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Omkar Speciality Chemicals Ltd.

BSE: 533317 Sector: Industrials
NSE: OMKARCHEM ISIN Code: INE474L01016
BSE LIVE 19:40 | 19 Oct 81.00 -0.30
(-0.37%)
OPEN

80.55

HIGH

82.00

LOW

80.45

NSE 19:31 | 19 Oct 81.00 -0.20
(-0.25%)
OPEN

82.10

HIGH

82.10

LOW

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OPEN 80.55
PREVIOUS CLOSE 81.30
VOLUME 16116
52-Week high 120.05
52-Week low 63.13
P/E 4.38
Mkt Cap.(Rs cr) 167
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 80.55
CLOSE 81.30
VOLUME 16116
52-Week high 120.05
52-Week low 63.13
P/E 4.38
Mkt Cap.(Rs cr) 167
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Omkar Speciality Chemicals Ltd. (OMKARCHEM) - Auditors Report

Company auditors report

TO THE MEMBERS OF

OMKAR SPECIALITY CHEMICALS LIMITED

Report on the Financial Statements

We have audited the accompanying financial statements of Omkar Speciality ChemicalsLimited ("the Company") which comprise of the Balance Sheet as at March 312016 the Statement of Profit and Loss the Cash Flow Statement for the year then endedand a summary of the significant accounting 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 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 specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit. We have taken into account the provisions of the Act the accounting and auditingstandards and the matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe 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 but not for the purpose ofexpressing an opinion on whether the Company has in place an adequate internal financialcontrols system over financial reporting and the operating effectiveness of such controls.An audit also includes evaluating the appropriateness of the accounting policies used andthe reasonableness of the accounting estimates made by the Company’s Directors aswell as evaluating the overall presentation of the financial statements. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour 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 March 31 2016 and its profit and its cash flows for the year ended on that date.

Emphasis of Matters

We draw attention to the following matters in the Notes to the financial statements: a.During the year under review the company has changed the method of arriving cost of Workin progress and finished goods this has resulted into under-statement of stock and profitby Rs 65.68 lacs. Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of Section 143(11) of theAct we give in the Annexure A a statement on the matters specified in the paragraph 3and 4 of the order.

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 Sheetthe Statement of Profit and Loss and the Cash Flow Statement dealt with by this Reportare in agreement with the books of account. (d) In our opinion the aforesaid financialstatements comply with the Accounting Standards specified under Section 133 of the Actread with Rule 7 of the Companies (Accounts) Rules 2014.

(e) The going concern matter described in the Emphasis of Matters paragraph above inour opinion may not have an adverse effect on the functioning of the Company.

(f) On the basis of the written representations received from the Directors as on March31 2016 taken on record by the Board of Directors none of the Directors is disqualifiedas on March 31 2016 from being appointed as a director in terms of Section 164 (2) of theAct.

(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.

For J.P.J. Associates
Chartered Accountants
Firm Registration No.113012W
Sd/-
CA Sandesh Deorukhkar
Partner
M.No.: 044397
Date: May 23 2016
Place: Mumbai

ANNEXURE – A TO THE AUDITOR’S REPORT

The Annexure referred to in Independent Auditors’ Report to the members of theCompany on the financial statements for the year ended March 31 2016 we report that:

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

(b) A substantial portion of the fixed assets have been physically verified by themanagement during the year and in our opinion the frequency of verification is reasonablehaving regard to the size of the Company and Nature of Business. No material discrepancieswere noticed on such verification.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the company.

(ii) The inventories have been physically verified during the year by the management.In our opinion the frequency of verification is reasonable. On the basis of examinationof inventory records in our opinion and according to the information and explanationsgiven to us the Company is maintaining proper records of inventory. The discrepanciesnoticed on verification between the physical stocks and the book records were not materialand have been properly dealt within the books of accounts.

(iii) The Company has granted loans secured or unsecured to Companies firms or otherparties covered in the register maintained under section 189 of the Companies Act 2013.

(a) The terms and conditions of the grant of such loans are not prejudicial to thecompany’s interest;

(b) In our opinion and according to the information and explanations given to usreceipt of the principal amount and interest are regular.

(c) In our opinion and to the best of our information and according to the explanationsgiven to us the amount of Rs 7789 lacs was due from the companies firms or otherparties covered in the register maintained under section 189 of the Companies Act 2013 inthe normal course of business.

(iv) The Company has not accepted any deposit from the public.

(v) We have broadly reviewed the cost records maintained by the company specified bythe Central Government under subsection (l) of section 148 of the Companies Act 2013 andare of the opinion that prima facie the prescribed records have been maintained. Howeverwe have not made a detailed examination of the cost records with a view to determinewhether they are accurate or complete.

(vii) (a) According to the records of the Company and as per the information andexplanations given to us the Company is regular in depositing undisputed statutory duesincluding Provident Fund Investor Education and Protection Fund Employees’ StateInsurance Sales tax Wealth tax Service tax Duty of Customs Duty of Excise valueadded tax cess and other statutory dues with appropriate authorities except Income Taxliability of `387.07 lacs for the Assessment year 2015-16 including interest thereon tillMarch 31 2016.

(b) According to the information and explanation given to us and records examined byus there are no disputed dues of Sales Tax Wealth Tax Service Tax Custom Duty ExciseDuty and Cess outstanding as on March 31 2016 except following dues raised by the incomeTax Department Sales tax Department which are disputed by the Company: (Rs in Lakhs)

Assessment year Total Demand Payment Made Particulars
Income Tax
2009-10 41.32 25.00 Appeal Pending with Income Tax Appellate Tribunal.
2010-11 119.69 125.00
2011-12 97.45 60.00
2012-13 28.36 15.00 Appeal filed.
VAT
2009-10 13.88 0.00 Appeal filed
2009-10 7.70 1.50 Stay granted

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of dues to a financial institution or banks ordebenture holders.

(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loans during the year. Accordinglyparagraph 3 (ix) of the Order is not applicable.

(x) According to the information and explanations given to us no fraud by the Companyor on the Company by its officers or employees has been noticed or reported during thecourse of our audit. (xi) As per the information and explanation given to us the Companyhas paid / provided for managerial remuneration as per the provisions of Section 197 ofthe Companies Act 2013.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable.

(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 given to us andbased on our examination of the records of the Company the Company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the 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. Accordingly paragraph 3(xv) ofthe Order is not applicable.

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

For J.P.J. Associates
Chartered Accountants
Firm Registration No.113012W
Sd/-
CA Sandesh Deorukhkar
Partner
M.No.: 044397
Date: May 23 2016
Place: Mumbai

ANNEXURE - B TO THE AUDITORS’ REPORT

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 OmkarSpeciality Chemicals Limited ("the Company") as of March 31 2016 inconjunction with our audit of the financial statements of the Company for the year endedon 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 auditinvolves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system over financial reporting and their operating effectiveness. Ouraudit 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 judgment 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 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 authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized 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

As per the explanation and information provided to us by the management and on thebasis of verification we are of the opinion that the internal control over financialreporting based on the internal control over financial reporting criteria established bythe Company considering the essential components of internal control stated in theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting issued bythe Institute of Chartered Accountants of India is in place.

For J.P.J. Associates
Chartered Accountants
Firm Registration No.113012W
Sd/-
CA Sandesh Deorukhkar
Date: May 23 2016 Partner
Place: Mumbai M.No.: 044397