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NRB Industrial Bearings Ltd.

BSE: 535458 Sector: Engineering
NSE: NIBL ISIN Code: INE047O01014
BSE LIVE 15:41 | 17 Nov 29.15 -0.20
(-0.68%)
OPEN

30.00

HIGH

30.00

LOW

29.15

NSE 15:28 | 17 Nov 29.25 -0.20
(-0.68%)
OPEN

29.45

HIGH

29.95

LOW

28.90

OPEN 30.00
PREVIOUS CLOSE 29.35
VOLUME 432
52-Week high 45.00
52-Week low 28.20
P/E
Mkt Cap.(Rs cr) 71
Buy Price 29.15
Buy Qty 38.00
Sell Price 0.00
Sell Qty 0.00
OPEN 30.00
CLOSE 29.35
VOLUME 432
52-Week high 45.00
52-Week low 28.20
P/E
Mkt Cap.(Rs cr) 71
Buy Price 29.15
Buy Qty 38.00
Sell Price 0.00
Sell Qty 0.00

NRB Industrial Bearings Ltd. (NIBL) - Auditors Report

Company auditors report

TO THE MEMBERS OF NRB INDUSTRIAL BEARINGS LIMITED

Report on the Financial Statements

We have audited the accompanying financial statements of NRB INDUSTRIAL BEARINGSLIMITED ("the Company") which comprise the Balance Sheet as at 31 March2016 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 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 financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards prescribedunder section 133 of the Act as applicable.

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 judgments 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 financialstatements that give a true and fair view and are free from material misstatement whetherdue 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 financial statements in accordance with the Standards onAuditing specified under Section 143(10) of the Act. Those Standards require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures 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 the accounting policies used and the reasonableness ofthe accounting estimates made by the Company’s Directors as well as evaluating theoverall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid 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 31March 2016 and its loss and its cash flows for the year ended on that date.

Emphasis of Matters

We draw attention to Note 41 to the Financial Statements. As stated in the Note theremuneration paid to the Managing Director of Rs. 34.81 lacs for the period from 01October 2012 to 31 March 2014 is subject to the approval of the Central Government.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. 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 financial statements comply with the AccountingStandards prescribed under section 133 of the Act as applicable.

e) On the basis of the written representations received from the directors as on 31March 2016 taken on record by the Board of Directors as on 31 none of the directors isdisqualified March 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 A". Our report expresses modified opinion on theadequacy and operating effectiveness of the Company’s internal financial controlsover financial 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 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company does not have any pending litigations which would impact its financialposition.

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the InvestorEducation 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. 117365W)
Uday M. Neogi
Place: Mumbai (Partner)
Date : 27 May 2016 (Membership No. 30235)

ANNEXURE A TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 1 (f) under ‘Report on controls Other Legal andRegulatory Requirements’ of our report of even date to the members of NRB IndustrialBearings limited on the financial statements for the year ended 31 March 2016)

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 NRBIndustrial Bearings Limited ("the Company") as of March 31 2016 in conjunctionwith our audit of the 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 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. These responsibilities includethe design implementation and maintenance of adequate internal financial that wereoperating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to 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") issued by the Institute of Chartered Accountants of Indiaand the Standards on Auditing prescribed under Section 143(10) of the Companies Act 2013to the extent applicable to an audit of internal financial controls. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated 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 internal financial controls over financial reporting assessingthe risk that a material weakness exists and testing and evaluating the design andoperating 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 qualified audit opinion on the Company’s internal financialcontrols system 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.

Qualified opinion

According to the information and explanations given to us and based on our audit thefollowing material weakness has been identified in the Company’s internal financialcontrols over financial reporting as at March 31 2016:

The Company does not have adequate internal control system for recording in ERP Systemof stagewise movement of quantities for shop floorwork in progress resulting in incorrectbook quantities of shop floor work in progress at any point of time and consequentlymaterial differences between the book and physical stock of shop floor work in progress.

This could potentially result in material misstatements in the Company’sInventory.

A ‘material weakness’ is a deficiency or a combination of deficiencies ininternal financial control over financial reporting such that there is a reasonablepossibility that a material misstatement of the company’s annual or interim financialstatements will not be prevented or detected on a timely basis.

In our opinion to the best of our information and according to the explanations givento us except for the effects of the material weakness described above on the achievementof the objectives of the control criteria the Company has maintained in all materialrespects adequate internal financial controls over financial reporting and such internalfinancial controls over financial reporting were operating effectively as of March 312016 based on the internal control over financial reporting criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India.

We have considered the material weakness identified and reported above in determiningthe nature timing and extent of audit tests applied in our audit of the financialstatements of the Company for the year ended March 31 2016 and the material weaknessdoes not affect our opinion on the said financial statements of the Company.

