Independent Auditor's Report
To the Members of M/s. Om Infra Limited (formerly known as Om Metals Infraprojects Ltd.,)
Report on the Standalone Financial Statements
Qualified Opinion
We have audited the accompanying Standalone Financial Statements of Om Infra Limited [formerly known as Om Meta is Infra projects Ltd.) ("the Company"), which includes its joint operations, which comprise the Balance Sheet as at 31st March, 2023, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flow and the 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. Company's Financial statements Includes financial statements 8 Joint Operations audited by other auditors and 1 unaudited joint operation, report of which have been furnished to us. Our opinion, in so far as it relates to the affairs of such Segment is based solely on the report of other auditors.
In our opinion and to the best of our information and according to the explanations given to us, except for the matters discussed in basis of qualified opinion, the aforesaid standalone financial statements give the information required by 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 March 31, 2023, arid the profit, and total comprehensive income, changes in equity and its cash flows for the year ended on that date.
Basis of qualified opinion
1. As stated in Note 58(d) to the standalone financial statements, The Company's non-current investments as at 31 March 2023 include investments aggregating Rs. 2,50 Lacs and advances of Rs. 747.66 Lacs (P.y. 747.66 Lacs) in the name of Gurha Thermal Power Company Limited (GTPCL); being considered good and recoverable by the management.
GTPCL has filed termination to their respective authority and claimed the amount Invested and termination payments as per concession agreement of Rs. 3940.72 Lacs and such matter is pending Appellate authority.
So far as this matter indicates material uncertainty about the going concern of joint venture and as In our view, recoverability of the amount Invested and advance provided not certain but no provisioning has been made against such probable non recovery of complete investment and loans. No Interest has been provided by the company on advances granted to joint venture for four years. Management ls of the view that such claim of GTPCL have merits and will be in favor of SPV and amount invested and advance provided will be recovered. Our opinion is modified in respect of the same.
Such Matter is pending and reported since 31.03.2019.
2, Financial Statements, includes financial statements of one joint operation, whose financial statements reflect total assets Rs. 855.66 Lacs as at 31 March 2023, and total revenues of Rs. 1.06 lacs and Met loss of joint operation of Rs. 100.88 Lacs for the year ended on that date, as considered in these standalone financial statements. The Company had prepared separate set of statutory financial statements of joint operations for the years ended 31 March 2023 in accordance with accounting principles generally accepted in India. Audited financial statements of such entities are not made available to us. Our opinion in respect of these joint operations is qualified in respect of this matter.
3. During the year, company has booked sales of Rs. 615.04 iacs in Joint Operation, Om Metals-SPML Joint Venture in the month of May, 2022. Company has reversed sales of the same amount in the month of march, 2023. The same is on account of rejection of the amount the project authority as per management discussion and such transaction has revenue neutral as per management. But as per accounting policy, invoice to be recorded as revenue only when it is approved by project authority. But as per facts produced by the management and qualification received by auditor, such revenue booked without approval of project authority. So we cannot rely on the books audited by the auditor. Company's financial statements includes sales of RS. 1652.00 lacs , profit after tax of Rs. 131,95 lacs and total assets of Rs. 2000 iacs. We qualify the balance sheet and statement of profit and loss produced by auditor as such books of accounts are not in line with accounting policies of company.
Emphasis of Matter
1. Company real estate division has debtors of Rs, 3S.83 Lacs but as per registries with government authorities, Such amount has been received. We found deficiency in registry process while reconciling with books of accounts and amount collection afterwards. We do not qualify our opinion on the same.
2. As stated in Mote 53{a} to the standalone financial statements, The Company's non-current investments as at 31 March 2G23 include investments aggregating Rs. 55E9.7Q Lacs and advances of Rs. 9757.72 Lacs (P.V. 10324.31 Lacs) in the subsidiary, Bhilwara Jaipur Toll Road Private Limited; being considered good and recoverable by the management.
Subsidiary has filed termination to their respective authority and claimed the amount invested and termination payments as per concession agreement of Rs. 61200.00 Lacs and arbitrator awarded 77943.00 Lacs in favor of company. Subsidiary has not accounted this award till balance sheet date as such award is eligible for appeal.
As per management. Such award will be recorded as soon as company gets unconditional right to receive such amount. Our opinion is not modified in respect of the same,
3. Company's two Joint Ventures of Ghana and Rwanda, compliance of foreign withholding taxes is not available with the auditors (L S Kumar & Associates) report. Hence we are unable to provide our true and fair view on this matter.
