To,
The Members of Mercury Laboratories Limited
Report on the Financial Statements
Opinion
We have audited the accompanying Financial Statements of MERCURY LABORATORIES
LIMITED ("the Company") which comprise the Balance sheet as at 31 March,
2023, the Statement of Pro t & Loss (Including the Statement of Other
Comprehensive Income), the Statement of Cash Flow and Statement of Changes in Equity for
the year then ended, and notes to the financial statements, including a summary of
significant accounting policies and other explanatory information (hereinafter referred to
as "Financial Statements")
In our opinion and to the best of our information and according to the explanations
given to us, 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 a airs of the Company as at March 31, 2023, and the 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 in accordance with the Standards on Auditing (SAs) 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
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
financial statements under the provisions of the Companies Act, 2013 and the Rules there
under, 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.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the financial statements of the current period. These matters
were addressed in the context of our audit of the financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
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 Management Discussion and Analysis,
Boards Report including Annexures to Boards Report, Corporate Governance, Shareholders
Information and Other Information included in the Companys Annual Report, but does not
include financial statements and our auditors reports 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 standalone 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.
Managements Responsibility for the Financial Statements
The Companys Board of Directors is responsible for the matters stated in Section
134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation
and presentation of these financial statements that give a true and fair view of the
financial position, financial 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, including the Accounting Standards specified under
Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Account) Rules,
2014.
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.
Those Board of Directors are also responsible for overseeing the Companys financial
reporting process.
Auditors Responsibility
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.
A further description of the auditors responsibilities for the audit of the financial
statements is located in Appendix A. This description forms part of our auditors report.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order, 2020 ("the Order")
issued by the Central Government in terms of section 143 (11) of the Companies Act, 2013,
we enclose in the Annexure-A, a statement on the matters specified in paragraph 3 & 4
of the said 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 purpose of our Audit;
b) In our opinion, proper books of accounts as required by the law have been kept by
the Company, so far as appears from our examination of the said books;
c) The Balance Sheet, Statement of Pro t & 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 accounts of the Company;
d) In our opinion, the aforesaid Financial Statements comply with the Ind AS specified
under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
e) On the basis of written representations received from the directors, as on 31 March,
2023, and taken on record by the Board of Directors, we report that none of the directors
is disqualified as on 31 March, 2023 from being appointed as a director of the Company in
terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial
reporting and the operating effectiveness of such controls; refer to our separate report
in Annexure B attached herewith.
g) With respect to the matter to be included in the Auditors Report u/s. 197(16) of the
Act, in our opinion and according to information and explanations given to us, the
remuneration paid by company to its directors is in accordance with the provisions of
Section 197 of the Act read with Schedule V in terms of requisite approvals obtained as
mandated therein and is not in excess of the limits specified therein.
h) With respect to the other matters to be included in our 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 details of pending litigations are as given in note 42 of notes forming part of
the financial statements.
(ii) There are no long-term contracts for which there were material foreseeable losses
for which provision is required
(iii) There has been no delay in transferring amounts required to be transferred to the
Investor 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 Bene ciaries") or provide any guarantee, security or the like
on behalf of the Ultimate Bene ciaries;
(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 Bene ciaries") or provide any guarantee, security or the like on
behalf of the Ultimate Bene ciaries;
(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 Dividend declared and paid during the year by the Company is in compliance with
Section 123 of the Act.
(vi) Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books
of account using accounting software which has a feature of recording audit trail (edit
log) facility is applicable with effect from April 1, 2023 to the Company and accordingly,
reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable
for the financial year ended March 31, 2023.
Appendix A to Independent Auditors Report
Further description of Auditors responsibilities for audit of financial statements
As part of an audit in accordance with SAs, we exercise professional judgment and
maintain professional skepticism throughout the audit.
We also:
O 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.
O Obtain an understanding of internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances. Under section 143(3)(I) of the
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.
O Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
O 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 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.
