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Mukand Ltd.

BSE: 500460 Sector: Metals & Mining
NSE: MUKANDLTD ISIN Code: INE304A01026
BSE 15:40 | 22 Feb 74.80 -0.40
(-0.53%)
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74.50

HIGH

75.45

LOW

74.15

NSE 15:44 | 22 Feb 74.90 0.05
(0.07%)
OPEN

75.40

HIGH

75.40

LOW

73.75

OPEN 74.50
PREVIOUS CLOSE 75.20
VOLUME 9650
52-Week high 109.00
52-Week low 60.30
P/E
Mkt Cap.(Rs cr) 1,058
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 74.50
CLOSE 75.20
VOLUME 9650
52-Week high 109.00
52-Week low 60.30
P/E
Mkt Cap.(Rs cr) 1,058
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Mukand Ltd. (MUKANDLTD) - Auditors Report

Company auditors report

To the Members of Mukand Limited

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of Mukand Limited("the Company") which comprise the Balance Sheet as at March 31 2017 theStatement of Profit and Loss the Cash Flow Statement for the year then ended and asummaryofsignificantaccounting policies and other explanatory information.

Management’s Responsibility for the Standalone Financial Statements

The Company’s Board of Directors is responsible for the matters stated in

Section 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 with the accounting principles generally accepted in Indiaincluding the Accounting Standards specified under Section 133 of the Act read with Rule7 of the Companies (Accounts) Rules 2014. This responsibility also includes maintenanceof adequate accounting records in accordance with the provisions of the Act forsafeguarding of 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 and ensuring their operatingeffectiveness and the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the standalone financial statements that give a true andfair view and 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 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 specified under Section 143(10) of the Act.Those Standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the standalone financial statements arefree from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the standalone financial statements. The procedures selected depend on theauditors’ judgment including the assessment of the risks of material misstatement ofthe standalone financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to theCompany’s preparation of the standalone financial statements that give a true andfair view in order to design audit procedures that are appropriate in the circumstances.An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by the Company’s Directors as wellas evaluating the overall presentation of the standalone financial statements.

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

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 2017 its loss and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to the following matter in the notes to the standalone financialstatements: a) Note 18 (a) to the Statement relating to the exposures in Bombay ForgingsLimited (BFL) aggregating Rs. 82.01 Crores as at March 31 2017 (Rs. 78.28 crores as atMarch 31 2016) where the management has barring anysignificantuncertainties in futurerelied upon the the value of current assets and valuationofunencumbered fixed projectedfuture earnings from the business activities of BFL.

b) Note 18 (b) to the Statement relating to the exposures in Vidyavihar ContainersLimited (VCL) a subsidiary company aggregating Rs. 47.13 Crores (net) as at March 312017 (Rs. 47.13 Crores (net) as at March 31 2016) where the management hasbarringanysignificantuncertainties in future relied upon the future realizable values offinancial assets of VCL to recover its exposures.

c) Note 21 (b) to the Statement relating to the exposures aggregating Rs. 113.54Crores as at March 31 2017 (Rs. 120.00 crores as at March 31 2016) in respect of roadconstruction activity and our reliance on the management’s expectation of itsrealisibility.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

(1) As required by the Companies (Auditors’ Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of subsection (11) ofSection 143 of the Act we give in "Annexure 1"

a statement on the matters specified in paragraphs 3 and 4 of the Order to the extentapplicable.

(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 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 and the Cash Flow Statementdealt with by 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 312017 and taken on record by the Board of

Directors none of the directors is disqualified as on March 31

2017 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 overfinancial reporting of the Company and the operating effectiveness of such controls wegive our separate Report in "Annexure 2". g. With respect to the other mattersto be included in the Auditor’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 andaccording to the explanations given to us:

(i) The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements Refer Note 20 on Contingent Liabilities ;

(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 ;

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

(iv) The company has provided requisite disclosures in the financial statements as toholdings as well as dealings in Specified Bank Notes during the period from 8th November2016 to 30th December 2016. Based on audit procedures and relying on the managementrepresentation we report that the disclosures are in accordance with the books of accountmaintained by the company and as produced to us by the Management - Refer Note No. 17 tothe financial statements.