Other Matter
{1) We did not audit the separate financiat statements of eight joint operations, included in these standalone financial statements, whose financial statements reflect total assets of Rs. 10050.63 lacs as at 31 March 2023, and total revenues of Rs 31168.86 Lacs and Met profit after tax of Rs. 351.83 Lacs for the year ended on that date, as considered In these standalone financial statements. The Company had prepared separate set of statutory financial statements of these joint operations for the years ended 31 March 2023 in accordance with accounting principles generally accepted in India and which have been audited by other auditors under generally accepted auditing standards applicable in India. Our opinion in so far as it relates to the amounts and disclosures in respect of these joint operations is solely based on report of the other auditors and the conversion adjustments prepared by the management of the Company, which have been audited by us. Our opinion is not qualified in respect of this matter.
(ii) As stated in Mote 67 to the standalone financial statements. Company made claims against customer/parties/ subsidiaries/Joint ventures which represents work done in earlier years or loss of interest or any other matter which are either in dispute or yet to be finalized by both the parties amounting to Rs. 54850.14 Lacs (P.y, Rs, 62464.41 lacs) net off counter claims of Rs. 2517.16 lacs (P'.y. Rs.2343.38 lacs). Outcome of such claims are presently unascertainable. Mo adjustment has been made in the standalone financial statements. Our opinion is not qualified in respect of this matter.
jiii) GST INPUT accounts of the company is not reconciled with GSTR 2A/2E5 available at GST common portal. Our opinion fs not modified in respect of the same.
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 thereon and we do not provide a separate opinion on these matters. The Key audit matters on financiat statements of Engineering and Hotel Segments and joint operations of the Company are provided by other auditors and whose reports have been furnished to us. Our opinion, in so far as it relates to the affairs of such Segment is based solely on the report of other auditors.
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S.no,
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Key Audit Matter
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Auditor's Response
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1.
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Revenue Recognition
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Principal Audit Procedures
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Other Than Real Estate
There are significant accounting Judgements including estimation of costs to complete, determining the stage of completion and the timing of revenue recognition.
The Company recognizes revenue and profit/loss on the basis of stage of completion based on the milestone approved by project authority.,
Cost contingencies are included in these estimates to take into account specific uncertain risks, or disputed claims against the Company, arising within each contract. These contingencies are reviewed by the Management on a regular basis throughout the contract life and adjusted where appropriate.
Real Estate
Revenue from sale of constructed properties is recognised at a 'Point of Time', when the Company satisfies the performance obligations, which generally coincides with compfetion/possession of the unit,
Recognition of revenue at a point in time based on satisfaction of performance obligation requires estimates and judgements regarding
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Other Than Real Estate
Our procedures included:
• Testing of the design and implementation of controls involved for the determination of the estimates used as well as their operating effectiveness;
• Testing the relevant information technology systems' access and change management controls relating to contracts and related information used in recording and disclosing revenue in accordance with the new revenue accounting standard;
9 Testing a sample of contracts for appropriate Identification of performance obligations;
• For the sample selected, reviewing for change orders and the impact on the estimated costs to complete;
• Engaging technical experts to review estimates of costs to complete for sample contracts; and
• Performed analytical procedures for reasonableness of revenues disclosed by type and service offerings.
Real Estate
Our audit procedures on revenue recognition included the following:
• We verified performance obligations satisfied by the Company;
• We tested flat buyer agreements/saie deeds, occupancy certificates (OC), project completion, possession letters, sale proceeds received from customers to test transfer of controls;
• We conducted site visits during the year to understand status of the project and its construction status;
• We verified calculation of revenue to be recognised and matching of related cost;
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tinning of satisfaction of performance obligation, allocation of cost incurred to segment/units and the estimated cost for completion of some final pending works. Due to judgement and estimates Involved, revenue recognition is considered as key audit matter.,
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* We verified allocation of common cost to units sold and estimates of cost yet to be incurred before final possession of units.
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2.
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Evaluation of uncertain tax positions
The Company has material uncertain tax positions including search Si Seizure including matters under dispute which Involves significant Judgment to determine the possible outcome of these disputes.
Refer Mote 51 to the Standalone Financial Statements.
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Principal Audit Procedures
Obtained details of completed tax assessments and demands during the year from management. We involved our internal experts to challenge the management's underlying assumptions in estimating the tax provision and the possible outcome of the disputes. Our internal experts also considered legal precedence and other rulings in evaluating management’s position on these uncertain tax positrons.
Additionally, we considered the effect of new Information in respect of uncertain tax positions during the year to evaluate whether any change was required to management's positron on these uncertainties.
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3.
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Recoverability of Indirect and direct tax receivables
As at March 31, 2023, noncurrent assets in respect of withholding tax and others include Cenvat recoverable amounting to Rs. 739,36 Lacs (P.V. Rs, 847.90 Lacs) which are pending for adjudication and current excess input of GST Rs. 1765.31 Lacs (P.Y. Rs. 1567.39 Lacs).
