To
The members of SUPERIOR FINLEASE LIMITED
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements of
SUPERIOR FINLEASE LIMITED ("the Company"), which comprise the balance sheet as
at 31st March 2023, the statement of profit and loss and the 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 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 accounting principles generally accepted in India of
the state of affairs of the Company as at 31st March 2023, and the net profit(including
other 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 Act. 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 (ICAI) together with ethical requirements that are relevant to our audit of the
financial statements under the provisions of the Act and the rules thereunder, and we have
fulfilled our ethical responsibilities in accordance with these requirements and the Code
of Ethics. We believe that the audit evidences we have obtained are 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. We have determined the matters described hereunder to be key audit matters
to be communicated in our report.
| Key audit matters |
Auditors response |
| 1. Loans and advances: - |
Our audit procedure inter- alia includes the following: - |
| In current year, Indian Accounting Standards under Division
III of Schedule III of the Companies Act, 2013 have become applicable upon the Company
with transition effect from 1st April 2018. |
1. We evaluated the control environment including
authorization, sanctioning and disbursement of significant loans advanced during the year. |
| Due to this, all the loans whether given or obtained, are to
be disclosed at Amortised |
2. We have obtained external confirmations from third parties
in respect of transactions and closing balance for significant loans advanced by the
company. |
| Cost using Effective Interest Method prescribed under Ind AS
109 on Financial Instruments. |
3. We tested all material entries recorded in connection with
the loan advance and interest thereon to determine whether the accounting was appropriate. |
| We focused on the conditions of disbursement and
appropriateness of sanctioning process of the loan granted by the Company. |
|
| 2. Compliance of RBI directions and circulars: |
Our audit procedure inter- alia includes the following: - |
| The recent RBI regulations increased the responsibility of
auditors of NBFCs. |
We have reviewed the conditions for prudential norms
prescribed by the RBI including: - |
| As Company is an NBFC, it is responsibility of Company to
duly follow the directions and circulars. |
a) Provision on standard assets. |
| We focused on the requisite compliance and disclosure as per
the requirements in the norms. |
b) Transfer of 20% profit to reserve maintain under section
45-IC of the RBI Act. |
|
c) Holding of at least 50% of the financial assets and 50% of
the financial income respectively. |
|
d) Maintaining minimum Net Owned Fund of Rs. 200 Lakhs. |
Information other than the Standalone Financial Statements and
Auditors Report thereon
The Companys Board of Directors is 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 statements and the auditors report thereon.
Our opinion on the standalone financial statement 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 during the course of our audit or otherwise appears to be
materially misstated.
If, based on the work we have performed, we conclude that there is a
material misstatement of this other information; we are required to report that fact. We
have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for
the 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 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 the AS and
the other accounting principles generally accepted in India. This responsibility also
includes maintenance of adequate accounting records in accordance with the provisions of
the Act for safeguarding 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 are operating
effectively for insuring the accuracy and completeness of the accounting records, relevant
to the preparation and presentation of the standalone financial statements that give a
true and fair view and are free from material misstatements, whether due to fraud or
error.
In preparing the standalone 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 Standalone
Financial Statements
Our objectives are to obtain a reasonable assurance about whether the
standalone financial statements as a whole are free from material misstatement, whether
due to fraud or error, and to issue our 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 due to 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 the SAs, we exercise
professional judgment and maintain professional scepticism throughout the audit. We also:
(i) 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 one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations or the override of internal
control.
(ii) Obtain an understanding of the internal controls relevant to the
audit in order to design audit procedures that are appropriate in the circumstances. Under
section 143(3)(i) of the Act, we are also responsible for expressing our opinion on
whether the company has adequate internal financial controls system in place and the
operating effectiveness of such controls.
(iii) Evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures made by management.
(iv) 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.
(v) 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.
Materiality is the magnitude of misstatements in the financial
statement, individually or in aggregate, makes it probable that the economic decision of
reasonable knowledgeable user of the financial statement may be influenced.
We consider quantitative materiality and qualitative factors in (i)
Planning the scope of our audit work and in evaluating the results of our work; and, (ii)
to evaluate the effect of any identified misstatements in the financial statements.
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 controls 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 reasonable be thought
to bear on our independence, and where applicable, relevant 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, or when in extremely rare circumstances, we determine that a
matter should not be communicated in our report because the adverse consequences of doing
so would reasonably be expected to outweigh the public interest benefits of such
communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order, 2016 (the
Order), as amended, issued by the Central Government of India in terms of sub-section
(11) of section 143 of the Act, 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. The Company is a Non-Banking Financial Company not accepting public
deposits and holding certificate of Registration No. 14.00199 dated 04/03/1998 from
Reserve Bank of India has been issued to the Company.
a) The Board of Directors has passed resolution for the non-acceptance
of any public deposits.
b) The Company has not accepted any public deposits during the relevant
year.
c) The Company has complied with the prudential norms relating to
income recognition, accounting standards, assets classification and previously for bad and
doubtful debts as applicable to it.
3. As required by Section 143(3) of the Act, we report that:
a. We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the purposes of our
audit.
b. In our opinion, proper books of account as required by law have been
kept by the Company so far as it appears from our examination of those books;
c. the Balance Sheet, the Statement of Profit and Loss, Statement of
Changes in Equity and the Cash Flow Statement dealt with by this report are in agreement
with the books of account;
d. In our opinion, the aforesaid 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 (2) of the Act.
f. With respect to the adequacy of the internal financial controls over
financial reporting of the Company and the operating effectiveness of such controls, refer
to our separate Report in Annexure B. 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 Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in
our opinion and to the best of our information and according to the explanations given to
us:
i. The Company has disclosed the impact, if any of pending litigations
on its financial position, in its standalone financial statements.
ii. The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable losses.
iii. The Company is not required to transfer any amount to the Investor
Education and Protection Fund.
iv. 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 entities,
including foreign entities ("Intermediaries"), with the understanding, whether
recorded in writing or otherwise, that the Intermediary shall, 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.
v. 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 entities
("Funding Parties"), with the understanding, whether recorded in writing or
otherwise, that the Company shall, 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.
vi. Based on the audit procedures that has 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.
