We have audited the accompanying standalone financial statements of California Software
Company Limited (“the company”), which comprise the Balance Sheet as at 31st March 2024, the
Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes
in Equity and the Statement of Cash Flows for the year ended on that date, and a summary of
significant accounting policies and other explanatory information (herein 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 section of our report, 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 31st March 2024, its profit,
total comprehensive income, changes in equity and its cash flows for the year ended on that date.
Basis for Qualified Opinion
1. Balances appearing in Current Tax Asset (net) amounting to Rs.380.02 Lakhs, under Current
Assets in the Standalone Financial Results are subject to reconciliation. The effect of the non¬
reconciliation is not quantifiable.
2. Balances appearing in Investment in Equity Instrument of Subsidiary amounting to Rs.3ii.38
Lakhs, grouped under the head Investments under Non-Current Financial Assets in the
Standalone Financial Results is subject to Impairment testing. The effect of Impairment loss for
the said Investment is not quantifiable.
3. Balances appearing in Trade receivables amounting to Rs.i,465.35 Lakhs, under Current
Financial Assets in the Standalone Financial Results are subject to reconciliation and
confirmation from the customers. Consequent impact of non collection of receivables shall
impair CST exemption on Exports which needs to be provided. The effect of the non¬
confirmation / non-reconciliation is not quantifiable.
We conducted our audit of the standalone financial statements 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 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 independence 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 ICAI’s 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.
Key Audit Matters
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. We have determined the matters described below to be the key audit matters to be
communicated in our report.
Key Audit Matters
? Revenue recognition
?Accuracy of recognition, measurement, presentation and disclosure of revenue and related
balances towards Ind AS 115- Revenue from contracts with customers.
? The application of this standard involves the assessment towards identification of performance
obligation, determination of transaction price for each of the identified performance obligations,
the judgements used in determining the satisfaction of those performance obligations over
time or at a point in time.
? The company revenue from contracts mainly includes software development services, business
process outsourcing services and IT Infrastructure services.
Auditor’s Response
Our audit procedure involves the identification of internal controls and their operating
effectiveness towards application of this standard. We have also carried out substantive testing of
the transactions.
a. We have assessed the appropriateness of the revenue recognition policies by comparing with
the applicable Indian Accounting Standards.
b. Selected the samples of continuing contracts as well as new contracts and identified the
performance obligations and compared the same with the performance obligation identified by
the company.
c. Verified the basis of allocation of transaction price to the identified performance obligation if not
specifically mentioned in the contract.
d. Identified the basis to be considered to determine the satisfaction of performance obligation
and compared the same with the judgements used by the company in determining the
satisfaction of performance obligation over the time or at a point in time.
e. Verified the appropriate evidence considered for determining the satisfaction of performance
obligation towards transfer of promised goods or services.
f. Verified the judgements used by the company in determining the stages of completion of the
contracts where the satisfaction of entire performance obligation is partially completed.
g. Verified the process towards identification of contracts where the right to consideration is
unconditional and is due only after passage of time.
Information Other than the Standalone Financial Statements and Auditor’s Report
Thereon
The Company’s 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, Business Responsibility
Report but does not include the standalone Financial Statements and our auditor’s 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
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 Company’s 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, total comprehensive income,
changes in equity and the cash flows of the company in accordance with Indian Accounting
Standards 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, 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.
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 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 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 with reference to standalone financial
statements 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 the 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 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.
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 section 143(11) of the Act, we give in the “Annexure B”,
a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, based on our audit 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 including the Other Comprehensive
Income, Statement of Changes in Equity and the Statement of Cash Flows dealt with by this
Report are in agreement with the relevant books of accounts.
d) In our opinion, the aforesaid standalone financial statements comply with the Ind AS
specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules,
2014.
e) The matter described in the Basis for Qualified Opinion paragraph above, in our opinion,
may have an adverse effect on the functioning of the Company
f) 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 directors is disqualified as on 31st
March 2024 from being appointed as a director in terms of Section 164(2) of the Act.
g) The qualification relating to the maintenance of accounts and other matters connected
therewith are as stated in the Basis for Qualified Opinion paragraph above
h) With respect to the adequacy of the internal financial controls with reference to
standalone financial statements of the Company and the operating effectiveness of such
controls, refer to our separate Report in “Annexure A”. Our report expresses a modified
opinion on the adequacy and operating effectiveness of the company’s internal financial
controls with reference to standalone financial statements.
i) With respect to the other matters to be included in the Auditor’s Report in accordance
with the requirement 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 Companies Act, 2013.
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 does not have pending litigations on its financial position in its standalone
financial statements as at 31st March 2024.
ii. The Company has made provision, as required under the applicable law or accounting
standards, for material foreseeable losses, if any, on long term contracts to the standalone
financial statements. The Company do not have any derivative contracts.
iii. There were no amounts required to be transferred 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 (which are material either individually or in 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, including foreign entities
(“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, including foreign entities (“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.
v. As stated in the standalone financial statements;
a. The Company has not declared any dividend during the previous year.
b. The company has not declared and paid interim dividend during the year.
c. The Board of Directors of the Company have not proposed final dividend for the year
31/03/2024.
vi. The company is using accounting software which has a feature of recording audit trail (edit
log), however the audit trail feature was not enabled/operated throughout the year.
For K. GOPAL RAO & CO.,
Chartered Accountants.
CA. MADAN GOPAL NARAYANAN
Partner
Membership No. 211784
UDIN:24211784BKFJPH8186
Place: CHENNAI
Date: MAY 30,2024
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