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Kesar Enterprises Ltd Auditor Reports

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Kesar Enterprises Ltd Share Price Auditors Report

TO THE MEMBERS OF KESAR ENTERPRISES LIMITED

Report on the Audit of the Ind AS Financial Statements

Opinion

We have audited the accompanying financial statements of KESAR ENTERPRISES LIMITED (the "Company"), which comprise the Balance Sheet as at March 31, 2024, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date and a summary of material accounting policies and other explanatory information (hereinafter referred to as the "financial statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Companies Act, 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 and its profit, 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 financial statements in accordance with the Standards on Auditing ("SA"s) specified under section 143(10) of the Act. Our responsibilities under those SAs 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 the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAIs Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Material Uncertainty Related to Going Concern

We draw attention to Note 45 in the Ind AS financial statements, for the reason stated in the said note, the management has a reasonable expectation that the Company has adequate resources to continue its operational existence for the foreseeable future, the Ind AS financial statements has been prepared on going concern basis, despite accumulated losses resulting in erosion of its net worth.

Our opinion is not modified in respect of this matter.

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 financial statements of the current year. These matters were addressed in the context of our audit of the Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material Uncertainty Related to Going Concern as above, we have determined the matter described below to be the key audit matter to be communicated in our report.

Key Audit Matter How our audit addressed the key audit matter
Valuation of Inventory: Principle Audit Procedures
As on March 31, 2024, the Company has inventory of sugar with the carrying value Rs. 8,986.18 Lakhs. The inventory of sugar is valued at the lower of cost and net realizable value. We understood and tested the design and operating effectiveness of controls as established by the management in determination of net realizable value of inventory of sugar.
We considered the inventory valuation of sugar as a key audit matter given the relative size of the balance in the financial statements and significant judgment involved in the consideration of factors such as minimum sale price, monthly quota, fluctuation in selling prices and the related notifications of the Government in determination of net realizable value. Assessing the appropriateness of Companys accounting policy for valuation of finished goods and compliance of the policy with the requirements of the prevailing accounting standards.
(Refer Note 7 to the financial Statements) We considered various factors including the actual selling price prevailing around and subsequent to the year- end, minimum selling price, monthly quota and other notifications of the Government of India, initiatives taken by the Government with respect to sugar industries.
Compared the cost of the finished goods with the estimated net realizable value and checked if the finished goods were recorded at net realizable value where the cost was higher than the net realizable value.
Based on the above procedures performed, the managements determination of the net realizable value of the inventory of sugar as at the year end and comparison with cost for valuation of inventory, is considered to be reasonable
Regulations – Litigations and claims • Our Audit approach in relation to the matter involved the following:
The Company is exposed to various laws and regulations. In this regulatory environment, there is an inherent risk of litigations and claims. Consequently, provisions and contingent liabilities disclosures may arise from direct and indirect tax proceedings, legal proceedings, including regulatory and other government / department proceedings, as well as investigations by authorities. • Review the outstanding litigations against the Company for consistency with the previous years. Enquire and obtain explanations for movement during the year.
As at March 31, 2024, the Companys has ascertained contingent liabilities of Rs. 2,020.39 Lakhs. • Reading the latest correspondence between the Company and the various tax/legal authorities for significant matters.
Management applies significant judgments in estimating the likelihood of the future outcome in each case when considering whether, and how much, to provide or in determining the required disclosure for the potential exposure of each matter. This is due to the highly complex nature and magnitude of the legal matters involved along with the fact that resolution of tax and legal proceedings may span over multiple years, and may involve protracted negotiation or litigation. These estimates could change substantially over time as new facts emerge and each legal case progress. • Examined selectively the Companys legal expenses and read fully the minutes of the board meetings, in order to ascertain all cases have been identified.
We determined this matter to be a key audit matter due to the inherent complexity and magnitude of potential exposures across the Company and the judgment necessary to estimate the amount of provisions required or determine the required disclosure. • With respect to tax matters, involving our tax specialists, and discussing with the Companys personnel dealing with tax matters, their views and strategies on significant cases, as well as the related technical grounds relating to their conclusions based on applicable tax laws and precedence.
• Assessing the decisions and rationale for provisions held or for decisions not to record provisions or make disclosures.
• For those matters where management concluded that no provisions should be recognised, by considering the adequacy and completeness of the Companys disclosures.
For complex regulatory litigations, reviewing the relevant correspondence by the company, by studying the matters in the light of past precedence and views of companys legal advisor as made available by the company.

