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Ashok Alco-Chem Ltd.

BSE: 524594 Sector: Industrials
NSE: ASHOKALCO ISIN Code: INE994D01010
BSE 16:01 | 30 Oct 47.00 -1.20
(-2.49%)
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50.60

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NSE 05:30 | 01 Jan Ashok Alco-Chem Ltd
OPEN 50.60
PREVIOUS CLOSE 48.20
VOLUME 1079
52-Week high 54.10
52-Week low 13.30
P/E
Mkt Cap.(Rs cr) 22
Buy Price 45.85
Buy Qty 100.00
Sell Price 49.60
Sell Qty 55.00
OPEN 50.60
CLOSE 48.20
VOLUME 1079
52-Week high 54.10
52-Week low 13.30
P/E
Mkt Cap.(Rs cr) 22
Buy Price 45.85
Buy Qty 100.00
Sell Price 49.60
Sell Qty 55.00

Ashok Alco-Chem Ltd. (ASHOKALCO) - Auditors Report

Company auditors report

To

The Members of ASHOK ALCO-CHEM LIMITED

Report on the Financial Statements Opinion

We have audited the accompanying standalone financial statements of ASHOK ALCO-CHEMLIMITED ("the Company") which comprise the Balance Sheet as at 31st March2019 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Changes in Equity and the Statement of Cash Flows for the year ended on thatdate and a summary of the significant accounting policies and other explanatoryinformation (hereinafter referred to as "the standalone 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 u/s. 133 ofthe Act read with the Companies (Indian Accounting Standards) Rules 2015 as amended("Ind AS") and other accounting principles generally accepted in India of thestate of affairs of the company as at 31st March 2019 the loss and total comprehensiveincome changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing (SAs) specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Standalone Financial Statements section of ourreport. We are independent of the company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India (ICAI) together with the ethicalrequirements that are relevant to our audit of the standalone financial statements underthe provisions of the Act and the Rules made thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAl's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the standalone financial statements.

Key Audit Matters

Key audit matters are those matters that in our professional judgement were of mostsignificance in our audit of the standalone financial statements of the current period.These matters were addressed in the context of our audit of the standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report.

Key Audit Matters How the matter was addressed in our audit
Recoverability of Indirect Tax Receivables
Current assets as on March 31 2019 in respect of Indirect Taxes comprising of Sales Tax VAT & GST amounting to RS. 6.52 Crores are recoverable pending action by the department. Our audit procedures includes verification of various assessment & appellate orders returns filed communications with the department and other related documents.

Other Information

The company's management and Board of Directors is responsible for the preparation ofthe other information. The other information comprises the information included in theCompany's Annual Report but does not include the standalone financial statements and ourauditor's report thereon.

Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other information ismaterially inconsistent with the standalone financial statements or our knowledge obtainedduring the course of our audit or otherwise appears to 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.

Responsibility of Management and Those Charged with Governance for the StandaloneFinancial Statements

The company's management and Board of Directors are responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these standalone financialstatements that give a true and fair view of the financial position financialperformance total comprehensive income changes in equity and cash flows of the companyin accordance with the Ind AS and other accounting principles generally accepted in India.This responsibility also includes maintenance of adequate accounting records in accordancewith the provisions of the Act for safeguarding the assets of the company and forpreventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgements 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 standalonefinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

In preparing the standalone financial statements management is responsible forassessing the company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the company or to cease operations or has norealistic alternative but to do so.

The Board of Directors are responsible for overseeing the company's financial reportingprocess.

Auditor's Responsibilities for the Audit of the Standalone Financial Statements

Our objective are to obtain reasonable assurance about whether the standalone 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 standalone financial statements.

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

• Identify and assess the risks of material misstatement of the standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances under section 143(3)(i)of the Act.We are also responsible for expressing our opinion on whether the company hasadequate internal financial controls system in place and the operating effectiveness ofsuch controls.

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

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe standalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the company to cease tocontinue as a going concern.

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

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 compiledwith relevant ethical requirements regarding independence and to communicate with them allrelationships and other matters that may reasonably be thought to bear on our independenceand where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that are of most significance in the audit of the standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when 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 Section 143 (11) of the Act we givein "Annexure A" a statement on the matters specified in paragraphs 3 and4 of the Order to the extent applicable.

2. As required by section 143 (3) 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 Statement of Profit and Loss including Other ComprehensiveIncome Statement of Changes in Equity and the Statement of Cash Flows dealt with by thisReport are in agreement with the relevant books of accounts.

d) In our opinion the aforesaid standalone financial statements comply with the Ind ASspecified under section 133 of the Act read with RulRs. 7 of the Companies (Accounts)Rules 2014.

e) On the basis of the written representations received from the directors as on 31stMarch 2019 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2019 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) In our opinion and according to the information and explanations given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of Section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under Section 197(16) which arerequired to be commented upon by us.

h) With respect to the other matters to be included in the Auditor's Report inaccordance with RulRs. 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 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 Funds of the Company.

