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Facor Alloys Ltd.

BSE: 532656 Sector: Metals & Mining
NSE: N.A. ISIN Code: INE828G01013
BSE 10:43 | 20 Apr 3.41 0.16
(4.92%)
OPEN

3.41

HIGH

3.41

LOW

3.27

NSE 05:30 | 01 Jan Facor Alloys Ltd
OPEN 3.41
PREVIOUS CLOSE 3.25
VOLUME 683404
52-Week high 4.26
52-Week low 1.04
P/E
Mkt Cap.(Rs cr) 67
Buy Price 3.41
Buy Qty 199091.00
Sell Price 0.00
Sell Qty 0.00
OPEN 3.41
CLOSE 3.25
VOLUME 683404
52-Week high 4.26
52-Week low 1.04
P/E
Mkt Cap.(Rs cr) 67
Buy Price 3.41
Buy Qty 199091.00
Sell Price 0.00
Sell Qty 0.00

Facor Alloys Ltd. (FACORALLOYS) - Auditors Report

Company auditors report

TO THE MEMBERS OF FACOR ALLOYS LIMITED

Report on the audit of the Standalone Financial Statements

Opinion

We have audited the accompanying Standalone financial statements ofFACOR ALLOYS LIMITED (“the Company”) which comprise the Balance Sheet as atMarch 31 2020 and the Statement of Profit and Loss (including other comprehensiveincome) Statement of changes in Equity and Statement of Cash Flows for the year thenended and notes to the financial statements including a summary of significantaccounting policies and other explanatory information.

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid Standalone financial statements give theinformation required by the Companies Act 2013(“the Act”) in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 312020and total comprehensive income (comprising loss and other comprehensive income) theprofit changes in equity and its cash flows and for the year then ended on that date.

Basis for opinion

We conducted our audit in accordance with the Standards on Auditing(SAs) specified under Section 143(10) of the Act. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theStandalone Financial Statements section of our report. We are independent of the Companyin accordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia (ICAI) together with the ethical requirements that are relevant to our audit of theStandalone financial statements under the provisions of the Act and the Rules thereunderand 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 opinion.

Other information

The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the annualreport but does not include the Standalone financial statements and our auditor's reportthereon.

Our opinion on the Standalone financial statements does not cover theother information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone financial statementsour responsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the Standalone financial statements orour knowledge obtained in the audit or otherwise appears to be materially misstated. Ifbased on the work we have performed we conclude that there is a material misstatement ofthis other information we are required to report that fact.

We have nothing to report in this regard.

Responsibilities of management and those chargedwith governance for the Standalone financial statements

The Company's Board of Directors is 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 changes in equity and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the accounting Standardsspecified under Section 133 of the Act.

This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate implementation and maintenance of accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the Standalone financial statements that give a true andfair view and are free from material misstatement whether due to fraud or error.

In preparing the 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 also responsible for overseeing thecompany's financial reporting process.

Auditor's responsibilities for the audit ofthe Standalone financial statements

Our objectives are to obtain reasonable assurance about whether theStandalone financial statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these Standalone 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 theStandalone financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control.

• Obtain an understanding of internal control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. UnderSection 143(3) (i) of the Act we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls system in place and theoperating effectiveness of such controls.

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

• Conclude on the appropriateness of use of the going concernbasis of accounting and based on the audit evidence obtained whether a materialuncertainty exists 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 Standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of theStandalone financial statements including the disclosures and whether the Standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.

Materiality is the magnitude of misstatements in the standalonefinancial statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the financial statements may beinfluenced. We consider quantitative materiality and qualitative factors in (i) planningthe scope of our audit work and in evaluating the results of our work; and (ii) toevaluate the effect of any identified misstatements in the financial statements.

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 public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould 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(“the Order”) issued by the Central Government of India in terms of sub-section(11) of section 143 of the Act we give in the Annexure A a statement on the mattersspecified in paragraphs 3 and 4 of the Order.

2. As required by section 143(3) of the Act we report to the extentapplicable that:

a. We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit.

b. In our opinion proper books of account as required by law have beenkept by the Company so far as appears from our examination of those books;

c. The Balance Sheet Statement of Profit and Loss including OtherComprehensive Income the Statement of changes in equity and the statement of Cash FlowStatement dealt with by this Report are in agreement with the books of account;

d. In our opinion the aforesaid Standalone financial statements complywith the Indian Accounting Standards specified under Section 133 of the Act.

e. On the basis of the written representations received from thedirectors as on 31st March 2020 and taken on record by the Board of Directors none ofthe directors is disqualified as on 31st March 2020 from being appointed as a director interms of Section 164 (2) of the Act;

f. With respect to the adequacy of the internal financial controls overfinancial reporting of the Company and the operating effectiveness of such controls referto our separate Report in “Annexure B”; and

g. With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 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 itsfinancial position in note no.36 in its standalone financial statements.

ii) The Company did not have any long-term contracts includingderivatives contracts for which there were any material foreseeable losses;

iii) There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.