For Haribhakti & Co. LLP
Chartered Accountants
ICAI Firm Registration No.103523W/W100048
Sumant Sakhardande
Place: Mumbai Partner
Date : May 24 2017 Membership No.034828

Annexure 1 to the Independent Auditor’s Report

[Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements’ in the Independent Auditor’s Report of even date to the members ofMukand Limited on the standalone financial statements for the year ended March 31 2017]

(i)

(a) The Company has maintained the fixed asset register showing quantitative detailsand situation of fixed assets. However it is in the process of updating the same foraccumulated depreciation and net block of the assets

(b) During the year all the fixed assets have not been physically verified by themanagement. However there is a regular programme of verification which in our opinionis reasonable having regard to the size of the Company and the nature of its assets. Asinformed no material discrepancies were noticed on such verification.

(c) The title deeds of immovable properties recorded as fixed assets in the books ofaccount of the Company are held in the name of the Company.

(ii) The inventory (excluding stocks lying with third parties) has been physicallyverified by the management during the year. In respect of inventory lying with thirdparties these have substantially been confirmed by them. In our opinion the frequency ofverification is reasonable. As informed no material discrepancies were noticed onphysical verification carried out during the year.

(iii) As informed in current year the Company has not granted any loans secured orunsecured to companies firms Limited Liability Partnerships or other parties covered inthe register maintained under Section 189 of the Act. However there is outstanding loanfrom earlier years given to one of the subsidiaries of the Company. (a) According to theinformation and explanations given to us and based on the audit procedures conducted byus we are of the opinion that the terms and conditions of the aforesaid loans granted bythe Company are not prejudicial to the interest of the Company.

(b) The schedule of repayment of principal and payment of interest in respect of suchloans has not been stipulated (c) According to information and explanations given to us inrespect of the aforesaid loans there is no overdue amount of loans outstanding as onbalance sheet date.

(iv) Based on information and explanation given to us in respect of loans investmentsguarantees and securities the Company has complied with the provisions of Section 185 and186 of the Act.

(v) In our opinion and according to the information and explanations given to us theCompany has complied with the directives issued by Reserve Bank of India and theprovisions of Sections 73 to 76 of the Act and the rules framed there under with regard tothe acceptance of deposits. Further as informed no order has been passed by the CompanyLaw Board or National Company Law Tribunal or Reserve Bank of India or any Court or anyother Tribunal on the Company in respect of the aforesaid deposits.

(vi) We have broadly reviewed the books of account maintained by the Company in respectof products where the maintenance of cost records has been specified by the CentralGovernment under sub-section (1) of Section 148 of the Act and the rules framed thereunder and we are of the opinion that prima facie the prescribed accounts and records havebeen made and maintained.

(vii)

(a) The Company is regular in depositing with appropriate authorities undisputedstatutory dues including provident fund employees’ state insurance income taxsales tax service tax value added tax customs duty excise duty cess and any othermaterial statutory dues applicable to it. However there have been delays in payment oftax deducted at source excise duty service tax value added tax and LBT which have notbeen regularly deposited and there have been delays in many cases.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees’ state insurance income tax salestax service tax value added tax customs duty excise duty cess and any other materialstatutory dues applicable to it were outstanding at the year end for a period of morethan six months from the date they became payable.