Emphasis of Matter

We draw attention to,

(a) Note 44 to the accompanying Ind AS Financial Statements, For reason stated in the said note, The Company had entered into a One Time Settlement (OTS) with UCO Bank in March, 2023 and has paid the entire OTS amount as per OTS sanction terms. Accordingly, the Company has given the accounting effect in the books by writing back of liabilities amounting to Rs. 9,113.77 Lakhs and included in Other Income in note no 26. Pursuant to the payment of entire OTS amount, the Company is in the process of completing with the other procedural formalities like release of the Banks charge on the assets of the Company and withdrawal of various legal cases.

(b) Refer Note 2(a) to the accompanying Ind AS Financial Statements, During the year the Company has revalued certain class of assets in compliance with Ind AS 16 -Property, Plant & Equipment. The fair value gain on the said revaluation is amounting to Rs. 4,425.23 lakhs, which is reflected in revaluation reserve.

Our opinion is not modified in respect of these matter.

Information Other than the Financial Statements and Auditors Report Thereon

The Companys Board of Directors is responsible for the other information. The other information comprises the information included in the Boards Report including Annexures to Boards Report but does not include the financial statements and our auditors report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the 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 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 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 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, 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 is also responsible for overseeing the Companys financial reporting process.

Auditors Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of 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 financial 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 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 the management and Board of Directors.

• Conclude on the appropriateness of managements and Board of Directors 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 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 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 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 give 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, based on our audit 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 the Statement of Cash Flows dealt with by this Report are in agreement with the books of account.

d) In our opinion, the aforesaid financial statements comply with the Ind AS specified 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, 2024 taken on record by the Board of Directors, none of the directors is disqualified 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 adequacy of the internal controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companys internal financial controls over financial reporting.

g) 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: In our opinion and to the best of our information and according to the explanations given to us, the Company has not paid/provided for any managerial remuneration to its directors during the year. Accordingly, the provisions of section 197 of the Act are not applicable to the Company.

h) With respect to the other matters to be included in the Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, 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 on its financial position in its Ind AS financial statements – Refer Note 32 on Contingent Liabilities to the Ind AS 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 (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 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 (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 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 have been 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 neither paid nor declared any dividend during the year. So, the compliance with respect to section 123 of the Act is not applicable.

vi. Based on our examination which included test checks, the company has used an accounting software for maintaining its books of account 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 audit trail feature being tampered with.

For V. C. Shah & Co.

Chartered Accountants

ICAI Firm Registration No.109818W

Viral J. Shah

Partner

Membership No.: 110120

UDIN: 24110120BKFQQL1426

Place: Mumbai

Date: May 22, 2024

ANNEXURE ‘A TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements section of our report of even date to the Members of KESAR ENTERPRISES LIMITED on the Ind AS financial statements for the year ended March 31, 2024)

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 to the best of our information and according to the explanations provided to us by the Company and the books of account and records examined by us in the normal course of audit, we state that:

i. (a) (A) The Company is maintaining proper records showing full particulars including quantitative details and situation of Property, plant and equipment.

(B) The company is maintaining proper records showing full particulars of intangible assets.

(b) The Property, Plant and Equipment were physically verified during the year by the management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the property, plant and equipment at reasonable intervals. According to the information and explanation given to us, no material discrepancies were noticed during such verification.

(c) The title deeds of the immovable property disclosed in the financial statements are held in the name of the company, except for the following cases:

Description of Property Gross Carrying Value (Rs. in Lakhs) Held in Name of Whether promoter, director or their relative or employee Period held Reason for not being in the name of company
Freehold land in Village Khurpia, Tehsil Kiccha, District Udham Singh Nagar, Tehsildar (Tehsil Kiccha, District Udham Singh Nagar), Uttarakhand 1,271.09 Pannaben Vinay Shah No 06-02-2023 till date Fraudulently manipulated land revenue records
Freehold land in village Bandia ,Bareilly Nainital Road, Tehsil -Kichha, District-Udham Singh Nagar, Uttarakhand 490.36 Pannaben Vinay Shah No 03-May-2024 till date Fraudulently manipulated land revenue records

