To the Members of
The Indian Card Clothing Company Limited
Report on the Audit of the Standalone Financial Statements
Opinion
We have audited the standalone Financial Statements of The Indian Card Clothing Company
Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2023,
and 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 Significant Accounting Policies and other
explanatory information (hereinafter referred to as "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 accounting principles generally accepted in India, of the
standalone state of affairs of the Company as at March 31, 2023, and its standalone profit
(including Other Comprehensive Income), standalone changes in equity and its standalone
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 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 thereunder, and we have fulfilled our other
ethical responsibilities in accordance with these requirements and the Code of Ethics.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Emphasis of Matters
i. We draw your attention to Note 44 to the standalone financial statements regarding
management assessment with respect to impact of recent earthquakes in Turkey on business
of Companys branch located therein. Based on the assessment performed, the management
believes that no material adjustment is required to the standalone financial statements
for the year ended March 31,2023. Our opinion is not modified in respect of this matter.
ii. We draw your attention to Note 45 to the standalone financial statements regarding
impairment assessment performed by the Company with respect to its investment in
subsidiary, ICC International Agencies Limited (ICCIAL). Based on the internal and
external information available, confirmed orders at hand and future business projections
of the subsidiary, the management believes that there is no requirement for impairment of
investment made in ICCIAL and therefore no material adjustment is required to the
standalone financial statements for the year March 31, 2023. Our opinion is not modified
in respect of this matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment and based on the
consideration of reports of other auditors on separate financial statements of components
audited by them, 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.
| Key Audit Matters |
How our audit addressed the key audit matters |
| Trade Receivable |
Our audit procedures included, but not limited to, following: - |
| Total value of Trade Receivables (Gross) as on 31st March 2023 is Rs. 1,483.07 Lakh
and loss allowance against the same is Rs. 57.86 Lakh. |
- We performed audit procedures on existence of trade receivables, which included
reading and comparing balance confirmations with books, testing subsequent receipts and
sales transactions for the samples selected. |
| Assessment of the recoverability of trade receivables is in herently subjective and
requires significant management judgment. |
- We obtained and verified age wise analysis of trade receivables as at March 31,
2023. |
| Timing of collection of dues from the customers may differ from the actual credit
period. Significant judgment is required by the management to estimate the amounts
unlikely to be ultimately collected. |
- We have sought information and explanation from the management regarding status of
receivables in respect of overdue receivables for the purpose of ensuring adequacy of
provision. |
|
- We have also tested subsequent collections made from the overdue receivables. |
|
- We also considered historical reasonability of forecasting the loss allowance. |
| The recoverability of the Companys trade receivables and the valuation of the loss
allowance is a key audit matter due to the significant judgement involved. |
Based on the above procedures performed, we did not note any material misstatements in
the value of trade receivable disclosed in the financial statements. |
| Valuation of investments |
Our audit procedures included, but not limited to, following - |
| The company has total investments of Rs. 15648.19 Lakhs which constitutes 56% of total
assets of the company. During the year fair valuation gain is Rs 520.65 Lakh disclosed for
under Other Income in the Statement of Profit and loss. |
- For the purpose of existence and valuation, we have verified independent balance
confirmation, wherever received and account statement provided by the management as at
March 31,2023. |
| Considering the significance of total value of investments to total assets and
management judgements involved in respect of classification and measurement, Investments
are considered as Key Audit Matter. |
- We obtained term sheet or other contract documents to understand and evaluate
classification and measurement criteria for various investments made by the Company. |
|
- We also verified accuracy of realised and unrealised gain recognised in the
statement of profit and loss account. |
|
- In case of investment in subsidiaries, we obtained and evaluated management
assessment supported with the valuation report if any to confirm whether any adjustment is
required on account of impairment of investments. |
|
Based on the above procedures performed, we did not note any material misstatements in
the valuation of investment disclosed in the financial statements. |
Other Information
The Companys Board of Directors is responsible for the other information. The other
information comprises the Management Discussion and Analysis; Board of Directors Report
along with its Annexures included in the Annual Report, but does not include the Financial
Statements and our auditors report thereon. Our opinion on the 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 Financial Statements, our responsibility is to read
the other information and, in doing so, consider whether the 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.
