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Bannari Amman Sugars Ltd.

BSE: 500041 Sector: Agri and agri inputs
NSE: BANARISUG ISIN Code: INE459A01010
BSE 00:00 | 27 Nov 1344.00 -8.90
(-0.66%)
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1349.10

HIGH

1356.00

LOW

1343.85

NSE 00:00 | 27 Nov 1346.05 1.75
(0.13%)
OPEN

1368.00

HIGH

1368.05

LOW

1321.00

OPEN 1349.10
PREVIOUS CLOSE 1352.90
VOLUME 66
52-Week high 1600.00
52-Week low 636.05
P/E 15.94
Mkt Cap.(Rs cr) 1,685
Buy Price 1325.00
Buy Qty 45.00
Sell Price 1356.95
Sell Qty 1.00
OPEN 1349.10
CLOSE 1352.90
VOLUME 66
52-Week high 1600.00
52-Week low 636.05
P/E 15.94
Mkt Cap.(Rs cr) 1,685
Buy Price 1325.00
Buy Qty 45.00
Sell Price 1356.95
Sell Qty 1.00

Bannari Amman Sugars Ltd. (BANARISUG) - Auditors Report

Company auditors report

To

The M embers of Bannari Amman Sugars Limited

Report on the Audit of the Financial Statements

Opinion

1. We have audited the accompanying financial statements of Bannari Amman SugarsLimited (the Company") which comprise the Balance Sheet as at March 31 2020 theStatement of Profit and Loss (including Other Comprehensive Income) Statement of CashFlows and Statement of Changes in Equity for the year then ended on that date and notes tothe financial statements including a summary of significant accounting policies and otherexplanatory information.

2. 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 theCompanies Act 2013 (" the Act") in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2020 and its profit and totalcomprehensive income its cash flo'ws and changes in equity for the year ended on thatdate.

Basis for Opinion

3. We conducted our audit in accordance 'with the Standards on Auditing (SAs) specifiedunder Section 143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditor s Responsibilities for the Audit of the Financial StatementsSection of our report. We are independent of the Company in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India (ICAI) together with theethical requirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules thereunder and 'we have fulfilled our other ethicalresponsibilities in accordance 'with these requirements and the Code of Ethics. We believethat the audit evidence 'we have obtained is sufficient and appropriate to provide a basisfor our opinion.

Key Audit Matters

4. Key audit matters are those matters that in our professional judgement were ofmost significance in our audit of the financial statements of the current period. Thesematters were addressed in the context of our audit of the financial statements as a wholeand in forming our opinion thereon and we do not provide a separate opinion on thesematters. We h ave determined the matter described below as the key audit matter of thecompany for the year ended March 31 2020.

Sl. No. Description of Key Audit Matter How the matter was addressed in Audit
4.1 Determination of net realizable value of inventory of sugar as at the year ended March 312020 We understood and tested the design and operating effectiveness of controls as established by the management in preparation of cost sheet and underlying judgement and basis of determination of net realizable value of inventory of sugar.
The Company has inventory of sugar with the carrying value of Rs.83602.69 lakhs as on March 31 2020. The inventory of sugar is valued at the lower of Weighted Average cost and net realizable value.
We considered the value of the inventory of sugar as a key audit matter given the relative size of the balance in the financial statements and significant judgement involved in the consideration of factors such as minimum sale price monthly quota fluctuation in selling prices and the related notifications of the Government in determination of net realizable value. We considered various factors including the actual selling price prevailing around and subsequent to the year end minimum selling price & monthly quota and other notifications of the Government of India initiatives taken by the Government with respect to sugar industry as a whole.
Based on the above procedures performed the i management s determination of the cost and net realizable value of the inventory of sugar as at the year-end is considered to be reasonable.

Information Other than the Financial Statements and Auditor's Report thereon

5. The Company s Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the (Management Discussion and AnalysisBoards Report including Annexures to Board's Report Corporate Governance and ShareholdersInformation but does not include the financial statements and our auditor s reportthereon 'which 'we have obtained prior to the date of this Audit Report.

6. Our opinion on the financial statements does not cover the other information and wedo not express any form of assurance conclusion thereon.

