You are here » Home » Companies » Company Overview » CIL Nova Petrochemicals Ltd

CIL Nova Petrochemicals Ltd.

BSE: 533407 Sector: Industrials
NSE: CNOVAPETRO ISIN Code: INE672K01025
BSE 00:00 | 10 Jul 7.00 0
(0.00%)
OPEN

7.30

HIGH

7.32

LOW

7.00

NSE 15:53 | 14 Jul 7.00 0.30
(4.48%)
OPEN

6.40

HIGH

7.00

LOW

6.40

OPEN 7.30
PREVIOUS CLOSE 7.00
VOLUME 3301
52-Week high 12.50
52-Week low 3.80
P/E
Mkt Cap.(Rs cr) 19
Buy Price 7.00
Buy Qty 278.00
Sell Price 7.30
Sell Qty 98.00
OPEN 7.30
CLOSE 7.00
VOLUME 3301
52-Week high 12.50
52-Week low 3.80
P/E
Mkt Cap.(Rs cr) 19
Buy Price 7.00
Buy Qty 278.00
Sell Price 7.30
Sell Qty 98.00

CIL Nova Petrochemicals Ltd. (CNOVAPETRO) - Auditors Report

Company auditors report

To

The Members of

CIL Nova Petrochemicals Limited

Report on the Audit of the Financial Statements Opinion

1. We have audited the financial statements of CIL Nova Petrochemicals Limited("the Company") which comprise the Balance Sheet as at 31stMarch2019 and the Statement of Profit and Loss the Statement of Changes in Equity andStatement of Cash Flows for the year then ended and notes to the financial statementsincluding a summary of the significant accounting policies and other explanatoryinformation.

2. In our opinion and to the best of our information and according to theexplanations given to us the aforesaid financial statements give the information requiredby the Companies Act 2013 (the ‘Act') in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in Indiaincluding Indian Accounting Standards (‘Ind AS') specified under Section 133 of theAct of the state of affairs of the Company as at 31 March 2019 and its profit totalcomprehensive income its cash flows and the changes in equity for the year ended on thatdate.

Basis for Opinion

3. We conducted our audit in accordance with the Standards on Auditing 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 together with the ethicalrequirements that are relevant to our audit of the financial statements under theprovisions of the Companies Act 2013 and the Rules there under and we have ful-lled ourethical responsibilities in accordance with these requirements and the Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our opinion.

Key Audit Matters

4. Key audit matters are those matters that in our professional judgment were ofmost significance in our audit of the standalone financial statements of the currentperiod. These matters were addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereon and we do not provide a separateopinion on these matters.

5. Key audit matter identified in our audit is on recoverability assessment oftrade receivables as follows:

Key audit matter How our audit addressed the key audit matter
Measurement of Expected Credit Loss on Trade Receivables
Trade receivables amount to Rs.401880478/- after providing for an impairment based on expected credit loss methodofRs.3993229/-Themeasurement of expected credit loss is based on provision matrix that identi-es receivables on number of days remaining outstanding and empirical data on recoverability. This Provision matrix requires to be updated regularly based on the circumstantial evidences which may result in significant variation in measurement from one period to other. The management's estimations for impairment based on expected credit loss method our audit procedures included the following:
• Obtained a list of receivables
• We analysed the aging of receivables;
• Identified any receivables with financial di-culty through discussion with management;
• We obtained receivables balance confirmations on a sample basis;
• Tested subsequent settlement of receivables after the balance sheet date on a sample basis;
• In respect of receivables overdue for a period of 90 days or more we assessed the recoverability through inquiry with management and by obtaining sufficient corroborative evidence to support the conclusions.

Information other than the Standalone Financial Statements and Auditors' Report thereon

6. The Company's Board of Directors is responsible for the other information. Theother information comprises the information included in the Annual Report but does notinclude the standalone financial statements and our auditor'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 identified above when it becomes available and in doingso consider whether the other information is materially inconsistent with the financialstatements or our knowledge obtained in the audit or otherwise appears to be materiallymisstated.

