Report on the Audit of the Standalone Financial Statements
To the Members of Sat Industries Limited
Opinion
We have audited the standalone financial statements of Sat Industries Limited
("the Company"), which comprise the balance sheet as at 31st March,
2023 and the statement of Profit and Loss, statement of changes in equity and statement of
cash flows for the year then ended, and notes to the financial statements, including a
summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations
given to us, the aforesaid standalone 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 31st March, 2023 the profit and
total comprehensive income, changes in equity and its cash flows for the year ended on
that date.
Basis for Opinion
We conducted our audit 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
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.
Other Information
The Companys Board of Directors is responsible for the other information. The other
information comprises the information included in the Integrated Report, Boards Report
along with its Annexures and Financial Highlights included in the Companys Annual Report
but does not include the financial statements and our auditors report thereon.
Our opinion on the standalone 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 standalone 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 in the audit or otherwise appears to be materially misstated. If, based on the
work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact.
We have nothing to report in this regard.
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.
On the facts and circumstances of the Company and the audit, we determine that there
are no key Audit matters to communicate.
Managements Responsibility for the Standalone 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 of
these standalone financial statements that give a true and fair view of the financial
position, financial performance, changes in equity and cash flows of the Company in
accordance with 30 the accounting principles generally accepted in India, including the
accounting Standards specified under section 133 of the Act. This responsibility also
includes maintenance of adequate accounting records in accordance with the provisions of
the Act for safeguarding of the assets of the Company and for preventing and detecting
frauds and other irregularities; selection and application of appropriate accounting
policies; making judgments and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls, that were
operating effectively for ensuring the accuracy and completeness of the accounting
records, relevant to the preparation and presentation of the financial statement 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 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:
• Iden tify and assess the risks of material misstatement financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those
risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for
our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to
design audit procedures that are appropriate in the circumstances. Under section 143(3)(i)
of the 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.
• E valuate the appropriateness of accounting policies and the reasonableness of
accounting estimates and related disclosures made by management.
• C onclude on the appropriateness of managements 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.
• E valuate the overall presentation, structure and 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 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 of the Requirements
1. As required by the Companies (Auditors Report) 2022 ("the Order"), issued
by the Central Government of India in terms of sub-section(11) of section 143 of the
Companies Act, 2013, we give in the Annexure-A a statement on the matters 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) T he Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement
dealt with by this Report are in agreement with the books of account. of
(d) In our opinion, the aforesaid standalone financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the directors as on 31st
March, 2023 taken on record by the Board of Directors, none of the directors is
disqualified as on 31st March, 2023 from being appointed as a director in terms
of Section 164(02) of the Act.
(f) With respect to the other matters to be included in the Auditors Report in
accordance with the requirements of section 197(16) of the Act, as amended: In our opinion
and to the best of our information and according to the explanations given to us, the
remuneration paid by the Company to its directors during the year is in accordance with
the provisions of section 197 of the Act.
(g) W ith 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.
(h) W ith respect to the other matters to be included 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) T he does not have any pending litigations which would impact its financial
position except disclosed in note 33(a) to the accounts.
(ii) T he Company did not have any long-contracts including derivative contracts for
which there were any material foreseeable losses. (iii) T here 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,
other than as disclosed in the notes to the accounts, no funds have been advanced or
loaned or invested (either from borrowed funds or share premium or any other sources or
kind of funds) by the Company to or in any other person(s) or entity(ies), including
foreign entities ("Intermediaries"), with the understanding, whether recorded in
writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or
invest in other persons or entities identified in any manner whatsoever by or on behalf of
the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the
like on behalf of the Ultimate Beneficiaries;
(b) T he management has represented that, to the best of its knowledge and belief,
other than as disclosed in the notes to the accounts, 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; and (c) B ased on such audit procedures that auditor
has considered reasonable and appropriate in the circumstances, nothing has come to their
notice that has caused them to believe that the representations under sub-clause(i) and
(ii) contain any material misstatement.
(v) T he dividend declared and/or paid during the year by the Company is in compliance
with Section 123 of the Act.
