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Advance Petrochemicals Ltd.

BSE: 506947 Sector: Consumer
NSE: N.A. ISIN Code: INE334N01018
BSE 00:00 | 15 Apr Advance Petrochemicals Ltd
NSE 05:30 | 01 Jan Advance Petrochemicals Ltd
OPEN 38.00
PREVIOUS CLOSE 38.00
VOLUME 50
52-Week high 38.95
52-Week low 35.65
P/E 35.19
Mkt Cap.(Rs cr) 3
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 38.00
CLOSE 38.00
VOLUME 50
52-Week high 38.95
52-Week low 35.65
P/E 35.19
Mkt Cap.(Rs cr) 3
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Advance Petrochemicals Ltd. (ADVANCEPETROCH) - Auditors Report

Company auditors report

To

The Members of

Advance Petrochemicals Limited

Report on the IND AS Financial Statements

Opinion

We have audited the accompanying financial statements of Advance Petrochemicals Limited("the Company") which comprise the Balance Sheet as at March 31 2020 theStatement of Profit and Loss (including Other Comprehensive Income) the Statement ofChanges in Equity and the Statement of Cash Flows for the year ended on that date and asummary of the significant accounting policies and other explanatory information(hereinafter referred to as "the 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 Companies Act 2013 ("the Act") in the manner so required and give a trueand fair view in conformity with the Indian Accounting Standards prescribed under section133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015 asamended ("Ind AS") and other accounting principles generally accepted in Indiaof the state of affairs of the Company as at March 31 2020 the profit and totalcomprehensive income changes in equity and its cash flows for the year ended on thatdate.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Standards onAuditing specified under section 143(10) of the Act (SAs). Our responsibilities underthose Standards are further described in the Auditor's Responsibilities for the Audit ofthe Standalone Financial Statements section of our report. We are independent of theCompany in accordance with the Code of Ethics issued by the Institute of CharteredAccountants of India (ICAI) together with the independence requirements that are relevantto our audit of the financial statements under the provisions of the Act and the Rulesmade there under and we have fulfilled our other ethical responsibilities in accordancewith these requirements and the ICAI's Code of Ethics. We believe that the audit evidencewe have obtained is sufficient and appropriate to provide a basis for our audit opinion onthe standalone financial statements.

Basis for Qualified Opinion

The Company has not provided for the employees post employment and other long termemployee benefit in the Ind AS Financial Statement as the company recognizes the postemployment and other long term employee benefits as an expense in the Profit & Lossaccount in the year of payment which is in line with the companies policy mentioned inNote-35 to the Ind AS Financial Statement. However company is required to provide for thepost employment and other long term employee benefits on actuarial valuation basis as perthe requirement of Indian Accounting Standard 19- "Employee Benefit". In absenceof the actuarial valuation for the post employment and other long term employee benefit inthe Ind AS financial Statement we are unable to quantify the impact of such non provisionon financial position and result of the Company.

Emphasis of Matter

We draw your attention to Note 47 to the Standalone Financial Statements which explainsthe management's assessment of the financial impact due to the lock-down and otherrestrictions and conditions related to the COVID - 19 pandemic situations for which adefinitive assessment of the impact in the subsequent period is highly dependent uponcircumstances as they evolve. Our opinion is not modified in respect of this matter.

Key audit matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Standalone Ind AS financial statements of the currentperiod. These matters were addressed in the context of our audit of the standalone Ind ASfinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report.

Sr. No. Key Audit Matters Principal Audit Procedures/ Auditor's Response
1 Appropriateness of Current / Noncurrent classification For the purpose of current/non-current classification of assets and liabilities the Company has ascertained its normal operating cycle as twelve months. This is based on the nature of activities and the time between the acquisition of assets or inventories for processing and their realization in cash and cash equivalents.
The classification of assets and liabilities has been done on the basis of documentary evidences. Where conclusive evidences are not available the classification has been done on the basis of management's best estimate of the period in which the assets would be realized or the liabilities would be settled. We have evaluated the reasonability of the management's estimates.
2 Valuation of Stock in Process The Company is engaged in chemical activity and for the Purpose of valuation of stock in process of Rs. 505.00 Lacs we have advised management of the company to appoint technical expert for valuation of stock in process as on 31.03.2020 the company has not obtain such valuation report and therefore we have taken the value of stock in process as certified by the Management.
3 Investments The company is having investment of Rs. 3590220 being 226200 equity shares of Advance Multitech Ltd Rs. 10 each .The shares of this company is listed at Mumbai stock Exchange but presently these are not traded since trading is suspended by the exchange on account of non compliance of some of the terms of exchange. Therefore market value could not be determined .The company is in process of resumption of listing and expect that shares would be traded in the exchange. The fair value of investment is above than the cost of investment as per audited financial statement as on 31/03/2020. The management expects that on revocation of suspension the shares may trade above its cost and on account of it; there is no permanent deterioration in the value of investment. (Refer Note no. 37)

