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DCM Shriram Ltd.

BSE: 523367 Sector: Others
NSE: DCMSHRIRAM ISIN Code: INE499A01024
BSE LIVE 13:02 | 28 Jul 348.00 9.55
(2.82%)
OPEN

338.45

HIGH

349.00

LOW

338.10

NSE 12:57 | 28 Jul 347.00 9.00
(2.66%)
OPEN

340.40

HIGH

349.70

LOW

336.05

OPEN 338.45
PREVIOUS CLOSE 338.45
VOLUME 6438
52-Week high 411.40
52-Week low 195.85
P/E 10.11
Mkt Cap.(Rs cr) 5,652
Buy Price 346.05
Buy Qty 7.00
Sell Price 348.00
Sell Qty 28.00
OPEN 338.45
CLOSE 338.45
VOLUME 6438
52-Week high 411.40
52-Week low 195.85
P/E 10.11
Mkt Cap.(Rs cr) 5,652
Buy Price 346.05
Buy Qty 7.00
Sell Price 348.00
Sell Qty 28.00

DCM Shriram Ltd. (DCMSHRIRAM) - Auditors Report

Company auditors report

TOTHE MEMBERS OF DCM SHRIRAM LIMITED Report on the Standalone Ind AS FinancialStatements

We have audited the accompanying standalone Ind AS financial statements of DCM SHRIRAMLIMITED ("the Company") which comprise the Balance Sheet as at March 312017the Statement of Profit and Loss (including Other Comprehensive Income) the Cash FlowStatement and the Statement of Changes in Equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Ind AS 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 Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) prescribedunder section 133 oftheAct.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgements and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud orerror.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit.

In conducting our audit we have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit of the standalone Ind AS financial statements in accordance withthe 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 standalone Ind AS financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the standalone Ind AS financial statements thatgive a true and fair view in order to design auditprocedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the standalone Ind ASfinancial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of affairs of theCompany as at March 31 2017 and its profit total comprehensive income its cash flowsand the changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143 (3) oftheAct 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 the Statement of Profit and Loss including Other ComprehensiveIncome the Cash Flow Statement and Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account.

d) In our opinion the aforesaid standalone Ind AS financial statements comply with theIndian Accounting Standards prescribed undersection 133oftheAct.

e) On the basis of the written representations received from the directors as on March312017 taken on record by the Board of Directors none of the directors is disqualifiedas on March 312017 from being appointed as a director in terms of Section 164 (2) of theAct.

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 controlsoverfinancial reporting.

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 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements;

ii. The Company did not have any long-term contracts including derivative contracts forwhich 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 bythe Company;

iv. The Company has provided requisite disclosures in the standalone Ind AS financialstatements as regards its holding and dealings in Specified Bank Notes as defined in theNotification S.O. 3407(E) dated 8th November 2016 of the Ministry of Finance during theperiod from 8th November 2016 to 30th December 2016. Based on audit procedures performedand the representations provided to us by the management we report that the disclosuresare in accordance with the books of account maintained by the Company and as produced tous bythe Management.

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

For Deloitte Haskins & Sells
Chartered Accountants
(Firm's Registration No. 015125N)
Vijay Agarwal
Place : New Delhi (Partner)
Date : May 12017 (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 DCM SHRIRAMLIMITED ("the Company") as of March 31 2017 in conjunction with our audit ofthe standalone Ind AS financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls The Company's management isresponsible for establishing and maintaining internal financial controls 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 (the "Guidance Note")issued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for 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 as required under the Companies Act 2013. Auditor'sResponsibility

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 standalone Ind AS financial statements whether due to fraudor 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 controls systemover financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting A company's internalfinancial control over financial reporting is a process designed to provide reasonableassurance regarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally acceptedaccounting principles. A company's internal financial control over financial reportingincludes those policies and procedures that (1) pertain to the maintenance of recordsthat in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures 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 that the degree ofcompliance 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 312017 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 bythe Institute of Chartered Accountants ofIndia.

For Deloitte Haskins & Sells
Chartered Accountants
(Firm's Registration No.015125N)
Vijay Agarwal
Place: New Delhi (Partner)
Date: May 12017 (Membership No. 094468)

ANNEXURE BTOTHE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 2 under 'Report on Other Legal and Regulatory

Requirements' section of our report of even date)

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of property plant and equipment.

