TOLINS TYRES LIMITED (formerly known as Tolins Tyres Private Limited),
Report on the audit of the standalone financial statements Opinion
We have audited the accompanying standalone financial statements of TOLINS TYRES LIMITED(fonnerIy known as Tolins Tyres Private Limited) ("the Company"), which comprise the balance sheet as at 31s1 March 2024, the Statement of Profit and Loss Account (including other comprehensive income), the statement of changes in equity and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of signiticant accounting policies and other explanatory information (herein and after referred to as Standalone Financial Statement").
In our opinion and to the best of our information and according to tire explanations given to us, the aforesaid financial statements give the information required by tire Companies Act, 2013 ('the Act') in the manner so required and give a true and fair view in conformity with the accounting standards prescribed under section 133 of the Act read with tire companies(Indian Accounting Standards) rule 2015, as amended, (Tnd AS’) and generally accepted accounting principles in India, of the state of affairs of the Company as at 31sl March 2024 and its profit, total comprehensive income, changes in equity and its cash flows for the year ended on that date.
Basis for opinion
We conducted our audit of standalone financial statement in accordance with the standards on auditing (SA's) 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 tire 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 die ethical requirements that are relevant to our audit of the standalone financial statements under die provisions of die Act and die rules thereunder, and we have fulfilled our other ediical responsibilities in accordance with these requirements and die 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.
Kev 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 financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
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Kev Audit Matters
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Our Response
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1
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The company uses several systems for its overall financial reporting and there is a large volume of transactions being recorded at multiple locations daily. In addition, there are increasing challenges to protect the integrity of the company's systems and data since cyber security has
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Due to the automated controls and high degree of dependence in information systems, there is a risk that the financial accounting and reporting records may be misstated in caseyiTartycontrol lapses in the IT system related i^frcftifsi^/y^ave
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SI No
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Key Audit Matters
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Our Response
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become a more significant risk in recent periods.
Due to the pervasive nature and complexity of the IT environment as well as its importance in relation to accurate and timely financial reporting, we have identified this area as a Key Audit Matter.
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designed our audit procedures in accordance with the guidelines laid down in the Standards on Auditing (SA 530) and tested the controls in the Information Technology Systems on a sample basis which has an impact on the financial accounting and reporting records. We have also tested on a sample basis the controls related to access management including user rights in passing entries, approval for authorizing entries, authorization for reversing entries, segregation of duties, system password protection, external software/hardware access rights etc. Based on our sample review, no material weakness was identified in the IT related systems and controls.
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2
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The company holds a significant amount of inventory, including raw materials, work-in-progress, and finished goods, across various locations and manufacturing plant. The valuation of these inventories is critical as it directly impacts the company's financial results. The complexity arises from the need to correctly allocate costs, determine the net realizable value, and assess the potential obsolescence of inventory.
Given the scale of operations and diversity of products, the valuation process requires significant management judgment, particularly in estimating the recoverable amounts of inventory items that may be slow-moving or obsolete.
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We have assessed the effectiveness of the company's internal controls over inventory management, including physical counts and tire valuation process.
We have attended physical inventory counts at key locations to observe the procedures and ensure that the inventory quantities recorded were accurate.
Reconciliation of physical inventory counts to the inventory records was conducted, along with testing a sample of inventory items for valuation accuracy.
Reliance was placed on stock audit report made for the purpose of valuation of inventory.
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3
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Completeness in identification and disclosure of related party transactions in accordance with the applicable reporting framework.
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We have accessed the laid down systems and processes of the Company in identifying related party transactions and its ultimate disclosure in financial statements in accordance with the applicable reporting framework. We have designed the audit procedures in accordance with tire guidelines prescribed in Standards on Auditing (SA 550) to identify the risks of material misstatement arising from an entity's failure to appropriately account for or disclose material related party transactions. We have also reviewed the minutes of meetings of the board in tire course of the audit to identify any transactions that may require disclosure in accordance with the applicable reporting framework.