When we read the Annual Report if we conclude that there is a material misstatementtherein we are required to communicate the matter to those charged with governance and asmay be legally advised.

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

7. The Company's Board of Directors is responsible for the matters stated inSection 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 changes in equity and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding the assets of the Company and for preventing and detecting fraudsand other irregularities; selection and application of appropriate implementation andmaintenance of accounting policies; making judgments 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.

8. In preparing the financial statements management is responsible for assessingthe Company'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.

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

Auditors' Responsibilities for the Audit of the Standalone Financial Statements

10. 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 in-uence the economic decisions of users taken on thebasis of these financial statements.

11. As part of an audit in accordance with SAs we exercise professional judgmentand maintain 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 of opinion. The risk of not detecting a material misstatement resulting from fraudis higher than for our resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.

• 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 control 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 the 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 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.

• 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.

12. We communicate with those charged with governance regarding among othermatters the planned scope and timing of the audit and significant audit -ndingsincluding any significant defficiencies in internal control that we identify during ouraudit.

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

14. 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

15. As required by the Companies (Auditor's Report) Order2016 ("theOrder") issued by the Central Government of India in terms of subsection (11) ofSection 143 of the Act we give in "Annexure A"a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

16. As required by Section 143(3) of the Act we report that:

a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.

c) The Balance Sheet the Statement of Profit and Loss and the Cash Flow Statementdealt with by this Report are in agreement with the books of account.

d) In our opinion the aforesaid financial statements comply with the Ind AS Specifiedunder 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 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 ofSection164(2) of the Act.

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

g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financialposition in the financial statements- Refer Note -38 to the Financial Statement;

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 Fund by the Company.

For Samir M. Shah &Associates
Chartered Accountants
[Firm Regd. No. 122377W]
Sd/-
(S. M. Shah)
Place : Ahmedabad Partner
Date : 29/05/2019 [M. No. 111052]

Annexure "A" to the Independent Auditors' Report of even date on theStandalone Financial Statements of CIL Nova Petrochemicals Limited

Referred to in paragraph 15 of our Report of even date to the Members of CIL NovaPetrochemicals Limited for the year ended 31st March 2019

1. In respect of Fixed Assets :

(a) The Company has maintained proper records showing full particulars includingquantitative details and situation of Fixed Assets on the basis of available information.

(b) As per the information and explanations given to us the management at reasonableintervals during the year in accordance with a programme of physical verificationphysically verified the fixed assets and no material discrepancies were noticed on suchverification as compared to the available records.

(c) As explained to us the title deeds of all the immovable properties are held in thename of the Company's name.

2. In respect of Inventories :

As per the information and explanations given to us inventories were physicallyveri-ed during the year by the management at reasonable intervals. No material discrepancywas noticed on such physical verification.

3. In respect of Loans and Advances grantedduring the year:

As regards the loans the Company has not granted any loans secured or unsecuredduring the year under audit to the Companies firms and other parties covered in theregister maintained under section 189 of the Companies Act 2013 and therefore theclauses (iii) (a) to (c) of the Companies (Auditor's Report) Order 2016 are notapplicable.

4. Loans Investments and guarantees:

In our opinion and according to information and explanations given to us the Companyhas complied with provisions of Section 185 and 186 of the Companies Act 2013 in respectof loans investments guarantees and security.

5. Acceptance of Deposits:

During the year the Company has not accepted any deposits and hence the directivesissued by the Reserve Bank of India and the provisions of sections 73 to 76 or any otherrelevant provisions of the Companies Act2013 and the rules framed there under are notapplicable to the Company. Therefore clauses (v) of Companies (Auditor's Report) Order2016 is not applicable.

6. Cost Records:

Pursuant to the rules made by the central government of India the Company is requiredto maintain cost records as specified under section 148(1) of the Act.

We have broadly reviewed the same and are of the opinion that prima facie theprescribed accounts and records have been made and maintained. However we have not made adetailed examination of the cost records with a view to determine whether they areaccurate or complete.

