Innovative Tyres & Tubes Auditors Report


To the Members of Innovative Tyres and Tubes Limited Report on the Audit of the Financial Statements Qualified Opinion

We have audited the accompanying financial statements of Innovative Tyres and Tubes Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2023, the Statement of Profit and Loss and the 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 "financial statements").

In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of the matters described in the Basis for Qualified Opinion section of our report, the aforesaid 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 state of affairs of the Company as at March 31, 2023, its loss and its cash flows for the year ended on that date.

BASIS FOR QUALIFIED OPINION

(a) As stated in Note Z(1)(Q) of the financial statement, RP has taken charge of the affairs of the Company on 28 March, 2022 and that he is not liable or responsible for any actions and regarding the information pertaining to the period prior to 28 March, 2022 and has relied upon the explanations, clarifications, certifications, representations and statements made by the existing offcials of the Company, who were also part of the Company prior to the appointment of the RP.

(b) The company is under Corporate Insolvency Resolution Process (CIRP) under the provisions of Insolvency and Bankruptcy Code,2016. Resolution professional has received claims of creditors amounting to 13,216/-lacs as per CIRP, and of which

13,121 Lacs-(secured portion is 3,915/-lacs and unsecured portion is of 9,206/-lacs) have been accepted by RP as of 11th October, 2022. However, the company has not made any provision for the additional liabilities admitted and accepted through CIRP process.

(c) The company is under Insolvency Process, the interest of the financial creditors is accrued but not booked into books of accounts as the said financial creditors is under moratorium period due to CIRP process. However, the amount of interest is not quanti_able.

(d) We draw attention to the Note Z(19) and Note J of the financial statement with respect to assessment of impairment of Property, Plant & Equipment, based on internal evidences and in accordance to AS 28 "Impairment of Asset", the company is required to determine impairment losses in respect of Property Plant and Equipment as per the methodology prescribed under the said Standard. The management has recognized impairment loss of 4922.45 Lacs on the basis of independent valuation reports. However, since the future projects. has not drawn by Company as required to compute "Value in Use" as per AS 28, the financial impact of impairment loss to be provided in annual financial results is presently not ascertainable.

(e) The company has not appointed an internal auditor as required under Section 138 of The Companies Act, 2013.

We conducted our audit in accordance with 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 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 financial statements under the provisions of the Act and 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 qualified opinion on the 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 financial statements of the current year. 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 not provide a separate opinion on these matters. Except for the matters described in the Basis for Qualified Opinion section above, we have determined that there are no other key audit matters to communicate in our report.

Other Information

The Resolution Professional (RP), Board of Directors and the management are 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, Corporate Governance and Shareholders Information, but does not include the financial statements and our auditors report thereon.

Management Discussion and Analysis, Boards Report including Annexures to Boards Report, Corporate Governance and Shareholders Information are expected to be made available to us 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 Resolution Professional (RP), Management and Those Charged with Governance for the Financial Statements

The Resolution Professional (RP) and Companys Board of Directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards prescribed under section 133 of the Act, read with relevant rules issued thereunder. 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 financial 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, the resolution professional (RP) and the management are 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 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 this 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 material misstatement of the 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 control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls 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 resolution professional (RP) and managements use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companys ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors report. However, future events or conditions may cause the Company to cease to continue as a going concern.

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 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 de_ciencies 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 financial statements of the current year 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.

Other Matter a) The audit of financial statements for the year ended March 31, 2022, was carried out and reported by M/s Maloo Bhatt & Co., vide their unmodified audit report dated 19th May, 2022, whose report has been furnished to us by the management and which has been relied upon by us for the purpose of our audit of the financial statements.

Our opinion is not modified in respect of this matter.

