We have audited the standalone financial statements of UNIWORTH LIMITED (“the
Company”), which comprise the balance sheet as at 31st March, 2024, and the statement of
Profit and Loss, (statement of changes in equity) 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 (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, except for the effects of the matter described in the Basis for Qualified Opinion section of
our report, the aforesaid financial statements 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, 2024 and loss, (changes in equity) and its cash flow for the year ended on that
date.
Basis for Qualified Opinion
1. In view of the circumstances stated in Note No 46 the original books of accounts of the
Company were not available and we have conducted our audit on the basis of available
books of accounts prepared by the Company.
2. Note No-34, regarding submission of details of secured loan for registration of charges
with register of company (ROC).Which is not agreement with the available books of
accounts prepared by the company, stated in Note No-46 and in respect of which we are
unable to form any opinion as to the non agreement with the books of account and
reasons for dissatisfaction on of charges stated therein.
3. In view of the matters specified in Note No 46 and Note 9(4)(v) of the Financial
Statements, we are unable to express our opinion regarding the reported amounts
accompanying disclosure and recoverability of Trade Receivable.
4. Footnote No.1 and 4 (i), (ii), (iii) and (iv) of Note No. 9 regarding overdue Export Bills
amounting to Rs 56445.64 lacs outstanding for long which, in our opinion, are doubtful
of recovery against which adequate provision has not been made in the financial
statements.
5. Footnote 1 of Note No. 12 regarding Claims Receivable amounting to Rs. 689.36 lacs due
from various banks outstanding for long which in our opinion are doubtful of recovery
against which adequate provision has not been made in the financial statements.
6. Footnote 2 and 3 of Note No.13 regarding Advance to suppliers and Miscellaneous
Advance of Rs. 7.90 lacs and Rs. 3494.75 lacs due from certain parties and Footnote 1 of
Note No13 regarding Advance relating to Companies of Rs. 1744.93 lacs respectively
which, in our opinion, are considered doubtful of recovery against which, adequate
provision has not been made.
7. Footnote of Note No. 7 regarding Miscellaneous Advance under Other Non Current
Assets off Rs. 4.94 lacs due from certain parties which, in our opinion, are considered
doubtful of recovery against which, adequate provision has not been made.
8. Footnote 2 of Note No. 10 relating to non-accounting in an earlier year of withdrawals
/ other transactions from certain Bank accounts due to reasons stated on the said Note
10 (2).
9. In absence of any workings for impairment of assets as per Indian Accounting Standard
(Ind AS) 36 Impairment of Assets, the impact of such impairment is not ascertainable.
10. Non-provision / non-compliance of items indicated in (3) to (7) above constitute a
departure from the Accounting Standards referred to in Section 133 of the Act. Without
considering item Nos (1),(2),(6) and (7), ) above, whose impact on the Company’s
Statement of Profit and Loss is presently non-ascertainable, had the provisions indicated
in item Nos. (2) to (3) been made,
(i) Loss for the year would have increased by Rs. 62387.51 lacs
(ii) Trade Receivables would have been decreased by Rs.56445.64 lacs
(iii) Other Financial Assets would have been decreased by Rs. 689.36 lacs
(iv) Other Current and Non Current Assets would have been decreased by
Rs.5252.51lacs
(v) The Retaining Earnings/(-)Loss would have been higher by(-)Rs. 62387.51 lacs
We conducted our audit in accordance with Standards on Auditing (SAs) specified under
section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are
further described in the Auditor’s Responsibilities for the Audit of the Financial Statements
section of our report. We are independent of the Company in accordance with the Code of
Ethics issued by the Institute of Chartered Accountants of India together with the ethical
requirements that are relevant to our audit of the financial statements under the provisions of
the Companies Act, 2013 and we have fulfilled our other ethical responsibilities in
accordance with these requirements and the ICAI’s Code of Ethics. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our qualified
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 there on, in addition to the matter described in the Basis for Qualified Opinion
section; we have determined the matters described below to be the key audit matters to be
communicated in our report.
