Sri Chamundeswari Sugars Ltd.
|BSE: 522300||Sector: Agri and agri inputs|
|NSE: SRICHAMUND||ISIN Code: INE004H01019|
|BSE 05:30 | 01 Jan||Stock Is Not Traded.|
|NSE 00:00 | 23 Jan||Stock Is Not Traded.|
|BSE: 522300||Sector: Agri and agri inputs|
|NSE: SRICHAMUND||ISIN Code: INE004H01019|
|BSE 05:30 | 01 Jan||Stock Is Not Traded.|
|NSE 00:00 | 23 Jan||Stock Is Not Traded.|
To The Members of SRI CHAMUNDESWARI SUGARS LIMITED Report on the FinancialStatements
1. We have audited the accompanying financial statements of Sri Chamundeswari SugarsLimited ('the Company') which comprise the Balance Sheet as at March 312017 theStatement of Profit and Loss the Cash Flow Statement for the year then ended and asummary of significant accounting policies and other explanatory information.
Management's Responsibility forthe Financial Statements
2. 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.
3. This responsibility also includes maintenance of adequate accounting records inaccordance 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.
4. Our responsibility is to express an opinion on these financial statements based onour audit.
5. 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.
6. 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.
7. An audit involves performing procedures to obtain audit evidence about the amountsand the disclosures in the financial statements. The procedures selected depend on theauditors'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 circumstance. 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.
8. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the financial statements.
Basis for Qualified Opinion
9. In our opinion the balance compensation of ? 988.84 Lakhs shown as receivable fromBangalore Metro Rail Corporation Ltd towards acquisition of land is doubtful ofrealization and has to be provided for. The loss of the company is understated to thatextent.
10. In our opinion and to the best of our information and according to the explanationsgiven to us except for the effect of the matters described in the Basis for QualifiedOpinion Paragraph above the aforesaid 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 312017 and its loss and its cash flows for the year ended on that date.
Emphasis of Matter
11. We draw attention to Note No. 37(A) (1) and (2)to the financial statements whichspecifies the claim challenged by the company. Our opinion is not modified in respect ofthis matter.
Report on Other Legal and Regulatory Requirements
12. As required by the Companies (Auditor's Report) Order 2016 (the"Order") issued by the Central Government of India in terms of sub- section(ll)of section 143 of the Act we give in the "Annexure - A" a statement on thematters specified in paragraphs 3 and 4 of the Order.
13. 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) Except for the effect of the matters described in the Basisfor Qualified Opinionparagraph above in our opinion proper books of account as required by law have been keptby the Company so far as it appears from our examination of those books.
(c) The Balance Sheet the Statement of Profit and Loss and Cash Flow Statement dealtwith by this Report are in agreement with the books of account.
(d) Except for the effect of the matters described in the Basis for Qualified Opinionparagraph above in-pur opinion the aforesaid financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.
(e) The matters described in the Basis for Qualified Opinion paragraph above in ouropinion may not have an adverse effect on the functioning of the company.
(f) On the basis of written representations received from the directors as on March 312017 taken on record by the Board of Directors none of the directors is disqualified ason March 31 2017 from being appointed as a director in terms of Section 164(2) of theAct.
(g) The qualifications relating to the maintenance of accounts and other mattersconnected therewith are as stated in the Basis for Qualified Opinion paragraph above.
(h) 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
(i) 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 as at March 31 2017on its financial position in its financial statements - Refer Note no. 37 (A) to thefinancial statements.
(ii) The Company has a long term lease contract for operating a Sugar Unit atSrinivasapura Hasan District. As per management representation there are no materialforeseeable losses which require provision on account of this. The company during theyear has not entered into any derivative contracts.
(iii) There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.
(iv) The Company has provided requisite disclosures in the financial statements as toholding as well as dealings in Specified Bank Notes during the period from November 082016 to December 30 2016 on the basis of information available with the Company. Basedon audit procedures and relying on the management representation we report thatdisclosures are in accordance with the books of accounts maintained by the Company and asproduced to us by the Management. - Refer Note 41.