(d) As disclosed in note no 2(a) to accompanying Ind AS Financial Statement, the company has revalued its land, buildings and Plant & Machinery during the year ended March 31, 2024 (but not the right of use assets and intangible assets), during the year and is based on the valuation by a registered valuer and the amount of change is more than 10% of the aggregate of net carrying value of land as class of Property Plant & Equipment. The information of the same is as below:

Particular Carrying amount as on 30-June- 2023 (Rs. in Lakhs) Carrying amount after Revaluation as on 30-June-2023 (Rs. in Lakhs) Addition (Rs. in Lakhs) Percentage
Land 15,811.10 20,230.00 4,418.30 27.94%

(e) As represented by the Management, no proceedings have been initiated during the year or are pending against the Company as at March 31, 2024 for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (as amended in 2016) and rules made thereunder. Hence, reporting under clause (i)(e) of paragraph 3 of the Order is not applicable.

ii. (a) According to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business. The discrepancies noticed on verification between the physical stocks and the book records as at the year end were not material and have been properly dealt with in the books of account wherever necessary.

(b) The Company has not been sanctioned working capital limits in excess of Rs. 5 crore, in aggregate, at any points of time during the year, from banks or financial institutions on the basis of security of current assets and hence reporting under clause (ii)(b) of paragraph 3 of the Order is not applicable.

iii. The Company has made investments in, companies, firms, Limited Liability Partnerships, and granted unsecured loans to other parties, during the year, in respect of which:

(a) During the year, the Company has not provided loans or advances in the nature of loans or stood guarantee or provided security to any other entity. Hence, reporting under clause (iii)(a) of paragraph 3 of the Order is not applicable.

(b) In our opinion, the investments made, loans and advances in nature of loans during the year are, prima facie, not prejudicial to the Companys interest. The company has not provided any guarantees to any parties.

(c) According to the information and explanations given to us and based on the audit procedures performed by us, the Company has not granted loans and advances in the nature of loans. Hence, reporting under clause (iii)(c),(d), (e) and (f) of paragraph 3 of the Order is not applicable.

iv. The company has not granted any loans to any parties as specified under section 185 of the Act. Further the Company has complied with section 186 of Act for all the investment made. The Company has not given any guarantee of security to anybody during the year.

v. According to the information given to us and based on the audit procedures performed by us, the Company has not accepted any deposit or amounts which are deemed to be deposits, as per the directives issued by Reserve Bank of India and the provisions of the section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules made thereunder. Hence, reporting under clause (v) of paragraph 3 of the Order is not applicable.

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 been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete. vii. In respect of statutory dues:

(a) In our opinion, the Company has generally been regular in depositing undisputed statutory dues, including Goods and Services tax, Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, duty of Custom, duty of Excise, Value Added Tax, Cess and other material statutory dues applicable to it with the appropriate authorities.

There were no undisputed amounts payable in respect of Goods and Service tax, Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, duty of Custom, duty of Excise, Value Added Tax, Cess and other material statutory dues in arrears as at March 31, 2024 for a period of more than six months from the date they became payable.

(b) There are no dues with respect to income tax, sales tax, service tax, value added tax, GST, customs duty, excise duty which have not been deposited on account of any dispute, except for details given below

