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CEAT Ltd.

BSE: 500878 Sector: Auto
NSE: CEATLTD ISIN Code: INE482A01020
BSE LIVE 15:41 | 02 Dec 1231.80 -28.25
(-2.24%)
OPEN

1250.00

HIGH

1255.50

LOW

1227.00

NSE LIVE 15:45 | 02 Dec 1230.75 -30.10
(-2.39%)
OPEN

1243.00

HIGH

1255.95

LOW

1227.00

OPEN 1250.00
PREVIOUS CLOSE 1260.05
VOLUME 56505
52-Week high 1422.00
52-Week low 731.20
P/E 11.39
Mkt Cap.(Rs cr) 4982.63
Buy Price 0.00
Buy Qty 0.00
Sell Price 1231.80
Sell Qty 58.00
OPEN 1250.00
CLOSE 1260.05
VOLUME 56505
52-Week high 1422.00
52-Week low 731.20
P/E 11.39
Mkt Cap.(Rs cr) 4982.63
Buy Price 0.00
Buy Qty 0.00
Sell Price 1231.80
Sell Qty 58.00

CEAT Ltd. (CEATLTD) - Auditors Report

Company auditors report

To the Members of CEAT Limited

Report on the Financial Statements

We have audited the accompanying standalone financial statements of CEAT Limited("the Company") which comprise the Balance Sheet as at March 31 2016 theStatement of Profit and Loss and Cash Flow Statement for the year then ended and asummary of significant 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 the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance withaccounting 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 maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and the 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

Our responsibility is to express an opinion on these standalone financial statementsbased on our audit. We have taken into account the provisions of the Act the accountingand auditing standards and matters which are required to be included in the audit reportunder the provisions of the Act and the Rules made thereunder. We conducted our audit inaccordance with the Standards on Auditing issued by the Institute of CharteredAccountants of India as 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 financial statements are free from materialmisstatement.

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 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 the Company’s Directors as well as evaluating theoverall presentation of the financial statements. We believe that the audit evidence wehave obtained is sufficient and appropriate accounting policies and to provide a basis forour audit opinion on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the standalone 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 of the state of affairs of the Company as at March31 2016 its profit and its cash flows 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 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the "Annexure 1" a statement on the mattersspecified in paragraphs 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 purpose 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 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 March 312016 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2016 from being appointed as a director in terms of section 164 (2) ofthe 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 2" to this report;

(g) With respect to the other matters to be included in the Auditor’s Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best 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 8(f) and Note 28(a)(1) & (3) to thefinancial statements;

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts Refer Note 8(g) to the financial statements;

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

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E

per Vinayak Pujare

Partner

Membership Number: 101143

Place: Mumbai

Date: April 27 2016

Annexure 1 referred to in paragraph 1 under the heading ‘Report on Other Legal andRegulatory Requirements’ 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 fixed assets have not been physically verified by the management during theyear but there is a regular programme of verification which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. No materialdiscrepancies were noticed on such verification

(c) Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to information and explanations givenby the management the title deeds of immovable properties included in property plant andequipment / fixed assets are held in the name of the Company.

(ii) The management has conducted physical verification of inventory at reasonableintervals during the year and no material discrepancies were noticed on such physicalverification been confirmed by them as at year-end.

(iii) (a) The Company has granted loans to two subsidiaries covered in the registermaintained under section 189 of the Companies Act 2013. In our opinion and according tothe information and explanations given to us the terms and conditions of the grants andloans are not prejudicial to the Company’s interest.

(b) In respect of loans granted the repayment of the principal amount is as stipulatedand payment of interest has been regular.

(c) There are no amounts of loans granted to companies firms or other parties listedin the register maintained under section 189 of the Companies Act 2013 which areoutstanding for more than ninety days.

(iv) In our opinion and according to the information and explanations given to usprovisions of section 185 and 186 of the Companies Act 2013 in respect of loans todirectors including entities in which they are interested and in respect of loans andadvances given investments made and guarantees and securities given have been compliedwith by the Company.