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 standalone financial position, standalone financial
performance (including other comprehensive income), standalone changes in equity and
standalone cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the Indian Accounting Standards (Ind AS)/ specified
under section 133 of the Act read with 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;
vi. Pursuant to the rules made by the Central Government of India, the Company is
required to maintain cost records as specified under Section 148(1) of the Act in respect
of its products. We have broadly reviewed the same, and are of the opinion that, prima
facie, the prescribed accounts and records have been made and maintained. We have not,
however, made a detailed examination of the records with a view to determine whether they
are accurate or complete.
vii. (a) According to the information and explanations given to us and the records of
the Company examined by us, in our opinion, the Company is generally regular in depositing
undisputed statutory dues in respect of provident fund, though there has been a slight
delay in a few cases, and is regular in depositing undisputed statutory dues, including
Goods and Service Tax, employees state insurance, sales tax, income tax, service tax,
duty of customs, duty of excise, value added tax, cess and other material statutory dues,
as applicable, with the appropriate authorities. There are no arrears of statutory dues
outstanding for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us and the records of the
Company examined by us, there are no statutory dues of Goods and Service Tax, employees
state insurance, provident fund, sales tax, service tax, duty of customs, duty of excise,
value added tax, cess and other material statutory dues, as applicable, which have not
been deposited on account of any dispute. The particulars of other statutory dues referred
to in sub-clause (a) as at March 31, 2023 which have not been deposited on account of a
dispute, are as follows:
| Name of the statute |
Nature of dues |
Amount (in Lakhs) |
Period to which the amount relates |
Forum where the dispute is pending |
| Income Tax Act 1961 |
Income Tax |
16.08 |
FY 2012-13 |
Commissioner of Income Tax |
| Maharashtra Tax on Entry of Goods in Local Areas Act, 2002 |
Entry tax |
0.18 |
FY 1996-97 |
Octroi Department |
| Maharashtra Municipal Corporations Act, 1949 |
Local Body Tax |
89.47 |
FY 2013-14, FY 2014-15, FY 2015-16 |
Assistant Commissioner of LBT Pimpri. |
viii. In terms of the information and explanations given to us and the books of account
and records examined by us, the Company has not surrendered or disclosed as income during
the year in the tax assessments under the Income Tax Act, 1961. Hence reporting under
clause 3(viii) of the order is not applicable.
ix. (a) According to the records of the Company examined by us and the information and
explanations given to us, except for interest on external commercial borrowings as
described below, the Company has not defaulted in repayment of loans or other borrowings
or in payment of interest thereon to any lender as at the balance sheet date.
| Nature of borrowing |
Name of lender |
Amount not paid on due date (Rs. In Lakh) |
Whether principal or interest |
Number Remarks, if any of days delay |
| External Commercial Borrowing |
Holding Company |
14.32 |
Interest |
6 Interest due is subsequently paid during the year. |
| External Commercial Borrowing |
Holding Company |
15.35 |
Interest |
5 Interest due is subsequently paid during the year. |
(b) According to the information and explanations given to us and on the basis of our
audit procedures, we report that the company has not been declared wilful defaulter by any
bank or financial institution or government or any government authority.
(c) According to the information and explanations given to us and on the basis of our
audit procedures, the Company has not availed any term loan during the year. The term loan
outstanding as at year end has been utilized in the previous years. Accordingly, the
provisions of Clause 3(ix)(c) of the Order are not applicable to the Company.
(d) According to the information and explanations given to us and on the basis of our
audit procedures, the Company has not raised any funds on short term basis.
(e) 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
taken funds in previous years from following entities and persons on account of or to meet
the obligations of its subsidiary as per details below:
| Nature of fund taken |
Name of Party |
Amount involved (In Rs. Lakh) |
Name of the subsidiary |
Relation |
Nature of Transaction for which funds utilized |
Remarks, if any |
| Preferential Allotment of equity shares |
Multi-Act Industrial Enterprises Limited - Holding Company |
30.00 |
ICC International Agencies Limited |
Subsidiary |
To meet working capital requirements |
|
(f) According to the information and explanations given to us and procedures performed
by us, we report that the company has not raised loans during the year on the pledge of
securities held in its subsidiaries.
x.(a) The Company has not raised any moneys by way of initial public offer, further
public offer (including debt instruments) during the year. Accordingly, the provisions of
Clause 3(x)(a) of the Order are not applicable to the Company.
(b) The Company has not made any preferential allotment or private placement of shares
or fully or partly or optionally convertible debentures during the year. The funds raised
in the previous years by way of preferential allotment have been used in current year for
the purpose for which such funds were raised.
xi. (a) During the course of our examination of the books and records of the Company,
carried out in accordance with the generally accepted auditing practices in India, and
according to the information and explanations given to us, we have neither come across any
instance of fraud by the Company or on the Company noticed or reported during the year,
nor have we been informed of any such case by the Management.
(b) During the course of our examination of the books and records of the Company,
carried out in accordance with the generally accepted auditing practices in India, and
according to the information and explanations given to us, report in the form ADT-4 as
specified under sub-section (12) of section 143 of the Companies Act has not been filed.