Sr. No. Name of the statute Nature of dues As on 31.03.2024 (Rs. in Lakhs) Period to which the amount relates Forum where dispute is pending
1 Central Sales Tax Act , 1956 Central Sales Tax 48.84 1989-90,2002-03 and 2003-04 High Court ,Allahabad
2 U.P. Tax on Entry of Goods into Local Area Act, 2007 Entry Tax 806.68 2000-01 to 2006-07 D.C. (A) – Bareilly
3 U.P. Tax on Entry of Goods into Local Area Act, 2007 Entry Tax 83.10 2008-09, 2009-10 Joint Commissioner (Corporate Circle), Commercial Tax, Bareilly
4 U.P. Tax on Entry of Goods into Local Area Act, 2007 Entry Tax 28.38 2010-11 High Court, Allahabad
5 U.P. Tax on Entry of Goods into Local Area Act ,2007 Entry Tax 1.66 2010-11 Joint Commissioner (Appeal) ,Bareilly
6 U.P. Tax on Entry of Goods into Local Area Act ,2007 Entry Tax 10.25 2017-18 Additional Commissioner (Appeal)
7 U.P. Tax on Entry of Goods into Local Area Act ,2007 Entry Tax 4.30 2015-16 Member Tribunal ,Bareilly
8 U.P.Trade Tax Act , 1948 Trade Tax 6.57 1987-88 to 1989-90 and 1991-92 to 1993-94, 1997-98 High Court ,Allahabad
9 U.P. Tax on Entry of Goods into Local Area Act ,2007 Entry Tax 1.66 2010-11 Joint Commissioner (Appeal) ,Bareily
10 Central Excise Act , 1944 CENVAT Credit availed on Molasses 634.45 2012-2013 High Court
11 Central Excise Act , 1944 Excise on Shortage of Sugar/Molasses /Scrap 308.62 2011-12 & 2012-13 Jt. Commissioner CEX Noida
12 Central Excise Act , 1944 Arrears of Overtime of Excise Personnel 1.08 2006-07 , 2007-08 & 2008-09 High Court ,Allahabad
13 Central Excise Act , 1944 License Fee Payable 0.48 2007-08 A.E.C. (U.P.)
14 Central Excise Act , 1944 & Central Excise Rules , 2002 Demand of reversal of Cenvat Credit on Steel / Welding Electrode 2.65 2005-2006 to 2008-2009 and 2011-2012 Cestat, Allahabad.

viii. As represented by the Management, there were no transactions which were previously not recorded in the books of account that 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 explanation given to us, and based on the audit procedures performed by us, the company has defaulted in the repayment of loans or borrowings to banks and lenders. Details of which are as follows.-

Nature of borrowing including debt securities Name of lender Amount not paid on due date (Rs. in Lakhs) Whether principal or interest No. of days delay or unpaid Remarks, if any Paid on Due date
Term Loan Govt of India (Ministry of Consumer Affairs, Food and Public Distribution) 2,862.93 Principal Unpaid Default of principal from 31-3-2015 to 30-09-2019
Term Loan Govt of India (Ministry of Consumer Affairs, Food and Public Distribution) 3,330.70. Interest Unpaid Default of interest from 31-3-2015 to 31-3-2024
Term Loan Govt of India (Ministry of Consumer Affairs, Food and Public Distribution) 453.89 Principal Unpaid Default of principal from 03-08-2018 to 03-08- 2022
Term Loan Govt of India (Ministry of Consumer Affairs, Food and Public Distribution) 356.41 Interest Unpaid Default of interest from 03-8-2015 to 03-08-2024
Term Loan Uttar Pradesh Co-operative Bank Ltd 386.12 Principal 943 31-08- 2021
Term Loan Uttar Pradesh Co-operative Bank Ltd 787.00 Principal 762 28-02- 2022
Term Loan Uttar Pradesh Co-operative Bank Ltd 944.50 Principal 578 31-08- 2022
Term Loan Uttar Pradesh Co-operative Bank Ltd 944.50 Principal 397 28-02- 2023
Term Loan Uttar Pradesh Co-operative Bank Ltd 888.86 Interest Unpaid 31-03- 2024
Term Loan Uttar Pradesh Co-operative Bank Ltd 38.10 Interest 578 28-02- 2023
Term Loan Uttar Pradesh Co-operative Bank Ltd 177.00 Interest 397 28-02- 2023
Term Loan Uttar Pradesh Co-operative Bank Ltd 486.25 Interest Unpaid Interest for the period 1-2-2022 till 31-3-2024
Term Loan Uttar Pradesh Co-operative Bank Ltd 50.00 Interest 575 28-03- 2024 31-08- 2022

(b) The Company has not been declared wilful defaulter by any bank or financial institution or any lender.

(c) According to the information and explanations given to us and based on the audit procedures performed by us, term loans were applied for the purpose for which the loans were obtained.

(d) On an overall examination of the Financial Statements of the Company, funds raised on short-term basis have not been used during the year for long-term purposes by the Company.

(e) The Company does not have any subsidiary, joint venture or associates. Hence, reporting under clause (ix) (e) and (f) of paragraph 3 of the Order is not applicable.

x. (a) The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) during the year and hence, reporting under clause (x)(a) of paragraph 3 of the Order is not applicable.