O 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 ndings, 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 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.
"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 for the year ended 31 March 2023 of
Mercury Laboratories Limited)
(I) (a) (A) The Company has maintained proper records of Property Plant &
Equipments purchases. However, as informed to us the Company is in the process of updating
its old records and Property Plant & Equipments Register showing full particulars
including quantitative details and the situation of Property Plant & Equipments.
(B) The Company has maintained proper records showing full particulars of the
Intangible Assets.
(b) The Company has a regular program of physical veri cation of its Property, Plant
and Equipment by which the Property, Plant and Equipment are veri ed in phased manner over
a period of time. In accordance with its program, certain Property, Plant and Equipment
were veri ed during the year and as informed to us, no material discrepancies were noticed
on such veri cation. In our opinion, the program of veri cation is reasonable having
regard to the size of the Company and the nature its Assets.
(c) According to the information and explanations given to us and on the basis of our
examination of the records of the Company, we report that the title deeds of immovable
properties (other than properties where the company is the lessee and the lease agreements
are duly executed in favour of the lessee) disclosed in the Financial Statements are held
in the name of the Company.
(d) The Company has not revalued its Property, Plant and Equipment or Intangible Assets
during the year.
(e) 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 physical veri cation of inventories has been conducted at reasonable
intervals by the management of the Company and in our opinion, and to the best of our
knowledge and belief, the coverage and procedure for such veri cation by the management is
appropriate. On the basis of our examination of the records of physical veri cation of
inventory, we are of the opinion that the no discrepancies of 10% or more in aggregate for
each class of inventory were noticed. The discrepancies noticed on veri cation between the
physical stocks and the book records were not material and have been properly dealt with
in the books of accounts.
(b) The Company has been obtained sanction of working capital limits in excess of Rs. 5
Crores, in aggregate, from banks or financial institutions on the basis of security of
current assets, at any point of time of the year. The quarterly returns / statements led
by the Company are in agreement with the books of accounts of the Company.
(iii) 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 during the
year under report. Consequently, no comments are necessary on Para (iii) (a) (b) (c) (d)
(e) & (f) of the Order
(iv) Since 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, the provisions of
sections 185 are not applicable and no compliance is required u/s 186.
(v) The Company has accepted deposits from members / directors and the same is in
compliance with the provisions of Sections 73 to 76 of the Companies Act 2013. No order
has been passed by the Company Law Tribunal or Reserve Bank of India or any court
or any tribunal.
(vi) We have broadly reviewed the cost records maintained by the company for its
products pursuant to the Companies (Cost Records and Audit) Rules, 2014 prescribed
by the Central Government for the maintenance of cost records under Section 148(1) of the
Companies Act, 2013 and we are of the opinion that prima facie the prescribed cost records
have been made and maintained. However, we have not made a detailed examination of these
records with a view to determine whether they are accurate or complete
(vii) (a) According to the records of the Company, the Company is regular in depositing
with appropriate authorities undisputed statutory dues including Provident Fund,
Employees State Insurance, Income Tax, Goods and Service Tax, Custom Duty, Cess and other
material statutory dues applicable to it to the appropriate authorities.
According to the information and explanations given to us, no undisputed amounts
payable in respect of Income Tax, Goods and Service Tax, Customs Duty, Cess and other
material statutory dues applicable to the Company were outstanding, as at 31 March, 2023
for a period of more than six months from the date they became payable.
(b) According to the records of the company, there are no dues of Provident Fund,
Employees State Insurance, Income Tax, Goods and Service Tax, Custom Duty, Cess and other
material statutory dues applicable to it which have not been deposited on account of any
dispute.
(vii) There are no transactions not recorded in the books of accounts that have been
surrendered or disclosed as income during the year in the tax assessments under the Income
Tax Act, 1961. Hence no further comments are required under Para 3(viii) of the Order.
