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Loyal Textile Mills Ltd.

BSE: 514036 Sector: Industrials
NSE: N.A. ISIN Code: INE970D01010
BSE LIVE 15:26 | 21 Aug 677.05 -48.95
(-6.74%)
OPEN

677.05

HIGH

710.00

LOW

677.05

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 677.05
PREVIOUS CLOSE 726.00
VOLUME 15
52-Week high 889.95
52-Week low 515.00
P/E 12.23
Mkt Cap.(Rs cr) 326
Buy Price 677.00
Buy Qty 5.00
Sell Price 700.00
Sell Qty 1.00
OPEN 677.05
CLOSE 726.00
VOLUME 15
52-Week high 889.95
52-Week low 515.00
P/E 12.23
Mkt Cap.(Rs cr) 326
Buy Price 677.00
Buy Qty 5.00
Sell Price 700.00
Sell Qty 1.00

Loyal Textile Mills Ltd. (LOYALTEXTILE) - Auditors Report

Company auditors report

To

The Members of

M/s. LOYAL TEXTILE MILLS LIMITED

KOVILPATTI.

Report on the Standalone Financial Statements

1. We have audited the accompanying standalone financial statements of LOYAL TEXTILEMILLS LIMITED KOVILPATTI which comprise the Balance Sheet as at 31st March2016 the Profit and Loss Statement and Cash Flow Statement for the year then ended and asummary of significant explanatory informations.

Management’s Responsibility for the Standalone Financial Statements

2. The company’s Board of Directors is responsible for the matters stated inSection 134(5) of the Companies Act 2013 ("the Act") with respect to thepreparation of these standalone financial statements that give a true and fair view of thefinancial position financial performance and cash flows of the company in accordance withthe accounting 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.

3. This responsibility also includes maintenance of adequate accounting records inaccordance 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 judgements and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

Auditor’s Responsibility

4. 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 the order and the Rules made there under. We conductedour audit in accordance with the Standards on Auditing specified under Section 143(10) ofthe Act. Those Standards require that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance about whether the financial statementsare free from material misstatement.

5. An audit involves performing procedures to obtain audit evidence about the amountsand the disclosures in the financial statements. The procedures selected depend on theauditor’s judgement including the assessment of the risks of material misstatementof the financial statementspolicies and whetherother due to fraud or error. In makingthose risk 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.

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

Opinion

7. 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 31st March 2016 and its profit and its cash flows for the year ended onthat date.

Report on Other Legal and Regulatory Requirements

8. 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-A" a statement on the mattersspecified in paragraph 3 and 4 of the Order to the extent applicable.

9. 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 the statement of profit the cash flow statement dealt with bythis 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 the written representations received from the directors as on 31March 2016 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2016 from being appointed as a director in terms of Section164 (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 -B"; and

(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 27 to the financial statements;

ii. The company did not have any long term contracts including derivative contracts forwhich there were any material foreseeable losses on the company in its FinancialStatements.

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

For Suri & Co.
Chartered Accountants
Firm Regn. No. 004283S
R.Krishnamoorthy
Place: Chennai Partner
Date : 26th May 2016 M.No.20695

ANNEXURE-A TO THE INDEPENDENT AUDITOR’S REPORT

(i) a) The company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets.

b) According to the information and explanations given to us the fixed assets at alllocations have been physically verified by the management during the year at reasonableintervals and no material discrepancies were noticed on such verification.

c) According to the information and explanation given to us the title deeds ofimmovable properties as disclosed in Note 9 to the standalone financial statement areheld in the name of the company except for the following:

Free hold Lease hold
Particulars (Rs. in lakhs) (Rs. in lakhs)
Gross Block as at 31st March 2016 Nil 165.23
Net Block as at 31st March 2016 Nil 163.56

(ii) As explained to us the inventories at all locations have been physically verifiedby the management at regular intervals during the year. The discrepancies noticed onphysical verification of stocks as compared to book records were not material and thesame have been properly dealt with in the books of account.

(iii) In our opinion and according to the information and explanations given to us thecompany has not granted any loan secured or unsecured to the companies firms limitedliability partnership or other parties listed in the register maintained under Section 189of the Companies Act 2013.

(iv) The company has not granted any loan or provided any guarantee or security to theparties covered under section 185 and 186 of the Act. In respect of investment insecurities the company has complied with the provisions of section 186 of the Act.

(v) The company has not accepted any deposit from public during the year as perprovision of section 73 and 76 of the Companies Act 2013. The company has accepted/ takeninterest free inter corporate deposit from a company / companies.

(vi) We have broadly reviewed the cost records maintained by the company as prescribedby the Central Government under sub section (1) of section 148 of the Companies Act 2013and are of the opinion that prima facie the prescribed accounts and records have beenmade and maintained. We have however not made a detailed examination of the records witha view to determine whether they are accurate or complete.

(vii) a) According to the information and explanations given to us the company hasbeen regular in depositing undisputed statutory dues including provident fundemployees’ state insurance income-tax sales-tax service tax duty of customs dutyof excise value added tax cess and any other statutory dues with the appropriateauthorities. In respect of undisputed statutory dues payable in respect of above which areoutstanding as at 31st March 2016 for a period of more than six months from thedates they became payable is given below:

Nature of Dues Amount (Rs. In lakhs)
Advance Licensing 165

b) According to the information and explanations furnished to us there are no dues ofincome tax service tax duty of customs duty of excise value added tax which have notbeen deposited on account of any dispute. In respect of sales tax which are pendingpayment on account of dispute the information of which is given below :

Name of the Statute/ Dues Unpaid Disputed Liability (Rs.in lakhs) Period to which the amount relates Forum where dispute is pending
Sales Tax 153.03 A.Y 2002-03 2003-04 2005-06 2007-08 2008-09 2009-10 2010-11 2013-14 2014-15 Additional Deputy Commissioner of Sales Tax and Sales Tax Appellate Tribunal

(viii) According to the information and explanations given to us the company has notdefaulted in repayment of dues to financial institutions or banks or Government. Thecompany has not issued any debenture.

(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments). The term loans taken during the year areapplied for the purposes for which term loans were obtained.

(x) According to the information and explanations given to us no material fraud by thecompany or on the company by its officers or employees has been noticed or reported duringthe year.

(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.

(xii) The Company not being a Nidhi company the requirements of paragraph 3(xii) ofthe Order is not applicable.

(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

(xiv) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year.

(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him.

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

For Suri & Co.
Chartered Accountants
Firm Regn. No. 004283S
R.Krishnamoorthy
Place: Chennai Partner
Date : 26th May 2016 M.No.20695

ANNEXURE-B TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE STANDALONEFINANCIAL STATEMENTS OF LOYAL TEXTILE MILLS 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 LoyalTextile Mills Limited as on March 31 2016 in conjunction with our audit of the financialstatements 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 (‘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 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 our judgement including the assessment of the risks of material misstatement ofthe 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 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 31 March 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.

For Suri & Co.
Chartered Accountants
Firm Regn. No. 004283S
R.Krishnamoorthy
Place: Chennai Partner
Date : 26th May 2016 M.No.20695