ANNEXURE- A TO THE AUDITORS REPORT
The Annexure referred to in Paragraph 1 under the heading of
"Report on other Legal and Regulatory
Requirements" of our report of even date to the members of
SUPERIOR FINLEASE LIMITED for the year ended on 31st March 2023.
(i) (a) As per information and explanation given to us, the company is
maintaining proper records showing full disclosures of fixed assets.
(b) As per information and explanation given to us, physical
verification of fixed assets has been conducted once in a year by the management and no
material discrepancies were noticed during the course of verification.
(c) According to information and explanation given to us, the company
does not hold any immovable property during the year dealt with by this report;
(ii) As per information and explanation given to us, the Company did
not hold inventory at any time during the period under audit and therefore the provisions
of this sub-clause are not applicable to the Company;
(iii) According to information and explanation given to us, the Company
has granted unsecured loans to parties covered in register maintained under section 189 of
the Companies Act, 2013 and;
(a) According to the information and explanations given to us,
unsecured loan has been granted to an associate Company for carrying on its business
objects. The terms and conditions of the grant of such loans are not prima facie
prejudicial to the companys interest;
(b) According to the information and explanation given to us, the
unsecured loan is repayable on demand and no schedule of repayment has been stipulated and
thus there arises no question of regularity in repayment;
(c) According to the information and explanation given to us, no amount
is overdue in respect of unsecured loan so granted as per stipulation.
(iv) According to information and explanations given to us, the Company
has complied with the provisions of section 185 and section 186 of the Companies Act, 2013
to the extent applicable in respect of loans, advances, guarantees and securities so
given;
(v) According to information and explanations given to us, the Company
has not accepted public deposits and the provision of section 73 to 76 or other relevant
provisions of the Companies Act, 2013 and rules framed thereunder are not applicable to
the Company;
(vi) According to information and explanations given to us, the Company
is not liable to maintain cost records as prescribed under section 148(1) of the Companies
Act, 2013;
(vii) (a) According to information and explanations given to us, the
company is generally regular in depositing undisputed statutory dues including income-tax
and any other applicable statutory dues to the appropriate authorities and there are no
outstanding statutory dues as on the last day of the financial year concerned for a period
of more than six months from the date they became payable;
(b) According to information and explanation given to us, there are no
outstanding statutory dues on the part of the Company which is not deposited on account of
dispute.
(viii) According to information and explanations given to us, the
company has not defaulted in repayment of loans and borrowings from any financial
institution, bank, government or dues to debenture holders;
(ix) According to information and explanations given to us, the Company
has not raised money by way of initial public offer or further public offer. The Company
has not taken any term loans from any bank or financial institution;
(x) According to information and explanations given to us, there is no
noticed or unreported fraud on or by the Company during the year under audit;
(xi) As per information, the Company is not a Nidhi Company, hence
provisions of sub- clause (xii) of the Paragraph 3 of the Order are not applicable;
(xii) According to information and explanations given to us, all
transactions with the related parties are in Compliance with sections 177 and 188 of
Companies Act, 2013 wherever applicable and the details have been disclosed in the
financial statements etc., as required by the applicable accounting standards;
(xiii) According to information and explanations given to us, the
Company has not made any preferential allotment or private placement of shares or fully or
partly convertible debentures during the year;
(xiv) According to information and explanations given to us, the
Company has not entered into non- cash transactions with directors or persons connected
with him;
(xv) According to information and explanations given to us, the Company
is a Non- Banking Financial Company and registered under Section 45-IA of the Reserve Bank
of India Act, 1934.
ANNEXURE- B TO THE AUDITORS REPORT
Report on the Internal Financial Controls under Clause (i) of Sub-
section (3) of Section 143 of the Companies Act, 2013
We have audited the internal financial controls over financial
reporting of SUPERIOR FINLEASE LIMITED 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 the 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 controls stated in the Guidance Note on Audit of Internal Financial Control 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 fraud and errors, the accuracy
and completeness of accounting records, and the timely preparation of reliable financial
information, as required under the Companies Act, 2013.
Auditors Responsibility
Our responsibility is to express an opinion on the Companys internal
financial controls over financial reporting based on our audit. We conducted our audit in
accordance with the Guidance Note on Audit of Internal Financial Controls over Financial
Reporting (the Guidance Note) and the Standards on Auditing, issued by ICAI and deemed to
be prescribed under Section 143(10) of the Companies Act, 2013 to the extent applicable to
an audit of internal financial controls, both applicable to an audit of Internal Financial
Controls and, both issued by the ICAI. 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
aspects.
Our audit involves performing procedures to obtain audit evidence about
the adequacy of the internal financial control 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 risks of
material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidences 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 the receipt and expenditures of the Company are being
only in accordance with authorizations 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 could not
be detected. Also, projections of any evaluation of the internal financial control over
financial reporting to future periods are subject to the risk that the internal financial
controls over financial reporting may became inadequate because of changes in conditions,
or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material aspects, 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 financial controls over financial reporting criteria considering the
essential components of internal control stated in the Guidance Note on Audit of Internal
Financial Controls over Financial Reporting issued by the Institute of Chartered
Accountants of India".
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