DECO-MICA LIMITED
Ahmcdabad
Report on the Audit of the St jndolone Financial Statements
Opinion
1. We have audited the accompanying Standalone Financial Statements of DECO-MICA LIMITED {"the C ompany''! which comprise the Balance Sheer as at 31“ March 2074. the Statement of Profit and Loss (including other Comprehensive Income), the Statement of Changes in equity, the Statement of Cash l luw for the year then ended and notes to the financial statements. includ.nC a summary of material accounting policies and other explanatory information (hereinafter referred to as "Standalone f inancial Statements").
2. In our opinion and to the best ol our information and according to the explanations given to us, the .daresaid standalone financial statements fiive ttie information required by the Companies Act, 2013 I 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 ol the Act read with the Companies (Indian Accounting Standards) Buies, 2015. os amended, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31. 2024 , its Profit, Other Comprehensive Income, its Cash Flows and Changes in Equity for the year ended on that date.
Basis for Opinion
3. We conducted our audit in accordance with the Standards on Auditing (SA's) specified under sccbon 113(101 of the Act. Out responsibilities under those Standards are further, described in the Auditor's Responsibility lor the Audit of the Financial Statements section of our report. We arc 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 lu our audit of the financial statements under the provisions of the Act and the Rules made there under and we have fulfilled our other ethical responsibilities in accord.iivce with these requirements and the ICAI's Code ol Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our opinion on the 5Umdalone Lm.inci.il Statement.
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Key Audit Mutters
4. Key audit matters are those matters that, in our professional, judgment, were of most Significance in our aud<t 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 m forming our opinion thereon, and we do not provide a separate opinion, on these matters.
Key audit matter identified in our audit In respect of Assessment of Existence & Recoverability of Trade Receivable as follows:
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[Refer Para 3.6 for the accounting policy and Note 3 for the related disclosures]
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Key Audit Matter
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How our audit addressed the key audit matter
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The company has trade receivables (net)
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Our audit procedures included the following:
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outstanding of Rs. 3416.60 lakhs after
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• Reviewing the accounting policy with respect
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deducting the provision for Impairment of Rs.
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to
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55.63 lakhs at the end of reporting period.
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o recognition of revenue & its appropriateness in accordance with Ind AS
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This represents 48.86% ol the total assets of
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115- Revenue from Contraa with
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the company.
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Customers;
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These balances arc receivable in relation to the
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o Appropriateness of Recognition,
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revenue recognized in accordance with the
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Measurement and Impairment of Trade
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requirements of Ind AS lib ‘Revenue from
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Receivables in accordance with ind AS
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Contract*, with Customers".
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109: Financial Instruments.
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The recoverability of trade receivables *s o key
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• Evaluating the design & implementation of
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element ol the company's walking capital
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internal controls in relation to recovery of
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management, which is managed on an ongoing
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Trade receivables, calculation of allowance for
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basis by its management Due to the nature of
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impaired trade receivable along with testing
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the business, the requirements of customers and various contract terms that are in place,
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ils operating effectiveness on sample basis.
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there is a risk th.it the carrying values may not
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• Obtaining the external balance confirmations
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iefleet the recoverable amounts as at the
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on samples basis to ascertain the existence &
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rciKHling date
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completeness of trade receivables.
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Therefore, the assessment of existence 8
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• Verified the subsequent receipts of trade
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recoverability of trade receivables is a key audit
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receivables for selected samples to ascertain
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matters duo to its si?e, and inherent uncertainty invoVed in the Management
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ts existence as on balance sheet date
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judgement.
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• Obtaining an understanding of the processes
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Refer note 2 I A) to significant accounting
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for evaluating the recoverability of the trade
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policies and note 9 and note 42 |l)(i) to the
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receivables including the collection process &
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standalone financial Statements.
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allowances for impaired trade receivables.
♦ evaluating management's assumptions in determining the provision for impairment of fade receivables, by analysing the ageing nf receivables, assessing significant overdue
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Key Audit Matter
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How our audit addressed the key audit matter
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Individual trade receivables and specific local risks, historical trends & patterns, combined with the legal documentations, where applicable.
• Verifying the ageing analysis of Trade receivables, long outstanding & overdue balances, latest correspondences with customers lor recovery of dues & evaluating its impact on provisioning S impairment.
• Assessing the adequacy of the disclosures as required by the statute.
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Information other than the Financial Statements and Auditor’s Report thereon
S. The Company's management and Board of Directors are responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Hoard's Report including Annexuies to Board's Report, Business Responsibility Report, Corporate Governance and Shareholder's Information and other Information in the Company’s annual report, but does not include the Standalone financial statements and our auditor’s report thereon, The other information is expected to be made available to us alter the date ol this auditor's report
Our opinion on the standalone financial statements does not cover the Oliver information and we do not express any form of assurance conclusion thereon.
