<dhhead>INDEPENDENT AUDITORS REPORT </dhhead>
To
The Members of
KABRA COMMERCIAL LIMITED
Report on the Audit of the Standalone Financial Statements
Opinion
We have audited the accompanying Ind AS Standalone Financial
Statements of KABRA COMMERCIAL LIMITED ("the Company"), which comprise the
Balance Sheet as at March 31, 2023, the Statement of Profit and Loss (including Other
Comprehensive Income), the Statement of Changes in Equity and tire Statement of Cash Flows
for the year then ended, and notes to the Ind AS financial statements including a summary
of significant accounting policies and other explanatory information (hereinafter referred
to as "Ind AS financial statements").
In our opinion and to the best of our information and according
to the explanations given to us, the aforesaid Ind AS 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 inconformity with the accounting principles
generally accepted in India including the Indian Accounting Standards ("Ind AS")
prescribed under section 133 of the Act, of the state of affairs of the Company as at
March 31, 2023, its Profit (including other comprehensive income), changes in equity and
its cashflows for the year ended on that date.
Basis for opinion
We conducted our audit in accordance with the standards on
auditing specified under section 143 (10) of the Companies Act, 2013. Our responsibilities
under those Standards are further described in the auditors responsibilities for the
audit of the 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 on the Ind AS financial
statements.
Emphasis of Matter
We draw attention to clause no. D(vii) Note No.-1 of Significant
Accounting Policies & Notes to Accounts of financial statements which state "No
provision for impairment loss has been made in respect of Sundry Debtors amounting to
Rs.3,11,27,385/- which is outstanding for more than 3 years and under sub-judice.
Management contemplates that the amount is fully recoverable as the judgement would be in
favour of the company."
However, considering the significant time involved in the court
process and delays in the realisation of amounts, we are unable to comment on the carrying
value of the above referred receivable and the shortfall, if any, on the amount that would
be ultimately realized by the Company.
Key Audit Matters
Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the Ind AS Standalone Financial
Statements of the current period. These matters were addressed in the context of our audit
of the Ind AS Standalone Financial Statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these matters.
Other information
The Companys Board of Directors is 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, Report on
Corporate Governance but does not include the Ind AS financial statements and our
auditors report thereon. The above- mentioned other information are expected to be made
available to us after the date of this auditors report.
Our opinion on the Ind AS financial statements does not cover
the other information and accordingly, we do not express any form of assurance conclusion
thereon.
In connection with our audit of the Ind AS financial statements,
our responsibility is to read the other information identified above when it becomes
available and, in doing so, consider whether the other information is materially
inconsistent with the Ind AS financial statements or our knowledge obtained in the audit
or otherwise appears to be materially misstated.
When we read the other information, if we conclude that there is
a material misstatement therein, we are required to communicate the matter to those
charged with governance. We have nothing to report in this regard.
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 Ind AS
financial statements that give a true and fair view of the financial position, financial
performance (including other comprehensive income), changes in equity and cash flows of
the Company in accordance with the accounting principles generally accepted in India,
including Ind AS prescribed 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; 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 Ind AS financial statements that give a true and fair
view and are free from material misstatement, whether due to fraud or error.
In preparing the Ind AS financial statements, management is
responsible for assessing the Companys ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless management either intends to liquidate the Company or to
cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the
Companys financial reporting process.
Auditors responsibilities for the audit of the Ind AS
Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether
the Standalone Financial Statements as a whole are free from material misstatement,
whether due to fraud or error, and to issue an auditors report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with SAs will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these Standalone Financial Statements.
As part of an audit in accordance with SAs, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of
the Standalone Financial Statements, whether due to fraud or error, design and perform
audit procedures responsive to those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
Obtain an understanding of internal control relevant to
the audit in order to design audit procedures that are appropriate in die circumstances.
Under section 143(3)(i) of the Companies Act, 2013, we are also responsible for expressing
our opinion on whether the company has adequate internal financial controls system in
place and the operating effectiveness of such controls
Evaluate the appropriateness of accounting policies used
and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of managements use of
the going concern basis of accounting and, based on the audit evidence obtained, whether a
material uncertainty exists related to events or conditions that may cast significant
doubt on the Companys ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in our auditors report to
the related disclosures in the Standalone Financial Statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditors report. However, future events or conditions may
cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content
of the Standalone Financial Statements, including the disclosures, and whether the
Standalone Financial Statements represent the underlying transactions and events in a
manner that achieves fair presentation.
