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DCM Shriram Ltd.

BSE: 523367 Sector: Others
NSE: DCMSHRIRAM ISIN Code: INE499A01024
BSE LIVE 15:40 | 08 Dec 213.15 2.15
(1.02%)
OPEN

212.00

HIGH

215.55

LOW

212.00

NSE LIVE 15:31 | 08 Dec 213.80 2.70
(1.28%)
OPEN

212.60

HIGH

216.05

LOW

212.60

OPEN 212.00
PREVIOUS CLOSE 211.00
VOLUME 4393
52-Week high 286.45
52-Week low 107.00
P/E 9.26
Mkt Cap.(Rs cr) 3461.56
Buy Price 213.50
Buy Qty 100.00
Sell Price 0.00
Sell Qty 0.00
OPEN 212.00
CLOSE 211.00
VOLUME 4393
52-Week high 286.45
52-Week low 107.00
P/E 9.26
Mkt Cap.(Rs cr) 3461.56
Buy Price 213.50
Buy Qty 100.00
Sell Price 0.00
Sell Qty 0.00

DCM Shriram Ltd. (DCMSHRIRAM) - Auditors Report

Company auditors report

To the members of DCM Shriram Limited

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of DCM SHRIRAMLIMITED ("the Company") which comprise the Balance Sheet as at March 312016 the Statement of Profit and Loss and the Cash Flow Statement for the year thenended and a summary of the significant 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 ofthese standalone 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 Standardsprescribed under section 133 of the Act as applicable. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement 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 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 and the Order under section 143 (11)of the Act. We conducted our audit of the standalone financial statements in accordancewith the Standards on Auditing 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 theamounts and the disclosures in the financial statements. The procedures selected depend onthe auditor’s judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error. In making thoserisk assessments the auditor considers internal financial control relevant to theCompany’s preparation of the financial 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 financial statements. We believe that theaudit evidence we have obtained is sufficient and appropriate to provide a basis for ouraudit 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 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 March 31 2016 and its profit and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. 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 Profit 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 financial statements comply with theAccounting Standards prescribed under section 133 of the Act as applicable. e) On thebasis of the written representations received from the directors as on March 31 2016taken on record by the Board of Directors none of the directors is disqualified as onMarch 31 2016 from being appointed as a director in terms of Section 164 (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". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company’s internal financial controlsover financial reporting. g) With respect to the other matters to be included in theAuditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 in our opinion and to the best of our information and according to theexplanations given to us: i. The Company has disclosed the impact of pending litigationson its financial position in its financial statements; ii. The Company did not have anylong-term contracts including derivative contracts for which there were any materialforeseeable losses; iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.

2. As required by the Companies (Auditor’s Report) Order 2016 ("theOrder") issued by the Central Government in terms of Section 143(11) of the Act wegive in "Annexure B" a statement on the matters specified in paragraphs 3 and 4of the Order.

For DELOITTE HASKINS & SELLS
Chartered Accountants
(Firm’s Registration No. 015125N)
Vijay Agarwal
Place : New Delhi Partner
Date : May 10 2016 (Membership No.094468)

ANNEXURE "A" TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 1(f) under ‘Report on Other Legal and RegulatoryRequirements’ of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of DCMSHRIRAM LIMITED ("the Company") as of March 31 2016 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

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 FinancialReporting" (the "Guidance Note") issued by the Institute of CharteredAccountants of India. These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence tocompany’s policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required 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 and the Standards on Auditing prescribed under Section 143(10) ofthe Companies Act 2013 to the extent applicable to an audit of internal financialcontrols. 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 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 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 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 to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2016 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.

For DELOITTE HASKINS & SELLS
Chartered Accountants
(Firm’s Registration No. 015125N)
Vijay Agarwal
Place : New Delhi Partner
Date : May 10 2016 (Membership No.094468)

ANNEXURE B TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 2 under ‘Report on Other Legal and RegulatoryRequirements’ section 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) The Company has a program ofverification of fixed assets to cover all the items in a phased manner over a period ofthree years which in our opinion is reasonable having regard to the size of the Companyand the nature of its assets. Pursuant to the program certain fixed assets werephysically verified by the Management during the year. According to the information andexplanations given to us no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and the records examinedby us and based on the examination of the registered sale deeds and lease agreementsprovided to us we report that the title deeds comprising the immovable properties ofland (freehold and leasehold) and buildings are held in the name of the Company and incase where such immovable properties has been transferred pursuant to the scheme ofamalgamation under Section 391 to 394 of the Companies Act 1956 the transfer is throughthe order of the Hon’ble High Courts. Further lands located at Rajasthan measuring808.70 Bighas amounting to Rs 13.03 Crores land located at Hyderabad measuring 5.03 acresamounting to Rs.1.56 Crores and lands located at Uttar Pradesh measuring 7.79 hectaresamounting to Rs 0.70 Crores are pending for registration in favour of the Company. (ii)As explained to us the inventories were physically verified during the year by theManagement at reasonable intervals except for inventory lying with third parties at theend of the year for which confirmations have been obtained in most of the cases and nomaterial discrepancies were noticed on physical verification.

(iii) According to the information and explanations given to us the Company hasduring the year granted unsecured loans aggregating to Rs.26.93 Crores to five whollyowned subsidiaries covered in the register maintained under section 189 of the CompaniesAct 2013. At the year end the loans granted to six subsidiaries aggregate to Rs.157.11Crores (net of provision of Rs.7.01 Crores). These loans include interest free loan ofRs.30.78 Crores made to a wholly owned subsidiary which as explained to us have beenmade for setting up new projects. In respect of these loans: (a) The terms and conditionsof the grant of such loans are in our opinion prima facie not prejudicial to theCompany’s interest after considering the purpose for which loans have been granted asindicated above.

