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Shilpa Medicare Ltd.

BSE: 530549 Sector: Health care
NSE: SHILPAMED ISIN Code: INE790G01031
BSE LIVE 19:40 | 19 Oct 667.90 2.00
(0.30%)
OPEN

670.00

HIGH

674.00

LOW

661.00

NSE 19:31 | 19 Oct 663.75 -3.75
(-0.56%)
OPEN

671.80

HIGH

672.80

LOW

659.55

OPEN 670.00
PREVIOUS CLOSE 665.90
VOLUME 797
52-Week high 786.75
52-Week low 525.00
P/E 39.64
Mkt Cap.(Rs cr) 5,350
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 670.00
CLOSE 665.90
VOLUME 797
52-Week high 786.75
52-Week low 525.00
P/E 39.64
Mkt Cap.(Rs cr) 5,350
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Shilpa Medicare Ltd. (SHILPAMED) - Auditors Report

Company auditors report

TO THE MEMBERS

SHILPA MEDICARE LIMITED

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of Shilpa MedicareLimited ("the Company") which comprise the balance sheet as at March 312016 the statement of profit and loss and cash flow statement for the year then endedand a summary of 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 standalone financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance withaccounting 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 the design implementation and maintenance of adequateinternal financial control 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 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 there under.

We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India as specified under Section 143(10) of theAct. Those Standards require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether the financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgement including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders 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 theappropriateness of accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof 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 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 its profit and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to Note 49 to the Standalone financial statements. The Company hasfiled a lawsuit for recovering its amount paid as capital advance to its vendor for supplyof Capital Assets along with punitive damages. The Preliminary hearings of the case arein progress. As the ultimate outcome of the case cannot be determined presently hence noprovision for the outstanding balance receivable from the party has been made in thefinancial statements. Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2015 ("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 paragraphs 3and 4 of the Order to the extent applicable.

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 purpose 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 Statement of Profit and Loss and Cash Flow Statement dealt withby 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 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; and

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.

ii. There has been no delay in transferring amounts to the Investor Education andProtection Fund by the Company.

For Bohara Bhandari Bung And Associates LLP
Chartered Accountants
ICAI Firm Registration Number: 008127S/S200013
per CA Pankaj Kumar Bohara
Partner
Membership Number: 215471
Place/Camp : Hyderabad
Date : 30th May 2016

Annexure-A - referred to in paragraph 1 of Report on Other Legal and RegulatoryRequirements section of our report of even date.

The Annexure referred to in our report to the members of Shilpa Medicare Limited ('theCompany') for the year ended March 31 2016. We report that:

1) In respect of Fixed Assets

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

b) As explained to us having regards to the size of the Company and the nature of itsassets Fixed Assets have been physically verified wherever feasible by the management andno material discrepancy with respect to book records was noticed on such verification.

c) In our opinion and according to the information and explanations given to us allthe title deeds of immovable properties are held in the name of the Company.

2) In respect of Inventories

a) According to the information and explanations given to us the Inventories in itspossession has been physically verified by the management. In our opinion the frequency ofthe verification is reasonable. The Stocks lying with third parties have been confirmed bythem as at year end. No material discrepancies were noticed on physical verification ofinventories.

3) According to the information and explanation given to us the Company has grantedunsecured loans amounting to Rs. 265.64 lakhs (Including Interest net of TDS) to 4 partiescovered in the register maintained under section 189 of the Act.

a. The terms and conditions of such loans granted are not prejudicial to the interestof the Company.

b. The schedule of repayment of principal and payment of interest has been stipulatedin the agreement and re-payment or receipts of principles amount and interest have beingmade as per stipulators.

c. As there were no amounts over due for more than 90 days position of Clause 3(iii)(c)is not applicable.

4) 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 and investments made.

5) According to the information and explanations given to us the Company has notaccepted any deposits from the public within the meaning of section 73 and 76 or any otherrelevant provisions of the Act and the rules framed there under.

6) We have broadly reviewed the books of accounts and records maintained by the Companypursuant to the rules made by the Central Government of India for the maintenance of costrecords prescribed under sub-section (1) of section 148 of the Act in respect of theproduction and processing activities of the Company and are of the opinion thatprima-facie cost records and accounts prescribed have been generally maintained. Howeverwe have not made a detailed examination of the records with a view to determining whetherthey are accurate or complete.

7) In respect of Statutory dues

a) The Company is generally regular in depositing with appropriate authoritiesundisputed statutory dues including provident fund employees' state insuranceincome-tax sales-tax wealth-tax service tax customs duty excise duty value addedtax cess and other material statutory dues applicable to it.

b) According to the information and explanations given to us there are no dues ofincome-tax sales-tax wealth-tax service tax customs duty excise duty value added taxand cess which have not been deposited on account of any dispute

8) According to the information and explanations given to us by the management we areof the opinion that the Company has not defaulted in the repayment of dues to banksgovernment and financial institutions. The Company did not have any debentures outstandingas at the year end.

9) Based on the information and explanations given to us by the management of theCompany the Company has not raised any money by way of public offer. No term loans weretaken during the year by the Company.

10) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and as per the information and explanations given bythe management we report that no material fraud by the Company or on the Company by itsofficers or employees has been noticed or reported during the year.

11) 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.

12) 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.

13) 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.

14) 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.

15) 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.

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

For Bohara Bhandari Bung And Associates LLP
Chartered Accountants
ICAI Firm Registration Number: 008127S/S200013
per CA Pankaj Kumar Bohara
Partner
Membership Number: 215471
Place/Camp : Hyderabad
Date : 30th May 2016

Annexure-B - to our report of even date on the Standalone Financial Statements ofShilpa Medicare 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 ShilpaMedicare Limited ('the Company') as of 31st March 2016 in conjunction with our audit ofthe standalone 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 controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe 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 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 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 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 the Company which has in all material respects an adequate internalfinancial controls systems over financial reporting and such internal financial controlsover financial reporting were generally operating effectively as at 31st March 2016 basedon the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the Institute ofChartered Accountants of India.

For Bohara Bhandari Bung And Associates LLP
Chartered Accountants
ICAI Firm Registration Number: 008127S/S200013
per CA Pankaj Kumar Bohara
Place/Camp : Hyderabad Partner
Date: 30th May 2016 Membership Number: 215471