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Aarti Industries Ltd.

BSE: 524208 Sector: Industrials
NSE: AARTIIND ISIN Code: INE769A01020
BSE LIVE 15:40 | 15 Dec 948.65 42.60
(4.70%)
OPEN

915.15

HIGH

951.00

LOW

905.00

NSE 15:50 | 15 Dec 947.65 40.90
(4.51%)
OPEN

913.30

HIGH

951.00

LOW

913.30

OPEN 915.15
PREVIOUS CLOSE 906.05
VOLUME 19782
52-Week high 1024.95
52-Week low 672.00
P/E 26.89
Mkt Cap.(Rs cr) 7,790
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 915.15
CLOSE 906.05
VOLUME 19782
52-Week high 1024.95
52-Week low 672.00
P/E 26.89
Mkt Cap.(Rs cr) 7,790
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Aarti Industries Ltd. (AARTIIND) - Auditors Report

Company auditors report

To

The Members of

Aarti Industries Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying Standalone Ind AS financial statements of AARTIINDUSTRIES LIMITED ("the company") which comprise the Balance Sheet as at 31stMarch 2017 the Statement of Profit and Loss (including other comprehensive income) theCash flow statement and the Statement of Changes in Equity for the year then ended and asummary of significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese Standalone Ind AS financial statements that give a true and fair view of financialposition financial performance including other comprehensive income cash flows and thechanges in equity of the Company in accordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards (Ind AS) prescribed underSection 133 of the Act read with the relevant rules issued thereunder.

This responsibility also includes the maintenance of adequate accounting records inaccordance with the provision of the Act for safeguarding of the assets of the Company andfor preventing and detecting the frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial control that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Standalone Ind AS financial statements that give a true and fair view and are freefrom material misstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these Standalone Ind AS financialstatements based on our audit.

We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made there under.

We conducted our audit of the Standalone Ind AS financial statements in accordance withthe Standards on Auditing specified under section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the Standalone Ind AS financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the Standalone Ind AS financial statements. The procedures selected dependon the auditor's judgment including the assessment of the risks of material misstatementof the Standalone Ind AS financial statements whether due to fraud or error. In makingthose risk assessments the auditor considers internal financial control relevant to thecompany's preparation of the Standalone Ind AS financial statements that give true andfair view in order to design audit procedures that are appropriate in the circumstances.

An audit also includes evaluating the appropriateness of accounting policies used andthe reasonableness of the accounting estimates made by Company's Directors as well asevaluating the overall presentation of the Standalone Ind AS financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India including the Ind AS of thestate of affairs (financial position) of the Company as at 31st March 2017 andits profit (financial performance including other comprehensive income) its cash flowsand the changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of Section 143(11) of the Companies Act2013 we give in the "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the Order.

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 bestof 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 theCompany so far as appears from our examination of those books;

c) The Balance Sheet Statement of Profit and Loss (including other ComprehensiveIncome) Cash Flow Statement and the Statement of Changes in Equity dealt with by thisreport are in agreement with the books of account;

d) In our opinion the aforesaid Standalone Ind AS financial statements comply with theAccounting Standards specified under Section 133 of the Act read with the relevant rulesissued thereunder

e) On the basis of the written representations received from the Directors as on 31stMarch 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2017 from being appointed as a Director in termsof section 164(2) of the Act;

f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in "Annexure B".

g) With respect to the other matters included in the Auditor's Report in accordancewith Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to ourbest of our information and according to the explanations given to us :

i. The Company has disclosed the impact of pending litigations as at 31stMarch 2017 on its financial position in its Standalone Ind AS financial statements. ReferNote 25 to the Standalone Ind AS financial statements;

ii. The Company did not have any long term contracts including derivative contracts forwhich there were any material foreseeable losses;

iii. There has been no delay in transferring amount required to be transferred to theInvestor Education and Protection Fund by the Company;

iv. The Company has provided requisite disclosures in the Standalone Ind AS financialstatements as to holding as well as dealings in Specified Bank Notes during the periodfrom 8th November 2016 to 30th December 2016 and further these arein accordance with books of accounts maintained by the Company and as produced to us bythe management. Refer Note 6 to the Standalone Ind AS financial statements.

For GOKHALE & SATHE

CHARTERED ACCOUNTANTS

Firm Reg. No.: 103264W

CA TEJAS. J. PARIKH

PARTNER

Membership No: 123215

Place: Mumbai

Date: 19th May 2017

"ANNEXURE A" TO THE INDEPENDENT AUDITORS' REPORT

In the Annexure as required by the Companies (Auditors Report) Order 2016 issued bythe Centrai Government in terms of Section 143 (11) of the Companies Act 2013 and on thebasis of the checks as we considered appropriate we report on the matters specified inparagraph 3 and 4 of the said order to the extent appiicabie to the Company

(i) (a) The Company is generally maintaining proper records showing fuii particuiarsinciuding quantitative details and situation of property plant and equipment.

