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Agarwal Industrial Corporation Ltd.

BSE: 531921 Sector: Industrials
NSE: AGARIND ISIN Code: INE204E01012
BSE LIVE 15:25 | 18 Oct 520.00 -9.90
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NSE 15:31 | 18 Oct 521.65 -4.35
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OPEN 520.00
PREVIOUS CLOSE 529.90
VOLUME 50397
52-Week high 792.00
52-Week low 265.15
P/E 54.34
Mkt Cap.(Rs cr) 528
Buy Price 515.10
Buy Qty 100.00
Sell Price 520.00
Sell Qty 3.00
OPEN 520.00
CLOSE 529.90
VOLUME 50397
52-Week high 792.00
52-Week low 265.15
P/E 54.34
Mkt Cap.(Rs cr) 528
Buy Price 515.10
Buy Qty 100.00
Sell Price 520.00
Sell Qty 3.00

Agarwal Industrial Corporation Ltd. (AGARIND) - Auditors Report

Company auditors report

To The Members of Agarwal Industrial Corporation Limited

Report on the Standalone Financial Statements

1. We have audited the accompanying Standalone financial statements of AgarwalIndustrial Corporation Limited ("the Company") which comprise the BalanceSheet as at March 31 2016 and the Statement of Profit and Loss the Cash Flow Statementfor the year then ended and a summary of significant accounting policies and otherexplanatory information.

Management’s Responsibility for the Standalone Financial Statements

2. The Company’s Board of Directors is responsible for the matters stated insection 134(5) of the Companies Act 2013 ("the Act") with respect to thepreparation of these standalone financial statements that give a true and fair view of thefinancial position financial performance and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes the maintenance of adequate accountingrecords in accordance with the provision of the Act for safeguarding the assets of theCompany and for preventing and detecting the frauds and other irregularities; selectionand application of appropriate accounting policies; making judgments and estimates thatare reasonable and prudent; and design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor’s Responsibility

3. Our responsibility is to express an opinion on these standalone financial statementsbased on our audit.

4. 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 thereunder.

5. We conducted our audit in accordance with the Standards on Auditing specified undersection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.

6. An audit involves performing procedures to obtain audit evidence about the amountsand the disclosures in the financial statements. The procedures selected depend on theauditor’s judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal financial control relevant to the Company’spreparation of the financial statements that give a true and fair view in order to designaudit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of accounting policies used and the reasonableness of theaccounting estimates made by Company’s Directors as well as evaluating the overallpresentation of the financial statements.

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

Opinion

8. In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at 31st March 2016 and its profit and its cash flows for the year ended on that date.

Report on other Legal and Regulatory Requirements

9. As required by the Companies (Auditor’s Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act and on the basis of such checks of the books and records of theCompany as we considered appropriate and according to the information and explanationsgiven to us we give in the "Annexure B" a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.

10. As required by section 143(3) of the Act we report that: a) We have sought andobtained all the information and explanations which to the best of our knowledge andbelief 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 it appears from our examination of those books.

c) The Balance Sheet the Statement of Profit and Loss and Cash Flow Statement dealtwith by this Report are in agreement with the books of account.

d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.

e) On the basis of written representations received from the directors as on 31stMarch 2016 taken on record by the disqualified Board of Directors none of thedirectors as on 31st March 2016 from being appointed as a director in terms of Section164(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 A".

g) With respect to the other matters to be included in the Auditor’s Report inaccordance with Rule 11 of Companies (Audit and Auditors) Rules 2014 in our opinion andto the best of our information and according to the explanations given to us:

i) The Company does not have any pending litigations which would impact its financialposition;

ii) The Company did not have any long-term contracts including derivatives contractsfor which there were any material foreseeable losses; and

iii) There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.

For Ladha Singhal & Associates
Chartered Accountants
(Firm Registration No. 120241W)
Ajay Singhal
(Partner)
M. No. 104451
Place: Mumbai
Dated: 30th May 2016.

Annexure A to Independent Auditor’s Report

Referred to as ‘Annexure A’ in paragraph 10(f) of the IndependentAuditors’ Report of even date to the members of Agarwal Industrial CorporationLimited on the standalone financial statement for the year ended on 31st March 2016.

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

1. We have audited the internal financial controls over financial reporting of AgarwalIndustrial Corporation Limited ("the Company") as on 31st March 2016 inconjunction with our audit of the standalone financial statements of the Company for theyear ended and as on that date.

Management’s Responsibility for Internal Financial Controls

2. The Company’s management is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountants of India ("the GuidanceNote"). These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company’spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditors’ Responsibility

3. 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 over financial reporting. Those Standards and theGuidance Note require that we comply with the ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the 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 financial statements whether due to fraud or error.