(b) The Company has a program of verification of property plant and equipment to coverall the items in a phased manner over a period of three years which in our opinion isreasonable having regard to the size of the Company and the nature of its assets. Pursuantto the program certain property plant and equipment were physically verified bytheManagement during the year. According to the information and explanations given to us nomaterial 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 provided to us we reportthat the title deeds comprising the immovable properties of land (freehold) andbuildings are held in the name of the Company and in case where such immovable propertieshas been transferred pursuant to the scheme of amalgamation under section 391 to 394 ofthe Companies Act 1956 the transfer is through the Orderof the Hon'ble High Courts.Further freehold land located at Hyderabad measuring 5.03 acres amounting to Rs.1.56crores and freehold lands located at Uttar Pradesh measuring 7.79 hectares amounting toRs. 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 bythe Management at reasonable intervals and no material discrepancies were noticed onphysical verification.

(iii) According to the information and explanations given to us the Company hasduring the year granted unsecured loans aggregatingto Rs. 84.13 crores to three whollyowned subsidiaries covered in the register maintained under section 189 of the CompaniesAct 2013. At the year end the loans granted to five subsidiaries aggregate to Rs. 183.50crores (net of provision of Rs.7.01 crores). These loans include interest free loan of Rs.30.78 crores (including Rs 11.45 crores classified as investment) made to a wholly ownedsubsidiary which as explained to us have been made for setting up new projects. Inrespect of these loans:

(a) The terms and conditions of the grant of such loans are in our opinion primafacie not prejudicial to the Company's interest after considering the purpose for whichloans have been granted as indicated 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 loan amount of Rs 7.01 crores in respect of one subsidiary and interest aggregatingRs. 24.67 crores in respect of three subsidiaries which has been provided/written-off inthe books.

(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 bythe Central Government undersection 148(1) of the Companies Act 2013 in respect of Sugar Cement FertilizerChemicals PVC Resin UPVC doors and windows and electrical energy businesses. We havebroadly reviewed the cost records maintained by the Company pursuant to the Companies(Cost Records and Audit) Rules 2014 as amended prescribed by the Central Governmentunder subsection (1) of Section 148 of the Companies Act 2013 and are of the opinionthat prima facie the prescribed cost records have been made and maintained. We havehowever not made a detailed examination of the cost records with a view to determinewhetherthey are accurate or complete.

(vii) According to the information and explanations given to us in respect ofstatutorydues:

(a) The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income-tax Sales Tax Service TaxCustoms Duty Excise Duty Value Added Tax cess and other material statutory duesapplicable to it to the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income-tax Sales Tax Service Tax Customs Duty Excise Duty ValueAdded Tax cess and other material statutory dues in arrears as at March 312017 for aperiod of more 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 312017 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 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 0.48 0.05 0.43
Customs Excise and Service Tax Appellate Tribunal 1997-98 2004-05 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 4.31 0.41 3.90
Finance Act 1994 Service Tax Customs Excise and Service Tax Appellate Tribunal 2005-06 2008-09 2009-10 2010-11 2011-12 2012-13 31.83 31.71 0.12
Income-tax Act 1961 Income-tax Appellate Authority upto Commissioner's level 2010-11 2011-12 2012-13 6.44 6.44
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 2007-08 2010-11 2011-12 2012-13 2013-14 1.60 0.34 1.26
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. crores)
Sales Tax Laws Value Added Tax Rajasthan Tax Board 2008-09 2009-10 2010-112011-12 3.65
Central Excise law Excise Duty Customs Excise and Service Tax Appellate Tribunal 2005-06 2013-14 2.45
High Court 2001-02 1.31
Income-tax Act 1961 Income-tax Income Tax Appellate Tribunal 2009-10 2010-11 2.83

(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 (including debt instruments). In our opinion and according to the information andexplanation given to us money raised by way of term loans have been applied by theCompany 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 and according to the information and explanations given to us theCompany has paid/provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of theOrder is not applicable.

(xiii) In our opinion and according to the information and explanations given to usthe Company is in compliance with

Section 188 and 177 of the Companies Act 2013 where applicable for all transactionswith the related parties and the details of related party transactions have been disclosedin the standalone IND AS financial statements etc. as required by the applicable Indianaccounting 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 the order is not applicable to the Company

(xv) In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any non-cash transactions with itsdirectors or directors of its holding subsidiary or joint venture company or personsconnected with them and hence provisions of section 192 of the Companies Act 2013 are notapplicable.

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

For Deloitte Haskins & Sells
Chartered Accountants
(Firm's Registration No. 015125N)
Vijay Agarwal
Place: New Delhi (Partner)
Date: May 12017 (Membership No. 094468)