7. In connection 'with our audit of the financial statements our responsibility is toread the other information identified above and in doing so consider whether the otherinformation is materially inconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated. Based on the workwe have performed on other information if we conclude that there is a materialmisstatement if any of this other information 'we are required to report that fact.

We have nothing to report in this regard.

Management's Responsibilities and those Charged with Governance for the FinancialStatements

8. The Company's Board of Directors is responsible for the matters stated in Section134(5) o f the Act with respect to the preparation of these financial statements that givea true and fair vie'w of the financial position financial performance cash flows andchanges in equity of the Company in accordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards specified under Section 133 of the Act read 'with Companies (Indian Accounting Standard) Rules 2015 as amended. Thisresponsibility also includes maintenance of adequate accounting records in accordance'with the provisions of the Act for safeguarding of 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 financialstatements that give a true and fair view and are free from material misstatement'whether due to fraud or error.

9. In preparing the financial statements the Board of Directors 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 unlessthe Board of Directors either intends to liquidate the Company or to cease operations orhas no realistic alternative but to do so.

10. Those Board of Directors are also responsible for overseeing the Company sfinancial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements

11. 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.

12. As part of an audit in accordance 'with SAs 'we exercise professional judgementand maintain professional skepticism throughout the audit. We also:

a) Identify and assess the risks of material misstatement of the financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.

b) Obtain an understanding of internal financial controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under Section143(3)(i) of the Act we are also responsible for expressing our opinion on 'whether theCompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

c) Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.

d) Conclude on the appropriateness of management's use of the going concern basis ofaccounting 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 financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

e) Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.

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

14. We al so provide those charged with governance with a statement that we havecomplied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may reasonably be thought to bear onour independence and where applicable related safeguards.

15. From the matters communicated 'with those charged 'with governance 'we determinethose matters that 'were of most significance in the audit of the financial statements ofthe current period and are therefore the key audit matters. ^We describe these matters inour auditor s report unless law or regulation precludes public disclosure about the matteror 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

16. As required by the Companies (Auditors Report) Order 2016 ( the Order ) issued bythe Central Government of India in terms of sub-section (11) of Section 143 of the Actwe give in the Annexure A a statement on the matters specified in paragraphs 3 and 4 ofthe Order to the extent applicable.

17. 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 Bal ance Sheet the Statement of Profit and Loss (including Other Compreh ensiveIncome) the Statement of Changes in Equity and the Cash Fl ow Statement dealt with bythis Report are in agreement with the books of account.

d) In our opinion the aforesaid financial statements comply with the Indian 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 March31 2020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 312020 from being appointed as a director in terms of Section 164(2) of theAct.

f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in Annexure B.

g) With respect to the matter to be included as per Section 197(16) of the Act:

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.

h) With respect to the other matters to be included in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in our opinion and to the best of ourinformation 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 No. 35 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 to theInvestor Education and Protection Fund by the Company.

For P K NAGARAJAN & Co.
Chartered Accountants
Firm Reg. No: 016676S
VIGNESA SOMATHURAI PANDIAN
Partner
Place : Coimbatore M.No.241168
Date : 24.06.2020 UDIN: 20241168AAAAAL8129

Annexure - A to the Independent Auditors' Report

Referred to in paragraph 16 of the Independent Auditors Report of even date to themembers of Bannari Amman Sugars Limited on the financial statements for the year endedMarch 31 2020.

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

b) The Company has a regular programme of physical verification of its fixed assets by'which all fixed assets are verified in a phased manner. In accordance 'with thisprogramme certain fixed assets 'were verified by the management during the year andaccording to the information and explanation given to us no material discrepancies werenoticed on such verification. In our opinion this periodicity of physical verification isreasonable having regard to the size of the Company and the nature of its assets.

c) In our opinion and according to the information and explanations given to us and onthe basis of examination of the records of the company the title deeds of immovableproperties are held in the name of the company. In respect of immovable properties takenon lease and disclosed as right-of-use-assets in the financial statements the leaseagreements are in the name of the company.

ii. The inventory has been physically verified by the management at reasonableintervals during the year. No material discrepancy was noticed on physical verification ofstocks by the management as compared to book records.

