The Members of Shiva Texyarn Limited Coimbatore
1. Report on the Standalone Financial Statements
We have audited the accompanying Standalone financial statements of Shiva TexyarnLimited ("the Company") which comprise the Balance Sheet as at 31 st March2017 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.
2. 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 with theaccounting 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 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.
3. Auditors' 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 theaudit report under theprovisions of the Actand the Rules made there under.
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 Standalone financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the Standalone financial statements. The procedures selected depend onthe auditor's 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 the Company'spreparation of the Standalone financial statements that give a true and fair view in orderto design audit procedures that are appropriate in the circumstances. An audit alsoincludes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating 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.
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 31 st March 2017 and its Profit and its cash flows for the year ended on thatdate.
5. Emphasis Matter
We draw attention to Note No. 31 (Vl)(l) Other Notes to Standalone FinancialStatements which explains in brief the scheme of demerger of Spinning Unit -1 withconnected wind mills and the accounting treatment given by the Company for the same duringthe Financial Year 2016-17.
6. 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 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 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 agreementwith 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 31 stMarch 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31 st March 2017 from being appointed as a director in terms ofSection 164 (2) of the 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 - B.
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.
iv. The company has provided requisite disclosures in its Standalone financialstatements as regards its holdings and dealings in Specified Bank Notes as defined in theNotification S.O. 3407(E) dated the 8th November 2016 of the Ministry of finance duringthe period from 8th November to 30th December 2016. Based on audit procedures performedand the representations provided to us by the management we report that the disclosuresare in accordance with the books of accounts maintained by the company and as produced tous by the management - Refer Note 31 Other Notes to the Standalone Financial Statements.
For VKS AIYER & Co
ICAI Firm Regn. No. 000066S
Membership No. 221962
Place : Coimbatore
Date : 15t November 2017
ANNEXURE - Ato Independent Auditors' Report
(Referred to in Paragraph 1 under the heading of "Report on Other Legal andRegulatory Requirements" of our report of even date)
1. In respect of fixed assets:
a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets on the basis of available information.
b) As explained to us the fixed assets have been physically verified by the managementin a phased periodical manner which in our opinion is reasonable having regard to thesize of the company and nature of its assets. No material discrepancies were noticed onsuch physical 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 Company.
2. In respect of Inventories:
As explained to us inventories have been physically verified by the management atreasonable intervals during the year. No material discrepancies were noticed on suchphysical verification.
3. In respect of Loans and Advances granted:
The Company has not granted any loans secured or unsecured to companies firms LLP'sor other parties covered in the register maintained under Section 189oftheAct.
4. In respect of Loans Investments Guarantees & Security:
The Company has not granted any Loan nor provided Guarantee / Security and hencecompliance with the provisions of Section 185 and 186 of the Act in respect of same doesnot arise. In respect of investment made in its wholly owned subsidiary the provisions ofSection 186 of the Act is complied with.
5. In respect of Deposits accepted:
The Company has accepted loans not being deposits from its Directors. These loans arenot covered by the provisions of Section 73 to 76 or any other relevant provisions of theAct read with rules made there under. Hence comment on compliance of provisions or rulesor other directives does not arise.
6. In respect of Cost Records:
The Central Government has prescribed maintenance of Cost Records under Section 148 (1)of the Companies Act 2013. We have broadly reviewed the accounts and records of theCompany in this connection and are of the opinion that prima facie the prescribedaccounts and records have been made and maintained. We have not however made a detailedexamination of the same.
7. In respect of Statutory dues:
a) According to the records of the Company undisputed statutory dues includingProvident Fund Employees' State Insurance Income Tax Sales Tax Wealth Tax ServiceTax Duty of Customs Duty of Excise Value Added Tax Cess and other statutory dues havebeen generally regularly deposited with the appropriate authorities. According to theinformation and explanations given to us no undisputed amounts payable in respect of theaforesaid dues were outstanding as at the end of the year for a period of more than sixmonths from the date of becoming payable.
b) According to the records of the Company there are no dues of Income Tax Sales TaxWealth Tax Service Tax Duty of Customs Duty of Excise Valued Added Tax and Cess whichhave not been deposited by the Company on account of any dispute.
8. Default in Repayment of Loans:
Based on our audit procedures and according to the information and explanation given tous we are of the opinion that the Company has not defaulted in repayment of dues tobanks; No borrowings were made from the financial institutions Government or debentureholders.
9. In respect of Application of Funds:
The Company has not raised any money by way of initial public offer or further publicoffer (including debt instruments) and term loans during the year.
In our opinion and according to the information and explanations given to us no fraudby the Company or on the Company by its officers or employees has been noticed or reportedduring the year.
11. Managerial Remuneration:
Managerial Remuneration has been paid / provided in accordance with the requisiteapprovals mandated by S. 197 r/w. Schedule V to the Act.
12. In respect of Nidhi Companies:
In our opinion the Company is not a Nidhi company. Therefore paragraph 3 (xii) of theOrder is not applicable to the Company.
13. In respect of Related party transactions:
According to the information and explanations given to us and based on our examinationof the records of the Company the related party transactions entered into by the Companyduring the year are in compliance with Section 188 of the Act and the details of suchtransactions have been disclosed in the financial statements as required by the accountingstandards and the Act.
14. In respect of preferential allotment / private placement:
The Company has not made any preferential allotment or private placement of shares orfully or partly convertible debentures during the year. Therefore paragraph 3 (xiv) ofthe Order is not applicable to the Company.
15. In respect of non-cash transactions with directors:
The Company has not entered into any non-cash transactions with directors or personsconnected with him. Therefore paragraph 3 (xv) of the Order is not applicable to theCompany.
16. In respect of registration with RBI:
The Company is not required to be registered under Section 45-IAof the Reserve Bank ofIndia Act 1934.
For VKS AIYER & Co
ICAI Firm Regn. No. 000066S
Membership No. 221962
Place : Coimbatore
Date : 1 * November 2017
ANNEXURE - B to Independent 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 ShivaTexyarn Limited ("the Company") as of 31 st March 2017 in conjunction with ouraudit 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 ("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 safeguarding ofits 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.
Our responsibility is to express an opinion on the Compan/s internal financial controlsover financial reporting based on our audit. We conducted our audit in accordance with theGuidance Note on Audit of Internal Financial Controls over Financial Reporting (the"Guidance Note") and the Standards on Auditing issued by ICAI and deemed to beprescribed under Section 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols 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 judgment 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 compan/s internal financial control over financial reporting is a process designed toprovide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A compan/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 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.
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 31st March 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 Institute of CharteredAccountants of India.
For VKS AIYER & Co
ICAI Firm Regn. No. 000066S
R UMAMAH ESWARI
Membership No. 221962
Place : Coimbatore
Date : 1st November 2017