Heritage Foods Limited | 30th Annual Report 2021-22

Financial Statements Company Overview Statutory Reports 133 Annexure A referred to in Paragraph 16 of the Independent Auditor’s Report of even date to the members of Heritage Foods Limited on the standalone financial statements for the year ended 31 March 2022 In terms of the information and explanations sought by us and given by the Company and the books of account and records examined by us in the normal course of audit, and to the best of our knowledge and belief, we report that: (i) (a) (A) The Company has maintained proper records showing full particulars, including quantitative details and situation of property, plant and equipment, right of use assets and investment property. (B) The Company has maintained proper records showing full particulars of intangible assets. (b) The property, plant and equipment,right of use assets and investment property have been physically verified by the management during the year and no material discrepancies were noticed on such verification. In our opinion, the frequency of physical verification program adopted by the Company, is reasonable having regard to the size of the Company and the nature of its assets. (c) The title deeds of all the immovable properties including investment properties held by the Company (other than properties where the Company is the lessee and the lease agreements are duly executed in favour of the lessee) are held in the name of the Company. (d) The Company has not revalued its Property, Plant and Equipment and Right of Use assets or intangible assets during the year. (e) No proceedings have been initiated or are pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder. Accordingly, reporting under-clause 3(i)(e) of the Order is not applicable to the Company. (ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year, except for inventory lying with third parties and goods-in-transit. In our opinion, the coverage and procedure of such verification by the management is appropriate and no discrepancies of 10% or more in the aggregate for each class of inventory were noticed. In respect of inventory lying with third parties, these have substantially been confirmed by the third parties. (b) The Company has a working capital limit in excess of ` 5 crore sanctioned by banks based on the security of current assets. The quarterly statements, in respect of the working capital limits have been filed by the Company with such banks and such statements are in agreement with the books of account of the Company for the respective periods, which were not subject to audit. (iii) (a) The Company has not provided any loans or advances in the nature of loans, or security to any other entity. However, the Company has provided guarantee to two companies. The details of the same are given below: Particular s Guarantees ( ` in millions) Aggregate amount during the year - Subsidiary - Joint Venture 80.00 50.00 Balance outstanding as at balance sheet date - Subsidiary - Joint Venture 207.50 220.00 (b) In our opinion, and according to the information and explanations given to us, the investments made, guarantees provided, are prima facie, not prejudicial to the interest of the Company. The Company has not provided any security or granted any loans or advances in the nature of loans during the year. (c) The Company does not have any outstanding loans and advances in the nature of loans at the beginning of the current year nor has granted any loans or advances in the nature of loans during the year. Accordingly, reporting under clauses 3(iii)(c), 3(iii) (d), 3(iii)(e) and 3(iii)(f) of the Order is not applicable to the Company. (iv) In our opinion, and according to the information and explanations given to us, the Company has complied with the provisions of section 186 of the Act in respect of investments and guarantees as applicable. Further, the Company has not entered into any transaction covered under section 185and section 186 of the Act in respect of loans and security. (v) In our opinion, and according to the information and explanations given to us, the Company has not accepted any deposits or there is no amount which has been considered as deemed deposit within the meaning of sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, reporting under clause 3(v) of the Order is not applicable to the Company. (vi) The Central Government has specified maintenance of cost records under sub-section (1) of section 148 of the Act only in respect of specified products of the Company. For such products, we have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under the aforesaid section, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete. Standalone