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Bhaskar Agrochemicals Ltd.

BSE: 524534 Sector: Agri and agri inputs
NSE: N.A. ISIN Code: INE972C01018
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Bhaskar Agrochemicals Ltd. (BHASKARAGROCHEM) - Auditors Report

Company auditors report

To the Members of

Bhaskar Agro Chemicals Limited

Report on the Financial Statement

We have audited the accompanying financial statements of Bhaskar Agro ChemicalsLimited ("the Company") which comprise the Balance Sheet as at March 312017 and the Statement of Profit and Loss and the Cash Flow Statement for the year thenended and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility For the 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 preparation andpresentation of these financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified Under Section 133 of Companies Act 2013 read with Rule 7 of the Companies(Accounts) Rules 2014. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the company and for preventing and detecting frauds and other irregularities;selection and application of appropriate accounting policies; making judgments andestimates that are reasonable and prudent; and design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit. 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 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.

An audit involves performing procedures to obtain audit evidence about the amounts andthe 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 financial statements that give a true and fair view in order to designaudit procedures that are appropriate in the circumstances but not for the purpose ofexpressing an opinion on whether the Company has a place an adequate financial controlssystem over financial reporting and the operating effectiveness of such controls. An auditalso includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by the Company’s Directors as wellas evaluating the overall presentation of the financial statements.

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

Basis for Qualified Opinion

The company has not provided depreciation on building and Plant & Machineryrelating to Unit-II in the books of account of the company as the Unit-II is closed.

Qualified Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us except for the matter described in the basis for Qualified opinion paragraphthe aforesaid financial statements give the information required by the Act in the mannerso required and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the state of affairs of the Company as at 31-03-2017 andits profit and its cash flows for the year ended on that date.

Report on Other Legal & Regulatory Requirements

1. 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 Companies Act 2013 we give in the Annexure - ‘A’ astatement on the matters specified in paragraphs 3 and 4 of the Order to the extentapplicable.

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 it appears from our examination of those books;

c) the Balance Sheet Statement of Profit and Loss and Cash Flow Statement dealt withby this Report are in agreement with the books of account;

d) in our opinion the aforesaid financial statements comply with the AccountingStandards specified under section 133 of the Companies Act 2013 read with Rule 7 of theCompanies (Accounts) Rules 2014;

e) on the basis of written representations received from the directors as on March 312017 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of section 164 of theCompanies Act 2013; and

f) With respect to the adequacy of Internal Financial Controls over Financial reportingof the Company and the operating effectiveness of such controls refer to our separatereport in "Annexure - B"

g) With respect to the other matters to be included in the Auditors’ Report inaccordance with Rule 11 of the Companies (Audit & Auditors) Rule 2014 in our opinionand to the best of our information & according to the explanations given to us:

i. The Company does not have any pending litigations as at 31.03.2017 which wouldimpact its financial position.

ii. The Company did not have any long term contracts including derivative contracts asat 31.03.2017 for which there were any material foreseeable losses.

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

iv. The Company has provided requisite disclosures in the financial statements as toholdings as well as dealings in Specified Bank Notes during the period from 8th November2016 to 30th December 2016. Based on audit procedures and relying on the managementrepresentation we report that the disclosures are in accordance with books of accountmaintained by the Company and as produced to us by the Management – Refer Note No. 24(B) (xv).

For R Kankaria & Uttam Singhi

Chartered Accountants

Firm Regi. No.: 000442S

Uttam Kumar Singhi

Partner

Membership No. : 027481/ICAI

Place: Hyderabad

Date: 15/05/2017

ANNEXURE "A" TO THE AUDITORS’ REPORT

Referred to in paragraph 1 under the head "Report on other legal & regulatoryrequirements" of our report of even date.

i) a The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets. b. All the Fixed assets have beenphysically verified by the management during the year. According to the information andexplanations given to us no material discrepancies were noticed on such verification. c.As per the documents verified by us and explanation given to us all the Title Deeds ofimmovable properties are held in the name of the company.