(ix) (a) Based on our audit procedures and on the information and explanations given by
the management, we are of the opinion that the Company has not defaulted in repayment of
dues to any lender.
(b) The Company has not been declared Willful Defaulter by and bank or financial
institution or government or any government authority.
(c) The Company has not taken any term loan during the year. As such there were no
outstanding term loans at the beginning of the year except vehicle loan and hence,
reporting under clause (ix) (c) of the Order is not applicable.
(d) On overall examination of the financial statements of the Company the funds raised
on short term basis have, prima facie, not been used during the year for long-term
purposes by the Company.
(e) On an overall examination of the financial statements of the Company, the Company
does not own any subsidiaries, associates or joint ventures and hence, reporting under
clause (ix) (e) & (f) 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.
(b) The Company has not made any preferential allotment or private placement of shares
or convertible debentures (fully, partially or optionally convertible) during the year.
(xi) (a) There has been no fraud by the Company or any fraud on the Company that has
been noticed or reported during the year. (b) No report under Sub-section (12) of S. 143
of the Act has been led by the Auditors in Form ADT-4 as prescribed under Rule 12 of the
Companies (Audit and Auditors) Rule, 2014 with the Central Government. (c) As per the
information and explanation given to us, no whistle-blower complaints, were received by
the Company during the year.
(xii) The Company is not a "Nidhi" Company. Hence, Para (xii) of the Order is
not applicable.
(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 sections 177 and 188 of the Act where applicable and details of such
transactions have been disclosed in the financial statements as required by the applicable
accounting standards
(xiv) (a) The Company has an internal audit system commensurate with the size of the
Company and nature of its business.
(b) The Reports of the Internal Auditor for the period under Audit were
considered by the Statutory Auditors.
(xv) According to the information and explanations given to us and based on our
examination of the records of the Company, the Company has not entered into non-cash
transactions with directors or persons connected with them. Accordingly, Paragraph 3 (xv)
of the Order is not applicable.
(xvi) (a) As per information and explanations given to us, the Company is not required
to be registered under section 45-IA of the Reserve Bank of India Act, 1934 (2 of 1934).
(b) The Company has not conducted any Non-Banking Financial or Housing Finance
Activities during the year.
(c) The Company or any member Company of the Group is not a Core Investment Company
(CIC) as defined in the regulations made by the Reserve Bank of India. Hence, no comments
are required on Paragraph (xvi) (c) & (d) of the Order.
(xvii) The Company has not incurred any cash losses in the financial year and in the
immediately preceding financial year.
(xviii) The company has not incurred any cash losses during the financial year under
report or in immediately preceding financial year.
(xix) On the basis of the financial ratios, ageing and expected dates of realization of
financial assets and payment of financial liabilities, other information accompanying the
financial statements 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) There are no unspent amounts towards Corporate Social Responsibility (CSR) on
other than ongoing projects requiring a transfer to a Fund specified in Schedule VII of
the Companies Act 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 for the year.
(b) There are no ongoing projects. Accordingly, reporting under clause 3 (xx) (b) of
the Order is not applicable for the year.
(xxi) These being standalone financial statements, no comments are required under
Paragraph (xxi) of the Order since the same is related to Consolidate Financial
Statements.
"Annexure B" to the Independent Auditors Report
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 MERCURY
LABORATORIES LIMITED ("the Company"), as on 31st March, 2023 in conjunction with
our audit of the financial statements of the Company for the year ended on that date
Managements Responsibility for Internal Financial Controls
The Respective Board of Directors of the Company are 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
("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 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") issued by ICAI 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. 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 judgment, 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 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 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 have, 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 31st March 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 ICAI.
|
For Naresh & Co. |
|
Chartered Accountants |
|
(F.R.N. 106928W) |
| Place: Vadodara |
CA Abhijeet Dandekar |
| Date: May 05, 2023 |
Partner |
| UDIN: 23108377BGUFPQ4919 |
(M. R. N. 108377) |
+91-9892691696
