TO THE MEMBERS OF
K.P. ENERGY LIMITED
Report on the Standalone Financial Statements
OPINION
We have audited the accompanying standalone Fiinancial statements of K.P. ENERGY LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2024, the 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 ended on that date, and a summary of the material 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 Fiinancial 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, as amended, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2024, 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 of the standalone Fiinancial statements in accordance with the Standards on Auditing specifiied under Section 143(10) of the Act (SAs). 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 independence requirements that are relevant to our audit of the standalone Fiinancial statements under the provisions of the Act and the Rules made thereunder, and we have ful_illed 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 suJicient and appropriate to provide a basis for our audit opinion on the Standalone Financial Statements.
KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional judgment, were of most signifiicance in our audit of the standalone Fiinancial statements of the current period. These matters were addressed in the context of our audit of the standalone Fiinancial 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 matters described below to the Key Audit Matters to be communicated in our report.
Sr. No. | Key Audit Matter (KAM) |
How the matter was addressed in our Audit? |
1. | Revenue recognition Fixed price (EPCC) development contracts |
Our audit procedures on revenue recognized from _ixed price contracts include obtaining an understanding of the systems, processes and controls implemented by management for recording and calculating revenue. |
The Company, inter alia, engages in Fixed-price (EPCC) development contracts, where, revenue is recognized using the milestone computed as per the input method based on managements estimate of contract costs. | We have tested that the revenue recognized is in accordance with the Indian Accounting Standard by evaluating identifiication of performance obligations. We have also tested managements estimation of contract cost and the obligations, if any. We have observed that the estimates of cost to complete were reviewed and approved by the appropriate levels of Management. | |
We have identifiied revenue recognition of _ixed price development contracts as a KAM considering there is an inherent risk around the accuracy of revenues given the customized and complex nature of these project development contracts. |
2. | Evaluation of procedure for recognizing the revenue from sale of power |
|
The Company has adopted the procedure for recognizing the revenue from sale of power as unbilled revenue at the initial stage on monthly basis and once the confirmation is received from the customer and the regulatory authority in respect of the actual units of electricity transmitted, the Company raises invoice to the client and the same is adjusted against the unbilled revenue booked earlier. | We have obtained the actual invoice raised by the Company after receipt of the confirmation from the regulatory authority and the customers, certifiicate of share of electricity generated by the GETCO State Load Dispatch Centre on monthly basis, calculations of Wheeling Loss on monthly basis issued by the Electricity Company to the client. We have matched the documents and correlate the same with the unbilled revenue booked on monthly basis. The unbilled revenue appearing as on March 31, 2024 would be offset only after the receipt of the above documentary evidences from the respective authorities and the customers which would be settled in the subsequent F.Y. and to that extent, there is the possibility that the revenue booked as unbilled revenue can be varied. |
3. | Right of Way Expenses incurred during the course of the development of EPC contracts |
|
The Company has, inter alia, incurred considerable amount on Right of Way expenses during the course of the development of EPC contracts. These costs comprise of the compensation paid to various individuals on whose lands the transmission towers are to be erected and the stringing of transmission lines were carried out. The compensation was paid to the individuals for the loss of standing crops on the respective lands. | Our audit procedures include the verifiication of payment details to various individuals, land records i.e 7/12 of the land to identify the actual owners or co-owners as the case may be along with the authorization trails of the management along with the control mechanism adopted by the management with its adequate implementation of the same. | |
We have obtained the payment vouchers or the agreements entered into by the Company with these individuals directly or through any agent as the case may be. We have verifiied the payment vouchers and agreements on test check basis to identify the actual person to whom the compensation was paid by the Company and also verifiied the consent of other co- owners where the compensation was paid to one of the co-owners. | ||
The Company has accounted for all the amounts which were paid as compensation to these individuals and charged the same to the revenue, however, in the case of the compensation paid in the month of March 2024, the payment vouchers with proper authorization have been produced before us and in such cases, the agreements were remained to be executed. Till the date of our audit report, the said agreements are yet to be executed. |
MANAGEMENTS RESPONSIBILITY 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 Fiinancial statements that give a true and fair view of the Fiinancial position, Fiinancial performance, total 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 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 Fiinancial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Fiinancial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone Fiinancial statements, management is responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. The Board of Directors are responsible for overseeing the Companys Fiinancial reporting process.