5. 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 controlssystem over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

6. A company’s internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company’s internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised 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

7. 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

8. In our opinion to the best of our information and according to the explanationsgiven to us the Company has in all material respects an adequate internal financialcontrols system over financial reporting and such internal financial controls overfinancial reporting were operating effectively as at 31 March 2016 based on the internalcontrol over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For Ladha Singhal & Associates
Chartered Accountants
(Firm Registration No. 120241W)
Ajay Singhal
Place: Mumbai (Partner)
Dated: 30th May 2016. M. No. 104451

Annexure B to Independent Auditor’s Report

Referred to as ‘Annexure B’ in paragraph 9 of the Independent Auditors’Report of even date to the members of Agarwal

Industrial Corporation Limited on the standalone financial statement for the year endedon 31st March 2016 we report that:

(i) (a) The company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) The fixed assets have been physically verified by the management during the yearunder a regular program of which in our opinion is reasonable having regard to the sizeof the company and the nature of its assets. No discrepancies were noticed on suchverification.

(c) According to the information and the explanation given to us and the recordsexamined by us we report that the title deeds of immovable properties are held in thename of the Company as at the Balance Sheet date.

(ii) As explained to us the inventories were physically verified during the year bythe management at reasonable intervals and no material discrepancies were noticed onphysical verification.

(iii) The Company has granted interest free unsecured loan to one body corporate beingwholly owned subsidiary covered in the register maintained under section 189 of theCompanies Act 2013 (‘the Act’).

(a) In respect of aforesaid loan granted the terms and condition under which suchloans are granted are not prejudicial to the interest of the company.

(b) In respect of aforesaid interest free long term loan granted to wholly ownedsubsidiary by the company there is no schedule of repayment of principle.

(c) There are no overdue amounts for more than ninety days or more in respect of theloan granted to the body corporate listed in the register maintained under section 189 ofthe Act.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Act with respectto the loans and investments made.

(v) In our opinion and according to the information given to us the company has notaccepted deposits and hence compliance with the directives issued by Reserve Bank ofIndia and the provisions of sections 73 to 76 or any other relevant provisions of the Actand the rules framed there under with regard to the deposits accepted is not applicable.

(vi) We have broadly reviewed the books of accounts maintained by the Company pursuantto the Rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Act in respect of Company’s products/ services and are of theopinion that prima facie the prescribed accounts and records have been made andmaintained. However we have not made a detailed examination of the records with a view todetermine whether they are accurate or complete.

(vii) (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company the company is regular in depositing withappropriate authorities applicable undisputed statutory dues including employee stateinsurance income tax sales tax service tax duty of custom duty of excise value addedtax cess.

(b) According to the information and explanation given to us no undisputed amountspayable in respect of employee state insurance income tax sales tax service tax dutyof custom duty of excise value added tax or cess were in arrears as at 31st March 2016for a period of more than six months from the date they became payable.

(c) According to the information and explanation given to us details of employee stateinsurance income tax sales tax service tax duty of custom duty of excise value addedtax or cess which have not been deposited as on 31st March 2016 on account of any disputeare as given below:

Name of Statute Nature of the dues Unpaid disputed Amount (in Lacs) Period for which the amount relates Forum where dispute is pending
The Karnataka Tax on Entry of Goods Act 1979 Tax on Entry of Goods 39.75 April 2011 to March 2012 JCCT Appeal
The Karnataka Value Added Tax 2003 Sales Tax Demand 0.97 April 2011 to March 2012 JCCT Appeal
Central Sales Tax 1956 Sales Tax Demand 0.93 April 2010 to March 2011 JCCT Appeal
The Karnataka Tax on Entry of Goods Act 1979 Tax on Entry of Goods Demand 38.35 April 2010 to March 2011 JCCT Appeal
Custom Act Penalty under the Custom Act 6.48 April 2013 to March 2014 CESAT Appellate Tribunal
Income Tax Act Income Tax Demand 20.25 A.Y. 2003-04 Rectification
Income Tax Act Income Tax Demand 17.50 A.Y. 2004-05 Rectification
Income Tax Act Income Tax Demand 35.43 A.Y. 2013-14 Commissioner of Income Tax (Appeal)

(viii) In our opinion and according to the information and explanation given to us thecompany has not defaulted in the repayment of loans or borrowings to banks or financialinstitutions. The Company does not have any borrowings from government and has not issuedany debentures.

(ix) The Company has not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) or term loans during the year; hence clause3(ix) of the Companies (Auditors’ Report) Order 2016 are not applicable to theCompany.

(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.

(xi) According to the information and explanation give 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 the Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi company; hence clause 3(xii) of the Companies (Auditors’Report) Order 2016 is not applicable to the Company.

(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with the sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the standalone financial statements as required by theapplicable accounting standards.

(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year hence; clause 3(xiv) ofthe Companies (Auditors’ Report) Order 2016 is not applicable to the Company.

(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with the directors or the persons connected to its directors; hence clause3(xv) of the Companies (Auditors’ Report) Order 2016 is not applicable to theCompany.

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

For Ladha Singhal & Associates
Chartered Accountants
(Firm Registration No. 120241W)
Ajay Singhal
Place: Mumbai (Partner)
Dated: 30th May 2016. M. No. 104451