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Chennai Petroleum Corporation Ltd.

BSE: 500110 Sector: Oil & Gas
NSE: CHENNPETRO ISIN Code: INE178A01016
BSE LIVE 15:43 | 09 Dec 276.35 5.15
(1.90%)
OPEN

271.00

HIGH

278.10

LOW

269.10

NSE LIVE 15:59 | 09 Dec 275.60 4.50
(1.66%)
OPEN

272.00

HIGH

278.25

LOW

269.05

OPEN 271.00
PREVIOUS CLOSE 271.20
VOLUME 101213
52-Week high 312.00
52-Week low 138.00
P/E 4.78
Mkt Cap.(Rs cr) 4117.62
Buy Price 276.35
Buy Qty 366.00
Sell Price 0.00
Sell Qty 0.00
OPEN 271.00
CLOSE 271.20
VOLUME 101213
52-Week high 312.00
52-Week low 138.00
P/E 4.78
Mkt Cap.(Rs cr) 4117.62
Buy Price 276.35
Buy Qty 366.00
Sell Price 0.00
Sell Qty 0.00

Chennai Petroleum Corporation Ltd. (CHENNPETRO) - Auditors Report

Company auditors report

INDEPENDENT AUDITORS’ REPORT

To

The Members of

Chennai Petroleum Corporation Limited Chennai

REPORT ON THE FINANCIAL STATEMENTS:

We have audited the accompanying financial statements of Chennai Petroleum CorporationLimited ("the company") which comprise the Balance Sheet as at 31stMarch 2016 the Statement of Profit and Loss the Cash Flow Statement for the year thenended and a summary of significant accounting policies and other explanatory informationwhich we have signed under reference to this report.

MANAGEMENT’S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS:

The Company’s Board of Directors is responsible for the matters in section 134(5)of the Companies Act 2013 ("the Act") with respect to the preparation of thesefinancial statements that give a true and fair view of the financial position financialperformance and cash flows of the Company in accordance with the accounting principlesgenerally accepted in India including the Accounting Standards specified under Section133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes the maintenance of adequate accounting records in accordancewith the provision of the Act for safeguarding of the assets of the Company and forpreventing and detecting the frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of internal financial control thatwere operating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

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 anddisclosures 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 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.

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

OPINION:

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India;

a) in the case of the Balance Sheet of the state of affairs of the Company as at March31 2016; b) in the case of the Statement of Profit and Loss of the profit for the yearended on that date; and c) in the case of the Cash Flow Statement of the cash flows forthe year ended on that date.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS:

1. As required under 143 (5) of The Companies Act 2013 we give in the Annexure I ofour report on the directions issued by the Comptroller and Auditor General Of India.

2. As required by the Companies (Auditor’s Report) Order 2016 ("TheOrder") issued by the Central Government of India in terms of Section 143(11) of theAct we give in the Annexure A statement on the matters specified in paragraphs 3 and 4 ofthe Order.

3. 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 the Statement of Profit and Loss and the Cash Flow Statementdealt with by 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 Act read with Rule 7 of the Companies(Accounts) Rules 2014.

e) Clauses referred to Section 164 (2) of the Companies Act 2013 does not apply todirectors of Government Companies as per the notification.

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 included in the Auditor’s Report and to ourbest of our information and according to the explanations given to us:

(i) The Company has disclosed the impact of pending litigations on its financialposition in its financial statements (Refer note: 28(1)(a) to financial statements).

(ii) The Company did not have any long-term contracts including derivative contractsfor 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.

For R.Subramanian and Company For S. Viswanathan LLP
Chartered Accountants Chartered Accountants
FRN: 004137S FRN: 004770S/S200025
R.Rajaram V C Krishnan
Partner Partner
Membership No: 025210 Membership No: 022167
Place : Chennai
Date : 23rd May 2016

ANNEXURE - I TO INDEPENDENT AUDITORS’ REPORT

The Annexure referred to in paragraph 1 of Our Report of even date to the members ofChennai Petroleum Corporation Limited on the accounts of the company for the year ended 31stMarch 2016.

On the basis of checks as we considered appropriate and according to the informationand explanations given to us during the course of audit we report that

a) The company is in possession of 186.86 acres of Land allotted by Government of TamilNadu (classified as Poramboke) for which Assignment deed is yet to be received.

b) There were no material waiver / write off of debts/loans/interest etc other thanwaiver / write off in the normal course of business which are based on facts of such casesand approval as per delegation of authority.

c) The company has maintained adequate records in respect of inventories lying withthird parties.

No assets have been received as gifts from Government and Other authorities during theyear.