In connection with uur audit of the standalone financial statements, our responsibility is to read the Oliver information Identified above when It becomes available 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.
When we rear! live Annual Report. If we conclude that there is a material misstatement therein, wc ore required to communicate the matter to those charged with governance and as may be legally advised.
Responsibilities of Management and I hose Charged with Governance for the Standalone Financial Statements
6. The Company's Board of Directors Is responsible for the matters staled in section 13-1(S) of the Act with respect to the preparation of these standalone financial statement that give a true and fair view ol 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. I lies responsibility also Includes maintenance of adequate accounting
records tn accordance with the provisions ot the Act tor safeguarding the assets of the Company and lor preventing and detecting frauds and other irregularities; selection and application of the 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 (he 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.
7. 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
8. I hose board of Directors arc also responsible for overseeing the Company's financial reporting
process.
Auditor's Responsibilities for the Audit of the Standalone Financial Statements
9. Our objectives ace to obtain reasonable assurance about whether tf>e 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, bul is not a guarantee that an audit conducted in accordance with $A$ will always detect a material misstatement when it exists Misstatements can arise from fraud or error and are considered material if. Individually ur m the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basts of these standalone financial statements.
10. 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 finonciol 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 ul internal control relevant to the audit in order in 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. 1
• Conclude on the appropriateness of managements use of the going concern basis of accounting and. based on the audit evidence obtained, whether 3 material uncertainty exists related to events or conditions that may cast significant doubt on the Company's jbility to continue as a going concern If we conclude that a material uncertainty exists, wo arc 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 tho 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 <1 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 0 manner that achieves fair presentation.
11. 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.
12. We also provide those charged with governance with a statement that we hove complied with relevant ethical requirements regarding independence, and to commumcate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
13. I rum the matters communicated with those charged with governance, v/e determine those matters that were of most significance In the audit of the standalone financial statements of the current year 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 extreme^ 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
M. As required by the Companies (Auditor's Report) Order, 20211 ("the Order'1) issued by the Central Government of India in terms of Section 1113(31| of the Act. we give in the “Annexure A", a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
15. Further to our comments in Annexure Af as required by Section 143(3} of the Ai t, based on our audit, we report that:
<i| We have sought and Obtained all the infer matron 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 lav/ have been kept by the Company so far as it appears from our examination cl those books.
c) The Standalone financial statements dealt with by this Report arc in agreement with the books of account.
d) in our opinion, the aforesaid standalone financial statements comply with accounting standards as specified under Section 133 of the Act
el On the basis of the written representations received from the directors and taken on record 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 with reference to Standalone Financial Statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure IT. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company’s internal financial controls v/ith reference to Standalone Financial Statement.
g) 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 19/ of the Ait read with Schedule V to the Act.
h) With respect to the other matters tu be included In the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 20:4 (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 the standalone financial statements; (Refer Note 31 to the standalone financial statements)
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
in I here has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
iv. |i) the management has represented that, to the best ol its knowledge and belief, other than as disclosed in the notes to the 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 to or in any other persons or entities , including foreign entities pniermedianesM| with the understanding, whether recorded in writing or otherwise, that the Intermediaries shall, whether, directly or indirectly lend or invest in the 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.
(ii) 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, whether directly or indirectly lend or invest in the other persons or entities identified in any manner whatsoever by or on behalf of the Funding Parties (“Ultimate Beneficiaries'') or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
ni) 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 (i) and |ii) of Rule 11(e) of the Companies (Audit and Auditors) Rules, 2014, as mentioned at para (iv)(i) and (iv)|h) above, contain any material misstatement.
v. The company has not declared or paid any dividend during the year as prescribed under Section 123 of the Act
vi, The company has used an accounting software for maintaining its books of account which does not have a feature of recording audit trail (edit log) facility Consequently, we are unable to report whether the audit trail facility has been operated and maintained throughout the year for all transactions recorded in the software, or if the audit trail feature has been tampered with.
for, J. T. Shah & Co.
Chartered Accountants (firm Regd. No. 10961GW!
Place: Ahmcdabad £^HMEOAMo\j V' N>
Date: 18/05/2024 >3^-
(N. C. Shah)
Partner
(M. No. 035159)
UOIN: 24G3S1S9BKAAOZ3G53
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Evaluate the appropriateness of accounting policies used and the rcosonoblencss of accounting estimates and related disclosures made by management.
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