For R A Maru & Associates
Chartered Accountants
FRN: 141914W
Sd/-
Rumeet Anil Maru
Place: Mumbai Proprietor
Date: 29.05.2019 M No: 166417

"(ANNEXURE - A)" to the Auditor's Report

(Referred to in Paragraph 1 under 'Report on other Legal and Regulatory Requirements'section of our report of even date)

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

(b) The fixed assets have been physically verified by the management at the year endand no material discrepancies were noticed on such physical verification.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of freehold immovableproperties are held in the name of the Company and those taken on lease and disclosed asfixed asset in the financial statements the lease agreements are in the name of theCompany where the Company is the lessee in the agreement.

2. (a) The stock of Finished Goods Raw materials Stores and consumables werephysically verified by the Management at each half year end;

(b) In our opinion and according to the information and explanations given to us theprocedure of physical verification of stocks followed by the management is reasonable andadequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventories. The discrepancies noticedon verification between the physical stocks and book records were not material and havebeen properly dealt with in the books of account.

3. The company has not granted unsecured loans to companies firms limited liabilitypartnerships or other parties covered in the register maintained under Section189 of theCompanies Act 2013. Accordingly paragraph 3 (iii) of the order is not applicable.

4. 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.

5. According to the information and explanations given to us the Company has notaccepted any deposit from the public during the year. Accordingly paragraph 3 (v) of theorder is not applicable.

6. We have broadly reviewed the cost records maintained by the Company pursuant to theCompanies (Cost Accounting Records) Rules 2011 prescribed by the Central Government underSection 148 of the Companies Act 2013 and are of the opinion that prima facie theprescribed cost records have been maintained. We have however not made a detailedexamination of the cost records with a view to determine whether they are accurate orcomplete.

7. (a) According to the information and explanations given to us and the records of theCompany examined by us in our opinion the Company is generally regular in depositingundisputed statutory dues in respect of sales tax including Value Added Tax Service TaxGoods & Service Tax Provident Fund Employees' State Insurance Income Tax Duty ofCustoms Duty of Excise Cess and other material statutory dues as applicable with theappropriate authorities.

(b) According to the information and explanations given to us no undisputed amountspayable in respect of Value Added Tax Service Tax Goods & Service Tax ProvidentFund Employees' State Insurance Income Tax Duty of Customs Duty of Excise Cess andother material statutory dues were in arrears as at 31st March 2019 for a period of morethan six months from the date they became payable.

(c) The particulars of dues of Value Added Tax Service Tax Goods & Service TaxProvident Fund Employees' State Insurance Income Tax Duty of Customs Duty of ExciseCess and other material statutory dues at 31st March 2019 which have not been depositedon account of dispute are as follows:

Name of the Statute Nature of Dues Amount (Rs. in Lakhs) Financial Year/s to which the amount relates Forum where dispute is pending
Sales Tax Assessment dues 199.21 1993-1994 to 2004-2005 Commissioner of Sales Tax
Income Tax Act 1961 Demand U/s 143 (3) 449.39 2006-2007 Income Tax Appellate Tribunal Mumbai
Income Tax Act 1961 Demand U/s 143 (3) 226.50 2010-2011 Commissioner of Income Tax (Appeals) Commissioner of Income Tax
Income Tax Act 1961 Demand U/s 143 (3) 49.45 2014-2015 (Appeals) & Rectification u/s 154 of The I.T. Act 1961
Income Tax Act 1961 Demand U/s 143 (3) 51.77 2015-2016 Commissioner of Income Tax (Appeals)

8. In our opinion and according to the information and explanations given to us theCompany has not defaulted in the repayment of loans or borrowings to financialinstitutions banks and government and dues to debenture holders.

9. The Company has not raised any moneys by way of initial public offer further publicoffer (including debt instruments) and term loans. Accordingly the provisions of ClausRs.3(ix) of the Order are not applicable to the company.

10. To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company and no fraud on the Company by its officers oremployees has been noticed or reported during the year.

11. 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.

12. In our opinion and according to the information and explanations given to us theCompany is not a nidhi company.

Accordingly paragraph 3(xii) of the Order is not applicable.

13. According to the information and explanation given to us the Company has enteredinto transaction with related parties in compliance with the provisions of Sections 177and 188 of the Act. The details of such related party transactions have been disclosed inthe financial statements as required by the applicable accounting standards.

14. 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.

15. 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 persons connected with him and hence provisions of section 192 of theCompanies Act 2013 are not applicable.

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

For R A Maru & Associates
Chartered Accountants
FRN: 141914W
Sd/-
Rumeet Anil Maru
Place: Mumbai Proprietor
Date: 29.05.2019 M No: 166417

"Annexure –B" to the Auditors' Report

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 ASHOKALCO-CHEM LIMITED ("the Company") as of 31st March 2019 in conjunction withour audit 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'). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to 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.

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. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the Company's internal financial controls system overfinancial 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

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 31st March 2019 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 R A Maru & Associates
Chartered Accountants
FRN: 141914W
Sd/-
Rumeet Anil Maru
Place: Mumbai Proprietor
Date: 29.05.2019 M No: 166417

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