(b) The Company has phased programme of physical verification of fixed assets by whichaii fixed assets are verified over a period of three years. In our opinion periodicity ofphysicai verification is reasonable having regard to the size of the Company and nature ofthe assets. We have been informed that no materiai discrepancy was noted on such physicaiverification.

(c) According to the information and expianations given to us and on the basis ofexamination of the records of the Company title deeds of immovable properties other thanseif-constructed immovable property (buildings) are held in the name of the Company.

(ii) The stock of inventory has been physically verified during the year by theManagement at reasonable intervals except stock lying with third parties confirmation ofsuch stocks with the third parties has been obtained by the Company. In our opinion theprocedures of physicai verification of inventory foiiowed by the management are reasonabieand adequate in reiation to the size of the Company and the nature of its business. Thediscrepancies noticed on physicai verification of stocks as compared to book records werenot material; however the same have been dealt with the books of account.

(iii) The Company had granted unsecured loan to its one whoiiy owned subsidiary coveredin the register maintained under section 189 of the Companies Act.

a) In our opinion terms and conditions of such loan was not prejudicial to theinterest of the Company.

b) The schedule of principal amount and interest has been stipulated and it is regular.

c) There is no overdue amount in respect of such loan granted.

(iv) In our opinion and according to the information and expianations given to us theCompany has compiied with provisions of section 185 and 186 of the Act with respect toloans and investments made.

(v) The Company has not accepted any deposits from public during the year.

(vi) The Company has maintained cost records as required under sub section 1 of section148 of the Companies Act 2013. We have not however carried out a detailed examinationof such records.

(vii) (a) The Company is regular in depositing with appropriate authorities undisputedstatutory dues including the Provident Fund Employees state insurance Income tax Salestax Wealth tax Service tax duty of Customs duty of Excise Value added tax cess andany other statutory dues appiicabie to it.

(b) According to the information and explanation given to us there are no dues ofincome tax saies tax service tax custom duty excise duty and value added tax whichhave not been deposited on account of any dispute except the following:

(Rs. in Crores)

Name of the Statute / Nature of the Financial Year Forum where dispute is pending Total
Dues Commissionerate Appellate Authorities and Tribunals
The Centrai Excise Act 1944/Custom Duty/Service Tax/Interest & Penalty FY 2001-02 to FY 2013-14 38.50 18.09 56.59
Income Tax Act / Tax Interest & Penalty FY 2008-09 FY 200910 FY 2010-11 FY 2011-12 FY 2012-13 12.80 12.80
Total 51.30 18.09 69.39

(viii) In our opinion and according to the information and explanation given to us theCompany has not defaulted in repayment of dues for loan taken from financial institutionsor bank or debenture holders.

(ix) In our opinion and according to the information and explanation given to us theterm loans raised during the year were applied for the purpose for which the loans wereobtained. The Company did not raise any money by way of public offer or further publicoffer (including debt instruments) during the year.

(x) According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.

(xi) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.

(xii) In our opinion and according to information and explanations given to us theCompany is not a Nidhi Company. Accordingly paragraph 3(xii) of the Order is notapplicable.

(xiii) According to the information and explanation given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details thereof havebeen adequately disclosed in the Standalone Ind AS financial statements under Note No. 31in accordance with the Accounting Standards applicable to the Company.

(xiv) According to the information and explanation given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year.

(xv) According to the information and explanation given to us the Company has notentered into non-cash transactions with Directors or persons connected with him.Accordingly paragraph 3(xv) of the Order is not applicable.

(xvi) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

For GOKHALE & SATHE

CHARTERED ACCOUNTANTS

Firm Reg. No.: 103264W

CA TEJAS. J. PARIKH
Place : Mumbai PARTNER
Date: 19th May 2017 Membership No: 123215

"ANNEXURE B" TO THE INDEPENDENT AUDITORS' REPORT

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of AARTIINDUSTRIES LIMITED ("the Company") as of March 31 2017 in conjunction with ouraudit of the Standalone Ind AS financial statements of the Company for the year ended onthat date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting('Guidance Note') issued by the Institute of Chartered Accountants of India (ICAI). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to Company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the 'Guidance Note and the Standards on Auditing issued by ICAI and deemed to beprescribed under section 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls. The Standards and the Guidance Note require thatwe comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the Standalone Ind AS financial statements whether due to fraudor error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A Company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A Company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the Company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the Company are being made only in accordance with authorizations ofmanagement and directors of the Company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of theCompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 2017 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For GOKHALE & SATHE

CHARTERED ACCOUNTANTS

Firm Reg. No.: 103264W

CA TEJAS. J. PARIKH
Place: Mumbai PARTNER
Date: 19th May 2017 Membership No: 123215