We communicate with those charged with governance regarding,
among other matters, the planned scope and timing of the audit and significant audit
findings, including any significant deficiencies in internal control that we identify during
our audit.
We also provide those charged with governance with a statement
that we have complied with relevant ethical requirements regarding independence, and to
communicate with*item all relationships and other matters that may reasonably be thought
to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with
governance, we determine those matters that were of most significance in the audit of the
Standalone Financial Statements of the current period and are therefore the key audit
matters. We describe these matters in our auditors report unless law or regulation
precludes public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
Report on other legal and regulatory requirements
1. As required by the Companies (Auditors Report) Order, 2020
("the Order") issued by the Central Government of India in terms of section
143(11) of the Act, we report in "Annexure A", 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 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), the Statement of Changes in Equity and the
Statement of Cash Flows dealt with by this report are in agreement with the books of
account;
(d) In our opinion, the aforesaid Standalone Financial
Statements comply with the Ind AS prescribed under section 133 of the Act read with the
Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of the written representations received from
the directors as on March 31, 2023 taken on record by the board of directors, 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;
(f) With respect to the adequacy of the internal financial
controls over financial reporting of the Company and the operating effectiveness of such
controls, refer to our separate Report in "Annexure B".
(g) In our opinion and according to the information and
explanations given to us, No remuneration is paid by the Company to its directors during
the year under report hence provisions of Section 197 of the Act read with Schedule V to
the Act is not applicable.
3. With respect to the other matters to be included in the
Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules,
2014, in our opinion and to the best of our information and according to the explanations
given to us;
i. The Company does not have any pending litigations which would
impact its Standalone Financial Statements;
ii. The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable losses; and
iii. There has been no delay in transferring amounts, required
to be transferred, to the Investor Education and Protection Fund by the Company.
iv. (a) The Management has represented that, to the best of its
knowledge and belief, no funds have been advanced or loaned or invested (either from
borrowed funds or share premium or any other sources or kind of funds) by the Company to
or in any other person(s) or entily(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;
(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;
(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 anymaterial 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.
Annexure -A to the Independent Auditors Report
Referred to in paragraph 1 under the heading Report on Other
Legal & Regulatory Requirement of our report of even date to the Standalone Financial
Statements of the Company 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 Ind AS 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 maintained proper records showing
full particulars, including
quantitative details and situation of the Property, Plant and
Equipment ("PPE").
font-family:Arial>(B) The Company does not have any Intangible Assets as on 31st
March 2023 nor at any time during the financial year ended 31st March 2023.
Accordingly, reporting under clause 3(i)(a)(B) of the Order is not applicable to the
Company.
(b) The Property, Plant and Equipment ("PPE") have
been physically verified 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. Pursuant to the program, a portion of
the Property, Plant and Equipment ("PPE") has been physically verified by the
management during the year and no material discrepancies between the books records and
the physical Property, Plant and Equipment ("PPE") have been noticed.
(c) The title deeds of all the immovable properties disclosed in
the Financial Statements are held in the name of the Company.
(d) In our opinion and according to the information and
explanations given to us, the Company has not revalued its PPE (including Right of Use
assets) during the year. The Company does not have any intangible assets.
(e) According to the information and explanations given to us
and on the basis of our examination of the records of the Company, no proceedings have
been initiated or are pending against the Company for holding any benami property
under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made
thereunder.
ii. (a) The Company has no inventory, hence requirement of
clause (ii)(a) of the above order are not applicable to the company.
