Kernex Microsystems (India) Ltd. — Interim / Quarterly Report 2020

Sep 19, 2019

P R 5 V & Co. LLP Chart e red A c c o untant s

202, Saptagiri Residency, 1· 10-9BIA, Chikoti Gardens, Begumpet, Hyderabad - 500 016 Phone : +91 4066108177/27766881 Telefax : +91 4027766881 E·mail prsvco@gmail.com Website : prsvllp.com

Independent Auditor's Review Report on the Quarterly Unaudited Standalone and Year to Date Financial Results of the Company Pursuant to the Regulation 33 of the SEBJ (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended.

To The Board of Directors of KERNEX MICROSYSTEMS (INDIA) LIMITED

• I. We ha ve reviewed the accompanying Statement of unaudited standalone financial results of KERNEX MICROSYSTEMS (INDIA) LIMITED for the quarter ended June 30, 2019 (t he "statement"). being submitted by the Company pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 ('the Regulation') as amended, read with SEBI Circular No.CI R/CFD/CMD I 144/20 19 dated March 29, 2019 ('the Circular').
• 1. This Statement. which has been prepared in accordance with the recognition and measurement principles laid down in the Indi an Accounting Standard 34 "Interim Financial Reporting" (" Ind AS 34"), prescribed under Secti on 133 of the Companies Act, 20 13 read with relevant rules issued there under and other accolln ting principles generally accepted in Indi a. read with the circular is the responsibility or the Company's Management and has been approved by the Board of Directors of the Company. Our responsibility is to issue a report on the Statement based on our review,
• 3, We conducted our review of the statement in accordance with the Standards on Review Engagements (SRE) 2410 'Review of Interim Financial Informati on Perfo rmed by the Independent Auditor or the Entity' , issued bv the Institute or Cha rtered ACCOUlllalllS of India. This Standard require::. that we plan and perform the rcvic\ to obtain moderate assurance as to whether the statement is free I"rom m8lcrialmisstatemenl. A review is limited primarily to inquiries ofColllpany personnel and analytical procedures applied to financial data and thus provides less assu rance than an audil. We have not perfo rmed an aud it and accordingly, we do not express an aud it opinion.
• 1. l3asccl on QLlr review conducted as above. nothing has come to our attention that callses tiS to believe lhat the accompanying statement. prepared in accordance with the aforesa id Indian Accounting Standards pr ~scr b"d und",. secti on 133 of the Companies Act. 20 13 read with rule 7 of the Companies (Accoullls) Ru les. 2014 and other accouilling principles generall y accepted in India, has not disc losed the information required to be disclosed in terms of the Regu lation, read with the Circul ar. including the manner in whi ch it is to be disclosed, or that it cOlllains any material 111 isstatel11enls.

1. We draw your attention that the statement which indicates the preparation of financial results of the Company on going concern basis for reasons stated therein. The appropriateness of assumption of going concern is dependent upon revival of market and consequently the Company's ability to generate sustainable cash flows in future to meet its obligations.

Our report is not modified in respect of this matter.

For PRSV & Co.LLP Chartered Accountants Firm Registration No: S200016

$8CC$ Hyderabad Y.Venkateswarlu Partner Acc

Place: Hyderabad Date: August 13, 2019

Membership No: 222068

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UDIN: 19222068 AAAAAQ9453

P R 5 V & Co. LLP Chartered Accountants

202, Saptagiri Residency, 1-10-98/A, Chikoti Gardens, 8egumpet, Hyderabad - 500 016 Phone : +91 4066108177/27766881 Telefax : +91 4027766881 E-mail prsvco@gmail.com Website : prsvllp.com

Independent Auditor's Review Report on the Qnarterly Una udited Consolidated and Veal' to Date Financial Res nlts of the Company Pursuant to the Regulation 33 or the SEBI (Listing Obligations and Disclosnre Requirements) Regulations, 2015, as amended,