For Deloitte Haskins & Sells
Chartered Accountants
(Firm‘s Registration No.117365W)
Uday M. Neogi
Place: Mumbai Partner
Date: 27 May 2016 (Membership No. 30235)

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 to the members of NRB IndustrialBearings limited on the the year ended 31 March 2016)

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

(b) The Company has a program of verification of fixed assets to cover all the itemsonce over a period of three years which in our opinion is reasonable having regards tothe size of the Company and the nature of its assets. In accordance with the programme allitems of fixed assets were physically verified during the previous period.

(c) According to the information and explanations given to us and the records examinedby us and based on the examination of the registered tittle deed provided to us we reportthat the tittle deed of the flat is held in the name of the company as at the balancesheet date.

In respect of immovable property of land taken on lease and building constructedthereon disclosed as fixed assets in the financial statements lease agreement has beenpledged as security for loans based on the confirmation directly received by us fromLenders the lease agreement is in the name of the Company where the company is lessee inthe agreement.

(ii) As explained to us the inventories were physically verified during the year bythe Management at reasonable intervals. Material discrepancies noticed on physicalverification during the year have been properly dealt with in the books of account.

(iii) The Company has not granted any loans secured or unsecured to companies orother parties covered in the register maintained under section 189 of the Companies Act2013.

(iv) In our opinion and according to the information and explanation given to us theCompany has not granted any loans or provided guarantees. In respect of investments madethe Company has complied with the provisions of section 186 of the Companies Act 2013.

(v) According to the information and explanations given to us the Company has notaccepted any deposit during the year.

(vi) The maintenance of cost records has been specified the Central Government undersection 148(1) of the Companies Act 2013. We have broadly reviewed the cost recordsmaintained by the Company pursuant to the Companies (Cost Records and Audit) Rules 2014as amended prescribed by the Central Government under sub-section (1) of Section 148 ofthe Companies Act 2013 and are of the opinion that prima facie the prescribed costrecords have been made and maintained

We have however not made a detailed examination of the cost records with a view todetermine whether they are accurate or complete.

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

(a) The dues of tax deducted at source and Service tax have not been regularlydeposited during the year with the appropriate authorities the delay in deposit have beenserious. The Company has generally been regular in depositing other undisputed statutorydues including Provident Fund Excise Duty Sales Tax Value Added Tax cess and othermaterial statutory dues applicable to it to the appropriate authorities.

(b) Except for tax deducted at source there were no undisputed amounts payable inrespect of Provident Fund Sales Tax Service tax Excise Duty Value Added Tax cess andother material statutory dues in arrears as at March 31 2016 for a period of more thansix months from the date they became payable:

Name of Statute Nature of Dues Amount Period to which the Amount Relates Due Date Date of subsequent payment
(Rs.)
Income Tax Act 1956 Interest on Tax deducted at source 13588 May-15 07-June-15 12-April-16
16-April-16
18-April-16
20-April-16
27-April-16
29-April-16
5694 May-15 07-June-15 -
38264 June-15 07-July-15 -
38660 Aug -15 07-Sept-15 -
Income Tax Act 1956 Tax collected at source 2812 Apr-15 07-May-15 -
810 May-15 07-June-15 -
3726 June-15 07-July-15 -
4139 Aug -15 07-Sept-15 -
Income Tax Act 1956 Interest on Tax collected at source 337 Apr-15 07-May-15 -
89 May-15 07-June-15 -
373 June-15 07-July-15 -
331 Aug -15 07-Sept-15 -

(c) There are no dues of Income-tax Sales Tax Service Tax Customs Duty Excise Dutyand Value Added Tax as on March 31 2016 on account of disputes.

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of loans or borrowings to financialinstitutions and banks. The Company has not issued any debentures.

(ix) The Company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments) or term loans during the year and hence reporting underclause (ix) of the Order is not applicable.

(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 managerial remuneration for the year 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 us theCompany is in compliance with Section 188 and 177 of the Companies Act 2013 whereapplicable for all transactions with the related parties and the details of related partytransactions have been disclosed in the financial statements etc. as required by theapplicable accounting standards.

(xiv) According to the information and explanations given to us the Company has madeprivate placement of shares during the year under review.

In respect of the above issue we further report that:

a) the requirement of Section 42 of the Companies Act 2013 as applicable have beencomplied with; and

b) the amounts raised have been applied by the Company during the year for the purposesfor which the funds were raised.

(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 persons connected with him and hence provisions of section 192 of theCompanies 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. 117365W)
Uday M. Neogi
Place: Mumbai (Partner)
Date: 27 May 2016 (Membership No. 30235)