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Arrow Textiles Ltd.

BSE: 533068 Sector: Industrials
NSE: ARROWTEX ISIN Code: INE933J01015
BSE 00:00 | 21 May 17.00 0
(0.00%)
OPEN

17.30

HIGH

18.90

LOW

17.00

NSE 09:54 | 22 May 17.70 0.70
(4.12%)
OPEN

17.70

HIGH

17.70

LOW

17.70

OPEN 17.30
PREVIOUS CLOSE 17.00
VOLUME 4046
52-Week high 33.90
52-Week low 13.30
P/E 17.35
Mkt Cap.(Rs cr) 32
Buy Price 16.00
Buy Qty 125.00
Sell Price 17.75
Sell Qty 100.00
OPEN 17.30
CLOSE 17.00
VOLUME 4046
52-Week high 33.90
52-Week low 13.30
P/E 17.35
Mkt Cap.(Rs cr) 32
Buy Price 16.00
Buy Qty 125.00
Sell Price 17.75
Sell Qty 100.00

Arrow Textiles Ltd. (ARROWTEX) - Auditors Report

Company auditors report

To the Members of Arrow Textiles Limited Report on the Financial Statements

We have audited the accompanying financial statements of Arrow Textiles Limited(“the Company”) which comprise the Balance Sheet as at March 31 2018 theStatement 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 ofsignificant 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 of these financial statementsthat give a true and fair view of the state of affairs (financial position) profit orloss (financial and changes in equity of the Company in accordance with the accountingprinciples generally accepted in India including the Indian Accounting Standards(‘Ind AS') specified under Section 133 of the Act. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of 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 and ensuring their operatingeffectiveness and the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.

Auditor's 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 thereunder.

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 ethical requirements and plan and performthe audit to obtain reasonable assurance about whether the financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditors'judgment including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the 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 including Ind AS specified under Section 133 of theAct of the state of affairs (financial position) of the Company as at March 31 2018 andits profit (financial performance including other comprehensive income) its cash flowsand the changes in equity for the year ended on that date.

Other Matter(s)

The comparative financial information for the year ended March 31 2017 and thetransition date opening balance sheet as at April 1 2016 prepared in accordance with IndAS included in these financial statements are based on the previously issued financialstatements for the year ended March 31 2017 and March 31 2016 respectively prepared inaccordance with Accounting Standards prescribed under Section 133 of the Act read withRule 7 of the Companies (Accounts) Rules 2014 which were audited by the predecessorauditor whose reports dated May 15 2017 and May

12 2016 respectively expressed an unmodified opinion on the financial statements forthe year ended March 31 2017 and March 31 2016 and have been adjusted for thedifferences in the accounting principles adopted by the Company on transition to Ind ASwhich have been audited by us. Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

(1) As required by the Companies (Auditors' Report) Order 2016 (“the Order”)issued by the Central Government of India in terms of Section 143(11) of the Act we givein “Annexure A” a statement on the matters specified paragraphs 3 and 4 of theOrder.

(2) Further to our comments in Annexure A as required by Section 143(3) of the Act wereport that: a. we have sought and obtained all the information and explanations which tothe best of our knowledge and belief were necessary for the purposes of our audit; b. inour opinion proper books of account as required by law have been kept by the Company sofar as it appears from our examination of those books; c. the financial statements dealtwith by this report are in agreement with the books of account; d. in our opinion theaforesaid financialstatements comply with the Ind AS specified under Section 133 of theAct; e. on the basis of written representations received from the directors as on March31 2018 and taken on record by the Board of Directors none of the directors isdisqualified as on March 31 2018 from being appointed as a director in terms of Section164 (2) of the Act; f. we have also audited the internal financialcontrols over financialreporting (IFCoFR) of the Company as on March 31 2018 in conjunction with our audit ofthe financial statements of the Company for the year ended on that date and our reportdated May 18 2018 as per “Annexure B” expressed an unmodified opinion; g. withrespect to the other matters to be included in the Auditor's Report in accordance withRule 11 of the Companies (Audit and Auditors) Rules 2014 as amended in our opinion andto the best of our information and according to the explanations given to us:

(i) the Company as detailed in Note No. 33 has disclosed the impact of pendinglitigations on its financial position;

(ii) the Company did not have any long-term contracts including derivative contractsfor which 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.

For M H S & Associates Chartered Accountants ICAI Firm Reg. No.: 141079W

(Mayur H. Shah)

Proprietor Membership No. 147928 Mumbai: May 18 2018

ANNEXURE A

To The Independent Auditor's Report of even date to the members of Arrow TextilesLimited on the financial statements for the year ended March 31 2018]

Based on the audit procedures performed for the purpose of reporting a true and fairview on the financial statements of the Company and taking into consideration theinformation and explanations given to us and the books of account and other recordsexamined by us in the normal course of audit and to the best of our knowledge and beliefwe report that: (i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets.

(b) The fixed assets of the Company have been physically verified by the managementduring the year and no material discrepancies were noticed on such verification. In ouropinion the frequency of verification of the fixed assets is reasonable having regard tothe size of the Company and the nature of its assets.

(c) The title deeds of immovable properties (which are included under the head‘Property Plant and Equipment') are held in the name of the Company.

(ii) In our opinion the management has conducted physical verification of inventory atreasonable intervals during the year and no material discrepancies between physicalinventory and book records were noticed on physical verification.