For AJAY PALIWAL & Co.
Chartered Accountants Firms Registration N0.: 12345C
Ajay Paliwal Proprietor M No.: 403290
UDIN: 23403290BGXWBY6917
Place of signature: Mumbai
Date: 25th May, 2023
ANNEXURE - A
To The Independent Auditors Report
(Referred to in paragraph 8 under ‘Report on Other Legal and Regulatory
Requirements section of our report of even date)
(i) (a) (A) The Company has maintained proper records showing full particulars,
including quantitative details and the situation of property, plant and equipment.
(B) T he Company has maintained proper showing full particulars of Intangible Assets.
(b) These property, plant and equipment were 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 explanations given to us, no material discrepancies were
noticed on such verification.
(c) The Company has no immovable properties. (d) T he Company has not revalued its
Property, Plant Equipment (including Right of Use assets) or intangible assets or both
during the year. Consequently, the question of our commenting on whether the revaluation
is based on the valuation by a Registered Valuer; specifying the amount of change, if
change is 10% or more in the aggregate of the net carrying value of each class of
Property, Plant and Equipment or intangible assets does not arise.
(e) Based on the information and explanations furnished us, 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, and
therefore the question of our commenting on whether the Company has appropriately
disclosed the details in its financial statement does not arise.
(ii) (a) The physical verification of inventory (excluding stocks with third parties)
have been conducted at reasonable intervals by the Management during the year and, in our
opinion, the coverage and procedure of such verification by the Management is appropriate.
In respect of inventory lying with third parties, these have been substantially confirmed
by them. The discrepancies noticed on physical verification of inventory as compared and
to book records were not 10% or more in aggregate for each class of inventory.
(b) During the year the Company has not been sanctioned working capital limits in
excess of five crore rupees, in aggregate, from banks or financial institutions on the
basis of security of current assets and accordingly, the question of our commenting on
whether the quarterly returns or statements filed by the Company with such banks or
financial institutions are in agreement with the books of account of the Company does not
arise.
(iii) During the year the Company has made investments in, provided guarantee and
granted unsecured loans to companies, firms, Limited Liability Partnerships or other
parties but has not provided security to any other entity,
(a) During the year the Company has provided loans or provided advances in loans and
stood guarantee but has not provided security to any other entity:
(A) the aggregate amount during the year, and balance outstanding at the balance sheet
date with respect to such loans advances and guarantees to subsidiaries, joint ventures
and associates;
( in lakhs)
| Loan to |
Aggregate amount during the year |
Amount outstanding as on 31st March, 2023 |
| Subsidiaries |
650.00 |
NIL |
| Joint venture |
NIL |
NIL |
| Associates |
NIL |
NIL |
( in lakhs)
| Guarantee to |
Aggregate amount during the year |
Amount outstanding as on 31st March, 2023 |
| Subsidiaries |
9160 |
9160 |
| Joint venture |
NIL |
NIL |
| Associates |
NIL |
NIL |
(B) the aggregate amount during the year, and balance outstanding at the balance sheet
date with respect to such loans or advances, but has not stood guarantees or provided
security, to parties other than subsidiaries, joint ventures and associates; ( in lakhs)
|
Aggregate amount during the year |
Amount outstanding as on 31st March, 2023 |
| Loan to others |
682.20 |
5498.45 |
(b) T he investments made, guarantee provided, given and the terms and conditions of
the grant of all loans and advances in the nature of loans, except wherever interest free
loans have been granted, are not prejudicial to the Companys interest.
(c) In r espect of loans and advances in the nature of no schedule of repayment of
principal and payment of interest has been stipulated.
(d) In r espect of aforesaid loans, there is no overdue for more than ninety days.
(e) During the year no loan or advance in the nature of loan granted which has fallen
due during the year, has been renewed or extended or fresh loans granted to settle the
overdue of existing loans given to the same parties.