1. Following Notes to the Financial Statements describe the uncertainty related to the
outcome of the lawsuits /other legal matters indicated therein:
(a) Footnote (2) of Note No. 9 regarding pending adjustments of Sundry Debtors
against supplies and other liabilities etc. due to the buyers. In absence of final
settlement with the parties and non-receipt of necessary approval from concerned
regulatory authority, extent of the amount of adjustments so required could not be
ascertained.
(b) Footnote to Note No.18 regarding estimated amount of Rs. 8722.28 lacs provided
during the year 2002-03 as sales claims and commissions relating to earlier years
from overseas customers of the Company which is pending for final settlement.
Necessary adjustments for such claims and commissions will be made after final
settlement and obtaining necessary approval from the concerned regulatory
authority.
(c) Note No. 39 regarding legal recourse taken by certain banks and financial
institutions for recovery of their dues and the matter is sub-judice as stated in the
said Note.
(d) Note No. 40 regarding applications made by the Company with the Reserve Bank
of India from time to time for extension / setting off of certain overdue bills.
(e) Matters disclosed in Note No. 31 relating to Entry Tax, Central/Commercial Sales
Tax Demands, Customs Demands, Professional Tax/Labour Cases/Water Cess,
Electricity Duty, etc., disclosed under Contingent Liabilities, which are contested
by the Company and pending before various forums / authorities for final
decisions.
(f) Note No. 20(1) regarding application filed against the company before Debt
Recovery Tribunal for recovery of the dues by certain banks.
(g) Note No. 8 (2) regarding Inventory lying with a third party, realisability and
future usage of which is not presently ascertainable.
(h) Note No.13 (5) regarding Transfer of Fixed Assets awaiting necessary adjustment.
2. Note No.16 (Footnote 3), Note No. 20 (Footnote 2) and Note No. 10 (Footnote 1 and
3) and Note No-11 (Foot Note-1) to the financial statements regarding non-receipt of
confirmations in respect of borrowings from banks/Financial Institutions and also
debit balances in certain current accounts with banks due to restructuring being in
progress, book balances thereof have been relied upon.
3. Note No 35 regarding balance with a related party under reconciliation
4. In absence of any relevant documents and adequate information relating to matter
specified in Note No - 41 & 42. We are unable to form to any opinion in these
respects.
5. Footnote 2(a) of Note No.16 regarding payments made to ARCIL by certain parties on
behalf of the Company, confirmations of which from the respective parties are
awaited.
6. Non provision of interest for secured lenders in view of facts stated in Note No 47.
7. Note No 10 (3) regarding debit balance of certain current accounts with banks which
are inoperative.
8. Note No.42 to the financial statements regarding preparation of these financial
statements on Going Concern basis for the reasons stated therein as also the fact that
the Company has accumulated losses and its net worth has been fully eroded Further
the Company has incurred net loss during the current and previous years, and the
Company’s current liabilities exceeded its current assets as at the Balance Sheet date.
These conditions, along with other matters set forth in Notes to Financial Statements,
indicate the existence of a material uncertainty that may cast significant doubt about
the Company’s ability to continue as a going concern.
Our opinion is modified in respect of these matters.
Information Other than the Financial Statements and Auditor’s Report Thereon
The Company’s Management and 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, Board’s Report including Annexures to Board’s
Report, Corporate Governance and Shareholder’s Information, but does not include the
financial statements and our auditor’s report thereon.
Our opinion on the 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 financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially
inconsistent with the 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.