7. In respect of Statutory Dues :

(a) According to the records of the Company the Company is generally regular indepositing with appropriate authorities undisputed statutory dues including providentfund employees' state insurance income tax Value added tax Central Sales Tax Goodsand Service Tax service tax duty of customs duty of excise cess and any otherstatutory dues with the appropriate authorities applicable to it. According to theinformation and explanations given to us no undisputed amounts payable in respect ofstatutory dues were outstanding as at 31st March 2019 for a period of morethan six months from the date they became payable.

(b) According to the records of the Company the dues of income tax service tax dutyof customs duty of excise value added tax central sales tax or cess which have not beendeposited on account of disputes and the forum where the dispute is pending are as under:

Name of the Statute Nature of the Dues Year Amount (Rs.) Forum where dispute is pending
Income Tax Act1961 Income Tax Demand & Interest 2011-12 1141960 Income Tax Appellate Tribunal
The Central Excise and Customs Act Excise Duty & Penalty 2003-04 3230730 Custom Excise and Service Tax Appellate Tribunal
The Finance Act1994 Service Tax & Penalty 2004-05 3398641 Custom Excise and Service Tax Appellate Tribunal
Service Tax & Penalty 2005-06 146479 Assistant Commissioner of Central Excise
The Textile Committee Amendment Act 1973 Textile Cess 1995 to 2005 5090119 Textiles Committee Government of India Ministry of Textiles
Gujarat Pollution Control Act Compensation 2004 to 2010 5164620 High Court of Gujarat

8. Based on our audit procedure and according to the information and explanationgiven to us we are of the opinion that the Company has not defaulted in repayment of duesto Banks or Government. The Company has no debenture holder or any financial institutionalborrowing during the year.

9. According to the information and explanations given to us the Company had notraised any money by way of public issue during the year. According to the information andexplanations given to us and on an overall examination of the balance sheet of theCompany in our opinion the term loans taken during the year were applied for the purposefor which they were obtained.

10. Based upon the audit procedures performed and information and explanationsgiven by the management we report that no fraud by the Company or any fraud on theCompany by it's officer or employees has been noticed or reported during the course of ouraudit.

11. In our opinion and according to the information and explanations given to usthe Company had paid managerial remuneration which is in accordance with the requisiteapprovals mandated by the provisions of section 197 read with schedule V of The CompaniesAct 2013.

12. In our opinion and according to the information and explanations given to usthe provisions of special statute applicable to chit funds and nidhi / mutual benefitfunds / societies are not applicable to the Company. Hence Clause 3(xii) of the Company's(Auditor's Report) Order 2016 is not applicable.

13. In our opinion and according to the information and explanations given to usthe transactions entered by the Company with related parties are in compliance with theprovisions of section 177 and 188 of the Companies Act 2013 and details thereof areproperly disclosed in the financial statements as required by the applicable accountingstandard.

14. The company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review. Henceclause (xiv) of the Company's (Auditor's Report) Order 2016 is not applicable.

15. The Company had not entered in to any non-cash transactions with the directorsor persons connected with him during the year hence section 192 of the Companies Act2013 is not Applicable hence clause (xvi) of Company's (Auditor's Report) Order 2016 isnot applicable.

16. As the Company is not required to register under section 45-IA of Reserve Bankof India Act 1934 hence clause (xvi) of Company's (Auditor's Report) Order 2016 is notapplicable.

For Samir M. Shah &Associates
Chartered Accountants
[Firm Regd. No. 122377W]
Sd/-
(S. M. Shah)
Place : Ahmedabad Partner
Date : 29/05/2019 [M. No. 111052]

Annexure "B" To Independent Auditors' Report

Referred to in paragraph 16(f) of "Report on Other Legal and RegulatoryRequirements" of our Report of even date to the Members of CIL NovaPetrochemicals Limited for the year ended 31st March 2019.

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 CIL NovaPetrochemicals Limited as of 31st March 2019 in conjunction with our audit ofthe standalone financial statements of the Company for the year ended on that date.

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. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe 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 Samir M. Shah &Associates
Chartered Accountants
[Firm Regd. No. 122377W]
Sd/-
(S. M. Shah)
Place : Ahmedabad Partner
Date : 29/05/2019 [M. No. 111052]