AUDITORS RESPONSIBILITY FOR THE AUDIT OF THE FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether the Fiinancial 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 in_luence the economic decisions of users taken on the basis of these Fiinancial 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 Fiinancial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is suJicient 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 Fiinancial 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 Fiinancial 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 signifiicant 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 Fiinancial 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 Fiinancial statements, including the disclosures, and whether the Fiinancial statements represent the underlying transactions and events in a manner that achieves fair presentation.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by Section 143(3) of the Act, we report that: a) We have sought and obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the 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 Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, Statement of Changes in Equity and Cash Flow Statement 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 specifiied 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 March 31, 2024 taken on record by the Board of Directors, none of the directors is disqualifiied as on March 31, 2024 from being appointed as a director in terms of Section 164(2) of the Act.
f) 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 has disclosed the impact of pending litigations as on March 31, 2024 on its Fiinancial position in its standalone Fiinancial statements Refer Note 31 to the standalone Fiinancial statements.
The Company has following pending litigations:
1. Public Interest Litigation No. 85 of 2016 at High Court of Gujarat
2. Public Interest Litigation No. 241 of 2018 at High Court of Gujarat
3. Special Civil Application No. 9120 of 2017 at High Court of Gujarat
4. Special Civil Application No. 6303 of 2020 at High Court of Gujarat
5. Special Civil Application No. 1050 of 2020 at High Court of Gujarat
6. Special Civil Application No. 17093 of 2018 at High Court of Gujarat
7. Special Civil Application No. 6832 of 2020 at High Court of Gujarat
8. Public Interest Litigation No. 88 of 2023 at High Court of Gujarat
9. Assessment Proceedings with Assessment Unit, Income tax department for AY 2019_20 amounting to 179.94 Lakhs under Section 147 read with Section 144B of the Income Tax Act, 1961.
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 (which are material either individually or in the aggregate) 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 or entity, including foreign entity ("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 identifiied in any manner whatsoever by or on behalf of the Company ("Ultimate Bene_iciaries") or provide any guarantee, security or the like on behalf of the Ultimate Bene_iciaries;
(b) The Management has represented that, to the best of its knowledge and belief, no funds (which are material either individually or in the aggregate) have been received by the Company from any person or entity, including foreign entity ("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 identifiied in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Bene_iciaries") or provide any guarantee, security or the like on behalf of the Ultimate Bene_iciaries;
(c) Based on the audit procedures that have been considered reasonable and appropriate in their 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. As stated in Note 12 to the Standalone Financial Statements: (a) The _inal dividend proposed in the previous year, declared and paid by the Company during the year, is in accordance with Section 123 of the Act, as applicable.
(b) The Interim Dividend declared and paid by the Company during the year and until the date of this report is in compliance with the Section 123 of the Act.
(c) The Board of Directors of the Company have proposed _inal dividend for the year, which is subject to the approval of the members at the ensuring Annual General Meeting. The amount of dividend proposed is in accordance with Section 123 of the Act, as applicable.
vi. Based on our examination, which included test checks, the Company has used accounting software for maintaining its books of account for the Fiinancial year ended March 31, 2024, which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further, during the course of our audit, we did not come across any instance of the audit trail feature being tampered with.
As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from April 1, 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 on preservation of audit trail as per the statutory requirements for record retention is not applicable for the Fiinancial year ended March 31, 2024.
2. 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 Companies Act, 2013, we give in the "Annexure-A" a statement on the matters specifiied in paragraphs 3 and 4 of the Order, to the extent applicable.
3. As required with reference to the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act"), we give in the "Annexure-B" a statement on the matters specifiied to the extent applicable.
For MAAK and Associates | |
Chartered Accountants | |
FRN: 135024W | |
Marmik Shah | |
Partner | |
Place: Ahmedabad | Membership No: 133926 |
Date: 22_04_2024 | UDIN: 24133926BKCJOI6792 |
Annexure-A
TO THE INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 2 under Report on Other Legal and Regulatory Requirements section of our Report of even date)
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of Property, Plant and Equipment.
(b) According to information and explanation given to us, the Company has maintained proper records showing full particulars of Property, Plant and Equipment.
(c) The Property, Plant and Equipment have been physically verifiied by the management in a phased manner, designed to cover all the items over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and nature of its business and no material discrepancies were noticed on such verifiication.
(d) The title deeds of immovable properties are held in the name of the Company.
(e) The Company has not revalued its Property, Plant and Equipment (including Right of Use assets) or intangible assets or both during the year and accordingly, the clause for revaluation of Property, Plant and Equipment (including Right of Use assets) or intangible assets or both is not applicable.
(f) 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 there under.
(ii) (a) According to the information and explanation given to us, the management has carried out physical verifiication of Inventories during the year on quarterly basis and at the end of Financial Year, which considering nature of Business and size of the Company is, in our opinion, at suitable intervals.
(b) According to the information and Explanation given to us, the Company has maintained proper records of inventory and has not found any material discrepancies on physical verifiication and the same have been properly dealt with in the books of accounts.