(b) According to the information and explanation given to us the dues outstanding withrespect to income tax sales tax service tax value added tax customs duty excise dutyon account of any dispute are as follows:

Name of the statute Nature of dues Amount Period to which the amount relates Forum where dispute is pending Remarks
(Rs. in Crores)
Income Tax Act Income Tax 0.682 1992-93 High Court
Income Tax Act Income Tax 0.313 1997-98 High Court
Wealth Tax Act Wealth Tax 0.352 1998-99 High Court
Income Tax Act Income Tax 0.640 1998-99 High Court
Income Tax Act Income Tax 0.346 2008-09 High Court
Income Tax Act Income Tax 0.251 2009-10 High Court
Income Tax Act Income Tax 0.220 2010-11 High Court
Income Tax Act Income Tax 0.594 1996-97

 

Name of the statute Nature of dues Amount Period to which the amount relates Forum where dispute is pending Remarks
(Rs. in Crores)
Trade tax & UP Trade 0.125 2001-02 High Court
Entry Tax Tax Entry Tax
Sales tax Local Sales 0.018 1988-89 Tribunal
Tax Central Sales Tax 1989-90
Sales tax Local Sales 0.021 1989-90 Deputy
Tax Central 1990-91 Commissioner
Sales Tax 1991-92 - Appeals
1996-97
1998-99
Entry Tax Entry Tax 0.109 2002-03 Commissioner
(Appeals)
Trade Tax UP Trade Tax 3.305 2002-03 Tribunal
2003-04
Sales tax Local Sales 0.033 2012-13 Commissioner
Tax Central Sales Tax (Appeals)

(viii) According to the information and explanations given to us the Company has notdefaulted in repayment of loans or borrowings to financial institution(s) bank(s)government(s) or dues to debenture holder(s).

(ix) In our opinion and according to the information and explanations given to us theCompany has not raised money by way of public issue offer or further public offer(including debt instruments) during the year. The Company has utilised the money raised byway of term loan for the purposes for which they were raised.

(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of fraud by the Company or any fraud on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such instance by themanagement.

(xi) According to the information and explanations given to us managerial remunerationhas been paid / provided in accordance with the requisite approvals mandated by theprovisions of Section 197 read with Schedule V to the Act (xii) In our opinion andaccording to the information and explanations given to us the Company is not a NidhiCompany. Therefore paragraph 3(xii) of the Order is not applicable to the Company.

(xiii) According to the information and explanation given to us all transactionsentered into by the Company with the related parties are in compliance with Sections 177and 188 of Act where applicable and the details have been disclosed in the FinancialStatements etc. as required by the applicable accounting standards.

(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review. Thereforeparagraph 3(xiv) of the Order is not applicable to the Company.

(xv) According to the information and explanations given to us the Company has notentered into any non-cash transactions with directors or persons connected with him duringthe year.

(xvi) According to the information and explanation given to us the Company is notrequired to be registered under Section 45-IA of the Reserve Bank of India Act 1934.

For Haribhakti & Co. LLP
Chartered Accountants
ICAI Firm Registration No.103523W/W100048
Sumant Sakhardande
Place: Mumbai Partner
Date : May 24 2017 Membership No.034828

Annexure 2 to the Independent Auditor’s Report

[Referred to in paragraph 2 under ‘Report on Other Legal and RegulatoryRequirements’ in the Independent Auditor’s Report of even date to the members ofMukand Limited on the standalone financial statements for the year ended March 31 2017]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") financial reporting includes those We have audited the internal financialcontrols over financial reporting of Mukand Limited Company Limited ("theCompany") as of March 31 2017 in conjunction with our audit of the standalonefinancial 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 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 Auditingspecified under section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls both issued by the ICAI. Those Standards and the

Guidance 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 obtainaudit evidence about the adequacy of the internal financial controls system over financialreporting and their operating effectiveness.

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 the auditor’s judgement including the assessment of the risks of materialmisstatement 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 policies andprocedures that controlover

(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 authorisations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company’s assets that could havea 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 2017 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 ICAI.

For Haribhakti & Co. LLP
Chartered Accountants
ICAI Firm Registration No.103523W/W100048
Sumant Sakhardande
Place: Mumbai Partner
Date : May 24 2017 Membership No.034828