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Shriram City Union Finance Ltd.

BSE: 532498 Sector: Financials
NSE: SHRIRAMCIT ISIN Code: INE722A01011
BSE LIVE 19:40 | 19 Oct 2080.70 4.60
(0.22%)
OPEN

2094.25

HIGH

2125.70

LOW

2023.20

NSE 19:31 | 19 Oct 2087.95 1.95
(0.09%)
OPEN

2110.00

HIGH

2110.00

LOW

2075.05

OPEN 2094.25
PREVIOUS CLOSE 2076.10
VOLUME 234
52-Week high 2650.00
52-Week low 1648.35
P/E 24.15
Mkt Cap.(Rs cr) 13,722
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 2094.25
CLOSE 2076.10
VOLUME 234
52-Week high 2650.00
52-Week low 1648.35
P/E 24.15
Mkt Cap.(Rs cr) 13,722
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Shriram City Union Finance Ltd. (SHRIRAMCIT) - Auditors Report

Company auditors report

To the Members of SHRIRAM CITY UNION FINANCE LIMITED

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of Shriram City UnionFinance Limited ("the Company") which comprise the Balance Sheet as at 31stMarch 2017 the Statement of Profit and Loss 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 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 judgements 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 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 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 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 judgement 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 theappropriateness of the 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 31st March 2017 and its profit/loss and its cash flows for the year ended on thatdate.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2017 issued by the CentralGovernment of India in terms of sub-section (11) of section 143 of the Act we give in theAnnexure ‘A' a statement on the matters specified in paragraphs 3 and 4 of the saidOrder.

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 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 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2017 from being appointed as a director in terms of Section164 (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. TheCompany has disclosed the impact of pending litigations which would impact its financialposition in its financial statements

– Refer Note No 27 to the financial statements;

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 disclosures in Note 53 in the standalone financialstatements in respect of holding of Specified Bank Notes (SBNs) on November 8 2016 and onDecember 30 2016 as well as dealings in the said SBNs during the period from November 92016 to December 30 2016. Based on our audit procedures and relying on the managementrepresentation regarding the holding and nature of cash transactions including those inSBNs we report that these disclosures are in accordance with the books of accountsmaintained by the Company and as produced before us. As per information and explanationsgiven to us and as stated in the said note 53 borrowers of the Company havefurther directly deposited cash in the Company's bank accounts and thatdenomination wise details of such deposits are not available with the Company.

For Pijush Gupta & Co.
Chartered Accountants
Firm Registration Number: 309015E
Pijush Kumar Gupta
Place: Chennai Partner
Date: May 022017. Membership No. 015139

ANNEXURE ‘A'

Annexure referred to in paragraph 1 under the heading "Report on other legal andregulatory requirements" of our report of even date

Report under The Companies (Auditor's Report) Order 2016

As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of India in terms of sub-section (11) of section 143 of the Act we give inthis Annexure a statement on the matters specified in paragraphs 3 and 4 of the saidOrder.

i. (a) According to the information and explanations given to us and records producedbefore us the Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) According to the information and explanations given to us and records producedbefore us the fixed assets have been physically verified by the management at reasonableintervals and no material discrepancies were noticed on such physical verification.

(c) According to the information and explanations given to us and records producedbefore us the title deeds of all the immovable properties are held in the name of thecompany.

ii. The Company is engaged in financing activities which does not involve maintenanceof any inventory.

iii. According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to Companies Firms Limited Liabilitypartnerships or other parties covered in the register maintained under Section 189 of theAct.

iv. According to the information and explanations given to us the Company has compliedwith the provisions of section 185 and 186 of the Companies Act 20l3 in respect of loansinvestments guarantees and security.

v. In respect of deposit and according to the information and explanations given to usthe Company complied with the directives issued by the Reserve Bank of India and theprovisions of sections 73 to 76 or any other relevant provisions of the Companies Act2013 and the rules framed thereunder where applicable. No order has been passed byCompany Law Board or National Company Law Tribunal or Reserve Bank of India or any courtor any other tribunal in this regard in respect of the company.

vi. According to the information and explanations given to us the Central Governmenthas not prescribed maintenance of cost records under Section 148(1) of the Act.

vii. (a) According to the information and explanations provided to us the Company isregular in depositing with appropriate authorities undisputed statutory dues includingprovident fund employees' state insurance income tax sales-tax service tax duty ofcustoms duty of excise value added tax cess and any other statutory dues to theappropriate authorities and there are no dues payable as at the year end with suchauthorities.

(b) According to the information and explanations given to us and the relevantdocuments produced before us the following dues outstanding in respect of Income TaxSales Tax Wealth Tax Service Tax Value Added Tax and Cess have not been deposited onaccount of dispute –

Statute Nature of Dues Amount Rs. lacs Years to which the amount relates Forum where dispute is pending
Income Tax 1961 Income Tax demands 40.78 Assessment Year 2011-12 ITAT Chennai Tamilnadu
Kerala Value Added Tax 2003 Value Added Tax 4.65 Assessment Year 2007-08 Dy. Commissioner (Appeals) Ernakulum Kerala
Kerala Value Added Tax 2003 Value Added Tax 0.72 Assessment Year 2011-12 Asst. Commissioner (Appeals) Ernakulum Kerala

viii. Based upon the audit procedures and according to the information and explanationsprovided to us the company has not defaulted in repayment of loans or borrowing tofinancial institution bank government or dues to debenture holders.

ix. In our opinion and to the best of our knowledge and belief and according to theinformation and explanations given to us the company has not raised money by way ofinitial public offer or further public offer (including debt instruments). The Company hasobtained term loans from the Banks and the same were applied for the purposes for whichthose were raised.

x. We have been informed that during the period under audit certain borrowers/employeeshave defrauded the company by pledging stolen/spurious gold against gold loans andproducing fake documents against other loans total amounting to Rs. 222.98 lacs. TheCompany has taken necessary action against the said borrowers. Refer Note 29 of thefinancial statements.

xi. Based on our audit procedures and as per information and explanations given by themanagement the managerial remuneration has been paid or provided in accordance with therequisite approvals mandated by the provisions of section 197 read with Schedule V to theCompanies Act.

xii. In our opinion the Company is not a Nidhi Company.

xiii. According to the information and explanations given to us the Company hascomplied with section 177 and 188 of Companies Act 2013 where applicable in respect ofall transactions with the related parties and the details have been disclosed in theFinancial Statements etc. as required by the applicable accounting standards

xiv. The Company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year under review

xv. According to the information and explanations given to us the company has notentered into any non-cash transactions with directors or persons connected with him

xvi. According to the information and explanations given to us the company isregistered under section 45 IA of the Reserve Bank of lndia Act 1934

For Pijush Gupta & Co.
Chartered Accountants
Firm Registration Number: 309015E
Pijush Kumar Gupta
Place: Chennai Partner
Date: May 022017. Membership No. 015139

ANNEXURE ‘B'

Annexure referred to in paragraph 2 (f) under the heading "Report on other legaland regulatory requirements" in the independent auditor's report of even date.

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 ShriramCity Union Finance Limited ("the Company") as of March 31 2017 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 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 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. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the Company's internal financial controls system overfinancial 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 financial reporting includes those policiesand procedures that

• pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

• provide reasonable assurance that transactions are recorded as necessary topermit preparation of financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and

• provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial 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 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 March 31 2017 based on"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 Pijush Gupta & Co.
Chartered Accountants
Firm Registration Number: 309015E
Pijush Kumar Gupta
Place: Chennai Partner
Date: May 022017. Membership No. 015139