(b) According to the information and explanations given to us
and on the basis of our examination of the records of the Company, the Company has been
sanctioned working capital limits from banks or financial institution on the basis of
security of current assets being Fixed Deposit with bank. Since, the loan is against Fixed
Deposit in bank, there is no requirement of filing Quarterly Returns or Statements With
the bank.
iii. During the year, the company has not made any investments
in, provided any guarantee or security or granted any loans or advances in the nature of
loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or any
other parties. Therefore, the provisions of clause 3(iii) of the said Order are not
applicable to the company.
iv. In our opinion and according to the information and
explanations given to us, the Company has neither granted any loan, guarantee, security,
nor purchased any investments which require compliance with the provisions of Sections 185
and 186 of the Companies Act, 2013. Thus paragraph 3(iv) of the order is not applicable to
the Company.
v. In our opinion and according to the information and
explanations given to us, the Company has not received any deposits
dining the year. Therefore, paragraph 3(v) of the order is not applicable to the Company.
vi. To the best of our knowledge and belief, the Central
Government has not specified maintenance of cost records under sub-section (1) of Section
148 of the Act, in respect of Companys products/ services. Accordingly, the provisions of
clause 3(vi) of the Order are not applicable.
vii. (a) According to the information and explanations given to
us and on the basis of our examination of the records of the Company, the Company is
generally regular in depositing undisputed statutory dues including Goods and Services
Tax, provident fund, employees state insurance, income-tax, sales-tax, service tax, duty
of customs, duty of excise, value added tax, cess and any other statutory dues, as
applicable, with the appropriate authorities. Further, no undisputed amounts payable in
respect thereof were outstanding at the year-end 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 dues in respect of Goods and
Services Tax, provident fund, employees state insurance, income-tax, sales-tax, service
tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues
that have not been deposited with the appropriate authorities on account of any dispute.
viii. According to the information and explanation given to us,
company has no transactions, not recorded in the books of account have been surrendered or
disclosed as income during the year in the tax assessments under the Income Tax Act, 1961
(43 of 1961).
ix. (a) In our opinion and according to the information and
explanations given to us, the company has not defaulted in repayment of any loan or other
borrowings or any interest due thereon to any lender.
(b) According to the information and explanation provided to us,
Company is not declared wilful defaulter by any bank or financial institution or other
lender.
(c) In our opinion and according to the information and
explanations given to us, the term loans were applied for the purpose for which the loans
were obtained.
(d) According to the information and explanations given to us,
and the procedures performed by us, and on an overall examination of the financial
statements of the company, we report that there are no funds raised on short-term basis
which have been utilised for long-term purpose.
(e) The Company did not have any subsidiary or joint venture
during the year. According to the information and explanations give to us and on an
overall examination of the financial statements of the company, we report that the company
has funds from any entity or person on account of or to meet the obligations of its
subsidiary/subsidiaries or associates.
(f) The Company did not have any subsidiary or joint venture
during the year. According to the information and explanations given to us and procedures
applied by us, we report that the company has not raised loans during the year on the
pledge of securities held in its subsidiary or associate
company/companies.
x. (a) According to the records of the company, The Company has
not raised any money by way of initial public offer or further public offer including debt
instruments) during the year. Accordingly, paragraph 3 (x)(a) of the order is not
applicable.
(b) According to the records of the company, The Company has not
raised any money by way of preferential allotment or private placement of shares or
convertible debentures (fully, partially or optionally convertible) during the year.
Accordingly, paragraph 3 (x)(b) 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 according to the information and explanations given to us, we have
neither come across any instance of fraud on or by the company, noticed or reported during
the year, nor we have been informed of such case by the management.
(b) According to the information and explanation given to us, no
report under sub-section (12) of section 143 of the Companies Act has been filed by the
auditors in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors)
Rules, 2014 with the Central Government;
(c) According to the information and explanation given to us, no
whistle-blower complaints, received during the year by the company;
xii. In our opinion and to the best of our information &
explanations provided by the management, Company is not a Nidhi company, accordingly
provisions of the Clause 3 (xii) of the Order is not applicable to tine company.
xiii. According to the information and explanations given to us
and based on our examination of the records of the company, transactions with the related
parties are in compliance with section 177 and 188 of the Act., where applicable, the
details of such transactions have been disclosed in the IND AS Financial Statements as
required by the applicable accounting standards.
xiv. (a) In our opinion the Company have an internal audit
system commensurate with the size and nature of its business,
(b) Reports of the Internal Auditors for the period under audit
were considered by the statutory auditor.
xv. According to the information and explanations given to us,
we are of the opinion that the company has not entered into any non-cash transactions with
directors or persons connected with him and accordingly, the provisions of clause 3(xv) of
the Order is not applicable.
xvi. (a) In our opinion and according to the information and
explanations given to us, the Company is not required to be registered u/ s 45-IA of the
Reserve Bank of India Act, 1934. Hence, reporting under clauses 3{xvi)(a) &c.