Annexure - A to the Independent Auditor's Report
Re: Sri Chamundeswari Sugars Limited (the "Company")
i. (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) These fixed assets have been physically verified by the management at reasonableintervals. No material discrepancies were noticed on such 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 the Company.
ii. As explained to us inventories have been physically verified by the management atregular intervals during the year. In our opinion the frequency of verification isreasonable. No material discrepancies were noticed on such physical verification.
iii. In ouropinion and according to the information and explanations given to us theCompany has not granted any loans secured or unsecured to companies firms LimitedLiability Partnerships or other parties covered in the register maintained under section189 of the Act. Accordingly paragraph 3 (iii) of the Order is not applicable to theCompany.
iv. In our opinion and according to the information and explanations given to us theCompany has not granted any loans to the parties covered under section 185 of theCompanies Act 2013. The company has given corporate guarantee to the tune of ? 2448 lakhsfor loans taken by the farmers who are supplying the Cane to the company. The Company hasnot provided any security. The Company has complied with the provisions of section 186 ofthe Act in respect of investments made or loans or guarantee or security provided.
v. On 16.09.2015 Company Law Board had passed order directing the company to repaydeposits accepted under the Companies Act 1956 from public amounting to ? 1053.72 lakhs(383 depositors) on or before 31.03.2016. The company has repaid ? 495.37 lakhs (94depositors) and the balance outstanding as on 31.03.2016 is ? 558.35 lakhs (289Depositors) the nonrepayment of deposits amounting to ? 558.35 lakhs is not in compliancewith the order of the company law board. The company has not accepted any deposits duringthe year.
vi. We have broadly reviewed the books of accounts maintained by the Company pursuantto the rules prescribed by the Central Government for the maintenance of cost recordsunder section 148(1) of the Act and are of the opinion that the prescribed accounts andrecords have been made and maintained.
vii. (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company undisputed statutory dues includingprovident fund employee state insurance income-tax sales tax service tax duty ofcustoms duty of excise value added tax cess and other material statutory dues havegenerally been regularly deposited during the year by the Company with the appropriateauthorities though there has been a slight delay in a few cases.
According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employee state insurance income-tax sales taxservice tax duty of customs duty of excise value added tax cess and other materialstatutory dues were in arrears as at March 31 2017 for a period of more than six monthsfrom the date they became payable
(b) According to the information and explanations given to us and the records of theCompany examined by us there are no dues of sales tax service tax and value added taxwhich have not been deposited on account of any dispute. The particulars of dues of incometax duty qf customs and duty of excise as at March 31 2017 which have not beendeposited on account of a dispute are as follows:
viii. In our opinion and according to the information and explanations given to us theCompany has not defaulted in repayment of loans taken from financial institutions. TheCompany has not issued debentures. The details of default in respect of loans orborrowings from Banks and Government is as under:
ix. The Company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments). Term loans availed during the year have beenapplied for the purpose for which those were raised.
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. The Company has paid/ provided for managerial remuneration in accordance with therequisite approvals mandated by the provisions of Section 197 read with Schedule V to theAct.
xii. Inouropinionand 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 give 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 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 India Act 1934. Accordingly paragraph 3(xvi) of the Order is not applicable.
Annexure - B to the Independent Auditor's Report
Referred to in paragraph 12(f) of the Independent Auditors' Report of even date to themembers of Sri Chamundeswari Sugars Limited on the financial statements for the year endedMarch 312017 Report on the Internal Financial Controls under Clause (i) of Subsection3 of Section 143 of the Companies Act 2013 ("the Act')
1. We have audited the internal financial controls over financial reporting of SriChamundeswari Sugars 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
2. 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
its business including adherence to' company's policies the safeguarding of itsassets the prevention and detection of frauds and errors the accuracy and completenessof the accounting records and the timely preparation of reliable financial informationas required under the Act.
3. 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 Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the ICAI. Those Standards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the 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.
5. 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
6. 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:
i. pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
ii. provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and
iii. 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
7. 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.
8. 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 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.