Information other than the standalone Ind AS financial statements and auditors' reportthereon

The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the Board'sReport including Annexures to Board's Report but does not include the standalone Ind ASfinancial statements and our auditor's report thereon.

Our opinion on the Standalone Ind AS financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone Ind AS financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone Ind AS financialstatements or our knowledge obtained during the course of our audit or otherwise appearsto be materially misstated.

If based on the work we have performed we conclude that there is a materialmisstatement of this other information; we are required to report that fact. We havenothing to report in this regard.

Management's Responsibility for the Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these financial statements that givea true and fair view of the financial position financial performance total comprehensiveincome changes in equity and cash flows of the Company in accordance with the Ind AS andother accounting principles generally accepted in India. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Company and for preventing and detecting frauds andother irregularities selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the standalone financial statements that give a true andfair view and are free from material misstatement whether due to fraud or error.

In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so. The Board of Directors are responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibilities for the Audit of Financial Statements

Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

•  Identify and assess the risks of material misstatement of the financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

•  Obtain an understanding of internal financial controls relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. Undersection 143(3)(i) of the Act we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls system in place and theoperating effectiveness of such controls.

•  Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management.

•  Conclude on the appropriateness of management's use of the going concernbasis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.

•  Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the standalone financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

Materiality is the magnitude of misstatements in the financial statements thatindividually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the financial statements.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

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 mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

2. As required by section 143(3) of the Act based on our audit 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 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 books of account.

(d) In our opinion the aforesaid standalone financial statements comply with the IndAS 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 2020 and taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2020 from being appointed as a director in termsof Section 164 (2) of the Companies Act2013.

(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". Our report expresses an unmodifiedopinion on the adequacy and operating effectiveness of the Company's internal financialcontrols over financial reporting.

(g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended:

In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its directors during the year is inaccordance with the provisions of section 197 of the Act

(h) 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. As explained to us there is no pending litigation that affects the financialposition of the company.

ii. As explained to us the company has not entered into any long term contractsincluding derivatives contracts and hence no material forcible loss.

iii. As explained to us no such amount is required to be transferred to the investoreducation and protection fund in accordance with the relevant provisions of the companiesact 2013 and the rules made there under.

For Devpura Navlakha & Co.
Chartered Accountants
(F.R.N. 121975W)
Ashwini Devpura
Partner
M.No.047390
Place: Ahmedabad UDIN: No20047390AAAACF8675
Date: 22/07/2020

ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE IND ASFINANCIAL STATEMENTS OF ADVANCE PETROCHEMICALS LIMITED

Referred to in Paragraph 1 under the heading "Report on other legal and regulatoryrequirements" of our Independent Auditor's Report of even date.

(i) In respect of Company's fixed assets:

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

(b) As explained to us the fixed assets have been physically verified by themanagement in a phased manner designed to cover all the items over the period of threeyears which are reasonable having regard to size of the company and nature of itsbusiness.

(c) On the basis of examination of records the title deeds of immovable property(Factory Land) is not held in the name of the Company having gross block and net block ofRs.46000/- (Rupees Forty Six Thousand only).

(ii) As explained to us physical verification of inventory has been conducted atreasonable intervals by the management during the year and the discrepancies noticed onverification between the physical stocks and the book records were not material havingregard to the size of the company and the same have been properly dealt with in the booksof account.

(iii) The Company has not granted secured/unsecured loans to Companies firms LimitedLiability Partnership or other parties covered in the register maintained under Section189 of the Act. Consequently requirement of Clause (iii) of paragraph 3 of the order arenot applicable.

(iv) In our opinion and according to the information and explanations given to us theCompany has not given any loan for parties covered under section 185 & 186 of thecompanies Act 2013 therefore provisions of Section 185 & 186 of the companies Act2013 is not applicable.

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public and hence the directives issued bythe Reserve Bank of India and the provision of Sections 73 to 76 or any other relevantprovisions of the Act and rules framed there under.