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 report in "Annexure 1", 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, we report that: a. We have sought and except for the matters described in the Basis for Qualified Opinion section above, obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit; b. Except for the possible effects of the matters described in the Basis for Qualified Opinion section above, 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 Balance Sheet, the Statement of Profit and Loss and the Statement of Cash Flows dealt with by this report are in agreement with the books of account; d. Except for the possible effects of the matters described in the Basis for Qualified Opinion section above, in our opinion, the aforesaid financial statements comply with the Accounting Standards prescribed under section 133 of the Act read with relevant rules issued thereunder; e. The matters described under the Basis for Qualified Opinion above, in our opinion, may have an adverse effect on the functioning of the Company; f. On the basis of the written representations received from the directors as on March 31, 2023, and taken on record by the Board of Directors and resolution professional (RP), none of the directors is disqualified as on March 31, 2023 from being appointed as a director in terms of section 164(2) of the Act. However, Since the Company is under Corporate Insolvency Resolution Process (CIRP), all the directors of the Company are suspended and powers of the board of directors are vested in the hands of Resolution Professional (RP). g. The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the Basis for Qualified Opinion section above. h. 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 2" and we have expressed disclaimer of opinion for the reasons stated in the said report; i. With respect to the other matter to be included in the Auditors Report in accordance with the requirements of section 197(16) of the Act, as amended: In our opinion and to the best of our information and according to the explanations given to us, since the Company is under CIRP and RP has taken charge of the affairs of the Company, No remuneration has been paid and provided by the Company to its directors during the year. j. 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, as amended, in our opinion and to the best of our information and according to the explanations given to us: (i) Except for the matters described in the Basis for Qualified Opinion section above, The Company has disclosed the impact of pending litigations on its financial position in its financial statements – Refer Note Z(3) on Contingent Liabilities to the financial statements;

(ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

(iii) There were no amounts which were 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 person(s) or entity(ies), including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; (iv) (b) The management has represented that, to the best of its knowledge and belief, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; (iv) (c) Based on the audit procedures that are 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 not declared nor paid any dividend during the year. Hence, reporting the compliance with section 123 of the Act is not applicable.

(vi) As proviso to rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable for the company only w.e.f. April 1, 2023, reporting under this clause is not applicable.

For Haribhakti & Co. LLP

Chartered Accountants ICAI Firm Registration No. 103523W / W100048

Yash Bhatt
Partner
Place: Mumbai Membership No. 117745
Date: July 6, 2023 UDIN: 23117745BGYEKQ7113

ANNEXURE 1 TO THE INDEPENDENT AUDITORS REPORT

[Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements section in the Independent Auditors Report of even date to the members of Innovative Tyres and Tubes Limited ("the Company") on the Financial statements for the year ended March 31, 2023]

Based on the audit procedures performed for the purpose of reporting a true and fair view on the Financial statements of the Company and taking into consideration the information, explanations and written representation given to us by the management and the books of account and other records examined by us in the normal course of audit, we report that: (i) (a) (A) The Company has not maintained proper records showing full particulars, including quantitative details and situation of Property, Plant and Equipment. (B) The Company has not maintained proper records showing full particulars of Intangible Assets.

(b) During the year, the property, plant and Equipment of the company have been physically verified by the management through independent Valuer following an IBC guideline and we have been informed that there are no material discrepancies, However no such Valuation report has been provided to us.

In our opinion, the frequency of verification is reasonable having regard to the operation and size of the Company and the nature of its assets.

(c) The title deeds of all the immovable properties, disclosed in the financial statements are held in the name of the Company.

(d) The Company has not revalued its Property, Plant and Equipment and Intangible Assets during the year.

(e) No proceedings have been initiated or are pending against the Company as at March 31, 2023 for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

(ii) (a) During the year, the inventory of the company have been physically verified by the management through independent valuer following an IBC guideline. In our opinion, the coverage and procedure of such verification by the management is appropriate. We have been informed that there are no material discrepancies. However, no such valuation report has been provided to us.

(b) The Company has not been sanctioned working capital limits in excess of five crore rupees during the year, in aggregate from financial institution, on the basis of security of current assets. Therefore, reporting under clause (ii)(b) of paragraph 3 of the Order is not applicable. The Company has been classified by the Bank as NPA and hence, no existing sanctions of loans has been renewed by the Bank during the year. (iii) The Company has not made any investments in, provided any loans or provided advances in the nature of loans, or stood guarantee, or provided security to companies, firms, Limited Liability Partnerships or any other parties. Accordingly, reporting under clause (iii) of paragraph 3 of the Order is not applicable. (iv) The Company has not granted any loans, made any investment or provided any guarantees or security to the parties covered under Section 185 and 186 of the Act. Hence the provisions of sections 185 and 186 of the Act is not applicable on the Company.

