<dhhead>Independent Auditors Report</dhhead>
To the Members of Manugraph India Limited
Report on the Audit of the Standalone Financial Statements
We have audited the accompanying Standalone Financial Statements of Manugraph India Ltd ("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 Cash Flows and the Statement of Changes in Equity for the year then ended and a summary of significant accounting policies and other explanatory information (hereinafter referred to as "the Standalone Financial Statements").
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 loss, total comprehensive income/(loss), its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of the Standalone Financial Statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act (SAs). Our responsibilities under those Standards are further described in the Auditors Responsibility for the audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the Standalone Financial Statements under the provisions of the Act and the Rules made thereunder and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAIs Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Financial Statements.
Sr. No. |
Key audit matter |
Auditors response |
Revenue Recognition (as per Note 1.4 to the Standalone Financial Statements) |
||
1. |
The Company operates and earns revenue from only one reportable segment i.e. Engineering.
The Company recognised revenue from sales of goods in accordance with the requirements of Ind AS 115, Revenue from Contracts with Customers measured at fair value of the consideration received or receivable in the ordinary course of its activities. Revenue from sale of goods is recognised net of discounts, rebates and taxes. |
Our audit procedures included the following:
contract with customers. |
2. |
Certain terms in sales arrangements relating to timing for transfer of control to the customer and delivery specifications, involves significant judgment in determining whether the revenue is recognised in the correct period. |
Financial Statements for compliance with disclosure requirements. |
Key audit matter is the matter that, in our professional judgement, was of most significance in our audit of the Standalone Financial Statements of the current period. This matter was addressed in the context of our audit of the Standalone Financial Statements as a whole and in forming our opinion thereon and we do not provide a separate opinion on this matter. We have determined the matter described as follows to be the key audit matter to be communicated in our report.
a. We draw attention to note no. 28.1 and 28.2 of the Standalone Financial Statement which describes managements assessment of exceptional items and its impact on the operations and financial results of the Company.
Our opinion is not modified in these matters.
Information other than the Financial Statements and Auditors Report thereon
The Companys Board of Directors is responsible for the other information. The "Other Information" comprises of the Report of the Board of Directors, Management Discussions and Analysis, Corporate Governance, but does not include Standalone Financial Statements, the Consolidated 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 or 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.
Managements responsibility 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, including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities, selection and application of appropriate accounting policies, making judgments and estimates that are reasonable and prudent, and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the Standalone Financial Statements, the Management is responsible for assessing the ability of the Company to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the 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 financial reporting process of the Company.
Auditors responsibility for the audit of the Standalone Financial Statements
Our objectives are to obtain 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 an Auditors Report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they can reasonably be expected to influence the economic decisions of users taken on the basis of these Standalone Financial Statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
Materiality is the magnitude of misstatements in the Standalone Financial Statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the Standalone Financial Statements 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 Standalone 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 control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Standalone Financial Statements of the current period and are therefore the key audit matters. We describe these matters in our Auditors Report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter must not be communicated in our report because the adverse consequences of doing so will reasonably be expected to outweigh the public interest benefits of such communication.
Report on other legal and regulatory requirements
i.) 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.
ii.) In our opinion, proper books of accounts as required by law have been kept by the Company so far as it appears from our examination of those books.
iii.) Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, Statement of Cash Flows and Statement of Changes in Equity dealt with by this Report are in agreement with the books of accounts.
iv.) In our opinion, the aforesaid Standalone Financial Statements comply with the Ind AS specified under Section 133 of the Act.
v.) On the basis of the written representations received from the Directors 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.
vi.) 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 internal financial controls over financial reporting of the Company.
vii.) 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.
viii.) 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:
For Desai Shah & Associates
Chartered Accountants
ICAI Firm Registration Number: 118174W
Sd/-
Anand Yagnesh Desai
Partner
Membership Number: 145560 Place: Mumbai
UDIN: 23145560BGTUFZ4444 Date: May 25, 2023
ANNEXURE A to the Independent Auditors Report
Referred to in para 1 under Report on other legal and regulatory requirements section of our report of even date, we report that:
(i.) In respect of the Companys fixed assets:
(B) The Company has maintained proper records showing full particulars of intangible assets.
(ii.) In respect of the Companys inventories:
(iii.) During the year the company has not made investments in, provided any guarantee or security or granted any or advances in the nature of loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or any other parties.
IGN=JUSTIFY>(Rs. in lakhs)
Particulars |
Guarantees |
Security |
Loans |
Advances in nature of loans |
Aggregate amount granted/provided during the year: - 1) Subsidiaries |
Nil |
Nil |
Nil |
Nil |
2) Joint Ventures |
Nil |
Nil |
Nil |
Nil |
3) Associates |
Nil |
Nil |
Nil |
Nil |
4) Others - Employees |
Nil |
Nil |
43.34 |
Nil |
Balance outstanding as at balance sheet date in respect of above cases: - |
||||
1) Subsidiaries |
Nil |
Nil |
Nil |
Nil |
2) Joint Ventures |
Nil |
Nil |
Nil |
Nil |
3) Associates |
Nil |
Nil |
Nil |
Nil |
4) Others Employees |
Nil |
Nil |
184.92 |
Nil |
(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, investments, guarantees, and security. Accordingly, the requirement to report under clause (iv) of the order is not applicable to the Company.
