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Rajapalayam Mills Ltd.

BSE: 532503 Sector: Industrials
NSE: RAJPALAYAM ISIN Code: INE296E01026
BSE LIVE 15:51 | 23 Aug 950.00 27.75
(3.01%)
OPEN

916.05

HIGH

966.90

LOW

916.05

NSE 00:00 | 29 Jan Stock Is Not Traded.
OPEN 916.05
PREVIOUS CLOSE 922.25
VOLUME 747
52-Week high 1041.80
52-Week low 441.30
P/E 18.73
Mkt Cap.(Rs cr) 701
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 916.05
CLOSE 922.25
VOLUME 747
52-Week high 1041.80
52-Week low 441.30
P/E 18.73
Mkt Cap.(Rs cr) 701
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Rajapalayam Mills Ltd. (RAJPALAYAM) - Auditors Report

Company auditors report

To the Members of M/s. Rajapalayam Mills Limited

Report on the Financial Statements

We have audited the accompanying financial statements of RAJAPALAYAM MILLS LIMITED("the Company") which comprise the Balance Sheet as at 31st March2016 the Statement of Profit and Loss and the Cash Flow Statement for the year thenended and a summary of significant accounting policies and other explanatory information.

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 preparationand presentation of these financial statement 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. This responsibility also includes maintenance of adequate accounting recordsin accordance 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 judgments 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 financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

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 matters which are required to be included in the audit report under theprovisions of the Act and 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 of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances.

An audit also includes evaluating the appropriateness of the accounting policies usedand the reasonableness of the accounting estimates made by the Company's Directors aswell as evaluating the overall 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 31stMarch 2016 its profit and its cash flow for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 ("the order")issued by the Central Government of India in terms of sub-section (11) of Section 143 ofthe Act we give in the Annexure A a statement on the matters specified in the paragraph3 and 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 explanation 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 specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014;

(e) On the basis of the written representations received from the directors as on 31stMarch 2016 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2016 from being appointed as a director in termsof Section 164 (2) of the Act;

(f) We have enclosed our separate report in "Annexure B" with respect to theadequacy of the internal financial controls over financial reporting of the Company andthe operating effectiveness of such controls. Our report expresses an unmodified opinionon the adequacy 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) Rule 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The details of the pending litigations and its impact on the financial statementshave been disclosed in Note No 26 (4) (6) and (7) of the 'Disclosures forming part ofFinancial Statements' for the year ended 31st March 2016;

ii. The Company has made provision as required under applicable law or accountingstandards for material foreseeable losses if any on long term contracts includingderivative contracts and the details have been disclosed in Note No. 26 (13) of the'Disclosures forming part of Financial Statements' for the year ended 31stMarch 2016;

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

For M.S. JAGANNATHAN & N. KRISHNASWAMI For RAMAKRISHNA RAJA AND CO.
Chartered Accountants Chartered Accountants
Firm Registration No. 001208S Firm Registration No. 005333S
K. SRINIVASAN V. JAYANTHI
Partner Partner
Membership No. 21510 Membership No. 28952
RAJAPALAIYAM
28th May 2016.

"ANNEXURE - A" TO THE INDEPENDENT AUDITORS' REPORT - 31ST MARCH2016

(Referred to Paragraph 1 under the heading of - "Report on other Legal andRegulatory Requirements" of our report of even date)

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

(b) The Company has a regular programme of physical verification of its fixed assets bywhich fixed assets are verified in a phased manner over a period of three years.

In accordance with this programme certain fixed assets were verified during the yearand no material discrepancies were noticed on such verification. In our opinion thisperiodicity of physical verification is reasonable having regard to the size of theCompany and nature of its assets.

(c) According to the information and explanations given to us 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 except goods in transit have been physically verified by themanagement at reasonable intervals during the year. In our opinion the frequency of suchverification is reasonable. In respect of inventories lying with third parties these havesubstantially been confirmed by them. The discrepancies noticed on verification betweenthe physical stocks and book records were not material.