(v) In respect of deposits accepted in our opinion and according to the informationand explanations given to us directives issued by the Reserve Bank of India and theprovisions of section 73 to 76 or any other relevant provisions of.the Companies Act2013 and the rules framed thereunder to the extent applicable have been complied with.We are informed by the management that no order in this regard has been passed by theCompany Law Board National Company Law Tribunal or Reserve Bank of India or any Court orany other Tribunal.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Companies Act 2013 related to the manufacture of rubber tyrestubes and flaps for all types of vehicles and are of the opinion that prima facie thespecified accounts and records . Inventories lying with third parties have have been madeand maintained. We have not however made a detailed examination of the same.

(vii) (a) Undisputed statutory dues including provident fund employees’ stateinsurance income-tax sales-tax service tax customs duty excise duty value added taxcess and other material statutory dues have generally been regularly deposited with theappropriate authorities.

(b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees’ state insurance income-tax servicetax sales-tax customs duty excise duty value added tax cess and other materialstatutory dues were outstanding at the year-end for a period of more than six monthsfrom the date they became payable.

(c) According to the records of the Company the dues outstanding of income-taxsales-tax service tax duty of custom duty of excise value added tax and cess onaccount of any dispute are as follows:

(Rs. in Lacs)
Department Period to which the amounts relates Commissionerate Appellate authorities and Tribunal High Court Supreme Court Deposit Net Amount
Central Excise Act/ Customs Act (Tax/ Interest/ Penalty) 1978 to 2016 601.37 4563.26 - - 111.98 5052.65
Service Tax under the Finance Act 1994 (Tax/Interest/ Penalty) 2005 to 2015 27.95 2823.23 - - 79.58 2771.60
Income Tax Act (Tax/ Interest/ Penalty) 1985 to 2013 6162.27 457.29 159.51 - - 6779.07
Sales Tax VAT CST (Tax/ Interest/ Penalty) 1987 to 2015 4242.63 1731.16 - - 589.82 5383.98
Wealth Tax (Tax) 2002-03 - 6.73 - - - 6.73
11034.22 9581.67 159.51 - 781.38 19994.03

(viii) Based on our audit procedures performed for the purpose of reporting the trueand fair view of the financial statements and according to information and explanationsgiven by the management we are of the opinion that the Company has not defaulted inrepayment of dues to financial institutions banks or debenture holders.

(ix) Based on the information and explanations given to us by the management termloans were applied for the purpose for which the loans were obtained.

(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the Company or no fraud on theCompany by officers and employees of the Company has been noticed or reported during theyear.

(xi) Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that the managerial remuneration has been paid /provided in accordance with the requisite approvals mandated by the provisions of section197 read with Schedule V to the Companies Act 2013.

(xii) In our opinion the Company is not a Nidhi company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe financial statements as required by the AS-18 (Related Party Disclosures) specifiedunder section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.

(xiv) According to the information and explanations given to us and on an overallexamination of the balance sheet the Company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder report and hence reporting requirements under clause 3(xiv) are not applicable tothe Company and not commented upon.

(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim.

(xvi) According to the information and explanations given to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E

per Vinayak Pujare

Partner

Membership Number: 101143

Place: Mumbai

Date: April 27 2016

ANNEXURE 2 TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE STANDALONEFINANCIAL STATEMENTS OF CEAT LIMITED

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

We have audited the internal financial controls over financial reporting of CEATLimited ("the Company") as of March 31 2016 in conjunction with our audit ofthe standalone 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 internal control over financial reporting criteria establishedthe Company considering the essential components of internal control stated in theGuidance Note on Audit of Internal Financial Controls over Financial Reporting issued bythe Institute of Chartered Accountants of India. These responsibilities include thedesign implementation and maintenance of adequate internal financial controls that wereoperating effectively ensuring the orderly and efficient conduct of its businessincluding adherence to the Company’s policies the safeguarding of its assets theprevention 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.

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 on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing as specified under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls both applicable to an audit of Internal Financial Controls and bothissued by the Institute of Chartered Accountants of India. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively 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 judgement 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 internal financial controls system overfinancial 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 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

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 2016 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.

Explanatory paragraph

We also have audited in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India as specified under Section 143(10) of theCompanies Act 2013 the standalone financial statements of CEAT Limited which comprisethe Balance Sheet as at March 31 2016 and the related Statement of Profit and Loss andCash Flow Statement for the year then ended and a summary of significant information andour report dated April 27 2016 expressed an unqualified opinion thereon.

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E

per Vinayak Pujare

Partner

Membership Number: 101143

Place: Mumbai

Date: April 27 2016

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