We have audited the accompanying standalone financial statements of Advance Metering Technology Limited (“the Company”), which comprise the standalone balance sheet as at 31st March, 2023, the standalone statement of profit and loss, including the standalone statement of other comprehensive income, the standalone statement of cash flow and the standalone statement of changes in equity for the year then ended, and notes to the standalone 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, the aforesaid Standalone financial statements give the information required by the Companies Act, 2013, as amended (“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 its loss including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Basis for Opinion
We conducted our audit of the Standalone financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Act. Our responsibilities under those SAs are further described in 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 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 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 audit opinion on the standalone financial statements.
Key Audit Matters
Key audit matters (‘KAM’) are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements for the financial year ended 31st March, 2023. 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.
We have determined the matters described below to be the key audit matters to be communicated in our report.
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S. No.
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Key Audit Matters
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How our audit addressed the key audit matter
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1.
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Revenue Recognition
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Our audit procedures included the following;
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Revenue from Sale of Goods
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Revenue is recognized when the controls of the goods have been transferred to the customer and the performance obligation of the sale of product is satisfied at point in time.
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Assessed the company’s revenue recognition policies in line with Ind AS 115 (‘’Revenue from contracts with Customers’’) and tested thereof.
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Revenue from Windmills Power generations
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Revenue is recognized on the basis of actual power sold as per terms of Power Purchase Agreement entered into with respective purchasers.
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Evaluated the integrity of the general information and technology control environment and testing the operating effectiveness of key IT application control over recognition of revenue.
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Interest Income
Interest income is recognized using effective interest rate (EIR) Method.
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Tested the effectiveness of such controls over revenue cut off at year end. On the sample basis, tested supporting documentation for sales transaction recorded during the year which included sales invoices, customer agreements.
Tested the supporting documentation for sales transaction recorded during the period closer to the year end and subsequent to the year end.
Compared revenue with the historical trends and where appropriate, conducted further enquiries and testing.
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2.
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Valuation of Investments and Impairment thereof
The Company’s investments represents
- Investments carried at Cost
o Investments in Subsidiary Companies o Investment in Joint Ventures o Investment in Government Securities
- Investment measured at Fair Value Through Profit & Loss
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Our audit procedures included the following; Assessed the appropriateness of relevant accounting policies of the Company, including those relating to recognition and measurement of financial instruments with the applicable accounting standard. For Instruments measured at Fair Value through Profit & Loss.
- Assessed the availability of quoted price in liquid markets or Mutual funds statements.
- Assessed whether the valuation process is appropriately designed and capture relevant valuation inputs.
For instruments carried at Cost
- Assessed the standalone financial statements of subsidiaries and joint venture of the Company.
- Annual performance report (APR) as per RBI Regulation have been properly submitted
Assessed the appropriateness of the Company’s description of the accounting policy and disclosure related to investments and whether there are adequately presented in the standalone financial statements.
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3.
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Physical Verification of Inventories
Inventory includes;
- Raw Material;
- Work In Progress &
- Finished Good
Inventories are valued at lower of cost or estimated net realizable value.
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Our audit procedures included the following;
We evaluated the design, implementation and tested the operating effectiveness of key controls that the Company has in relation to physical verification of inventories including the appropriateness of the Company’s standard operating procedures for conducting, recording and reconciling physical verification of inventories and tested the implementation thereof;
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4.
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Evaluation of the appropriateness of going
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Our audit procedures included the following;
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concern assumption
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We evaluated the design and implementation of
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Company has made assessment considering
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controls over evaluation of the appropriateness of
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internal and external sources of information of its
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going concern assumptions and tested the operating
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liquidity position and carrying value of its assets &
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effectiveness of these controls
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liabilities as at 31st March 2023.
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We ascertained the net current liability position of the Company as at 31st March 2023.
We discussed with the management and understood that
- No third party has invoked force major;
- There is no material dependency on any vendor or customer;
- No modification to contracts with customers have been made
We evaluated events subsequent to the balance sheet date up to the date of our audit report to determine if there is any impact on the going concern assessment
We evaluated adequacy of disclosures made in standalone financial statements for going concern assumptions.
We also evaluated the application of Standard of Auditing (SA) 570, Going Concern
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Other Information
The Company’s Management and Board of Directors are responsible for the other information as per SA 720 “The Auditor’s Responsibilities Relating to Other Information”. The other information comprises the information included in the Company’s annual report, but does not include the standalone financial statements and our auditor’s report thereon. The Company’s annual report is expected to made available to us after the date of this auditor’s report.
Our opinion on the standalone financial statements does not cover the other information and we will 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, when it becomes available and, in doing so, consider whether such other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
When we read the Director’s Report, Management Discussion and Analysis and Corporate Governance Report, if we conclude, that there is a material misstatement of this other information, we are required to communicate the matter to those charged with governance and taka necessary actions as required under SA 720, ‘The Auditor’s Responsibilities Relating to Other Information’.
Responsibilities of Management and Board of Directors for the Standalone Financial Statements
The Company’s Management and Board of Directors are 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 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.
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 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 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 concern and using the going concern basis of accounting unless Management and Board of Directors 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 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 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 standards of auditing (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 part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism 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 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 and Board of Directors.
- Conclude on the appropriateness of Management and Board of Directors use of the going concern basis of accounting in preparation of standalone financial statements 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.
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 for the financial year ended 31st March 2023 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
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 Act, we give in the “Annexure 1” a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. 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 accounts as required by law have been kept by the Company so far as it appears from our examination of those books;
c. The Standalone Balance Sheet, the Standalone Statement of Profit and Loss including the Statement of Other Comprehensive Income, the Standalone Statement of Cash Flow and Standalone Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
d. In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
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 with reference to these standalone financial statements and the operating effectiveness of such controls, refer to our separate Report in “Annexure 2” to this report;
g. With respect to the matter to be included in the Auditor’s Report under Section 197(16) 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 of the 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) of the Act which are required to be commented upon by us.
h. 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 in its Standalone Financial Statements - Refer Note 34 to the Standalone Financial Statements;
ii. The Company did not have any material foreseeable losses on long term contracts during the year ended 31st March 2023. The Group has not entered into any derivative contracts during the year ended 31st March 2023;
iii. There were no amounts which were required to be transferred during the year ended 31st March 2023 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 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 persons or entities, including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall:
1. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever (“Ultimate Beneficiaries”) by or on behalf of the Company or
2. provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
b) The management has represented, that, to the best of its knowledge and belief, no funds have been received by the Company from any persons or entities, including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall:
1. directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever (“Ultimate Beneficiaries”) by or on behalf of the Funding Party or
2. provide any guarantee, security or the like from or on behalf of the Ultimate Beneficiaries; and
c) Based on such audit procedures as 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 (iv) (a) and (iv) (b) contain any material mis-statement.
v. The Company has neither declared nor paid any dividend during the year. Hence, no reporting is required under rule 11(f) of Companies (Audit and Auditors) Rules 2014 read with section 143(3)(j) of the Companies Act, 2013.
For GSA & Associates LLP Chartered Accountants
Firm’s Registration No. 000257N/N500339
(Krishan Kant Tulshan) Partner
Place: Noida Membership No. 085033
Date: 26th May, 2023 UDIN: 23085033BGXJFC2359
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