(v) In our opinion, the Company has complied with the directives issued by Reserve Bank of India, the provisions of sections 73 to 76 of the Act and the rules made there under with regard to the acceptance of deposits or amounts which are deemed to be deposits, except for customer advances amounting to 681.55 lacs which are outstanding for more than 365 days as on 31st March, 2023. Further, as informed, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal on the Company in respect of the aforesaid deposits or amounts which are deemed to be deposits.

(vi) The maintenance of cost records has been specified by the Central Government under sub-section (1) of section 148 of the Act and rules thereunder. We have broadly reviewed such records and are of the opinion that, prima facie, the prescribed accounts and records have not been made and maintained.

(vii) (a) The Company is not regular in depositing with appropriate authorities, undisputed statutory dues including Goods and Services tax (GST), provident fund, employees state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and any other material statutory dues applicable to it, and there have been serious delays in a large number of cases. During the year 2017-18, sales tax, value added tax, service tax and duty of excise subsumed in GST and are accordingly reported under GST.

No undisputed amounts payable in respect of provident fund, employees state insurance, income tax, GST, customs duty, cess and any other material statutory dues applicable to it, were outstanding, at the year end, for a period of more than six months from the date they became payable, except as follows: Statement of Arrears of Statutory Dues Outstanding for More than Six Months

Name of the statute Nature of the dues Amount (in Lacs)
The Employees Provident Fund Scheme, 1952 Provident Fund 7.95
The Employee State Insurance Act, 1948 Employee State Insurance 1.09
Gujarat State Tax on Professions Act, 1976 Professional Tax 3.36
Income Tax Act, 1961 Tax deducted/ collected at source 16.16
The Bombay Labour Welfare Fund Act, 1953 Labour welfare fund 0.03

(b) There are no dues with respect to provident fund, employees state insurance, income tax, GST, sales tax, service tax, value added tax, customs duty, excise duty and cess, which have not been deposited on account of any dispute. However, there are certain claims submitted by the government authorities to Resolution Professional (RP) after commencement of Corporate Insolvency Resolution Process. The said claims has not been accounted by the RP in the books of accounts and details are not made available to us and hence we are unable to comment on the same. (viii) We have not come across any transaction which were previously not recorded in the books of account of the Company 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 defaulted in repayment of loans (term loan and working capital loans) taken from the lenders. The Companys accounts have been classified as Non-Performing Assets (NPA) by the lenders on 6th March, 2022. The Borrowing Accounts has gone into the moratorium pursuant to commencement of Corporate Insolvency Resolution Plan (CIRP) under Insolvency and Bankruptcy Code. The Bank has not charged any interest on the companys borrowing from March, 2022 onwards and has reversed the unrealised interest already charged in the accounts. The Company has not made any provision for such interest in the books of account. The amount of interest is not quanti_ed. Hence we are unable to comment on the quantum of the defaults in repayment of loans. (b) The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

(c) The Company did not obtain any money by way of term loans during the year. Accordingly, reporting under clause (ix) (c) of paragraph 3 of the Order is not applicable.

(d) On an overall examination of the Financial statements of the Company, no funds raised on short-term basis have, been used for long-term purposes by the Company.

(e) The Company does not have any subsidiary, associate or joint venture as defined under the Act. Hence reporting under clause (ix)(e) and (f) of the Order is not applicable. (x) (a) The Company has not raised money by way of initial public issue offer / further public offer (including debt instruments) during the year. Therefore, reporting under clause (x)(a) of paragraph 3 of the Order is not applicable.

(b) The Company has not made any preferential allotment or private placement of shares or convertible debentures (fully, partially or optionally convertible) during the year. Therefore, reporting under clause (x)(b) of paragraph 3 of the Order is not applicable.

(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 accordingly to the information and explanations given to us, we have neither come across any instance of fraud by the Company nor any fraud on the Company has been noticed or reported during the year, nor have we been informed of any such instance by the management.

