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BGR Energy Systems Ltd.

BSE: 532930 Sector: Engineering
NSE: BGRENERGY ISIN Code: INE661I01014
BSE LIVE 15:43 | 06 Dec 118.20 1.25
(1.07%)
OPEN

117.90

HIGH

120.00

LOW

116.50

NSE LIVE 15:58 | 06 Dec 118.05 0.75
(0.64%)
OPEN

117.80

HIGH

119.90

LOW

116.05

OPEN 117.90
PREVIOUS CLOSE 116.95
VOLUME 36558
52-Week high 138.80
52-Week low 89.40
P/E 21.97
Mkt Cap.(Rs cr) 852.93
Buy Price 0.00
Buy Qty 0.00
Sell Price 118.20
Sell Qty 252.00
OPEN 117.90
CLOSE 116.95
VOLUME 36558
52-Week high 138.80
52-Week low 89.40
P/E 21.97
Mkt Cap.(Rs cr) 852.93
Buy Price 0.00
Buy Qty 0.00
Sell Price 118.20
Sell Qty 252.00

BGR Energy Systems Ltd. (BGRENERGY) - Auditors Report

Company auditors report

TO THE MEMBERS OF BGR ENERGY SYSTEMS LIMITED

Report on the Standalone Financial Statements

We have audited the accompanying standalone fi nancial statements of BGR EnergySystems Limited ("the Company") which comprise the Balance Sheet as atMarch 31 2016 the Statement of Profi t and Loss the Cash Flow Statement for the yearthen ended and a summary of the signifi cant accounting policies and other explanatoryinformation.

MANAGEMENT’S RESPONSIBILITY FOR THE STANDALONE 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& presentation of these standalone fi nancial statements that give a true and fairview of the fi nancial position fi nancial performance and cash fl ows of the Company inaccordance with the accounting principles generally accepted in India including theAccounting Standards specifi ed under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingof the assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal fi nancial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the fi nancial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.

AUDITORS’ RESPONSIBILITY

Our responsibility is to express an opinion on these standalone fi nancial statementsbased 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 thereunder.

We conducted our audit in accordance with the Standards on Auditing specifi ed 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 fi nancial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the fi nancial statements. The procedures selected depend on theauditors’ judgment including the assessment of the risks of material misstatement ofthe fi nancial statements whether due to fraud or error. In making those riskassessments the auditor considers internal fi nancial control relevant to theCompany’s preparation of the fi nancial statements that give a true and fair view inorder to design audit procedures that are appropriate in the circumstances. An audit alsoincludes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company’s Directors as wellas evaluating the overall presentation of the fi nancial statements.

We believe that the audit evidence we have obtained is suffi cient and appropriate toprovide a basis for our audit opinion on standalone fi nancial statements.

OPINION

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone fi nancial 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 March 31 2016 and its profi t and its cash fl ows for the year ended on that date.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1) As required by the Companies (Auditors’ Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofSection 143 of the Act we give in the Annexure A a statement on the mattersspecifi ed in paragraphs 3 and 4 of the Order to the extent applicable.

2) 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 ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books; c. the Balance Sheet the Statement of Profi t and Loss andthe Cash Flow Statement dealt with by this Report are in agreement with the books ofaccount; d. in our opinion the aforesaid standalone fi nancial statements comply with theAccounting Standards specifi ed under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014; e. on the basis of the written representations receivedfrom the directors and taken on record by the Board of Directors none of the directors isdisqualifi ed as on March 31 2016 from being appointed as a director in terms of Section164(2) of the Act; f. with respect to the adequacy of the internal fi nancial controlsover fi nancial reporting of the Company and the operating effectiveness of such controlsrefer to our separate report in Annexure B; and g. with respect to the othermatters to be included in the Auditors’ Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in our opinion and to the best of ourinformation and according to the explanations given to us: i. The Company has disclosedthe impact of pending litigations on its fi nancial position in its fi nancial statements– Refer Note nos. 12.1 12.2 and 35 to the standalone fi nancial statements; ii. TheCompany has made provision as required under the applicable law or accounting standardsfor material foreseeable losses if any on long-term contracts including derivativecontracts; and iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.