(f) During the year the Company has granted loans or advances in the nature of loans
either repayable on demand or without specifying any terms or period of repayment, the
aggregate amount, percentage thereof to the total loans granted, aggregate amount of loans
granted to Promoters, related parties as defined in clause(76) of section 2 of the
Companies Act, 2013 are as under: ( in lakhs)
| Aggregate amount |
% of the total loans granted |
Aggregate amount of loans granted to Promoters, related parties as
defined in clause (76) of section 2 of the Companies Act, 2013 |
| 1332.30 |
48.78% |
650.00 |
(iv) In our opinion and according to the information and explanations given to us the
Company has complied with the provisions of section 185 and 186 of the Companies Act,
2013, in respect of loans granted, investments made, guarantees, and security provided.
(v) A ccording to the information and explanations given to us, the Company has not
accepted any deposit during the year and accordingly the question of complying with
Sections 73 and 76 of the Companies Act, 2013 does not arise. In respect of unclaimed
deposits, the Company has complied with the provisions of Sections 74 and 75 or any other
relevant provisions of the Companies Act, 2013. According to the information and
explanations given to us, no Order has been passed by the Company Law Board or the
National Company Law Tribunal or the Reserve Bank of India or any Court or any other
Tribunal on the Company.
(vi) T he maintenance of cost records has not been prescribed by the Central Government
under Section 148(1) of the Companies Act, 2013 in respect of products of the Company.
(vii) (a) According to the information and explanations given to us and the records of
the Company examined by us, in our opinion, 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 with the appropriate authorities.
(b) A ccording to the information and explanations given to us and the records of the
Company examined by us, in our opinion, details of statutory dues referred to in
sub-clause(a) have not been deposited as on 31st March, 2023 on account of
disputes are given below:
| Name of statutes |
Nature of dues |
Amount ( in lakhs) |
The period to which the amount relates |
Forum where dispute is pending |
| CGST ACT, 2017 |
GST demand (net |
226.20 |
2017-18 |
Under Appeal |
|
of deposit) |
|
|
|
(viii) A ccording to the information and explanations given us and the records of the
Company examined by us, there are no transactions 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), that has not been recorded in the books of account.
(ix) (a) According to the information and explanations given to us and the records of
the Company examined by us, the Company has not defaulted on repayment of loans or other
borrowings or in the payment of interest thereon to any lender during the year.
(b) According to the information and explanations to us and on the basis of our audit
procedures, we report that the Company has not been declared Wilful Defaulter by any bank
or financial institution or other lender.
(c) According to the information and explanations to us and the records of the Company
examined by us, in our opinion, term loans were applied for the purpose for which the
loans were obtained.
(d) According to the information and explanations to us, and the procedure performed by
us, and on an overall examination of the financial statements of the Company, we report
that no funds raised on short term basis have been utilised for long term purposes by the
Company.
(e) According to the information and given to us, and the procedure performed by us, we
report that the Company has taken no funds from any entity or person on account of or meet
the obligations of its subsidiaries, associates or joint venture. Accordingly, reporting
under clause 3(ix) of the Order is not applicable
(f) According to the information and given to us, and the procedure performed by us, we
report that the Company has not raised loans during the year on the pledge of securities
held in its subsidiaries, joint ventures or associate companies during the year.
Accordingly, reporting under clause 3(ix)(f) of the Order is not applicable. (x) (a) The
Company has raised no money by way of an initial public offer or further public offer
(including debt instruments) during the year. Accordingly, reporting under clause 3(x)(a)
of the Order is not applicable.
(b) The Company has not made any allotment or private placement of shares or
convertible debentures (fully, partially, or optionally convertible) during the year.
Accordingly, reporting under clause 3(x)(b) of the Order is not applicable to the Company.
(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 explanation given to us, we have neither come across any
instance of material fraud by the Company to or on the Company, noticed or reported during
the year, nor have we been informed of any such case by the Management.
(b) 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 explanation given to us, a report under section 143(12)
of the Act, in Form ADT-4, as prescribed under rule 13 of Companies (Audit and Auditors)
Rules, 2014, was not required to be filed with the Central Government. Accordingly,
reporting under given clause 3(xi)(b) of the Order is not applicable to the Company.