(b) No report under section 143(12) of the Act has been filed with the Central Government by the auditors of the Company in Form ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014, during the year or upto the date of this report.

(c) There are no whistle blower complaints received by the Company during the year and upto the date of this report. (xii) In our opinion, the Company is not a Nidhi Company. Therefore, reporting under clause (xii) of paragraph 3 of the Order is not applicable.

(xiii) All transactions entered into by the Company with the related parties, if any are in compliance with sections 177 and 188 of the Act, where applicable and the details have been disclosed in the Financial statements as required by the applicable accounting standards.

(xiv) (a) In our opinion, though the Company is required to have an internal audit system under section 138 of the Act, however, it does not have same established during the year.

(b) The Company did not have an internal audit system for the period under audit. Hence, no Internal Audit Reports of the Company for the aforesaid period were provided.

(xv) The Company has not entered into any non-cash transactions with its directors or persons connected with them during the year and hence, provisions of section 192 of the Act 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. Therefore, reporting under clause (xvi)(a) and (b) of paragraph 3 of the Order are not applicable.

(b) The Company has not conducted any Non-Banking Financial or Housing Finance activities without having a valid Certificate of Registration (CoR) from the Reserve Bank of India as per the Reserve Bank of India Act, 1934.

(c) The Company is not a Core Investment Company (CIC) as defined in Core Investment Companies (Reserve Bank) Directions, 2016 ("Directions") by the Reserve Bank of India. Accordingly, reporting under clause (xvi)(c) and (d) of paragraph 3 of the Order are not applicable.

(xvii) The Company has incurred cash losses amounting to 400.06 lacs and 5130.75 lacs for the current financial year and immediately preceding financial year respectively.

(xviii) There has been resignation of the statutory auditors during the year, however, no issues, objections or concerns were raised by the outgoing auditors.

(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 resolution plans received from resolution applicants by the resolution professional (RP) and approval of plans by the committee of creditors (COC) and based on our examination of the evidence supporting the assumptions and relying on Note No Z (18) of the financial statement, nothing has come to our attention, which causes us to believe that material uncertainty exists as on the date of this audit report and that the Company may not be 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 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) The provisions of section 135 of the Act are not applicable to the Company. Hence, reporting under clause (xx) of paragraph 3 of the Order is not applicable.

(xxi) Since the Company is not required to prepare consolidated financial statements, clause 3 (xxi) is not applicable.

For Haribhakti & Co. LLP

Chartered Accountants ICAI Firm Registration No. 103523W / W100048

Yash Bhatt
Partner
Place: Mumbai Membership No. 117745
Date: July 6, 2023 UDIN: 23117745BGYEKQ7113

ANNEXURE 2 TO THE INDEPENDENT AUDITORS REPORT

[Referred to in paragraph 2(h) under ‘Report on Other Legal and Regulatory Requirements section in our Independent Auditors Report of even date to the members of Innovative Tyres and Tubes Limited on the Financial statements for the year ended March 31, 2023]

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 were engaged to audit the internal financial controls with reference to financial statements of Innovative Tyres and Tubes Limited ("the Company") as of March 31, 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 and maintaining internal financial controls based on the internal control with reference to financial statements 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 (the "Guidance Note") issued by the Institute of Chartered Accountants of India ("ICAI"). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the 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, to the extent applicable to an audit of internal financial controls, both issued by the ICAI.

Because of the matter described in Disclaimer of Opinion paragraph below, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on internal financial controls with reference to financial statements of the Company.

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 control 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 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, the Company has not established its internal financial controls with reference to financial statements on criteria based on or considering the essential components of internal control stated in the Guidance Note issued by ICAI.

Because of this reason, we are unable to obtain sufficient appropriate audit evidence to provide a basis for our opinion whether the Company had adequate internal financial controls with reference to 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 Financial statements of the Company, and the disclaimer does not affect our opinion on the Financial statements of the Company.

For Haribhakti & Co. LLP

Chartered Accountants ICAI Firm Registration No. 103523W / W100048

Yash Bhatt
Partner
Place: Vadodara Membership No. 117745
Date: July 6, 2023 UDIN: 23117745BGYEKQ7113