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Tata Steel Ltd.

BSE: 500470 Sector: Metals & Mining
NSE: TATASTEEL ISIN Code: INE081A01012
BSE LIVE 15:47 | 08 Dec 696.85 8.95
(1.30%)
OPEN

689.90

HIGH

713.00

LOW

685.25

NSE 15:58 | 08 Dec 697.80 9.80
(1.42%)
OPEN

689.10

HIGH

713.85

LOW

685.15

OPEN 689.90
PREVIOUS CLOSE 687.90
VOLUME 526914
52-Week high 734.90
52-Week low 377.45
P/E 13.14
Mkt Cap.(Rs cr) 67,679
Buy Price 0.00
Buy Qty 0.00
Sell Price 694.70
Sell Qty 643.00
OPEN 689.90
CLOSE 687.90
VOLUME 526914
52-Week high 734.90
52-Week low 377.45
P/E 13.14
Mkt Cap.(Rs cr) 67,679
Buy Price 0.00
Buy Qty 0.00
Sell Price 694.70
Sell Qty 643.00

Tata Steel Ltd. (TATASTEEL) - Auditors Report

Company auditors report

TO THE MEMBERS OF TATA STEEL LIMITED

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of TATA STEELLIMITED ("the Company") which comprise the Balance Sheet as at March 31 2017and the Statement of Profit and Loss (including Other Comprehensive Income) the Cash FlowStatement and the Statement of Changes in Equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Ind AS 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 Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) prescribedunder section 133 of the Act.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalone IndAS 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 Ind AS financialstatements based on our audit.

In conducting our audit we have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit of the standalone Ind AS financial statements in accordance withthe Standards on Auditing specified under Section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone Ind AS financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the standalone Ind AS financial statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the standalone Ind ASfinancial statements. We believe that the audit evidence obtained by us is sufficient andappropriate to provide a basis for our audit opinion on the standalone Ind AS financialstatements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of affairs of theCompany as at March 31 2017 and its profit total comprehensive income its cash flowsand the changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act we report to the extent applicable 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 including Other ComprehensiveIncome the Cash Flow Statement and Statement of Changes in Equity dealt with by thisReport are in agreement with the relevant books of account.

d) In our opinion the aforesaid standalone Ind AS financial statements comply with theIndian Accounting Standards prescribed under section 133 of the Act.

e) On the basis of the written representations received from the directors as on March31 2017 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of Section 164(2) of theAct.

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 A". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial 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) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements;

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative 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 standalone Ind AS financialstatements as regards its holding and dealings in Specified Bank Notes as defined in theNotification S.O. 3407(E) dated November 8 2016 of the Ministry of Finance during theperiod from November 8 2016 to December 30 2016. Based on audit procedures performed andthe representations provided to us by the management we report that the disclosures are inaccordance with the books of account maintained by the Company.

2. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"Annexure B" a statement on the matters specified in paragraphs 3 and 4 of theOrder.

For DELOITTE HASKINS & SELLS LLP

Chartered Accountants

(Firm's Registration No. 117366W/W-100018)

N. Venkatram

(Partner)

(Membership No. 71387)

Mumbai May 16 2017

ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1(f) under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of Tata SteelLimited ("the Company") as of March 31 2017 in conjunction with our audit ofthe standalone Ind AS 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 respective 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.

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 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 reffect 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 2017 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 DELOITTE HASKINS & SELLS LLP

Chartered Accountants

(Firm's Registration No. 117366W/W-100018)

N. Venkatram

(Partner)

(Membership No. 71387)

Mumbai May 16 2017

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2 under ‘Report on Other Legal and RegulatoryRequirements' section 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 program of verification of fixed assets to cover all the items ina phased manner over a period of three years which in our opinion is reasonable havingregard to the size of the Company and the nature of its assets. Pursuant to the programcertain fixed assets were physically verified by the Management during the year. Accordingto the information and explanations given to us no material discrepancies were noticed onsuch verification.

(c) According to the information and explanations given to us and the records examinedby us and based on the examination of the registered sale deeds transfer deeds mutationof title papers property tax papers and conveyance deeds provided to us we report thatthe title deeds comprising all the immovable properties in respect of land and buildingswhich are freehold are held in the name of the Company as at the balance sheet dateexcept the following:

i. in respect to freehold land fair value at deemed cost amounting to `60.16 crore(purchase cost `0.34 crore) the title deeds of which are held in the name of erstwhilecompanies which have subsequently been amalgamated with the Company;

ii. title deeds to freehold land fair value at deemed cost amounting to `1.87 crore(purchase price `0.03 crore) which has not been executed.

iii. title deeds to freehold land fair value at deemed cost amounting to `117.68 crore(purchase cost `6.74 crore) were not readily available. iv. title deeds to buildings withgross carrying amount and net carrying amount of `0.61 crore and `0.57 crore respectivelywere not readily available.

(ii) As explained to us inventories of finished and semi-finished goods and rawmaterials at Works Mines and Collieries were physically verified during the year by theManagement. In respect of inventories of stores and spare parts and stocks at stockyardsand with consignment/conversion agents the Company has a programme of verification ofstocks over a three year period. In case of materials lying with third partiescertificates for stocks held have been received. In our opinion and according to theinformation and explanations given to us the inventories have been verified by themanagement at reasonable intervals in relation to size of the Company and nature ofbusiness and no material discrepancies were noticed on physical verification.

(iii) According to the information and explanations given to us the Company hasgranted loans secured or unsecured to companies firms Limited Liability Partnershipsor other parties covered in the register maintained under section 189 of the CompaniesAct 2013 in respect of which: (a) The terms and conditions of the grant of such loansare in our opinion prima facie not prejudicial to the Company's interest except anintercorporate deposit of `21.37 crore placed with a subsidiary company which is not agoing concern.