For Manohar Chowdhry & Associates
Chartered Accountants
Firm Registration Number: 001997S
M.S.N.M. Santosh
Partner
Membership Number: 221916
Place: Chennai
Date:May 30 2016

ANNEXURE - A TO THE INDEPENDENT AUDITORS’ REPORT ON THE STANDALONE FINANCIALSTATEMENTS

The Annexure referred to in paragraph 1 under the heading "Report on Other Legaland Regulatory Requirements" of our Independent Auditors’ Report to the membersof BGR ENERGY SYSTEMS LIMITED for the year ended March 31 2016 we report that: (i) (a)The Company is maintaining proper records showing full particulars including quantitativedetails and situation of fi xed assets; (b) The Company has a regular program of physicalverifi cation of its fi xed assets by which fi xed assets are verifi ed in a phased manneron a rotational basis. In accordance with this program certain fi xed assets were verified during the year and no material discrepancies were noticed on such verifi cation. Inour opinion this periodicity of physical verifi cation is reasonable having regard to thesize of the Company and the nature of its assets; and (c) According to the information andexplanations given to us and on the basis of our examination of the records of theCompany the title deeds of immovable properties are held in the name of the Company.

(ii) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company we are of the opinion that the management hasconducted the physical verifi cation of inventory at reasonable intervals during the year.There are no material discrepancies were noticed between book stock and physical stock onphysical verifi cation conducted by the management.

(iii) The Company has not granted any loans to parties covered in the registermaintained under section 189 of the Act during the year. Accordingly paragraph 3(iii)(a)(b) and (c) of the Order is not applicable. (iv) According to the information andexplanations given to us and on the basis of our examination of the records of theCompany the company has given guarantees to 2 parties as covered under Section 185 of theAct prior to the fi nancial year 2015-16. The maximum amount involved and the year-endbalance of these guarantees amounts to Rs. 672.94 lakhs and Rs. 669.30 lakhs respectively.

In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 186 of the Act.

(v) The Company has not accepted any deposits from the public within the meaning ofsections 73 to 76 of the Act and the rules framed there under to the extent notifi ed.Accordingly paragraph 3(v) of the Order is not applicable. (vi) We have broadly reviewedthe cost records maintained by the Company as specifi ed by the Central Government underSection 148(1) of the Act and are of the opinion that prima facie the prescribed costrecords have been maintained. We have however not made a detailed examination of thecost records with a view to determine whether they are accurate or complete. (vii)(a) Inour opinion and according to the information given to us and on the basis of ourexamination of the records of the Company amounts deducted/ accrued in the books ofaccount in respect of undisputed statutory dues including Provident Fund Employees’State Insurance Profession Tax Income-tax Sales-tax Value Added Tax Works ContractTax Service tax Customs Duty Excise Duty Cess and other statutory dues have generallybeen regularly deposited during the year by the company with the appropriate authorities.According to the information and explanations given to us and on the basis of ourexamination of the records of the Company no undisputed amounts payable in respect ofProvident Fund Employees’ State Insurance Profession Tax Income-tax Sales-taxValue Added Tax Works Contract Tax Service tax Customs Duty Excise Duty Cess were inarrears as at March 31 2016 for a period of more than six months from the date theybecame payable; and

(b) As per the information and explanations given to us the following are the detailsof statutory dues which have not been deposited by the Company on account of disputes:

Name of the Statute Nature of the Dues Amount (Rs. in lakhs) Financial year Forum in which the Appeal is lying in
Central Sales Tax Act 1956 Central Sales Tax 4.20 1997-98 The Honourable High Court Andhra Pradesh.
Central Sales Tax Act 1956 Central Sales Tax 35.03 1997-98 The Honourable High Court Andhra Pradesh.
Andhra Pradesh Value Added Tax Act 2005 Andhra Pradesh Sales Tax 0.12 1998-99 Commercial Tax officer Andhra Pradesh.
Tamil Nadu General Sales Tax Act 1959 Tamil Nadu Sales Tax 0.11 1999-00 Commercial Tax officer Tamilnadu.
Tamil Nadu General Sales Tax Act 1959 Tamil Nadu Sales Tax 2.21 2001-02 Sales Tax Appellate Tribunal Chennai Tamilnadu.
Central Sales Tax act 1956 Central Sales Tax

(1) 5.58

2004-05 Sales Tax Appellate Tribunal Vishakapatnam Andhra Pradesh.
Andhra Pradesh Value Added Tax Act 2005 Andhra Pradesh Sales Tax (Penalty)

(1) 2.59

2006-07 Sales Tax Appellate Tribunal Vishakapatnam Andhra Pradesh.
Kerala Value Added Tax Act 2003 Kerala Sales Tax

(1) 2.65

2006-07 The Deputy Commisioner (Appeals) Ernakulam Kerala
Central Sales Tax Act 1956 Central Sales Tax

(1) 157.14

2006-07 Appellate Deputy Commissioner Kancheepuram Tamilnadu.
Central Sales Tax Act 1956 Central Sales Tax