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Information other than the standalone financial statements and auditors' 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 annual report, Board's Report including Annexures to Board s Repoit and Business responsibility report but does not include the standalone financial statements and our auditors repoit 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 intormation 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 board of directors are 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 ot the financial position, financial performance including other comprehensive income, changes in equity and cash flows of the Company in accordance with the IND AS and including other accounting principles generally accepted in India, (accounting standards specified under section 133 of the Act, read with the companies (accounting standards) rule,2006, 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 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 Statement 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.
A,.H;.nr'g 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 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 audil 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 finaneial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain au i evi
is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a ma eria misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgen-, intentional omissions, misrepresentations, or the override of internal control.
. Obtain an understanding of internal control relevant to die audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act, 2013, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls system in p ace 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 die Standalone Financial Statements that, individually or in aggregate' makes it probable that tine economic decisions of a reasonably knowledgeable user of tire 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 tire 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 drought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with drose charged with governance, we determine those matters drat were of most significance in the audit of dre standalone financial statements of the current period and are therefore die key audit matters We describe drese 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 tine 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 tine Companies Act, 2013, based on our audit, we report that:
(a) We have sought and obtained all tine 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 tine Company so far as it 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 Equip and the cash flow statement if any dealt with by this report are in agreement with the books of account,
(d) In our opinion, the aforesaid standalone financial statements comply with tire Indian accounting standards(Ind AS) specified under section 133 of the Act, (read with rule 7 of the Companies (Accounts) Rules, 2014);
(e) On the basis of the written representations received from the directors as on 31s1 March 2024 taken on record by the board of directors, none of the directors is disqualified as on 31sl 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 over financial reporting of the Company and the operating effectiveness of such controls refer to our separate report in "Annexure - B". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company's internal financial controls over financial reporting;
(g) 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 tire explanation 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.
(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, in our opinion and to the best of our information and according to the explanations given to us: -
a The Company does not have pending litigations which impact on its standalone financial position in its Standalone Financial Statements.
b The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses to the standalone financial statements; and
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, other than disclosed in notes to accounts, 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 ol lunds) by the Company to or in any other person or entity, including foreign 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 identtiiui
in any manner whatsoever by or on behalf of the Company ( Ultimate Bene iciaries or p -
guarantee, security or the like on behalf of the Ultimate Beneficiaries,
(b) Tire Management has represented, that, to the best of its knowledge and belief, other than d’s , _
notes to accounts, no funds (which are material either individually or in e aggrega e) received by the Company from any person or entity, including foreign entity ( un mg '
with tire understanding, whether recorded in writing or otherwise, that the ompany s a ' '
directlv or indirectly, lend or invest in other persons or entities identified in any manner w a bv or on behalf of tire Funding Party ("Ultimate Beneficiaries") or provide any guarantee, secu ty the like on behalf of tire Ultimate Beneficiaries;
(c) Based on the audit procedures that have been considered reasonable and appropriate m the
circumstances, nothing has come to our- notice that has caused us to believe that the representation under sub-clause (i) and (ii) of Rule 11(d), as provided under (a) and (b) above, contain any maten
misstatement.
e. The company has not declared or paid any dividend during the year in contravention of provision section 123 of the Companies Act, 2013.
f Based on our examination, which included test checks, the Company has used accounting software for maintaining its books of account for the financial year ended March 31, 2024 which has feature o recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further, during the course of our audit we did not come across any instance of the audit trail feature being tampered with.
As proviso to Rule 3(1) of the Companies (Accounts) Rule, 2014 is applicable from April 1, 2023, reporting under Rule ll(g)of the Companies (Audit and Auditors) Rule, 2014 on preservation of audit trial as per statutory requirements for record retention is not applicable for the financial year ended
March 31,2024.
For Kflshhan Retna & Associates Chartered Accountants S Finn Registration NOy0Ul536S
Nikhil R KuWj^
Partner / \ XSaV
Membership No. 231162 'vV
______ I(0( UlARTEKKDttrl
Dale : 24.07.2024 (^(accountants)^))
Place : Frnakulam JlPjJ
UDIN : 24231162BKRSVC8670
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