(b) The schedule of repayment of principal and payment of interest has been stipulatedand the repayments of principal amounts and interest have been regular as per stipulationsexcept for loans and interest amounting to `539.73 crore representing due from asubsidiary company and interest amounting to `13.11 crore representing due from threesubsidiary companies.

(c) Amounts referred to (b) above have been overdue for more than 90 days and asexplained to us the Management has taken reasonable steps for recovery of the principalamounts and interest thereon.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Companies Act2013 in respect of grant of loans making investments and providing guarantees andsecurities as applicable.

(v) According to the information and explanations given to us the Company has notaccepted any deposit during the year. In respect of unclaimed deposits the Company hascomplied with the provisions of Sections 73 to 76 or any other relevant provisions of theCompanies Act 2013.

(vi) The maintenance of cost records has been specified by the Central Government undersection 148(1) of the Companies Act 2013. We have broadly reviewed the cost recordsmaintained by the Company pursuant to the Companies (Cost Records and Audit) Rules 2014as amended and The Cost Accounting Records (Electricity Industry) Rules 2011 prescribedby the Central Government under sub-section (1) of Section 148 of the Companies Act 2013and are of the opinion that prima facie the prescribed cost records have been made andmaintained. We have however not made a detailed examination of the cost records with aview to determine whether they are accurate or complete.

(vii) According to the information and explanations given to us in respect ofstatutory dues:

(a) The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income-tax Sales Tax Service TaxCustoms Duty Excise Duty Value Added Tax Cess and other material statutory duesapplicable to it with the appropriate authorities. We are informed that the Companyintends to obtain exemption from operations of Employees' State Insurance Act at somelocations and necessary steps have been taken by the Company. We are also informed thatactions taken by the authorities at some locations to bring the employees of the Companyunder the Employees' State Insurance Scheme has been contested by the Company and fullpayment has not been made of the contributions demanded.

(b) There were no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income-tax Sales Tax Service Tax Customs Duty Excise Duty ValueAdded Tax Cess and other material statutory dues in arrears as at March 31 2017 for aperiod of more than six months from the date they became payable except for thefollowing:

Name of Statute Nature of Dues Amount (`crore) Period to which the Amount Relates Due Date Date of subsequent payment
MMDR Contribution to District Mineral Foundation and interest thereon 295.81 Jan'15-Sep'16 Sept'16 Outstanding
JVAT JVAT 2.18 2015-2017 Sept'16 Outstanding
Sales Tax Act Sales Tax 2.07 2013-2014 Sept'16 Outstanding

(c) Details of dues of Income-tax Sales Tax Service Tax Customs Duty Excise DutyValue Added Tax which have not been deposited as on March 31 2017 on account of disputesare given below:

Name of the Statute (Nature of Dues) Forum where Dispute is pending Period to which the amount relates Amount (net of payments) (`crore) Amounts paid under Protest ` ( crore)
Income Tax CIT(A)/ITAT 2004-05 2006-07 to 2009-10 368.81 1047.72
Income Tax Officer 2010-11 0.67 -
Customs Act High Court 2002-03 0.03 0.07
Commissioner 1993-94 & 2006-2008 83.59 50.00
Supreme Court 2004-05 235.48 -
High Court 1988-90 2000-01 & 2003-06 14.54 0.10
Central Excise Act Tribunal 1990-91 1992-94 1996-97 & 1998-99 to 2015-16 1008.70 43.36
Commissioner 1988-90 1994-2017 55.75 4.20
Deputy Commissioner 1985-87 & 1998-99 0.18 -
Assistant Commissioner 1982-2006 2013-14 0.87 0.00
High Court 1973-74 1977-79 1983-84 1991-97 2000-02 2003-04 2007-09 2012-2017 280.04 16.13
Tribunal 1980-81 1983-85 1987-99 2001-2011 & 2012-2014 72.48 6.32
Sales Tax Commissioner 1988-90 1991- 92 1993-94 2000-01 to 2014-15 & 2016-2017 483.44 5.86
Deputy Commissioner 1975-76 1977-78 1983-88 & 1993-94 to 2011-12 & 2013-14 32.27 3.01
Assistant Commissioner 1973-74 1980-81 1983-84 to 1996-97 2000-01 to 2005-06 2008-09 2013-2014 2014-15 & 2016-2017 11.55

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of loans or borrowings to financialinstitutions banks and government and dues to debenture holders.

(ix) In our opinion and according to the information and explanations given to us termloans taken have been applied by the Company during the year for the purposes for whichthey were raised other than temporary deployment pending application of proceeds.

(x) To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company and no material fraud on the Company has been noticedor reported during the year.

(xi) In our opinion and according to the information and explanations given to us theCompany has paid / provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of theCARO 2016 Order is not applicable.

(xiii) In our opinion and according to the information and explanations given to us theCompany is in compliance with Section 177 and 188 of the Companies Act 2013 whereapplicable for all transactions with the related parties and the details of related partytransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

(xiv) During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures and hence reporting underclause (xiv) of CARO 2016 is not applicable to the Company.

(xv) In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any non-cash transactions with itsdirectors or directors of its holding subsidiary or associate Company or personsconnected with them and hence provisions of section 192 of the Companies Act 2013 are notapplicable.

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

.

For DELOITTE HASKINS & SELLS LLP

Chartered Accountants

(Firm's Registration No. 117366W/W-100018)

N. Venkatram

(Partner)

(Membership No. 71387)

Mumbai May 16 2017