the Act, wherever applicable and details of such
transactions has been disclosed in the financial statements as required by the applicable
accounting standards.
14. (a) The company has an internal audit system commensurate with the size and nature
of its business.
(b) The reports of the Internal Auditors for the period under audit were considered by
us, in determining the nature, timing and extent of our audit procedures.
15. 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 them. Accordingly, paragraph 3 (xv)
of the order is not applicable,
16. (a) According to the information and explanations given to us, the Company has
obtained registration under section 45-IA of the Reserve Bank of India Act, 1934.
(b) The company has conducted Non-Banking Financial activities with a valid certificate
of Registration (COR) from the Reserve Bank of India.
(c) The company is not a Core Investment Company (C1C) as defined in the regulations
made by R eserve Bank of India.
(d) We are informed by the management of the company that the group it belongs has only
one core investment company (CIC).
17. The company has not incurred cash losses in the. current financial year and in the
immediately preceding financial year.
18. There has been no resignation of the statutory auditors during the year under
audit.
19. 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, that Company is 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 front the balance sheet date, will get
discharged by the Company as and wrhen they fall due.
20. (a) Section 135(5) second proviso of the Companies Act, 2013 in respect of other
than ongoing projects of CSR activities does not apply to the company.
(b) Section 135(6) of the Companies Act, 2013 in respect of ongoing projects of CSR
activities does not apply to the company.
21. Since, the company is not required to prepare consolidated financial statements,
our reporting on the matters as required by this clause is not applicable.
|
For BENNUR NAGARAJA & CO |
|
CHARTERED ACCOUNTANTS |
|
FRNo.419S |
|
J. |
| PLACE : BANGALORE |
(BENNUR NAGARAJA) |
| DATE : 26/05/2023 |
PROPRIETOR |
| 1 Dl\ : 23024163BGXDRL8795 |
i M. No. 024163 |
GILADA FINANCE AND INVESTMENTS LIMITED AMSEXURE -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 with reference to financial statements
over financial reporting of Gilada Finance & Investments Ltd as of 3 F1
March. 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 Companys management is responsible for establishing ar.d 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, including adherence to the 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
Uur 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
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 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 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 (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; (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 the 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 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, the Company has, in all material respects, an adequate internal
financial controls system over financial reporting and such internal financial controls
over financial reporting were operating effectively as at 31st March, 2023,
based on the internal control over financial reporting criteria established by the Company
considering the essential component of internal control stated in the Guidance Note on
Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of
Chartered Accounts oflndia.
| PLACE : BANGALORE |
For BENNUR NAGARAJA & CO |
| DATE : 26/05/2023 |
CHARTERED ACCOUNTANTS |
| UDIN : 23024163BGXDRL8795 |
FR No. 419S |
|
(BENNUR NAGARAJA) |
|
PROPRIETOR |
|
M.No. 024163 |
+91-9892691696
