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Ugar Sugar Works Ltd.

BSE: 530363 Sector: Agri and agri inputs
NSE: UGARSUGAR ISIN Code: INE071E01023
BSE LIVE 15:40 | 11 Dec 30.95 -0.55
(-1.75%)
OPEN

31.75

HIGH

32.65

LOW

30.20

NSE 15:43 | 11 Dec 30.90 -0.65
(-2.06%)
OPEN

31.90

HIGH

32.80

LOW

28.70

OPEN 31.75
PREVIOUS CLOSE 31.50
VOLUME 95009
52-Week high 43.00
52-Week low 22.15
P/E
Mkt Cap.(Rs cr) 348
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 31.75
CLOSE 31.50
VOLUME 95009
52-Week high 43.00
52-Week low 22.15
P/E
Mkt Cap.(Rs cr) 348
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Ugar Sugar Works Ltd. (UGARSUGAR) - Auditors Report

Company auditors report

To the members of

The Ugar Sugar Works Limited

Report on the Financial Statements

We have audited the accompanying financial statements of The Ugar Sugar Works Limited("the Company") which comprise the Balance Sheet as at 31 March 2017 theStatement of Profit and Loss the Cash Flow Statement for the year then ended and asummary of the significant accounting policies and other explanatory information.

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 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. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit.

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 judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal financial control relevant to the Company’spreparation of the financial statements that give a true and fair view in order to designaudit procedures that are appropriate in the circumstances but not for the purpose ofexpressing an opinion on whether the Company has in place an adequate internal financialcontrols system over financial reporting and the operating effectiveness of such controls.An audit also includes evaluating the appropriateness of the accounting policies used andthe reasonableness of the accounting estimates made by the Company’s Directors aswell as evaluating the overall presentation of 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 financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2017 and its Profit and its Cash Flow for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order 2016 ("theOrder") as amended issued by the Central Government of India in terms ofsub-section (11) of section 143 of the Act we give in the "Annexure A" astatement on the matters specified in paragraphs 3 and 4 of the Order.

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 31March 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31 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. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements Refer Note D-1 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 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 its financial statements as toholdings as well as dealings in Specified Bank Notes during the period from 08-11-2016 to30-12-2016 and these are in accordance with the books of accounts maintained by theCompany.

For M/s P. G. Bhagwat
Chartered Accountants
Firm Registration No. 101118W
Nikhil M. Shevade
Place : Ugar Khurd Partner
Date : 29-05-2017 Membership No. 217379

"Annexure A" to the Independent Auditors’ Report

(Referred to in paragraph 1 of our ‘Report on Other Legal & RegulatoryRequirement’ of even date)

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

(b) A major portion of the Fixed Assets have been physically verified by the managementin a phased manner designed to cover all the items over a period of three years which inour opinion is reasonable having regard to the size of the company and nature of itsbusiness. Pursuant to the program a portion of the fixed asset has been physicallyverified by the management during the year and no material discrepancies between the bookrecords and the physical fixed assets have been noticed.

(c) The title deeds of immovable properties are held in the name of the Company.

(ii) (a) The management has conducted the physical verification of inventory atreasonable intervals.

(b) The discrepancies noticed on physical verification of the inventory as compared tobooks records which have been properly dealt with in the books of account were notmaterial.

(iii) The Company has not granted any loans secured or unsecured to companies firmsLimited Liability partnerships or other parties covered in the Register maintained undersection 189 of the Act. Accordingly the provisions of clause 3 (iii) (a) to (c) of theOrder are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and I86 of the Companies Act2013 in respect of loans investments guarantees and security.

(v) According to information and explanation given to us the Company has not acceptedany deposits from public. Accordingly the reporting under Clause 3(v) of the Companies(Auditor’s Report) Order 2016 is not applicable.

However 2 (Two) public depositors have not claimed their deposits after maturity as on31 March 2017 and the amount outstanding as on that date was Rs.2.92 Lakh. These amountsare lying with the company as there is litigation amongst the heirs about the trueownership of the deposits. As informed to us they will be paid as soon as the court orderis received.

(vi) We have broadly reviewed the books of accounts relating to materials labour andother items of cost maintained by the Company pursuant to the rules made by the CentralGovernment for maintenance of cost records under section 148(1) of the Companies Act 2013and we are of the opinion that prima facie the prescribed accounts and records have beenmade and maintained. We have however not made a detailed examination of records with aview to determine whether they are accurate and complete.

(vii) (a) The Company is generally regular in depositing with appropriate authoritiesundisputed statutory dues including Provident Fund Investor Education and ProtectionFund Income Tax Sales Tax Cane Purchase Tax Wealth Tax Custom Duty Service TaxExcise Duty Cess and other statutory dues applicable to it. There are no arrears ofoutstanding dues as on the last day of the financial year for a period of six months fromthe date they become payable.