To The Boa rd or l)ircctors or KI!:RNEX MICIWSVSTEMS (INDIA) LIMITED

• I. We have reviewed thc accompanying Statemel1l of Consol idated unaudited financial resu lts of KERN EX MICROSVSTEMS (INDIA) LIMITED ("'the Parent") and its subsidiaries (the Parent and its subsidiaries together referred to as '·the Group") and its share of the net profit after tax and total comprehensive loss of its joint ventures for the quarter ended Ju ne 30. 20 19 (the "statement"), being submitted by the Parent pursuant to the requi rements of Regulation 33 of the SEBI (Listing Obligation and Disc losure Requirements) Regul ations, 2015 ('the Regulation ') as amended, read with SEBI Circular NoCIR/CFD/CMDI /44/20 19 datcd March 29. 2019 ('the Circular').
• 1. This Statemel1l, which has been prepared in accordance with the recognition and measurement principlcs laid down in thc Indian Accounting Standard 34 " Intcrim Financial Reporting" (" Ind AS 34" ). prescri bed under Section 133 orthe Compani es Act. 2013 read with relevant rules issued there under and other accolillting principles generally accepted in India. read with the circular is the responsibility of the Parel1l's Managemcill and has bcen approved by thc Board of Directors of the Company. Our responsibility is to issue a repon on the Statement based 011 our revi ew.
• 1. We conducted our review of' the statement in accordance with the Standards on Rev iew Engagemeills (SRE) 2410 'Review of Il1lerim Financial Information Performed by the Independent Aueli tor of the El1lity' . issued b) the Institute of Chartered Accounta nts of Inelia. A review of interim linancial information consists or making inquiries, primarily of persons responsible for fin ancial and accounting mailers. and applyi ng analytical anel other review procedures. A review is substantially less in scope than an audit conducted in accorda nce wi th Standards on Auditing and consequently does not enablc us to obtain assurance that we wou ld become aware of all signi fi cant matters that might be identilied in an audit. Accordingl). \ c do not express an auelit opinion.

We also performed procedures in accordance with the circular issued by the SEBI under Regulation 33 (8) of the SEB I (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, to the extent appl icabl e.

• 1. The Statement includes the resuits or the entities as mentioned in Annexure I .
• 5. Based on our review conducted and procedures performed as stated in paragraph 3 above and based on the consideration of the review reports of other auditors referred to in paragraph 7 and 8 below, nothi ng has come to our attention that causes us to bel ieve that the accompanying Statement, prepared in accordance \ ilh the recognition and measurement principles laid down in the aforesaid Indian Accounting Standards prest:ribcd under sec tion 133 ortlle Companies Act. 2013 read with rule 7 of the Companies (Accounts) Rul es. 2014 and othcr accounting principles generally accepted in India, has not di sc losed the information required to be di sclosed in terms of the Regulation, read with the Circular, including the manner in which it is to be disc losed, or that it contains any material m isstatel11ents.
• 6. Since subsidiary is following Cash basis of accounting. no provision is made towards interest of Rs 79.25 lakin on unsecured loan lor the quaner ended June 30. 2019. The loss or the subsidiary is short reponed by Rs 79.25 crores lor the quarter ended June 30, 2019.
• 1. We did not rev iew the interim linancial results and other fina ncial intormation of I whol ly owned subsidiary. included in the consol idated unaudited financial results, whose interim financial results and other linanci,,1 inlormation rellects total revenues of Rs.26.08 Lakhs. and total net profit afler tax or Rs.3A3 lakhs. and total comprehensive income of Rs. Nil. j·or the quarter ended June 30, 20 19 as considered in the consol idated unaudited tinancial resuits. These interim financial resuits and other financial inlormation of\holl) 011 ned subsidiar) have been reviewed by other auditors whose reports have been furni shed to us by the management and QLlr concl usion on the statement, in so far as it relates to the amounts and di sc losures included in respect of the subsidiary, is based solely on the reports 01' the other auditors and procedures performed by us as stated in paragraph 3 above. Our conc lusion on the Statement is nOt mod ifi ed in respect of the above matter.
• 1. The consolidated unaudited financial results also includes the Group's share of net profit/(Ioss) after tax or Rs. N il and total comprehensive income/(Ioss) of Rs. N il. for the quarter ended June 30. 2019, as considered in the consolidated unauditecl financial res Li lts, in respect of I Joint venture, based on their interilll 11nancial results and /-inancial inforl11ati on which have not been rev iewed by their auditors. These '.' inaneial Results ha ve been approved by the Management and furn ished to LIS. According 10 the information and explanation given to us by the Management, these interim financial results arc not material to the Group. Our conclusion on the Statement is not modified in respect of the above matter.

1. We draw your attention that the statement which indicates the preparation of financial results of the Company on going concern basis for reasons stated therein. The appropriateness of assumption of going concern is dependent upon revival of market and consequently the Company's ability to generate sustainable cash flows in future to meet its obligations. Our conclusion on the Statement is not modified in respect of the above matter.

For PRSV & Co.LLP Chartered Accountants Firm Registration No: S200016 $8CQ$

Hyderabad Y.Venkateswarlu ed Act Partner Membership No: 222068

Place: Hyderabad Date: August 13, 2019

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UDIN: 19222068 AAAAAR9317