(b) During the year, the Company has not made any preferential allotment or private placement of shares or convertible debentures (fully or partly or optionally) and hence, reporting under clause (x)(b) of paragraph 3 of the Order is not applicable. xi. (a) To the best of our knowledge and according to the information and explanations provided to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the year. Hence, reporting under clause (xi)(a) of paragraph 3 of the Order is not applicable.

(b) No report under sub-section (12) of section 143 of the Companies Act is required to be filed in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government, during the year and upto the date of this report.

(c) As represented by the management, there are no whistle blower complaints received by the Company during the year. xii. The Company is not a Nidhi Company. Hence, reporting under clause (xii)(a), (b) and (c) of paragraph 3 of the Order is not applicable.

xiii. In our opinion, the Company is in compliance with Section 177 and 188 of the Companies Act, 2013 with respect to applicable transactions with the related parties and the details of related party transactions have been disclosed in the financial statements as required by the applicable accounting standards.

xiv. (a) In our opinion the Company has an adequate internal audit system commensurate with the size and the nature of its business.

(b) We have considered, the internal audit reports for the period under audit, issued to the Company during the year and till date, in determining the nature, timing and extent of our audit procedures.

xv. In our opinion during the year the Company has not entered into any non-cash transactions with its Directors or persons connected with its directors as per the provisions of section 192 of the Companies Act, 2013. Hence, reporting under clause (xv) of paragraph 3 of the Order is not applicable to the Company.

xvi. (a) The provisions of section 45-IA of the Reserve Bank of India Act, 1934 (2 of 1934) are not applicable to the Company.

Accordingly, the requirement to report on clause (xvi)(a) of the Order is not applicable to the Company.

(b) The Company has not engaged in any Non-Banking Financial or Housing Finance activities. Accordingly, the requirement to report on clause 3(xvi)(b) of the Order is not applicable to the Company.

(c) The Company is not a Core Investment Company as defined in the regulations made by Reserve Bank of India. Accordingly, the requirement to report on clause 3(xvi)(c) of the Order is not applicable to the Company.

(d) There is no Core Investment Company as a part of the Group, hence, the requirement to report on clause 3(xvi)(d) of the Order is not applicable to the Company.

xvii. The Company has not incurred cash losses during the financial year but has incurred cash losses Rs. 2,519.34 .78 lakhs during the immediately preceding financial year.

xviii. There has been no resignation of the statutory auditor during the year. Hence, reporting under clause (xviii) of paragraph 3 of the Order is not applicable.

xix. On the basis of the financial ratios Refer Note no. 49, 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 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 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. Based on the verification of the details provided, the criteria specified under section 135 of the Act is not fulfilled and hence the requirement of spending on Corporate Social Responsibility is not applicable to the Company. Accordingly, reporting under clause (xx)(a) and (b) of paragraph 3 of the Order is not applicable

For V. C. Shah & Co.

Chartered Accountants

ICAI Firm Registration No.109818W

Viral J. Shah

Partner

Membership No.: 110120

UDIN: 24110120BKFQQL1426

Place: Mumbai

Date: May 22, 2024

ANNEXURE "B" TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 2(f) under ‘Report on Other Legal and Regulatory Requirements section of our report of even date to the Members of KESAR ENTERPRISES LIMITED on the Ind AS financial statements for the year ended March 31, 2024) Report on the Internal Financial Controls Over Financial Reporting 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 KESAR ENTERPRISES LIMITED (the "Company") as of March 31, 2024 in conjunction with our audit of the Ind AS financial statements of the Company for the year ended on that date.

Opinion

In our opinion, to the best of our information and according to the explanations given to us, 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, 2024, based on the criteria for internal financial control over financial reporting 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 ICAI.

Managements Responsibility for Internal Financial Controls

The Management of the Company 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 (the "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 over financial reporting of the Company 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") issued by the ICAI and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. 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 financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained, is sufficient and appropriate to provide a basis for our audit opinion on the Companys internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A companys internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial control over financial reporting includes those policies and procedures that (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.

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.

For V. C. Shah & Co.

Chartered Accountants

ICAI Firm Registration No.109818W

Viral J. Shah

Partner

Membership No.: 110120

UDIN: 24110120BKFQQL1426

Place: Mumbai

Date: May 22, 2024

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