(1&3)420.37

2007-08 Appellate Deputy Commissioner Kancheepuram Tamilnadu.
Andhra Pradesh Value Added Tax Act 2005 Andhra Pradesh Sales Tax (Penalty)

(1) 7.43

2007-08 Sales Tax Appellate Tribunal Vishakapatnam Andhra Pradesh.
Chapter V of Finance Act 1994 Service Tax

(2) 25.00

2007-08 CESTAT Chennai Tamilnadu.
Central Sales Tax Act 1956 Central Sales Tax

(1&3) 389.54

2008-09 Appellate Deputy Commissioner Kancheepuram Tamilnadu.
Andhra Pradesh Value Added Tax Act 2005 Andhra Pradesh Sales Tax 118.43 2008-09 The Sales Tax Appellate Tribunal Andhra Pradesh
Tamil Nadu Value Added Tax Act 2006 Tamil Nadu Sales Tax

(1) 7.14

2008-09 The Appellate Deputy Commissioner (CT) North Chennai.
Central Sales Tax Act 1956 Central Sales Tax

(1) 248.74

2009-10 The Appellate Deputy Commissioner (CT) North Chennai.
Central Sales Tax Act 1956 Central Sales Tax

(1) 792.05

2010-11 The Appellate Deputy Commissioner (CT) North Chennai.
Andhra Pradesh Value Added Tax Act 2005 Andhra Pradesh Sales Tax

(1) 39.36

2010-11 The Appellate Deputy Commissioner. Guntur
Andhra Pradesh Value Added Tax Act 2005 Andhra Pradesh Sales Tax (Penalty)

(1) 3.94

2010-11 The Appellate Deputy Commissioner. Guntur
Income Tax Act 1961 Income Tax 137.65 2006-07 The Honourable High Court Andhra Pradesh
Income Tax Act 1961 Income Tax 141.67 2007-08 The Honourable High Court Andhra Pradesh
Income Tax Act 1961 Income Tax

(1) 25.36

2007-08 Commissioner of Income Tax (Appeals) Chennai
Income Tax Act 1961 Income Tax 192.15 2008-09 The Honourable High court Andhra Pradesh
Income Tax Act 1961 Income Tax

(1) 36.62

2008-09 Commissioner of Income Tax (Appeals) Chennai
Income Tax Act 1961 Income Tax

(1) 10376.98

2009-10 Commissioner of Income Tax (Appeals) Chennai
Income Tax Act 1961 Income Tax

(1) 120.06

2010-11 Commissioner of Income Tax (Appeals) Chennai
Income Tax Act 1961 Income Tax 958.43 2011-12 Commissioner of Income Tax (Appeals) Chennai
Income Tax Act 1961 Income Tax

(1) 97.67

2012-13 Commissioner of Income Tax (Appeals) Chennai
Income Tax Act 1961 Income Tax

(1) 116.39

2013-14 Commissioner of Income Tax (Appeals) Chennai
Mines & Minerals (Development & Regulations) Act 1957 Royalty

(3) 1926.45

2010-11 The Honourable High Court Bombay.
Mines & Minerals (Development & Regulations) Act 1957 Royalty

(3)211.45

2010-11 The Honourable High Court Bombay.
The Employee Provident Fund & Miscellaneous Provisions Act 1952 Provident Fund

(1) 521.15

2006-2010 The Honourable High Court Hyderabad
The Rajasthan Value Added Tax 2003 Rajasthan Sales Tax

(1&4) 9866.00

2009-2010 Rajasthan Tax Board Ajmer
The Rajasthan Value Added Tax 2003 Rajasthan Sales Tax

(4) 9541.00

2010-2011 Rajasthan Tax Board Ajmer
The Rajasthan Value Added Tax 2003 Rajasthan Sales Tax

(4) 4334.00

2011-2012 Rajasthan Tax Board Ajmer
Central Sales Tax ACT 1956 Central Sales Tax

(1) 630.60

2011-12 The Appellate Deputy Commissioner (CT) North Chennai.
Andhra Pradesh Value Added Tax Act 2005 Andhra Pradesh Sales Tax 431.88 2011-12 The Appellate Deputy Commissioner Guntur.
Central Sales Tax Act 1956 Central Sales Tax 65.35 2012-13 The Appellate Deputy Commissioner (CT) North Chennai.
Central Sales Tax Act 1956 Central Sales Tax

(1) 461.07

2013-14 The Appellate Deputy Commissioner (CT) North Chennai.
The Rajasthan Value Added Tax 2003 Rajasthan Sales Tax 1110.92 2012-13 The Appellate Authority Ajmer

(1)Represents gross tax liability. Out of this a sum of Rs.5867/- lakhs waspaid as deposit/adjusted against refund due. (2) Excludes interest and penaltywhich are not ascertainable.