(b) The schedule of repayment of principal and payment of interest has been stipulatedand repayments or receipts of principal amounts and interest have been regular as perstipulations.

(c) There is no overdue amount remaining outstanding as at the year-end for more than90 days.

The reporting under clauses (iii)(b) and (c) above has been done without consideringthe loans against which provision have been made in earlier years.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Companies Act2013 in respect of grant of loans and making investments.

(v) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 73 to 76 or any other relevantprovisions of the Companies Act 2013 and the Companies (Acceptance of Deposits) Rules2014 as amended with regard to the deposits accepted. According to the information andexplanations given to us no order has been passed by the Company Law Board or theNational Company Law Tribunal or the Reserve Bank of India or any Court or any otherTribunal in respect of contravention of the above said sections and the relevant rules.

(vi) The maintenance of cost records has been specified by the Central Government undersection 148(1) of the Companies Act 2013 in respect of Sugar Cement FertilizerChemicals PVC Resin UPVC doors and windows businesses. We have broadly reviewed the costrecords maintained by the Company pursuant to the Companies (Cost Records and Audit)Rules 2014 as amended prescribed by the Central Government under sub-section (1) ofSection 148 of the Companies Act 2013 and are of the opinion that prima facie theprescribed cost records have been made and maintained. We have however not made adetailed examination of the cost records with a view to determine whether they areaccurate or complete. (vii) According to the information and explanations given to us inrespect of statutory dues: (a) The Company has generally been regular in depositingundisputed statutory dues including Provident Fund Employees’ State InsuranceIncome-tax Sales Tax Service Tax Customs Duty Excise Duty Value Added Tax cess andother material statutory dues applicable to it to the appropriate authorities. (b) Therewere no undisputed amounts payable in respect of Provident Fund Employees’ StateInsurance Income-tax Sales Tax Service Tax Customs Duty Excise Duty Value Added Taxcess and other material statutory dues in arrears as at March 31 2016 for a period ofmore than six months from the date they became payable.

(c) Details of dues of Income-tax Sales Tax/ Value Added Tax Service Tax CustomsDuty and Excise Duty which have not been deposited as on March 31 2016 on account ofdisputes are given below:

Name of Statute Nature of Dues Forum where Dispute is Pending Period to which the Amount Relates Amount Involved * (Rs.in Crores) Amount paid under protest (Rs.in Crores) Amount Unpaid (Rs.in Crores)
Central Excise Law Excise Duty Appellate Authority upto Commissioner’s level 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 3.28 0.05 3.23
Customs Excise and Service Tax Appellate Tribunal 1997-98 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 5.47 1.02 4.45
Finance Act 1994 Service Tax Customs Excise and Service Tax Appellate Tribunal 2005-06 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 31.94 31.71 0.22
Income-tax Act 1961 Income-tax Appellate Authority upto Commissioner’s level 2010-11 2011-12 5.71 5.71 -
Income Tax Appellate Tribunal 2009-10 2.21 2.21 -
Customs Act 1962 Customs Duty Customs Excise and Service Tax Appellate Tribunal 2012-13 5.38 0.54 4.84
Sales Tax Laws Sales Tax Appellate Authority upto Commissioner’s level 1983-84 2001-02 2005-06 2006-07 2007-08 2010-11 2011-12 1.89 0.41 1.48
Appellate Tribunal 1994-95 2009-10 2.39 0.95 1.44

*Amount as per demand orders including interest and penalty wherever indicated in theorder.

The following matter has been decided in favour of the Company although the departmenthas preferred appeal at higher levels:

Name of Statute Nature of Dues Forum where Dispute is Pending Period to which the Amount Relates Amount Involved (Rs.in Crores)
Sales Tax Laws Value Added Tax Rajasthan Tax Board 2008-09 2009-10 2010-11 2011-12 3.65
High Court 2001-02 1.31
Income-tax Act 1961 Income-tax Income Tax Appellate Tribunal 2009-10 0.45

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of dues to financial institutions banksand government and dues to debenture holdeRs.

(ix) The Company has not raised moneys by way of initial public offer or further publicoffer. Further during the year the Company has raised money by way of debt instrumentsincluding commercial papers. In our opinion and according to the information andexplanation given to us money raised by way of debt instruments and term loans have beenapplied by the Company during the year for the purposes for which they were raised.

(x) To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company and no material fraud on the Company by its officersor employees has been noticed or reported during the year. (xi) In our opinion andaccording to the information and explanations given to us the Company has paid/providedmanagerial remuneration in accordance with the requisite approvals mandated by theprovisions of section 197 read with Schedule V to the Companies Act 2013. (xii) TheCompany is not a Nidhi Company and hence reporting under clause (xii) of the CARO 2016Order is not applicable. (xiii) In our opinion and according to the information andexplanations given to us the Company is in compliance with Section 188 and 177 of theCompanies Act 2013 where applicable for all transactions with the related parties andthe details of related party transactions have been disclosed in the financial statementsetc. as required by the applicable accounting standards.

(xiv) During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures and hence reporting underclause (xiv) of CARO 2016 is not applicable to the Company. (xv) In our opinion andaccording to the information and explanations given to us during the year the Company hasnot entered into any non-cash transactions with its directors or persons connected withhim and hence provisions of section 192 of the Companies Act 2013 are not applicable.

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

For DELOITTE HASKINS & SELLS
Chartered Accountants
(Firm’s Registration No. 015125N)
Vijay Agarwal
Place : New Delhi Partner
Date : May 10 2016 (Membership No.094468)

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