To The Members of SHAH FOODS LIMITED
Report on the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements of SHAH FOODS
LIMITED ("the Company"), which comprise the Balance Sheet as at March 31,
2023, and 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 then ended and
a summary of the 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 March 31, 2023 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 standalone financial statements in accordance with the
standard on auditing specified u/s. 143(10) of the act (SAs). Our responsibilities under
those standards are further described in the auditors responsibilities for the audit of
standalone financial statements section of our report. We are independent of the company
in accordance with the code of ethics issued by ICAI together with Independence
Requirements that are relevant to our audit of the standalone financial statements under
the provisions of the Act and the rules made there under, 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 we have obtained is sufficient and appropriate to
provide the basis for our audit opinion on the standalone financial statements.
Emphasis of Matter
We further draw attention to note no 2.1, 2.12 and 2.14 to the notes to financial
statements regarding sale of the Plant and Machineries and Factory building and land used
for the business. The said assets are classified as non-current assets held for sale. Even
though the company could not able to sell the factory land during the year due to pandemic
situation, the intention of the management is still same. Our opinion is not modified in
respect of this matter.
Key Audit Matters
Key Audit Matters are those matters that, in our professional judgement, were of most
significance in our audit of the standalone financial statements of the current period.
There is no key audit matter with respect to standalone financial statements to be
communicated in our report.
Information other than Standalone Financial Statements and Auditors Report thereon
The companys Board of Directors are responsible for the preparation of the other
information. The other information comprises the information included in the management
discussion and analysis, boards report including annexure to boards report, Business
responsibility report, corporate governance and Shareholders information but does not
include the standalone financial statement and our auditors report thereon.
Our opinion on the standalone financial statements does not cover the 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 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 material misstatement of this other
information, we are required to report the fact. We have nothing to report in this regard.
Managements Responsibility for the Standalone Financial Statements
The Companys Board of Directors is responsible for the matters stated in section
134(5) of the Act with respect to the preparation of these financial statements that give
a true and fair view of the financial position, financial performance including other
comprehensive income, cash flows and changes in equity of the Company in accordance with
the accounting principles generally accepted in India, including the Indian Accounting
Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian
Accounting Standards) Rules, 2015, as amended including the Companies (Indian Accounting
Standards) Amendment Rules, 2019. 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 the 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 charged with governance are also responsible for overseeing the Companys
financial reporting process.
Auditors Responsibility
Our responsibility is to express an opinion on these standalone financial statements
based on our audit. In conducting our audit, we have taken into account the provisions of
the Act, the accounting and auditing standards and matters which are required to be
included in the audit report under the provisions of the Act and the Rules made there
under and the Order issued under section 143(11) of the Act.
As part of an audit in accordance with SAs, we exercise professional judgement and
maintain professional Scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the standalone financial
statements, whether due to fraud or error, design and perform audit procedures responsive
to those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances. Under Section 143(3)(i) of the
Act, we are also responsible for expressing our opinion on whether the bank has adequate
internal financial controls with reference to financial statements 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 in the standalone financial statements made
by the Management and Board of Directors.
Conclude on the appropriateness of the Management 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 company?s ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in our Auditor?s Report to
the related disclosures in the standalone financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our Auditor?s Report. However, future events or conditions may
cause a Company to cease to continue as a going concern.
We conducted our audit of the standalone financial statements in accordance with the
Standards on Auditing specified under Section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the standalone financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
the disclosures in the standalone financial statements. The procedures selected depend on
the auditors judgment, including the assessment of the risks of material misstatement of
the standalone financial statements, whether due to fraud or error. In making those risk
assessments, the audit or considers internal financial control relevant to the Companys
preparation of the standalone financial statements that give a true and fair view in order
to design audit procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of the accounting policies used and the
reasonableness of the accounting estimates made by the Companys Directors, as well as
evaluating the overall presentation of the standalone financial statements.
We believe that the audit evidence obtained by us is sufficient and appropriate to
provide a basis for our audit opinion on the standalone financial statements.
Report on Other Legal and Regulatory Requirements
1. 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 Flow dealt with by this
Report are in agreement with the books of account.
d) In our opinion, the afore said standalone financial statements comply with the
Indian Accounting Standards prescribed 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 of the
Company as on March 31, 2023 taken on record by the Board of Directors, none of the
directors is disqualified as on March 31, 2023 from being appointed as a director
in terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial
reporting of the Company and the operating effectiveness of such controls, refer to
our separate Report in "Annexure A". 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 matters to be included in the Auditors Report in
accordance with the requirements of Section 197(16) of the Act, as amend:
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.