(c) The Company has not been sanctioned working capital limits in excess of 5 Crores, in aggregate, at any points of time during the year, from banks or Fiinancial institutions on the basis of security of current assets and hence reporting under clause 3(ii)(b) of the Order is not applicable.
(iii) (a) According to information and explanation given to us, the Company has granted loans, secured or unsecured to companies, _irms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013 within applicable limits.
(b) In our opinion and according to information and explanations given to us, 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) According to information and explanation given to us, in respect of loans and advances in the nature of loans, the schedule of repayment of principal and payment of interest has been stipulated and the repayments or receipts are regular.
(d) According to information and explanation given to us, in respect of loans granted by the Company, there is no overdue amount remaining outstanding as at the Balance Sheet date.
(e) According to information and explanation given to us, no Loan granted by the Company, which has been fallen during the year, has been renewed or extended or fresh loans granted to settle the overdue of existing loans given to the same parties.
(f) According to information and explanation given to us, the Company has granted loans to related parties as de_ined in clause (76) of Section 2 of the Companies Act, 2013 in the nature of loans repayable on demand.
(iv) In our opinion and according to information and explanations given to us, the Company has complied with the provisions of Section 185 and 186 of the Companies Act, 2013 in respect of loans, investment, guarantees and security.
(v) According to information and explanation given to us, the Company has not accepted any deposits as de_ined in the Companies (Acceptance of Deposits) Rules, 2014. Accordingly, the provision of Clause 3(v) of the order is not applicable to the Company.
(vi) We have broadly reviewed the records maintained by the Company pursuant to rules prescribed by the Central Government for maintenance of cost records under sub-section (1) of Section 148 of the Companies Act, 2013 and are of the opinion that, prima facie, the prescribed accounts and records have been maintained. However, we have not made detailed examination of records.
(vii) (a) According to the information and explanations given to us, in respect of statutory dues:
1. The Company has generally been regular in depositing undisputed statutory dues.
2. There were no undisputed amounts payable as at March 31, 2024 for a period of more than six months from the date they became payable.
3. The Company has disputed outstanding statutory dues as at March 31, 2024 amounting to 179.94 Lakhs for the AY 2019_20.
(viii) According to the information and explanations given to us, there were no transactions relating to previously unrecorded income that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (43 of 1961), if so, whether such undisclosed income has been recorded in the accounts during the year is not applicable to Company.
(ix) (a) In our opinion and according to information and explanations given to us, the Company has not defaulted in the repayment of loans and borrowings to Fiinancial institutions and banks.
(b) In our opinion and according to information and explanations given to us, the Company is not declared wilful defaulter by any bank or Fiinancial institution or other lender.
(c) In our opinion and according to information and explanations given to us, the Company has applied term loans for the purpose for which the loans were obtained.
(d) In our opinion and according to information and explanations given to us, the Company has not utilised funds raised on short term basis for long term purposes.
(e) In our opinion and according to information and explanations given to us, 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, and therefore, reporting under this clause is not applicable to the Company.
(f) In our opinion and according to information and explanations given to us, the Company has not raised loans during the year on the pledge of securities held in its subsidiaries, joint ventures or associate companies.
(x) (a) In our opinion and according to information and explanations given to us, the Company has not raised moneys by way of initial public offer or further public offer (including debt instruments). The term loans have been applied by the Company during the year for the purpose for which they were raised.
(b) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and therefore, the reporting under clause 3(xiv) of the Order is not applicable to the Company.
(xi) (a) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company by its oJicers or employees has been noticed or reported during the course of our audit.
(b) To the best of our knowledge and according to the information and explanations given to us, any report under sub-section (12) of Section 143 of Act has not been _iled by the auditors in Form ADT_4, the clause for rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government is not applicable to the Company.
(c) To the best of our knowledge and according to the information and explanations given to us, there are no whistle-blower complaints received during the year by the Company and accordingly, no reporting is required under this clause.
(xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, reporting under clause 3(xii) of the Order is not applicable.
(xiii) In our opinion and according to the information and explanations given to us, the Company is in compliance with sections 177 and 188 of the Companies Act, 2013 where applicable for all transactions with related parties and details of such transactions have been disclosed in the Fiinancial statements as required by the applicable accounting standards.
(xiv) (a) In our opinion and according to the information and explanations given to us, the Company has an internal audit system commensurate with the size and nature of its business.
(b) We have considered the reports of the Internal Auditors for the period under audit and there are no adverse comments made by the Internal Auditors.
(xv) In our opinion and according to the information and explanations given to us, during the year, the Company has not entered into non-cash transactions with directors or persons connected with them and hence, provisions of Section 192 of the Companies Act, 2013 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, the reporting under clause (xvi) of the Order is not applicable to the Company.