(b) is not applicable.
(c) The company is not a Core Investment Company (CIC) as
defined in the regulations made by the Reserve Bank of India. Accordingly, the reporting
under Clause 3(xvi)(c) of the Order is not applicable to the Company.
(d) As informed by the Company, the Group to which the Company
belongs has no CIC as part of the Group.
xvii. The Company has not incurred cash losses during the
financial year and immediately preceding financial year.
xviii. There has been no resignation of the statutory auditors
during the year. Accordingly, the provisions of clause 3(xviii) of the Order is not
applicable
xix. On the basis of the financial Tatios, 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 indicating that company is
incapable 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. The provisions of section 135 towards corporate social
responsibility are not applicable on the company. Accordingly, the provisions of clause
3(xx) of the Order is not applicable
xxi. Reporting under clause xxi of the Order is not applicable
at the standalone level
"Annexure B" to the Independent Auditors Report of
even date on the Ind AS Standalone Financial Statements of KABRA COMMERCIAL LIMITED.
Report on the Internal Financial Controls under Clause (i) of
Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
We have audited the internal financial controls over financial
reporting of KABRA COMMERCIAL LIMITED ("the Company") as of March 31, 2023 in
conjunction with our audit of the Ind AS Standalone Financial Statements of the Company
for the year ended on that date.
Managements Responsibility for Internal Financial Controls
The Companys management is responsible for establishing and
maintaining internal financial controls based on the internal control over financial
reporting criteria established by the Company considering the essential components of
internal control stated in the Guidance Note on Audit of Internal Financial Controls over
Financial Reporting issued by the Institute of Chartered Accountants of India, These
responsibilities include the design, implementation and maintenance of adequate internal
financial controls that were operating effectively for ensuring the orderly and efficient
conduct of its business, including adherence to companys policies, the safeguarding of
its assets, the prevention and detection of frauds and errors, the accuracy and
completeness of the accounting records, and the timely preparation of reliable financial
information, as required under the Companies Act, 2013.
Auditors Responsibility
Our responsibility is to express an opinion on the Companys
internal financial controls over financial reporting based on our audit. We conducted our
audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over
Financial Reporting (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 financial controls, both applicable to an
audit of Internal Financial Controls and, both issued by the Institute of Chartered
Accountants of India. Those Standards and the Guidance Note require that we comply with
ethical requirements and plan and perform the audit to obtain reasonable assurance about
whether adequate internal financial controls over financial reporting was established and
maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit
evidence about the adequacy of the internal financial controls system over financial
reporting and their operating effectiveness. Our audit of internal financial controls over
financial reporting included obtaining an understanding of internal financial controls
over financial reporting, assessing the risk that a material weakness exists, and testing
and evaluating the design and operating effectiveness of internal control based on the
assessed risk. The procedures selected depend on the auditors judgement, including the
assessment of the risks of material misstatement of the Standalone Financial Statements,
whether due to fraud or error.
We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our audit opinion on the Companys
internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A companys internal financial control over financial
reporting is a process designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of Standalone Financial Statements for external
purposes in accordance with generally accepted accounting principles. A companys
internal financial control over financial reporting includes those policies and procedures
that (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
Standalone 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
Standalone Financial Statements,
Inherent Limitations of Internal Financial Controls Over
Financial Reporting
Because of the inherent limitations of internal financial
controls over financial reporting, including the possibility of collusion or improper
management override of controls, material misstatements due to error or fraud may occur
and not be detected. Also, projections of any evaluation of the internal financial
controls over financial reporting to future periods are subject to the risk that the
internal financial control over financial reporting may become inadequate because of
changes in conditions, or that the degree of compliance with the policies or procedures
may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an
adequate internal financial controls system over financial reporting and such internal
financial controls over financial reporting were operating effectively as at March 31,
2023, based on the internal control over financial reporting criteria established by the
Company considering the essential components of internal control stated in the Guidance
Note on Audit of Internal Financial Controls Over Financial Reporting issued by the
Institute of Chartered Accountants of India.
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