(vii) (b) According to the information and explanation given to us there are no duesof Income tax Sales tax Service tax Custom duty Excise Duty and Cess which have notbeen deposited on account of any dispute other than those mentioned below:

Nature of Dues Name of Statute Period to which the amount relates Amount Rs. Lakh Forum where dispute is pending
Central Excise Central Excise Act 2006-07 14.61 CESTAT Bangalore
Central Excise Central Excise Act 2007-08 45.84 CESTAT Bangalore
Central Excise Central Excise Act 2008-09 15.36 CESTAT Bangalore
Central Excise Central Excise Act 2010-11 3.03 CESTAT Bangalore
Central Excise Central Excise Act 2008-2013 151.34 CESTAT Bangalore
Central Excise Central Excise Act 2012-13 26.65 Asst. Commissioner of Central Excise Belgavi
Central Excise Central Excise Act 2010-2012 4.92 Commissioner of Central Excise (Appeals) Mysore
Central Excise Central Excise Act 2014 16.38 Commissioner of Central Excise (Appeals) Mysore
Central Excise Central Excise Act 2014-2015 19.14 Commissioner of Central Excise (Appeals) Mysore
Central Excise Central Excise Act 2015 159.07 Commissioner of Central Excise (Appeals) Mysore
Central Excise Central Excise Act 2015 0.96 Commissioner of Central Excise (Appeals) Mysore
Central Excise Central Excise Act 2015 0.50 Commissioner of Central Excise (Appeals) Mysore
Income Tax Income Tax Act 1961 AY 2011-12 15.74 Commissioner of Income Tax (Appeals) Kolhapur
Income Tax Income Tax Act 1961 AY 2012-13 17.45 Commissioner of Income Tax (Appeals) Kolhapur
Income Tax Income Tax Act 1961 AY 2012-13 189.53 Commissioner of Income Tax (Appeals) Kolhapur
Income Tax Income Tax Act 1961 AY 2013-14 16.93 Commissioner of Income Tax (Appeals) Kolhapur
Income Tax Income Tax Act 1961 AY 2014-15 14.42 Commissioner of Income Tax (Appeals) Kolhapur
Income Tax Income Tax Act 1961 AY 2014-15 9.27 Commissioner of Income Tax (Appeals) Kolhapur
Commercial Tax Karnataka Tax on Entry of Goods Act 1979 FY 2011-12 20.14 Commissioner of Commercial Taxes (Appeals) Belgaum

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of dues to financial institutions orGovernment. The Company has not issued any debentures.

(ix) Based upon the audit procedures performed and the information and explanationsgiven by the management the Company has not raised moneys by way of initial public offeror further public offer including debt instruments and term Loans. Accordingly theprovisions of clause 3 (ix) of the Order are not applicable to the Company and hence notcommented upon.

(x) Based upon the audit procedures performed and the information and explanationsgiven by the management we report that no fraud by the Company or on the Company by itsofficers or employees has been noticed or reported during the year.

(xi) Based upon the audit procedures performed and the information and explanationsgiven by the management the managerial remuneration has been paid or provided inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Companies Act;

(xii) In our opinion the Company is not a Nidhi Company. Therefore the provisions ofclause 4 (xii) of the Order are not applicable to the Company.

(xiii) In our opinion all transactions with the related parties are in compliance withsection 177 and 188 of Companies Act 2013 and the details have been disclosed in theFinancial Statements as required by the applicable accounting standards. Howevermonitoring and supervisory controls over related party transactions and arm’s lengthprice thereof need to be further strengthened.

(xiv) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year underreview. Accordingly the provisions of clause 3 (xiv) of the Order are not applicable tothe Company and hence not commented upon.

(xv) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not entered into any non-cash transactions withdirectors or persons connected with him. Accordingly the provisions of clause 3 (xv) ofthe Order are not applicable to the Company and hence not commented upon.

(xvi) In our opinion the company is not required to be registered under section 45 IAof the Reserve Bank of India Act 1934 and accordingly the provisions of clause 3 (xvi)of the Order are not applicable to the Company and hence not commented upon.

For M/s P. G. Bhagwat
Chartered Accountants
Firm Registration No. 101118W
Place : Ugar Khurd Nikhil M. Shevade
Partner
Date : 29-05-2017 Membership No. 217379

"Annexure - B" to the Independant Auditors' Report

(Referred to in paragraph 2(f) of our ‘Report on Other Legal & RegulatoryRequirement’ 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 The UgarSugar Works Limited ("the Company") as of 31 March 2017 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

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 safeguardingof its 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.

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 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 controlssystem 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 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.

Opinion Paragraph

In our opinion the Company has in all material respects an adequate internalfinancial control system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31-03-2017 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 M/s P. G. Bhagwat
Chartered Accountants
Firm Registration No. 101118W
Nikhil M. Shevade
Place : Ugar Khurd Partner
Date : 29-05-2017 Membership No. 217379