(b) In our opinion and according to the information and explanations given to us, the Company has not conducted any Non-Banking Financial or Housing Finance activities without a valid Certifiicate 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 de_ined in the regulations made by the Reserve Bank of India, accordingly this clause is not applicable to the Company.
(xvii) In our opinion and according to the information and explanations given to us, the Company has not incurred cash losses in the Fiinancial year and in the immediately preceding Fiinancial year.
(xviii) There has been no resignation of Statutory Auditors during the year and accordingly, the provisions of clause 3(xviii) of the order is not applicable.
(xix) On the basis of the Fiinancial ratios, ageing and expected dates of realisation of Fiinancial assets and payment of Fiinancial liabilities, other information accompanying the Fiinancial statements and our knowledge of the Board of Directors and Management plans and based on our examination of the evidence supporting the assumptions, nothing has come to our attention, which causes us to believe that any material uncertainty exists as on the date of the audit report indicating that 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 up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date, will get discharged by the Company as and when they fall due.
(xx) (a) In our opinion and according to the information and explanations given to us, there are no unspent amount towards Corporate Social Responsibility (CSR) on other than ongoing projects requiring a transfer to a fund specifiied in Schedule VII to the Companies Act, 2013 in compliance with second proviso to sub-section (5) of Section 135 of the said Act. Accordingly, reporting under clause 3(xx)(a) of the Order is not applicable to the Company.
(b) In respect of other than ongoing projects, there are no unspent amount requiring a transfer to a special account within a period of 30 days from the end of the said Fiinancial year in compliance with the provision of Section 135(6) of the Companies Act, 2013.
(xxi) In our opinion and according to the information and explanations given to us, there are no qualifiications or adverse remarks by the respective auditors in the Companies (Auditors Report) Order (CARO) reports of the companies included in the Standalone Financial Statements.
For MAAK and Associates | |
Chartered Accountants | |
FRN: 135024W | |
Marmik Shah | |
Partner | |
Place: Ahmedabad | Membership No: 133926 |
Date: 22_04_2024 | UDIN: 24133926BKCJOI6792 |
Annexure-B
TO THE INDEPENDENT AUDITORS REPORT OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS
Report on the Internal Financial Controls under Clause (i) of sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
1. We have audited the internal Fiinancial controls over Fiinancial reporting of K.P. ENERGY LIMITED ("the Company") as of March 31, 2024 in conjunction with our audit of the standalone Fiinancial statements of the Company for the year ended on that date.
MANAGEMENTS RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
2. The Companys management is responsible for establishing and maintaining internal Fiinancial controls based on the internal control over Fiinancial 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 Fiinancial controls that were operating effectively for ensuring the orderly and eJicient 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 Fiinancial information, as required under the Companies Act, 2013.
AUDITORS RESPONSIBILITY
3. Our responsibility is to express an opinion on the Companys internal Fiinancial controls over Fiinancial reporting based on our audit. We have conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") 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 Fiinancial 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 Fiinancial controls over Fiinancial reporting was established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal Fiinancial controls system over Fiinancial reporting and their operating effectiveness. Our audit of internal Fiinancial controls over Fiinancial reporting included obtaining an understanding of internal Fiinancial controls over Fiinancial 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 Fiinancial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained is suJicient and appropriate to provide a basis for our audit opinion on the Companys internal Fiinancial controls system over Fiinancial reporting.
MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
6. A Companys internal Fiinancial control over Fiinancial reporting is a process designed to provide reasonable assurance regarding the reliability of Fiinancial reporting and the preparation of Fiinancial statements for external purposes in accordance with generally accepted accounting principles. A Companys internal Fiinancial control over Fiinancial reporting includes those policies and procedures that: (1) Pertain to the maintenance of records that, in reasonable detail, accurately and fairly refilect the transactions and dispositions of the assets of the Company;
(2) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of Fiinancial 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 Fiinancial statements.
INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
7. Because of the inherent limitations of internal Fiinancial controls over Fiinancial 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 Fiinancial controls over Fiinancial reporting to future periods are subject to the risk that the internal Fiinancial control over Fiinancial Guidance Note on Audit of reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
OPINION
8. In our opinion, the Company has, in all material respects, an adequate internal Fiinancial controls system over Fiinancial reporting and such internal Fiinancial controls over Fiinancial reporting were operating effectively as at March 31, 2024, based on the internal control over Fiinancial 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.
For MAAK and Associates | |
Chartered Accountants | |
FRN: 135024W | |
Marmik Shah | |
Partner | |
Place: Ahmedabad | Membership No: 133926 |
Date: 22_04_2024 | UDIN: 24133926BKCJOI6792 |
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