For R.Subramanian and Company For S. Viswanathan LLP
Chartered Accountants Chartered Accountants
FRN: 004137S FRN: 004770S/S200025
R.Rajaram V C Krishnan
Partner Partner
Membership No: 025210 Membership No: 022167
Place : Chennai
Date : 23rd May 2016

ANNEXURE - A TO INDEPENDENT AUDITORS’ REPORT

The Annexure referred to in paragraph 2 of our report of even date to the members ofChennai Petroleum Corporation Limited on the accounts of the company for the year ended 31stMarch 2016.

On the basis of such checks as we considered appropriate and according to theinformation and explanations given to us during the course of our audit we report that:

1. (a) The company is maintaining proper records showing full particulars includingquantitative details and situation of its fixed assets.

(b) The company has a program of physical verification of its fixed assets by which allfixed assets are verified in a phased manner in a period of 4 years. In our opinion thisperiodicity of physical verification is reasonable having regard to the size of thecompany and the nature of its assets. According to the information and explanations givento us no material discrepancies were observed by the Management on such verification.

(c) The company is in possession of 186.86 acres of Land allotted by Government ofTamil Nadu (classified as Poramboke) for which Assignment deed is yet to be received.

2. According to the Information and explanation given to us physical verification ofinventory has been conducted at reasonable intervals by the management and no materialdiscrepancies were noticed.

3. According to the information and explanations given to us and on the basis of ourexamination of the books of account the Company has not granted any loans secured orunsecured to companies firms or other parties covered in the register maintained underSection 189 of the Companies Act 2013. Consequently the provisions of clauses 3(a) and3(b) are not applicable.

4. The company has not provided any loan or investments or Guarantees or Securitieswhich falls under the purview of Sec 185 and Sec 186 of Companies Act 2013.

5. According to the information and explanations given to us the Company has notaccepted deposits from the public and consequently the directives issued by the ReserveBank of India and provisions of Section 73 to 76 or any other relevant provisions of theCompanies Act 2013 and Companies (Acceptance of Deposits) amended Rules 2015 are notapplicable.

6. We have broadly reviewed the records maintained by the Company pursuant to the rulesprescribed by the Central Government for maintenance of cost records under sub-section 1of Section 148 of the Act and are of the opinion that prima facie the prescribed accountsand records have been made and maintained. However we have not made a detailedexamination of the records.

7. (a) According to the information and explanations given to us the Company isregular in depositing with the appropriate authorities the undisputed statutory dues inthe case of Provident Fund Employees’ State Insurance and Tax deducted at source. Tothe best of our knowledge and according to the information and explanations given to usthere are no arrears of outstanding statutory dues as at March 31 2016 for a period ofmore than six months from the date they became payable.

(b) The details of disputed dues of Income tax Sales tax Excise duty Customs dutyand value added tax which have not been deposited as on 31st March 2016 aregiven in the Annexure ‘’II" to our report.

8. In our opinion and according to the information and explanations given to us theCompany has not defaulted in repayment of any dues to financial institutions banks anddebenture holders.

9. In our opinion and according to the information and explanations given to us theCompany has not raised any money by the way of initial public offer (including debtinstruments) and hence this clause is not applicable.

10. According to the information and explanations given to us by the Company no fraudon or by the Company has been noticed or reported during the year.

11. The managerial remuneration paid by the company is as per the Sec 197 of TheCompanies Act 2013 and Schedule V of the Companies Act 2013.

12. The Company is not a Nidhi company hence this clause is not applicable.

13. All transactions mentioned are in compliance with Sec 177 and Sec 188 of theCompanies Act 2013 and are disclosed as required under the applicable Accounting Standard.

14. The Company has made a preferential allotment of Non Convertible RedeemablePreference Shares for Rs 100000/- lakhs and the company has complied with the requirementsof Sec 42 of the Companies Act 2013 and the amounts raised were used for the purpose forwhich the funds were raised.

15. The company has not entered into any non-cash transactions with the Directors orthe persons connected with him which will come under the purview of Sec 192 of theCompanies Act 2013.

16. As the Company is not in non banking financial services this clause is notapplicable.

For R.Subramanian and Company For S. Viswanathan LLP
Chartered Accountants Chartered Accountants
FRN: 004137S FRN: 004770S/S200025
R.Rajaram V C Krishnan
Partner Partner
Membership No: 025210 Membership No: 022167
Place : Chennai
Date : 23rd May 2016

ANNEXURE - B TO THE 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 ChennaiPetroleum Corporation Limited ("the Company") as of 31st March 2016in conjunction with our audit of the standalone financial statements of the Company forthe 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 (‘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 safeguardingof its 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.

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 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.

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 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 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 have amaterial 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 31st March 2016based on the internal control over financial 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 R.Subramanian and Company For S. Viswanathan LLP
Chartered Accountants Chartered Accountants
FRN: 004137S FRN: 004770S/S200025
R.Rajaram V C Krishnan
Partner Partner
Membership No: 025210 Membership No: 022167
Place : Chennai
Date : 23rd May 2016

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