(v.) The Company has not accepted any deposit from the public and does not have any amounts deemed to be deposits. In respect of unclaimed deposits, the Company has complied with the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013. Accordingly, clause (v) of the Order is not applicable to the Company.
(vi.) The maintenance of cost records has been specified by the Central Government under Section 148(1) of the Companies Act, 2013. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended and prescribed by the Central Government under of Section 148(1) of the Companies Act, 2013, and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
(vii.) In respect of statutory dues:
Sr. No |
Name of the Statute |
Nature of Dues |
Amount (Rs. in lakhs) |
Period to which the amount relates |
Forum where dispute is pending |
1. |
Income Tax Act, 1961 |
Income tax |
67.48 |
Assessment Year 2016-17 |
Commissioner of Income Tax (Appeals) |
2. |
The Central Excise Act, 1944 and Chapter V of the Finance Act, 1994 |
Duty Drawback on Exported goods |
3.90 |
01.09.2010 to 30.09.2010 |
The Joint Secretary, Govt. Of India, Ministry of Finance, Department of Revenue, New Delhi. |
Total |
71.38 |
(viii.) The Company has not surrendered or disclosed any transaction, previously unrecorded in the books of account, in the tax assessments under the Income Tax Act, 1961 as income during the year. Accordingly, the requirement to report on clause (viii) of the Order is not applicable to the Company.
(ix.) (a) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans or borrowings or in the payment of interest thereon to any lender.
(x.) (a) The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) during the year.
(b) During the year the Company has not made any preferential allotment or private placement of shares or convertible debentures (fully, partially or optionally convertible) and accordingly reporting under clause (x)(b) of the Order is not applicable to the Company.
(xi.) (a) According to the information and explanations given to us, no instances of material fraud by the Company or on the Company has been noticed or reported during the course of our audit.
(xii.) The Company is not a Nidhi Company and accordingly reporting under clause (xii) of the Order is not applicable.
(xiii.) According to the information and explanations given to us the Companys transactions with its related party are in compliance with Sections 177 and 188 of the Companies Act, 2013 where applicable and the details of related party transactions have been disclosed in the financial statements etc. as required by the applicable accounting standards.
(xiv.) (a) In our opinion and according to the information and explanations given to us, the Company has an internal audit system commensurate with the size and nature of its business.
(b) We have considered the internal audit reports issued to the Company during the year and till date in determining the nature, timing and extent of our audit procedures.
(xv.) In our opinion and according to the information and explanations given to us, during the year, the Company has not entered into any non-cash transactions with directors or persons connected with them. Accordingly reporting under clause (xv) of the Order is 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. Accordingly, the requirement to report on clause (xvi)(a) of the Order is not applicable to the Company.
(xvii.) The Company has incurred cash losses of Rs. 938.36 lakhs in the financial year ending March 31st, 2023, and cash losses of Rs. 1,412.60 lakhs in the immediately preceding financial year.
(xviii.) There has been no resignation of the statutory auditors during the year, and accordingly requirement to report on clause (xviii) of the Order is not applicable to the Company.
(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, 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 that Company is not capable of meeting its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date. We, however, state that this is not an assurance as to the future viability of the Company. We further state that our reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date, will get discharged by the Company as and when they fall due.
(xx.) Compliance with regards to the second proviso to sub-section (5) of section 135 of the Companies Act, 2013 is not applicable to the Company and accordingly reporting under clause (xx)(a) and (xx)(b) of the Order is not applicable.
(xxi.) The Company is a holding company of a wholly owned USA based subsidiary up till November 29, 2022.The USA based subsidiary Manugraph Americas Inc. is not required to prepare CARO report, accordingly requirement of clause 3(xxi) of the Order is not applicable to the Company.
ICAI Firm Registration Number: 118174W
Sd/-
Membership Number: 145560 Place: Mumbai
UDIN: 23145560BGTUFZ4444 Date: May 25, 2023
Annexure B to the Independent Auditors Report
Referred to in para 2(f) under Report on other legal and regulatory requirements section of our report 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)
Managements responsibility for Internal Financial Controls
Auditors Responsibility
Meaning of internal financial controls over financial reporting
the Company are being made only in accordance with authorisations of Management and Directors of the Company; and iii) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the assets of the Company that can have a material effect on the Standalone Financial Statements.
Inherent limitations of internal financial controls over financial reporting
Opinion
For, Desai Shah & Associates Chartered Accountants Firm Registration Number: 118174W
Sd/- |
||
Anand Yagnesh Desai Partner Membership Number: 145560 |
Place : |
Mumbai |
UDIN: 23145560BGTUFZ4444 |
Date : |
May 25, 2023 |
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