(iii) The Company has not granted any loans secured or unsecured to companies firmsor other parties covered in the register maintained under Section 189 of the Act. Hencethe provisions of Paragraph 3 (iii) of the order are not applicable to the Company.

(iv) In our opinion the Company has not advanced any loan or given any guarantee orprovided any security or made any investment covered under section 185 and 186 of the Act.Hence the provisions of Paragraph 3(iv) of the order are not applicable.

(v) In our opinion the Company has not accepted any deposits within the meaning ofSections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules 2014 (asamended). Accordingly the provisions of Paragraph 3(v) of the order are not applicable.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto rules prescribed by the Central Government for the maintenance of the cost recordsunder Sub-Section (1) of Section 148 of the Act and are of the opinion that prima faciethe prescribed accounts and records have been made and maintained.

(vii) (a) The Company is regular in depositing with appropriate authorities undisputedstatutory dues including provident fund employees' state insurance income tax salestax gst service tax duty of customs duty of excise value added tax cess and anyother material statutory dues as applicable to it. Further no undisputed amounts payablein respect thereof were outstanding at the year-end for a period of more than six monthsfrom the date they became payable.

(b) In our opinion there are no dues with respect to income tax sales tax servicetax value added tax customs duty excise duty which have not been deposited on accountof any dispute except for the dues in relation to income tax as disclosed hereunder:

Name of the Statute Nature of Dues Amount ( Rs. in ‘000) Period to which the Amount Relates Forum where dispute is pending
Income Tax Act 1961 Income Tax 172.71 F.Y. 2011-12 Rectification application made u/s 154 of the Act and pending before Assessing Officer.
Income Tax Act 1961 Income Tax 1040.40 F.Y. 2014-15 Commissioner of Income Tax (Appeals)

(viii) According to the information and explanations given to us the Company has notdefaulted in repayment of loans or borrowings to banks. The Company did not have anyoutstanding dues to any financial institutions or debenture holders during the year.

(ix) The Company did not raise moneys by way of initial public offer or further publicoffer (including debt instruments). In our opinion no term loans were raised during theyear under audit.

(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of fraud by the Company or any fraud on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such instance by themanagement.

(xi) As per the information and explanations given to us managerial remuneration hasbeen paid / provided in accordance with the requisite approvals mandated by the provisionsof Section 197 read with Schedule V to the Act. (xii) In our opinion the Company is not aNidhi Company. Therefore the provisions of Paragraph 3(xii) of the Order are notapplicable to the Company.

(xiii) As per the information and explanation given to us all transactions enteredinto by the Company with the related parties are in compliance with Sections 177 and 188of Act where applicable and the requisite details have been disclosed in the financialstatements etc. as required by the applicable Ind AS.

(xiv) As informed the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures. (xv) According to theinformation and explanations given to us the Company has not entered into any non-cashtransactions with directors or persons connected with them covered under Section 192 ofthe Act.

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

For M H S & Associates Chartered Accountants ICAI Firm Reg. No.: 141079W

(Mayur H. Shah)

Proprietor Membership No. 147928 Mumbai: May 18 2018

ANNEXURE B

Independent Auditor's Report on the Internal Financial Controls under Clause (i) ofSub-Section 3 of Section 143 of the Companies Act 2013 (“the Act”)

In conjunction with our audit of the financial statements of Arrow Textiles Limited(“the Company”) as of and for the year ended March 31 2018 we have audited theinternal financial controls over financial reporting (IFCoFR) of the company of as of thatdate.

Management's Responsibility for Internal Financial Controls

The Company's Board of Directorsisresponsibleforestablishingandmaintaininginternalfinancialcontrols based on the criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the“Guidance Note”) issued by the Institute of Chartered Accountants of India(ICAI). These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company's policiesthe safeguarding 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 Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's IFCoFR based on our audit.We conducted our audit in accordance with the Guidance Note and the Standards on Auditingissued by ICAI and deemed to be prescribed under Section 143(10) of the Act to the extentapplicable to an audit of IFCoFR both issued by the ICAI. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe IFCoFR and their operating effectiveness. Our audit of IFCoFR included obtaining anunderstanding of IFCoFR assessing the risk that a material weakness exists and testingand evaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgement including theassessment of the risks of material misstatement of the Ind AS financial statementswhether 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 IFCoFR.

Meaning of Internal Financial Controls over Financial Reporting

A Company's IFCoFR is a process designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with the Indian Accounting

Standards (Ind AS) prescribed under Section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 as amended and other accounting principlesgenerally accepted in India. A Company's IFCoFR includes those policies and proceduresthat (1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the Company are being made only in accordance withauthorisations of management and directors of the Company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the Company's assets that could have a material effect on the financialstatements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of IFCoFR including the possibility of collusionor improper management override of controls material misstatements due to error or fraudmay occur and not be detected. Also projections of any evaluation of the IFCoFR to futureperiods are subject to the risk that the IFCoFR may become inadequate because of changesin conditions or that the degree of compliance with the policies or procedures maydeteriorate.

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 2018 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 ICAI.

For M H S & Associates Chartered Accountants ICAI Firm Reg. No.: 141079W

(Mayur H. Shah)

Proprietor Membership No. 147928

Mumbai: May 18 2018