(iii) The Company has granted loan to one body corporate covered in the registermaintained under Section 189 of the Companies Act 2013.

(a) In our opinion the rate of interest and other terms and conditions on which theloan had been granted to the body corporate listed in the register maintained underSection 189 of the Act were not prima facie prejudicial to the interest of the Company.

(b) In the case of loans granted to the body corporate listed in the registermaintained under Section 189 of the Act the borrowers have been regular in the payment ofinterest as stipulated. The terms of arrangements do not stipulate any repayment scheduleand the loan is repayable on demand. Accordingly paragraph (iii) (b) of the Order is notapplicable to the Company in respect of repayment of the principal amount.

(c) There are no overdue amounts in respect of the loan granted to a body corporatelisted in the register maintained under Section 189 of the Act.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 185 and 186 of the Act with respectto the loans investments guarantees and security made.

(v) The Company has not accepted any deposits within the meaning of Section 73 to 76 ofthe act and Companies (Acceptance of Deposits) Rules 2014 from the public during the year.

(vi) The Central Government under sub-section (1) of Section 148 of the Companies Act2013 has specified maintenance of cost records for the Company and such accounts andrecords have been made and maintained by the Company.

(vii) (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company the Company is regular in depositingundisputed statutory dues including provident fund employees' state insurance incometax sales tax service tax duty of customs duty of excise value added tax cess andany other statutory dues with the appropriate authorities.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund income tax sales tax service tax duty of customsduty of excise value added tax cess and other statutory dues were in arrears as at 31stMarch 2016 for a period of more than six months from the date they become payable.

(b) According to the information and explanations given to us the following dues ofservice tax has not been deposited by the Company on account of disputes:

Name of the Statute Amount (Rs. in Lakhs) Forum where dispute is pending Central Excise Customs & Service Tax
Service Tax 182.97 Appellate Tribunal Chennai

(viii) The Company has not defaulted in repayment of loans or borrowing to financialinstitutions or bank. The Company did not have any loans or borrowings from the governmentor borrowings by way of debentures.

(ix) The Company has not raised any money by way of initial public offer (includingdebt instruments).

The moneys raised by way of Term Loans were applied for the purposes for which theywere raised.

(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 course of our audit.

(xi) According to the information and explanations given 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) 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 to the Company.

(xiii) According to information and explanations given to us and based on ourexamination of the records of the Company transactions with related parties are incompliance with Sections 177 and 188 of the Act where applicable. The details of suchrelated party transactions have been disclosed in the financial statements as required bythe applicable accounting standards.

(xiv) According to the information and explanations given 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 base 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 to the Company.

(xvi) The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934. Accordingly the provisions of Clause 3(xvi) of the Order are notapplicable to the Company.

For M.S. JAGANNATHAN & N. KRISHNASWAMI For RAMAKRISHNA RAJA AND CO.
Chartered Accountants Chartered Accountants
Firm Registration No. 001208S Firm Registration No. 005333S
K. SRINIVASAN V. JAYANTHI
Partner Partner
Membership No. 21510 Membership No. 28952
RAJAPALAIYAM
28th May 2016.

"Annexure - B" to the Independent Auditor's Report of even date on theFinancial Statements of Rajapalayam 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 RajapalayamMills Limited ("the Company") as of March 31 2016 in conjunction with our auditof 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 (ICAI). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including 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.

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 and 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 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 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 controls systemover financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A Company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A Company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that 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 thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the Company has in all material respects an adequate internal financialcontrols system over financial reporting and such internal financial controls overfinancial reporting were operating effectively as at March 31 2016 based on the internalcontrol over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For M.S. JAGANNATHAN & N. KRISHNASWAMI For RAMAKRISHNA RAJA AND CO.
Chartered Accountants Chartered Accountants
Firm Registration No. 001208S Firm Registration No. 005333S
K. SRINIVASAN V. JAYANTHI
Partner Partner
Membership No. 21510 Membership No. 28952
RAJAPALAIYAM
28th May 2016.