ii). The inventory has been physically verified during the year by the management inour opinion the frequency of verification is reasonable. No material discrepancies havebeen noticed on physical verification of stocks as compared to book records.

iii). The company has not granted any loans secured or unsecured to companies firmsLimited Liability Partnership or other parties who are covered in the register maintainedunder section 189 of Companies Act 2013 accordingly Clause (iiia)(iii b ) and (iiic)of Paragraph 3 of the Order are not applicable.

iv) According to the information and explanations given to us the Company has notgranted any loans guarantees and security and made investments as per section 185 &186 of the Companies Act 2013

v) According to the information and explanations given to us the Company has notaccepted any deposits from the public as per the directives issued by the Reserve Bank ofIndia and as per the provisions of section 73 to 76 or any other relevant provisions ofthe Companies Act 2013 and the rules framed there under .

vi) The Central Government has not prescribed the maintenance of cost records undersection 148(1) of the Companies Act 2013 for the company.

vii) (a) According to the information & explanations given to us none of theundisputed statutory dues including Provident Fund Employees State Insurance Income TaxSales Tax Service Tax Custom Duty Excise Duty Value Added Tax Cess and any otherStatutory Dues were outstanding as at last day of the financial year concerned for aperiod of more than six months.

(b) According to the information & explanations given to us there is no due inrespect of disputed amount to be deposited in respect of Income Tax Sales Tax ServiceTax Custom Duty Excise Duty Value Added Tax as on 31st March 2017.

viii) According to the information and explanations given to us the company has notdefaulted in repayment of loans or borrowing to the financial institutions bankgovernment or dues to debenture holders.

ix) In our opinion and according to the information and explanations given to us thecompany has not raised money by way of initial public offer or further public offer(including debt instruments) & Term Loan during the year.

x) According to the information and explanations given to us no fraud by the Companyor any fraud on the company by its officers/employees has been noticed or reported duringthe course of our audit.

xi) According to the information and explanations given to us the Company has paid andprovided managerial remuneration during the year as per the provisions of Section 197 readwith Schedule V to the Companies Act.

xii) According to the information and explanations given to us the Company is not aNidhi Company. Accordingly Clause (xii) of Paragraph 3 of the Order is not applicable.

xiii) According to the information and explanations given to us all transactions withthe related party are in compliance with section 177 & 188 of Companies Act 2013 andthe same has been disclosed in financial statements as required by the AccountingStandards.

xiv) According to the information and explanations given to us the company has notmade preferential allotment or private placement of shares or fully or partly convertibledebentures during the year.

xv) According to the information and explanations given to us the company has notentered into Non Cash Transactions with directors or persons connected with him during theyear.

xvi) According to the information and explanations given to us company is not requiredto be registered under section 45-IA of Reserve Bank Of India.

For R Kankaria & Uttam Singhi
Chartered Accountants
Firm Regi. No.: 000442S
Uttam Kumar Singhi
Place: Hyderabad Partner
Date: 15/05/2017 Membership No. : 027481/ICAI

Reports on Internal Financial Controls Over Financial Reporting

Annexure "B" to the Independent Auditor’s Report of even date on theFinancial Statements of Bhaskar Agro Chemicals Limited

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 BhaskarAgro Chemicals Limited ("the Company") as of March 31 2017 in conjunctionwith our audit of the financial statements of the Company for the year ended on that 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 Reportingissued by the Institute of Chartered Accountants of India". These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to company’s policies the safeguarding of its assetsthe prevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.

Auditors’ 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 on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

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 included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor’s judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or 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 controlssystem over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

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 the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorizations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company’s assets that could havea 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 R Kankaria & Uttam Singhi

Chartered Accountants

Firm‘s Registration No. 000442S

Uttam Kumar Singhi

Partner

Membership No.027481/ICAI

Place: Hyderabad

Date:15/05/2017