iii. In our opinion and according to the information and explanations given to us andon the basis of our examination of the books of account the Company has not granted anyloans secured or unsecured to companies firms Limited Liability partnerships or otherparties listed in the register maintained under Section 189 of the Act. Consequently theprovisions of paragraph 3(iii) of the Order are not applicable to the Company.

iv. In our opinion and according to the information and the explanations given to usthe Company has not granted any loans or provided any guarantees or securities to theparties covered under the Section 185 o f the Act. The C ompany has complied with theprovisions of Section 186 of the Act in respect of investments made or loans or guaranteeor security provided.

v. The Company has not accepted any deposits from the public.

vi. As per the information and explanation given by the management maintenance of costrecords has been prescribed by the Central Government and 'we are of the opinion thatprima facie the prescribed accounts and records have been made and maintained underSection 148(1) of the Act by the company.

vii. a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company the undisputed statutory dues includingProvident fund Employee's State Insurance Income Tax Goods and Service Tax duty ofCustoms duty of Excise and any other material statutory dues as applicable have beenregularly deposited during the year by the Company with the appropriate authorities.

According to the information and explanations given to us no undisputed amountspayable in respect of Provident Fund Employees State Insurance Income tax Goods andService Tax duty of Customs duty of Excise and other material statutory dues were inarrears as at 31st March 2020 for a period of more than six months from the date theybecame payable.

b) According to the information and explanations given to us the company has nodisputed dues of income tax or duty of customs or duty of excise or Goods and Service Taxthat have not been deposited on account of matters pending before appropriate authority.

viii. According to the information and explanations given to us the Company has notdefaulted in repayment of dues to financial institutions banks and Government during theyear. The company has not issued any debentures.

ix. The Company has not raised any money by way of Initial Public Offer or furtherpublic offer (including Debt instruments) during the year. According to the informationand explanations given to us the term loans availed during the year have been applied forthe purposes for 'which those 'were obtained.

x. According to the information and explanations given to us no fraud by the Companyor on the Company by its officers or employees has been noticed or reported during theyear.

xi. According to the information and explanations given to us and based on theexamination of the records the Company has paid/provided for managerial remuneration inaccordance with the requisite approvals mandated by the provisions of Section 197 readwith Schedule V to the Act.

xii. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. A ccordingly paragraph 3(xii) of the Order is notapplicable.

xiii. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with Sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the financial statements as required by the applicableAccounting Standards.

xiv. According to the information and explanations given to us and based on ourexamination of the records the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year underreview. Accordingly paragraph 3(xiv) of the Order is not applicable.

xv. According to the information and explanations given to us and based on ourexamination of the records the Company has not entered into non"cash transactions'with the Directors or persons connected 'with them. Accordingly paragraph 3(xv) of theOrder is not applicable.

xvi. The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934. Accordingly the paragraph 3(xvi) of the Order is not applicableto the Company.

For P K NAGARAJAN & Co.
Chartered Accountants
Firm Reg. No. 016676S
VIGNESA SOMATHURAI PANDIAN
Place . Coimbatore Partner
M.No.241168
Date . 24.06.2020 UDIN. 20241168AAAAAL8129

Annexure - B to the Independent Auditors' Report

Referred to in paragraph 17(f) of the Independent Auditors Report of even date to themembers of Bannari Amman Sugars Limited on the financial statements for the year endedMarch 31 2020.

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act").

1. We h ave audited the internal financial controls over financial reporting of BannariAmman Sugars Limited ("the Company ") as of March 31 2020 in conjunction withour audit of the financial Statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

2. TheC ompany 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 Act.

Auditor's Responsibility

3. Our resp onsibility 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 Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the ICAI. Th ose Standards and the Guidance Note require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about 'whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.

4. O ur audit involves performing procedures to obtain audit evidence about theadequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgement including the assessment of therisks of material misstatement of the financial statements whether due to fraud or error.

5. We believe that the audit evidence 'we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the Company s internal financial controlssystem over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

6. A company's internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of 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:

a) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

b) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorization of management and directors of the company; and

c) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

7. Bec ause 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

8. 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 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 P K NAGARAJAN & Co.
Chartered Accountants
Firm Reg. No: 016676S
VIGNESA SOMATHURAI PANDIAN
Partner
Place : Coimbatore M.No. 241168
Date : 24.06.2020 UDIN: 20241168AAAAAL8129

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