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Continental Seeds and Chemicals Ltd.

BSE: 535065 Sector: Others
NSE: CONTI ISIN Code: INE340Z01019
BSE 05:30 | 01 Jan Continental Seeds and Chemicals Ltd
NSE 05:30 | 01 Jan Continental Seeds and Chemicals Ltd

Continental Seeds and Chemicals Ltd. (CONTI) - Auditors Report

Company auditors report

TO THE MEMBERS OF

CONTINENTAL SEEDS AND CHEMICALS LIMITED

CIN: L01111DL1983PLC015969

Report on the Audit of the Standalone Financial Statements

Qualified Opinion

We have audited the standalone financial statements of CONTINENTALSEEDS AND CHEMICALS LIMITED(‘the Company') which comprise the balance sheetas at 31st March 2021 and the statement of Profit and Loss statement of changes inequity and statement of cash flows for the year then ended and notes to the financialstatements including a summary of significant accounting policies and other explanatoryinformation.

In our opinion except for the possible effects of the matter describedin Basis for Qualified Opinion section of our report the aforesaid standalone financialstatements give the information required by the Act in the manner so required and give atrue and fair view in conformity with the accounting principles generally accepted inIndia of the state of affairs of the Company as at March 31 2021 and profit changes inequity and its cash flows for the year ended on that date.

Basis for Opinion

i. We are unable to observe physical inventories of Stock Traded goods finished goodsdue to COVID 19 and we are also unable to satisfy ourselves by alternative meansconcerning the inventories held at 31st March 2021 however as explained by themanagement physical verification of inventories has been conducted at regular intervalsand no material discrepancies were observed.

ii. Balance under Sundry Debtors and Sundry Creditors loans and advances given by theCompany and parties from whom unsecured loans have been taken are subject to confirmationsand adjustments if any required upon such confirmations are not ascertainable and hencenot provided for.

iii. Certain balances of Sundry debtors to Rs. 10 6457382/- wereoutstanding as on 31/03/2021. The confirmations from the parties to whom these amount tobe received have not been made available. Out of such debtors provision for doubtfuldebts should be recognized in respect of debtors outstanding for a period of three yearsor more where no movement has taken place and no confirmations are available. Adjustmentsif any are not ascertainable and will be provided on identification of such parties. Weconducted our audit in accordance with the Standards on Auditing (SAs) specified undersection 143(10) of the Companies Act 2013. Our responsibilities under those Standards arefurther described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountantsof India together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rules thereunder and we have fulfilled our other ethical responsibilities in accordance with theserequirements and the Code of Ethics. We believe that the audit evidence we have obtainedis sufficient and appropriate to provide a basis for our qualified opinion.

Key Audit Matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the financial statements of the current period.These matters were addressed in the context of our audit of the financial statements as awhole and in forming our opinion thereon and we do not provide a separate opinion onthese matters.

Responsibilities of Management and Those Charged with Governance forthe Standalone Financial Statements

The Company's Board of Directors is responsible for the mattersstated in section 134(5) of the Companies Act 2013 ("the Act") with respect tothe preparation of these standalone financial statements that give a true and fair view ofthe financial position financial performance changes in equity and cash flows of theCompany in accordance with the accounting principles generally accepted in Indiaincluding the accounting Standards specified under section 133 of the Act. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror. In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.

Auditor's Responsibilities for the Audit of the FinancialStatements

Our objectives are to obtain reasonable assurance about whether thefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonableassurance is a high level of assurance but is not a guarantee that an audit conducted inaccordance with SAs will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these financial statements.

As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional scepticism throughout the audit. We also:

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.

Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theCompanies Act 2013 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.

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

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 theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause theCompany to cease to continue as a going concern.

Evaluate the overall presentation structure and content of the financial statementsincluding the disclosures and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the financialstatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.

Report on Other Legal and Regulatory Requirements

1 As required by the Companies (Auditor's Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Companies Act 2013 we give in the "Annexure A" a statementon the matters specified in paragraphs 3 and 4 of the Order to the extent applicable.

2 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 standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.

(e) On the basis of the written representations received from the directors as on 31stMarch 2021 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2021 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) 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 does not have any pending litigations which would impact its financialposition

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 tothe Investor Education and Protection Fund by the Company.

For PMAS And Associates LLP
Chartered Accountants
Firm's Regn. No. 024726N/N500068
Sd/-
CA Neha Jawa
Partner
Membership No. 529237
New Delhi: 30.06.2021

"ANNEXURE A" TO THE INDEPENDENT AUDITORS' REPORT

With reference to the Annexure A referred to in the Independent Auditor's Reportto the members of the Company on the standalone financial statements for the year ended 31March 2021 we report the following:

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

(b) As explained to us fixed assets have been physically verified by the Managementduring the year in accordance with the phased programme of verification adopted by themanagement which in our opinion provides for physical verification of all the fixedassets at reasonable intervals. According to the information and explanations given to usno material discrepancies were noticed on such verification.

(c) According to information and explanations given to us and on the basis of ourexamination of the records of the company the title deeds of immovable properties areheld in the name of the company.