(3)Stay Order has been received against the amount disputed and not deposited. (4)Excludes interest and penalty.

(viii) According to the information and explanation given to us and on the basis of ourexamination of the books of account the Company has not defaulted in repayment of loansor borrowings to any fi nancial institutions or banks. (ix) During the year the Companydid not raise any money by way of initial public offer or further public offer (includingdebt instruments). As per the information and explanations provided to us and on basis ofour examination of books of account we are of the opinion that the term loans wereapplied for the purpose for which they were availed.

(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 fraud by the Company or any fraud on the Company by its offi cers or employeeshas been noticed or reported during the year nor have we been informed of such case bythe management.

(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 theinformation and explanations given to us the Company is not a nidhi company. Accordinglyparagraph 3(xii) of the Order is not applicable.

(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 sections 177 and 188 of Act where ever applicable and the details of suchtransactions have been disclosed in the fi nancial Statements as required by theapplicable accounting standards.

(xiv) According to the information and explanations given to us and based on ourexaminations 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. Accordingly paragraph 3(xiv) of the Order is not applicable.

(xv) According to the information and explanations given to us and based on ourexaminations of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

(xvi) In our opinion and according to the information and explanations given to us thecompany is not required to be registered under Section 45-IA of the Reserve Bank of IndiaAct 1934. Accordingly paragraph 3(xvi) of the Order is not applicable.

For Manohar Chowdhry & Associates
Chartered Accountants
Firm Registration Number: 001997S
M.S.N.M. Santosh
Partner
Membership Number: 221916
Place: Chennai
Date: May 30 2016

ANNEXURE - B TO THE INDEPENDENT AUDITORS’ REPORT ON THE STANDALONE FINANCIALSTATEMENTS

Report on the Internal Financial Controls under Clause (i) of sub – section (3) ofsection 143 of the Companies Act 2013 ("the Act)

We have audited the internal fi nancial controls over fi nancial reporting of BGREnergy Systems Limited ("the Company") as of March 31 2016 in conjunctionwith our audit of the standalone fi nancial statements of the Company for the year endedon that date.

MANAGEMENT’S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS

The Company’s management is responsible for establishing and maintaining internalfi nancial controls based on the internal control over fi nancial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India (‘ICAI’). Theseresponsibilities include the design implementation and maintenance of adequate internalfi nancial controls that were operating effectively for ensuring the orderly and efficient conduct of its business including adherence to company’s policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable fi nancial information as required under the Act.

AUDITORS’ RESPONSIBILITY

Our responsibility is to express an opinion on the Company’s internal fi nancialcontrols over fi nancial reporting based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") and the Standards on Auditing issued by ICAIand deemed to be prescribed under section 143(10) of the Act to the extent applicable toan audit of internal fi nancial controls both applicable to an audit of InternalFinancial Controls and both issued by the Institute of Chartered Accountants of India.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether adequate internalfi nancial controls over fi nancial reporting was established and maintained and if suchcontrols operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal fi nancial controls system over fi nancial reporting and their operatingeffectiveness. Our audit of internal fi nancial controls over fi nancial reportingincluded obtaining an understanding of internal fi nancial controls over fi nancialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditors’ judgment including the assessment of therisks of material misstatement of the financial statements whether due to fraud or error.We believe that the audit evidence we have obtained is suffi cient and appropriate toprovide a basis for our audit opinion on the Company’s internal fi nancial controlssystem over fi nancial reporting.

MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

A company’s internal fi nancial control over fi nancial 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 fi nancial controlover fi nancial reporting includes those policies and procedures that: i. Pertain to themaintenance of records that in reasonable details accurately and fairly refl ect thetransactions and dispositions of the assets of the company; ii. Provide reasonableassurance that transactions are recorded as necessary to permit preparation of fi nancialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the Company are being made only in accordance with authorizations ofmanagement and directors of the Company; and iii. 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 fi nancial statements.

INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

Because of the inherent limitations of internal fi nancial controls over fi nancialreporting 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 fi nancial controls over fi nancialreporting to future periods are subject to the risk that the internal fi nancial controlover fi nancial 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 internal financial controls system over fi nancial reporting and such internal fi nancial controlsover fi nancial reporting were operating effectively as at March 31 2016 based on"the internal control over fi nancial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India".

For Manohar Chowdhry & Associates
Chartered Accountants
Firm Registration Number: 001997S
M.S.N.M. Santosh
Partner
Membership Number: 221916
Place: Chennai
Date: May 30 2016

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