We have audited the standalone financial statements ofSM Auio Stamping Limited ("the company"] which comprise the standalone Balance Sheet as at March 31, 2024 and the standalone statement of profit and loss, and standalone statement of cash Hows tor the year then ended and notes to the standalone financial statements including a summary of the significant accounting policies anti other explanatory information {herein referred to as "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 [H the Act") in the manner so required and give a true and fair view in conformity with the Accounting Standards prescribed under section 133 of the Act read with rule 3 of the Companies {Accounting Standards) Rules, 2021 and other accounting principles generally accepted in India, of the state of affairs of the company as at March 31 2024, the profit and its cash flows for the year then ended.
We conducted our audit of standalone financial statements in accordance with the Standards on Auditing specified under Section 143(10] of the Act fSAs). Our responsibilities under those SAs are further described m the Auditor's Responsibilities 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 uf India 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 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 on the standalone financial statements.
We draw attention to the following matters in the Notes to the financial statements:
(a) Notes 8 & 15 to the financial statements, which state that Trade Payable and Trade Receivables balances are subject to confirmation.
(b) The company has changed depreciation method for intangible assets from Written Down Value to Straight Line Method. The difference in depreciation of earlier years is recorded as prior period items. However, in case if the life of the asset was over in earlier years, balance has been written off.
Also for tangible assets, if the life of the assets was over in earlier years and written down value was not up to the salvage value then excess balance above salvage value has been written off in the current financial year.
(c) Note 3 to the financial statements states that the company has exercised the buyback of shares during the year of 6,00,000 shares of Rs.60/- per share. The expenditure of Rs.19,04,908/- incurred on account of buyback of shares are debited to Reserves and Surplus Account.
Our opinion is not modified in respect of this matter.
Information Other Than the Standalone Financial Statements and Auditors' Report Thereon
The company's board of directors is responsible for the other information. The other information comprises the information included in the company's 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 are those matters that in our professional judgment were of most significance in our audit of the standalone financial statements of the current period. These matters were 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 these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.
We have determined the matters described below to be the key audit matters to be communicated in our report.
Revenue recognition (refer clause 1 fe) of Note No, 1 Significant Accounting Policies!
The Key Audit Matter
How the matter is addressed in our audit
Revenue is recognized at the time of dispatch of goods to the customer along with sales invoice and e-way bill.
Our audit procedures included:
Focusing un the Company's revenue recognition fur compliance with AS 9;
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Testing the design, implementation and operating effectiveness of the Company's manual and automated (Information Technology - IT) controls nn recording revenue We focused on controls around the timely and accurate recording of sales transactions.
The company's Board of Directors is responsible tor the matters stated in section )H4(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the state of affairs, profit and cash flows of the company in accordance with the 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 uf 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 uf 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, management and Board of Directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going nurnim jnd using the
going concern basis or 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 Company’s financial reporting process.
Auditor's Responsibilities for the Audit ortlu? Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from materia! misstatement whether due to fraud or error and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material, if individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As port of an audit in accordance with SAs we exercise profession.il judgment and maintain professional skepticism throughout the audit. Wc 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 I rum 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 pr ocedures 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 with reference to standalone 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 made by management.
• Conclude on the appropriateness of management s 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, [f we conclude that a materia] uncertainty exist, 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 the Company to cease
to continue as a going concern.
* Evaluate the overall presentation structure and content or the standalone financial statements including the disclosures and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
• 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 audit and evaluating the results of our work; 3nd [ii'J 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 inter nal 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 he 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 tn our auditors' report unless law or regulation precludes public disclosure about the matter or when in extremely rare circumstances, wo 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 Requirement
1 As required by the Companies (Auditor's Report] Order, 2020 ("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 paragraph 3 and 4 of the order,
2. As required by Section 143(3] of the Act, we report that;
fa] We have sought and obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose or our audit;
(b) In our opinion, proper books of accounts as required by law have been kept by the company so far as appears from our examination of those books;
(c) The Balance Sheet and the statement of profit and loss dealt with by this Report are in agreement with the hooks of account;
(d) In our opinion, the standalone financiaj^ioi^mtnts comply with the accounting
standards specified under section 133 of the Act, read with rule 3 of the Companies (Accounting Standards) rules, 202L
fe] On the basis of the written representations received from the directors as or 3! March 3UM taken on recor d by the Board of Directors, none of the directors is disqualified as
on 31 March 2024 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 with reference to these standalone financial statements and the operating effectiveness olsuch controls, refer to our separate Report in 'Annexure B" to this report;
(g) With respect to the other matters to be included in the Auditor's Report in accordance with Rule I l of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best ofour information and according to the explanations given to us;
i. The Company does not have any pending litigations which would impact its financial position,
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses,
iti. There are no amounts which were required to be transferred to the Investor Education and Protection Fund hy the Company, iv.
(i) The management has represented that, to the best of its knowledge and belief other than as discussed in the notes to 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 tn 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,
a. 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")
b, Provide any guarantee, security or the like on hehall of the Ultimate Bench claries.
(ii) Tho management has represented that, to the best of its knowledge and belief other than as discussed in the notes to 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,
a, 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")
b Provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(iti) Based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice Thai has caused us tu believe that the representations under sub-clause (i) and (ii i of Rule 11(e), as provided under fa) and (b) above, contain any material
misstatement.
v. The company has not dedared/proposed any interim and linal dividend for the Financial Vear 2023-24,
3. With respect to the matter to be included In the Auditors' Report under Section 197 116) of the Act
In our opinion and according to the information and explanations given to us the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of Section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act, The Ministry of Corporate Affairs has not prescribed other details under Section 197(16] oi the Act which are required to be commented upon by US*
4.
a. Based on our examination, the company has used accounting software for maintaining its books of accounts which has a feature of recording audit trail [edit log) facility except in respect of maintenance of Purchase Order records wherein the accounting software did not have the audit trail feature enabled throughout the year,
b. Also we were not able to access edit log facility for accounting master data In view of this we are not able to give any comment whether the audit trail feature was available and enabled throughout the year for this function.
c. The payroll records maintained by the company through Pamsoft software did not have audit trail feature throughout the year.
d. Further during the course of our audit we did not come across any instance of an audit trail feature [wherever we were able to access) being tampered with
e. This is the first year of applicability of this Feature, therefore, we have not verified retention of this log uf Financial Year 2022-23.
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