(ii) The Management physically verified the inventories of finished goods semi-finished goods and raw materials at regular intervals. The management has informed usthat no Material discrepancies were reported during such physical verification.

(iii) According to the information and explanations given to us the Company has notgranted any loans to companies firms or other parties covered in the Register maintainedunder Section 189 of the Companies Act 2013; and therefore paragraph 3(iii) of the Orderis not applicable

(iv) In The Company has provided continuing corporate guarantee in violation ofprovisions of section 185 & 186 on behalf of related partnership firm to the tune ofRs.10.60 Crore to obtain the credit facilities.(refer additional note no. 2.16).

(v) The company has accepted deposits in term of provisions of sections 73 to 76 of thecompanies Act 2013. Further we are informed that no order has been passed by the CompanyLaw Board or National Company Law Tribunal or Reserve Bank of India or any Court or anyother Tribunal(refer additional note no. 2.17)

(vi) As informed to us the Central Government has not prescribed maintenance of costrecords under sub-section (1) of Section 148 of the Act in respect of the activitiescarried on by the Company.

(vii) (a) According to the records of the company and information and explanationsgiven to us the Company has generally been regular in depositing undisputed statutorydues including Income-tax Tax deducted at sources Tax collected at source ProfessionalTax Sales Tax value added tax Goods and Service Tax Wealth Tax Service Tax CustomDuty Excise Duty Cess and other material statutory dues applicable to it with theappropriate authorities;

(b) According to the information and explanations given to us there were no disputedamounts payable in respect of Income-tax Wealth Tax Custom Duty Excise Duty sales taxVAT GST Cess and other material statutory dues in arrears /were outstanding as at 31March 2021 for a period of more than six months from the date they became payable.

(viii) According to the information and explanations given to us there was no defaultin repayment of dues to the financial institutions or bank. Further the company has notissued any Debentures.

(ix) In our opinion and according to the information and explanations given to us theCompany did not raise any money by way of initial public offer or further public offer(including debt instruments) and term loans except Term Loan including GCL of Rs. 255.38Lacs during the year. Accordingly paragraph 3(ix) of the Order is not applicable to theCompany.

(x) According to the information & explanations given to us no fraud on or by thecompany has been noticed or reported during the year under report.

(xi) In our opinion the managerial remuneration for the year ended March 31 2021 hasbeen paid/provided by the Company to its directors in accordance with the provisions ofsection 197 read with Schedule V to the Act.

(xii) Since the company is not a Nidhi Company this clause is not applicable upon it.

(xiii) All the transactions with the related parties are in compliance with sections177 and 188 of Companies Act 2013 and their details have been disclosed in the financialstatements as per the applicable accounting standards.

(xiv) During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly paid convertible debentures and hence reportingunder clause 3(xiv) of the Order is not applicable to the Company.

(xv) According to the information and explanations given to us company has not enteredinto any non-cash transactions with the persons connected with director details.Therefore the provisions of section 192 of Companies Act 2013 is not required to becomplied.

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

For PMAS And Associates LLP
Chartered Accountants
Firm's Regn. No. 024726N/N500068
Sd/-
CA Neha Jawa
Partner
Membership No. - 529237
New Delhi: 30.06.2021

" ANNEXURE B" TO THE INDEPENDENT AUDITORS' REPORT

Report on the Internal Financial Controls under Clause ( i ) ofSub-section 3 of Section 143 of the Companies Act2013(" the Act " )

We have audited the internal financial controls over financialreporting of Continental Seeds & Chemicals Limited ("the Company") asof March 31 2021 in conjunction with our audit of the Standalone financial statements ofthe Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing andmaintaining internal financial controls based on Guidance Note on Audit of InternalFinancial Controls over Financial Reporting issued by the Institute of CharteredAccountants of India .These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence tocompany's policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company'sinternal financial controls over the financial reporting based on our audit. We conductedour audit in accordance with the Guidance Note on Audit of Internal Financial Controlsover Financial Reporting (the "Guidance Note") and the Standards on Auditingissued by ICAI and deemed to be prescribed under Section 143(10) of the Companies Act2013 to the extent applicable to an audit of internal financial controls both applicableto an audit of Internal Financial Controls and both issued by the Institute of CharteredAccountants of India. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate 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 aboutthe adequacy of the internal financial controls 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 judgment including the assessment of therisks of material misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting isa process designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial controlover financial reporting includes those policies and procedures that

(1) Pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany;

(2) Provide reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorities of management and directors of the company;and

(3) Provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition use or disposition of the company's assetsthat could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over FinancialReporting

Because of the inherent limitations of the internal financial controlsover financial reporting including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of the changes inconditions or that the degree of compliance with the policies or procedures maydeteriorate.

Opinion

In our opinion the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31 March 2021 based onthe internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.

For PMAS And Associates LLP
Chartered Accountants
Firm's Regn. No. 024726N/N500068
Sd/-
CA Neha Jawa
Partner
Membership No. - 529237
New Delhi: 30.06.2021

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