(vi) As informed to us the Central Government has not prescribed maintenance of costrecords under sub-section (1) of section 148 of the Companies Act 2013 for any of theproducts of the Company. Accordingly the provisions of clauses 3(vi) of the order are notApplicable to the Company and hence not commented upon.

(vii) (a) According to the information and explanations given to us and the records ofthe company examined by us in our opinion the Company is generally regular in depositingwith appropriate authorities undisputed statutory dues including Provident FundEmployees' State Insurance Income Tax Goods and service tax and other material statutorydues applicable to it.

(b) According to the information and explanations given to us and the records of thecompany examined by us in our opinion no undisputed amount payable in respect ofoutstanding statutory dues were in arrears as at March 2020 for a period of more than sixmonths from the date they become payable

(c) Following amounts have not been deposited as on March 31 2020 on account of anydispute:

Nature of Statute Nature of the dues Rs. In Lacs Period to which the amount relates Forum where matter is pending
Central Sales Tax Act Assessment Dues 93.64 Year:2013-14 The office of Commissioner- Appeal

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

The Company has made default in payment of loan to Narol Textile Infrastructure &Enviro Management of Rs. 408117 for which details given as under:

(Amount in Rs.)

Financial Year Principal Amount Interest Total
2018-19 123636 87066 210702
2019-20 123636 73779 197415
Total 247272 160845 408117

(ix) To the best of our knowledge and belief and according to the information andexplanations given to us the Company has not raised moneys by way of initial public offeror further public offer including debt instruments and term loans. Accordingly theprovisions of clauses 3(ix) of the order are not Applicable to the Company and hence notcommented upon.

(x) To the best of our knowledge and belief and according to the information andexplanations given to us no fraud by the Company or on the Company by its officers oremployees has been noticed or reported during the year.

(xi) To the best of our knowledge and belief and according to the information andexplanations given to us managerial remuneration has been paid/ provided in accordancewith the requisite approvals mandated by the provisions of section 197 read with ScheduleV to the Act.

(xii) According to the information and explanation given to us in our opinion theCompany is not a Nidhi Company. Consequently requirements of clause (xii) of paragraph 3of the order are not applicable.

(xiii) To the best of our knowledge and belief and according to the information andexplanations given to us all transactions with the related parties are in compliance withsections 177 and 188 of the Companies Act 2013where applicable and the details have beendisclosed in the Ind AS financial statements etc. as required by the applicable Indaccounting standards.

(xvi) To the best of our knowledge and belief and according to the information andexplanations given to us the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year underreview. Consequently requirements of clause (xiv) of paragraph 3 of the order are notapplicable.

(xvii) To the best of our knowledge and belief and according to the information andexplanations given to us the Company has not entered into any non-cash transactions withdirectors or persons connected with him. Accordingly requirements of clause (xii) ofparagraph 3 of the order are not applicable.

(xviii) According to the information and explanation given to us and based on ourexamination of the records of the Company the Company is not required to be registeredunder section 45-IA of the Reserve Bank of India Act 1934.

For Devpura Navlakha & Co.
Chartered Accountants
(F.R.N. 121975W)
Ashwini Devpura
Partner
M.No.047390
Place: Ahmedabad UDIN: No-20047390AAAACF8675
Date: 22/07/2020

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE IND ASFINANCIAL STATEMENTS OF ADVANCE PETROCHEMICALS LIMITED

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 AdvancePetrochemicals Limited ("the Company") as of March 31 2020 in conjunctionwith our audit of the Ind AS financial statements of the Company for the year ended onthat date.

Management's Responsibility for Internal Financial Controls

The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountants of India. 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 respective company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the internal financial controls overfinancial reporting of the Company based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") issued by the Institute of Chartered Accountantsof India and the Standards on Auditing prescribed under Section 143(10) of the CompaniesAct 2013 to the extent applicable to an audit of internal financial controls. 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 internal financial controls system overfinancial reporting of the Company.

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 Ind AS 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 (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of Ind ASfinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorizations of management and directors of the company and (3) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition use ordisposition of the company's assets that could have a material effect on the Ind ASfinancial 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 2020 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 Devpura Navlakha & Co.
Chartered Accountants
(F.R.N. 121975W)
Ashwini Devpura
Partner
M.No.047390
Place: Ahmedabad UDIN:20047390AAAACF8675
Date: 22/07/2020