(c) During the course of our examination of the books and records of the Company,
carried out in accordance with the generally accepted auditing given practices in India,
and according to the information and explanation given to us, the Company has received no
whistle -blower complaints during the year. Accordingly, reporting under clause 3(xi)
(c)of the Order is not applicable to the Company. given (xii) (a) As the Company is not a
Nidhi Company, therefore, the clauses (xii)(a), (b) and (c) of the Order are not
applicable to the Company.
(xiii) All tr ansactions with the related parties are in with sections 177 and 188 of
Companies Act and the details have been disclosed in the financial statements, etc., as
required by the Indian Accounting Standard 24 "Related Party Disclosures"
specified under section 133 of the Act.
(xiv) (a) In our opinion and According to the information and explanation given to us,
the Company has an internal audit system commensurate with the size and nature of its
business.
(b) T he reports of the Internal Auditors for the under audit were considered by us.
(xv) T he Company has not entered into non-cash transactions with directors or persons
connected with him. Accordingly, the reporting under clause 3(xv) of the Order is not
applicable to the Company.
(xvi) (a) In our opinion and according to the information and explanation 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) T he Company has not conducted any Non-Financial or Housing Finance activities
without a valid Certificate of Registration (CoR) from the Reserve Bank of India as per
the Reserve Bank of India Act, 1934; Accordingly, the reporting under clause 3(xvi) (b) of
the Order is not applicable to the Company.
(c) T he Company is not a Core Investment
(CIC) as defined in the regulations made by the Reserve Bank of India, Accordingly, the
reporting under clause 3(xv)(c) of the Order is not applicable to the Company.
(d) Based on the information and explanations by the Management of the Company, the
Group does not have any CIC, which is part of the Group. We have not, however, separately
evaluated whether the information provided by the management is accurate and complete.
Accordingly, the reporting under clause 3(xv)(d) of the Order is not applicable to the
Company.
(xvii) The Company has not incurred cash losses in the year and in the immediately
preceding financial year.
(xviii) There has been no resignation of the statutory during the year and accordingly,
the reporting under clause 3(xviii) of the Order is not applicable to the Company.
(xix) According to the information and explanation given and on the basis of the
financial ratios (also refer note 56 to the financial statements), 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
assumption, nothing has come to our attention, which causes us to believe that any
material uncertainty exists as on the date of the audit report that Company is 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 our reporting
is based on the facts up to the date of the audit report and we neither give any guarantee
nor any assurance that all liabilities falling due within a period of one year from the
Balance sheet date will get discharged by the Company as and when they fall due.
(xx) (a) In respect of other than ongoing projects, there are no unspent amounts that
are required to be transferred to a fund specified in Schedule VII of the Companies Act
(the Act), in compliance with second proviso to sub section 5 of section 135 of the Act.
us This matter has been disclosed in note 42 to the financial statements.
(b) T here are no unspent amounts in respect of projects, that are required to be
transferred to a special account in compliance of provision of sub section (6) of section
135 of Companies Act.
(xxi) T he reporting under clause 3(xxi) of the Order is applicable in respect of audit
of standalone financial statements. Accordingly, no comment in respect of the said clause
has been included in this report.
For AJAY PALIWAL & Co.
Chartered Accountants Firms Registration N0.: 12345C
Ajay Paliwal Proprietor M No.: 403290
UDIN: 23403290BGXWBY6917
Place of signature: Mumbai
Date: 25th May, 2023
ANNEXURE - B
Independent Auditors Report on the Internal Financial Controls with reference to
financial statement 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 SAT
INDUSTRIES LIMITED ("the Company") as of 31st March, 2023 in
conjunction with our audit of the standalone Ind AS 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") issued by the Institute of Chartered Accountants of India
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 (Referred to in paragraph 7(g) under
‘Report on Other Legal and Regulatory Requirements of our report of even date) 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, 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 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 Institute of Chartered
Accountants of India.
For AJAY PALIWAL & Co.
Chartered Accountants Firms Registration N0.: 12345C
Ajay Paliwal Proprietor M No.: 403290
UDIN: 23403290BGXWBY6917
Place of signature: Mumbai
Date: 25th May, 2023
+91-9892691696