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 standalone financial statements.
ii. The Company has made provision, as required under the applicable law or accounting
standards, for material foreseeable losses, if any, on long-term contracts including
derivative contracts.
iii. There has been no delay in transferring amounts, required to be transferred, to
the Investor Education and Protection Fund by the Company.
iv. (a) The Management has represented that, to the best of its knowledge and belief,
no funds (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. No dividend is proposed and hence
reporting under this clause is not required.
2. As required by the Companies (Auditors Report) Order, 2020 ("the
Order") issued by the Central Government in terms of Section 143(11) of the Act,
we give in "Annexure B" a statement on the matters specified in
paragraphs 3 and 4 of the Order.
Suresh R Shah & Associates Chartered Accountants FRN:110691W
Place: Ahmedabad |
Mrugen K Shah |
Date: 12.05.2023 |
(Partner) |
|
M. No.: 117412 |
|
UDIN:23117412BGUDUW4016 |
ANNEXURE "A" TO THE INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 1(f) under ‘Report on Other Legal and Regulatory
Requirements section of our report to the Members of SHAH FOODS LIMITED of even
date)
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 SHAH
FOODS LIMITED ("the Company") as of March 31, 2023 in conjunction
with our audit of the standalone financial statements of the Company for the year ended on
that date.
Managements Responsibility for Internal Financial Controls
The Board of Directors 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. 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, 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 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 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
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.
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, 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, 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.
Suresh R Shah & Associates Chartered Accountants FRN:110691W
Place: Ahmedabad |
Mrugen K Shah |
Date: 12.05.2023 |
(Partner) |
|
M. No.: 117412 |
|
UDIN: 23117412BGUDUW4016 |
ANNEXURE ‘B TO THE INDEPENDENT AUDITORS REPORT (Referred to in paragraph 2 under
‘Report on Other Legal and Regulatory
Requirements section of our report to the Members of SHAH FOODS LIMITED of even date) i.
In respect of the Companys Property, Plant and Equipment and Intangible Assets:
(a) (A) The Company has maintained proper records showing full particulars, including
quantitative details and situation of Property, and Plant and Equipment.
(B) The Company does not have any intangible assets and hence records showing full
particulars of intangible assets is not applicable.
(b) The Company has a program of verification to cover all the items of Property and
Plant and Equipment in a phased manner which, in our opinion, is reasonable having regard
to the size of the Company and the nature of its assets. Pursuant to the program, certain
Property and Plant and Equipment were physically verified by the management during the
year. According to the information and explanations given to us, no material discrepancies
were noticed on such verification.
(c) According to the information and explanations given to us and on the basis of our
examination of the records of the Company, the title deeds of immovable properties (other
than immovable properties where the Company is the lessee and the leases agreements are
duly executed in favour of the lessee) disclosed in the standalone financial statements
are held in the name of the Company.
(d) According to the information and explanations given to us and on the basis of our
examination of the records of the Company, the Company has not revalued its Property,
Plant and Equipment (including Right of Use assets) or intangible assets or both during
the year.
(e) According to information and explanations given to us and on the basis of our
examination of the records of the Company, there are no proceedings initiated or pending
against the Company for holding any benami property under the Prohibition of Benami
Property Transactions Act, 1988 and rules made there under.
ii. (a) The company does not have any inventory and hence reporting under the clause
3(ii)(a) of the order is not applicable.
(b) The Company has not been sanctioned working capital limits in excess of Rs. 5
crores, 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
3(ii)(b) of the Order is not applicable.
iii. The Company has not made investments in companies, firms, Limited Liability
Partnerships, and granted unsecured loans to other parties, during the year, in respect of
which:
(a) According to information and explanations given to us and on the basis of our
examination of the records of the Company, The Company has not provided any loans or
advances in the nature of loans or stood guarantee, or provided security to any other
entity during the year, and hence reporting under clause 3(iii)(a) of the Order is not
applicable.
(b) According to information and explanations given to us and on the basis of our
examination of the records of the Company, in our opinion, no investments are made and
hence reporting under clause 3(iii)(b) of the Order is not applicable.
(c) According to information and explanations given to us and on the basis of our
examination of the records of the Company, no loans have been granted by the Company.
Hence, reporting under clause 3(iii)(c) of the Order is not applicable.
(d) According to information and explanations given to us and on the basis of our
examination of the records of the Company, no loans have been granted by the Company.
Hence, reporting under clause 3(iii)(d) of the Order is not applicable.