Accordingly reporting under clause 3(xi)(b) of the order is not applicable.
(c) During the course of our examination of the books and records of the Company,
carried out in accordance with the generally accepted auditing practices in India, and
according to the information and explanations given to us and as represented to us by the
management, there are no whistle blower complaints received by the company during the
year.
xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable
to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii. The Company has entered into transactions with related parties in compliance with
the provisions of Sections 177 and 188 of the Act. The details of related party
transactions have been disclosed in the financial statements as required under Ind AS 24,
Related Party Disclosures specified under Section 133 of the Act, read with the Companies
(Indian Accounting Standards) Rules, 2015, as amended.
xiv. (a) In our opinion and based on our examination, the company has an internal audit
system commensurate with the size and nature of its business.
(b) We have considered the internal audit reports of the company issued till date, for
the period under audit.
xv. The Company has not entered into any non-cash transactions with its directors or
persons connected with him. Accordingly, the provisions of Clause 3(xv) of the Order are
not applicable to the Company.
xvi. (a) The Company is not required to be registered under Section 45-IA of the
Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi)(a) of the
Order are not applicable to the Company.
(b) According to the information and explanations given to us and procedures performed
by us, we report that the Company has not conducted any Non-Banking Financial or Housing
Finance activities during the year. Therefore reporting under clause 3(xvi)(b) of the
order is not applicable.
(c) According to the information and explanations given to us and procedures performed
by us, the Company is not Core Investment Company (CIC) as defined in the regulations made
by the Reserve Bank of India, hence reporting under clause 3(xvi)(c) of the order is not
applicable.
(d) Based on information and explanation given to us and as represented by the
management, the Group does not have any Core Investment Company (CIC) as part of the
Group.
xvii. The Company has not incurred cash losses during current financial year and
immediately preceding financial year.
xviii. There has been no resignation by statutory auditors during the year hence
reporting under clause 3(xviii) of the order is not applicable.
xix. According to the information and explanations given to us and 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 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. As per Section 135 of the Act, the company is not required to spend any amount on
Corporate Social Responsibility (CSR). Accordingly, reporting under clause 3(xx)(a) and
(b) of the Order are not applicable.
|
For P G BHAGWAT LLP |
|
Chartered Accountants |
|
Firm Registration Number: 101118W/W100682 |
|
Abhijit Shetye |
|
Partner |
| Pune |
Membership Number: 151638 |
| May 29, 2023 |
UDIN: 23151638BGQGEW9253 |
Annexure B to the Independent Auditors Report
Referred to in paragraph 2(g) under the heading, "Report on Other legal and
Regulatory Requirements" of our report on even date:
Report on the Internal Financial Controls with reference to Standalone Financial
Statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013
("the Act")
We were engaged to audit the internal financial controls with reference to the
Standalone Financial Statements of The Indian Card Clothing Company Limited ("the
Company") as of March 31, 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 controls 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 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 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 conducted in accordance
with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting
(the "Guidance Note") and the Standards on Auditing, to the extent applicable to
an audit of internal financial controls, both issued by the Institute of Chartered
Accountants of India.
Because of the matter described in the Disclaimer of Opinion paragraph below, we were
not able to obtain sufficient and appropriate audit evidence to provide a basis of audit
opinion on an internal financial controls with reference to standalone financial
statements of the Company.
Meaning of Internal Financial controls with reference to the Standalone Financial
Statements
A companys internal financial controls with reference to the 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 the 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
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.
Disclaimer of Opinion
According to the information and explanation given to us, during current year the
Company is in the process of restructuring its finance and accounts function, including at
its branch at Turkey, and some of its other support functions and thereby re-establishing
internal financial controls with reference to standalone financial statements on criteria
based on or 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.
Because of this reason, we were unable to obtain sufficient appropriate audit evidence
to provide a basis for our opinion on whether the Company has internal financial controls
with reference to the standalone financial statements and whether such internal financial
controls were operating effectively as at March 31,2023.
We have considered the disclaimer reported above in determining the nature, timing, and
extent of audit tests applied in our audit of the standalone financial statements of the
Company for the year ended March 31, 2023, and the disclaimer does not affect our opinion
on the standalone financial statements of the Company.
|
For P G BHAGWAT LLP |
|
Chartered Accountants |
|
Firm Registration Number: 101118W/W100682 |
|
Abhijit Shetye |
|
Partner |
| Pune |
Membership Number: 151638 |
| May 29, 2023 |
UDIN: 23151638BGQGEW9253s |
+91-9892691696