Management’s Responsibility for the Standalone Financial Statements
The Company’s Board of Directors is responsible for the matters stated in section 134(5) of
the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone
financial statements that give a true and fair view of the financial position, financial
performance, (changes in equity) and cash flows of the Company in accordance with6 the
accounting principles generally accepted in India, including the accounting Standards
specified under section 133 of the Act. This responsibility also includes maintenance of
adequate accounting records in accordance with the provisions of the Act for safeguarding of
the assets of the Company and for preventing and detecting frauds and other irregularities;
selection and application of appropriate accounting policies; making judgments and estimates
that are reasonable and prudent; and design, implementation and maintenance of adequate
internal financial controls, that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and presentation of the
financial statement that give a true and fair view and are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s
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 are also responsible for overseeing the Company’s financial reporting
process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtained reasonable assurance about whether the Financial Statements
as a whole are free from material misstatement, whether due to fraud or error, and to issue
and auditor’s report that includes our opinion. Reasonable assurance is a high label of
assurance, but is not a guarantee that an audit conducted in accordance with SAs will always
detect a material misstatement when it exists. Misstatement 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 part of an audit in accordance with SAs, we exercise professional judgment 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 financial 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.
?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. 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 the Company to cease to continue as a going concern.
? Evaluate the overall presentation, structure and content of 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 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
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
auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably
be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
i) As required by the Companies (Auditor’s Report) Order, 2020 (“the Order”) issued by
the Central Government in terms of Sub-section (11) of Section 143 of the Act, we
enclose in the Annexure - A a statement on the matters specified in the said Order, to
the extent applicable to the Company.
ii) As required by Section 143(3) of the Act, we report that
a) We have sought and, except for the matters described in the Basis for Qualified
Opinion paragraph, obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our audit;
b) Except for the possible effects of the matters described in the Basis for Qualified
Opinion paragraph above, in our opinion proper books of account as required by
law have been kept by the Company so far as 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 Cash
Flows dealt with by this Report are in agreement with the books of account;
d) Except for the possible effects of the matters described in the Basis for Qualified
Opinion paragraph, in our opinion, the Balance Sheet, Statement of Profit and
Loss and Cash Flow Statement comply with the Accounting Standards specified
under Section 133 of the Act,
e) The matters described in the Basis for Qualified Opinion paragraph above, in our
opinion, may have an adverse effect on the functioning of the Company;
f) The matters described in sub-paragraph (1) under the Key Audit Matters
paragraph above, in our opinion, may have an adverse effect on the functioning of
the Company;
g) On the basis of written representations received from the Directors as on 31st
March, 2024 taken on record by the Board of Directors, none of the Director is
disqualified as on 31st March, 2024 from being appointed as a director in terms of
Section 164(2) of the Act.
h) 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.
i) With respect to the other matters to be included in the Auditor’s 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.
j) With respect to the other matters to be included in the Auditor’s 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, wherever ascertainable. Refer Note No -31.
ii. The Company did not have any long-term contracts including derivative
contracts for which there were any material foreseeable loss
iii. The Company has not transferred any amount to Investor Education and
Protection Fund (Refer to Footnote No. 1 to Note No. 16)
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 (“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 (“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.
(d) The company has neither declared nor paid any dividend during the year.
v. As stated in Note No.49 of the accompanying standalone financial statements
are based on our examination, which included test checks, the Company have used
accounting software, Enterprise Resource Planning (ERP) for maintaining its
books of account for the financial year ended 31st March, 2024 which has not a
feature of recording audit trail (edit log) facility and the same has not been
operated throughout the year for all relevant transactions recorded in the software,
then Rule 3(1) of the Companies (Accounts) Rules, 2014 is not complied with.
However, we are unable to comments on the audit trail feature being tampered
with or not.
As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable
from 1st April, 2023, reporting under Rule 11(g) of the Companies (Audit and
Auditors) Rules, 2014 on preservation of audit trail as per the statutory
requirements for record retention is not applicable or the financial year ended 31 st
March, 2024.
For KHANDELWAL RAY& CO.
Chartered Accountants
FR No. 302035E
(CA Anirban Roy)
Place: Kolkata Partner
Date: 30st May, 2024. (Membership No. 066427)
UDIN NO:
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