(e) According to information and explanations given to us and on the basis of our
examination of the records of the Company, no loans have been renewed by the Company
during the year. Hence, reporting under clause 3(iii)(e) of the Order is not applicable.
(f) The Company has not granted any loans or advances in the nature of loans either
repayable on demand or without specifying any terms or period of repayment during the
year. Hence, reporting under clause 3(iii)(f) of the Order is not applicable. The Company
has not provided any guarantee or security or granted any advances in the nature of loans,
secured or unsecured, to companies, firms, Limited Liability Partnerships or any other
parties.
iv. In our opinion and according to the information and explanations given to us, the
Company has complied with the provisions of Sections 185 and 186 of the Act in respect of
grant of loans, making investments and providing guarantees and securities, as applicable.
v. The Company has not accepted any deposit or amounts which are deemed to be deposits.
Hence, reporting under clause 3(v) of the Order is not applicable.
vi. The maintenance of cost records has not been specified by the Central Government
under sub-section (1) of section 148 of the Companies Act, 2013 for the business
activities carried out by the Company. Hence, reporting under clause (vi) of the Order is
not applicable to the Company.
vii. According to the information and explanations given to us, in respect of statutory
dues:
(a) The Company has generally been regular in depositing undisputed statutory dues,
including Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax,
Goods and Service Tax, Value Added Tax, Customs Duty, Excise Duty, Cess and other material
statutory dues applicable to it with the appropriate authorities.
(b) There were no undisputed amounts payable in respect of Provident Fund, Employees
State Insurance, Income Tax, Sales Tax, Service Tax, Value Added Tax, Goods and Service
Tax, Customs Duty, Excise Duty, Cess and other material statutory dues in arrears as at March
31, 2023 for a period of more than six months from the date they became payable.
(c) According to the information and explanations given to us dues that have not been
paid by the company on account of dispute are as follows:
Particulars |
Financial Year |
Authority with which case is pending |
Amount |
| Service Tax |
2012-13 |
Tribunal |
Rs.5,69,300/- |
viii. There were no transactions relating to previously unrecorded income that have
been surrendered or disclosed as income during the year in the tax assessments under the
Income Tax Act, 1961 (43 of 1961).
ix. (a) The Company has not taken loans or other borrowings from any financial
institution and hence reporting under clause 3(ix)(a) of the Order is not applicable.
(b) The Company has not been declared willful defaulter by any bank or financial
institution or government or any government authority.
(c) The Company has not taken term loan during the year and hence, reporting under
clause 3(ix)(c) of the Order is not applicable.
(d) On an overall examination of the financial statements of the Company, 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
has not taken any funds from any entity or person on account of or to meet the obligations
of its subsidiaries.
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
3(x)(a) 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 3(x)(b) of the Order is not applicable.
xi. (a) No fraud by the Company and no material fraud on the Company has been noticed
or reported during the year.
(b) No report under sub-section (12) of section 143 of the Companies Act has been 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) No complaints received by the Company from the whistle blower complaints during the
year (and upto the date of this report).
xii. The Company is not a Nidhi Company and hence reporting under clause 3(xii) of the
Order is not applicable to the Company.
xiii. In our opinion and according to the information and explanations given to us, the
Company is in compliance with Section 177 and 188 of the Companies Act, 2013 where
applicable, for all transactions with the related parties and the details of related party
transactions have been disclosed in the standalone 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 not considered, the internal audit reports for the year under audit as the
same was not provided to us.
xv. In our opinion and according to the information and explanations given to us,
during the year the Company has not entered into any non-cash transactions with its
Directors or persons connected to its directors and hence provisions of section 192 of the
Companies Act, 2013 are not applicable to the Company.
xvi. (a) In our opinion, the Company is not required to be registered under section
45-IA of the Reserve Bank of India Act, 1934. Hence, reporting under clause 3(xvi)(a), (b)
and (c) of the Order is not applicable.
(b) In our opinion, there is no core investment company within the Group (as defined in
the Core Investment Companies (Reserve Bank) Directions, 2016) and accordingly reporting
under clause 3(xvi)(d) of the Order is not applicable.
xvii. The Company has incurred cash losses during the financial year covered by our
audit and the immediately preceding financial year. The cash loss during the year is Rs.
20.60 lacs
xviii. There has been no resignation of the statutory auditors of the Company during
the 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 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.
Suresh R Shah & Associates Chartered Accountants FRN:110691W
Place: Ahmedabad |
Mrugen K Shah |
Date: 12.05.2023 |
(Partner) |
|
M. No.: 117412 |
|
UDIN: 23117412BGUDUW4016 |
+91-9892691696