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Principal Audit Procedures
We have involved our internal experts to review the nature of the amounts recoverable,, the sustainability and the likelihood of recoverability upon final resolution.
We have checked the reconciliation prepared by management for GST input, but same reconciliations are not matched with books.
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Assessment of the carrying
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Besides obtaining an understanding of Management's
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4.
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value of unquoted equity
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processes and controls with regard to testing the
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instruments in foss making
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impairment of the unquoted equity instruments in loss
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subsidiaries and joint ventures.
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making subsidiaries and joint ventures.
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The impairment review of
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Our procedures included the following:
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unquoted equity instruments
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• Engaged interna! fair valuation experts to challenge
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and debt, with a carrying value
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management's underlying assumptions and
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of Rs 47.50 lacs (P.V. Rs. 5675.92 Lacs), is considered to
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appropriateness of the valuation model used:
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be a risk area due to the size of
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« Compared the Company's assumptions with
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the balances as well as the
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comparable benchmarks in relation to key inputs such as
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judgmental nature of key assumptions, which may be
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long-term growth rates and discount rates;
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subject to management
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* Assessed the appropriateness of the forecast cash
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override.
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flows within the budgeted period based on their
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The carrying value of such
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understanding of the business and sector experience;
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unquoted equity instruments
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* Considered historical forecasting accuracy, by
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and debt is at risk of
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comparing previously forecasted cash flows to actual
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recoverability. The net worth of
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results achieved; and
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the underlying entities has
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• Performed a sensitivity analysis in relation to key
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significantly eroded and the orders in hand are below the break-even production levels of this facilities. The estimated recoverable amount is subjective due to the inherent uncertainty involved in forecasting and discounting future cash flows.
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assumptions.
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Refer to Note 9 of the
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Standalone Financial
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Statements
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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 Annexure to Board's Report, Business Responsibility Report, Corporate Governance and Shareholder's Information, 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.
Management's Responsibility for the Standalone Financial Statements
The Company's Management and the Board of Directors are responsible for the preparation and presentation of these standalone annual financial results that give a true and fair view of the net profit/ loss and other comprehensive income and other financial information in accordance with the recognition and measurement principles laid down in Indian Accounting Standards prescribed under Section 133 of the Act and other accounting principles generally accepted in India and in compliance with Regulation 33 of the Listing Regulations.
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 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 materia! 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 orto 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 annua! financial results.
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 Centrai Government of India in terms of sub-section (11} of section 143 of the Companies Act, 2013, we give in the Annexure "A" statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
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 except for the matter described in the basis of qualified opinion paragraph,
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 report(s) on the accounts of the segments office(s) i.e joint operations of the Company audited under section 143 (8) of the Act, by the branch auditors have been sent to us and have been properly dealt with by us in preparing this report.
d) The Balance Sheet, the Statement of Profit and Loss including Other comprehensive income, statement of changes in equity and the Cash Flow Statement dealt with by this Report are in agreement with the books of account and with the returns received from the Joint operations, not visited by us
e) Except for the effects of the matter described in the basis for qualified opinion paragraph, In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
f) 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 1G4 (2) of the Act,
g) With respect to the adequacy of the internal financial controls with reference to these standa lone Ind AS financial statements and the operating effectiveness of such controls, refer to our separate Report in "Annexure B'1' to this report;
h) In our opinion, the managerial remuneration for the year ended March 31, 2023 has been paid/provided by the Company to its directors in accordance with the provisions of Section 197 read with Schedule V to the Act;
1) 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, in our opinion and to the best of our information and according to the explanations given to us:
a) the company has disclosed the impact of pending litigation on its financial position in its Financial Statement as referred in Note no 51 to the Financial Statement.
b) The Company has made provisions, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on Long Term Contracts including derivative contracts.
c) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the company.
d)
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 securities premium or any other sources or kind of funds) by the Company to or in any persons or entities, including foreign entities ('the 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 (Jthe Ultimate Beneficiaries') or provide any guarantee, security or the like on behalf 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 ('the Funding Parties'), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether directly or indirectly, fend 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; and
c. Based on such audit procedures performed as considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the management representations under sub-clauses (a) and (b) above contain any material misstatement
e) The Board of Directors of the Company have proposed final dividend for the year ended 31 March 2023 which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend declared is in accordance with section 123 of the Act to the extent It applies to declaration of dividend.
For Ravi Sharma & Co.
Chartered Accountants FRN:015143C
CA Sourabh Jain
Partner
M. No. 431571
UDIN: 23431571BGYCKZ2B28 Place: Delhi D ate :27/04/2023
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