Ashwin Mankeshwar
Partner
Membership No. 046219
For and on behalf of
K.K. MANKESHWAR & CO.
Place : Nagpur Chartered Accountants
Date : 30th June 2020 Firm's Registration No. 106009W
UDIN:20046219AAAAEX9939

ANNEXURE A TO THE INDEPENDENT AUDITOR'S

REPORT

The Annexure referred to in paragraph 1 under “Report on

Other Legal and Regulatory Requirement” section of our

Independent Auditors' Report to the members of the Company

on the Standalone financial statements for the year ended

March 312020 we report that:

1. In respect of Company's Fixed Asset

a. The Company has maintained proper records showing full particularsincluding quantitative details and situation of fixed Assets.

b. The company has a regular programme of physical verification offixed assets. In our opinion the periodicity of physical verification is reasonablehaving regard to the size of the company and the nature of its asset.

c. The tittle deeds of immovable property are in name of erstwhilepre-demerged company. The immovable properties are transferred by virtue of BIFR OrderNo.314/98 dated 13th April 2004. The immovable properties acquired subsequentto demerger are held in the name of the company.

2. Physical verification of the inventory has been conducted atreasonable intervals by the management. No material discrepancies were noticed.

3. According to the information and explanation given to us theCompany has granted unsecured loans to bodies corporate covered in the registermaintained under Section 189 of Companies Act 2013 in respect of which:

a. The terms and conditions of the grant of such loans are in ouropinion prima facie not prejudicial to the company's interest.

b. The schedule of repayment of principle and payment of interest hasbeen stipulated and found that repayments or receipts of principle amounts and interesthave been regular as per stipulations.

4. In our opinion and according to the information and explanationgiven to us the company has complied with the provision of section 185 and 186 of the Actin respect of loans making investments and providing guarantees and securities asapplicable.

5. According to the information and explanation given to us theCompany has not accepted any deposits during the year.

6. The maintenance of cost records has been prescribed by the CentralGovernment under sub-section (1) of section

148 of the Companies Act 2013 for the business activities carried outby the company and we are of opinion that prima facie such accounts and records have beenmade and maintained

7. According to the information and explanation given to us in respectof statutory dues:

a) The Company has generally been regular in depositing undisputedstatutory dues including Provident Fund Employees' State Insurance Income Tax Goodsand Service Tax Customs Duty Cess and other material statutory dues applicable to itwith the appropriate authorities.

b) There were no undisputed amounts payable in respect of ProvidentFund Employees' State Insurance Income Tax Goods and Service Tax Customs Duty Cessand other material statutory dues in arrears as at March 31 2020 for a period of morethan six months from the date they became payable.

c) Details of dues of Income Tax Sales Tax Service Tax Excise Dutyand Value Added Tax which have not been deposited as at March 312020 on account ofdispute are given below:

Nature of dues Forum where dispute is pending Period to which the amount relates Amount in lakhs*
Service Commissioner 2009 - 2010 14.05
Tax (Appeals) Visakhapatnam
Custom A.P.High Court 1988 - 1989 158.34
Duty Hyderabad
Sales Tax A.P.High Court 2009 - 2010 21.27
Hyderabad 2010-2011
APSTAT- 2011 - 2012
Visakhapatnam 2012 - 2013 8.51
Income Addnl. Comm. 2009 - 2010 30.51
Tax IT (Appeals) 2010 - 2011
Visakhapatnam 2012-2013

* Amount is net of payment under protest

8. In our opinion and according to the information and explanationsgiven to us the Company has not defaulted in the repayment of loans or borrowings tobanks. The company did not have any outstanding loans or borrowings from financialinstitutions or government and there are no dues to debenture holders during the year.

9. The Company has not raised money by way of initial public

offer or further public offer (including debt instruments) and termloan during the year. Accordingly clause (ix) of the paragraph 3 of the Order is notapplicable.

10. According to the information and explanations given to us nomaterial fraud by the Company or on the Company by its officers or employees has beennoticed or reported during the course of our audit.

11. In our opinion and according to the information and explanationgiven to us the company has paid/ provided managerial remuneration in accordance with therequisite approvals mandated by the provisions of section 197 read with schedule V of theAct.

12. As the Company is not a Nidhi Company accordingly clause (xii) ofparagraph 3 of the order is not applicable to the Company

13. According to the information and explanation given to us alltransaction with related parties are in compliance with section 177 and 188 of CompaniesAct 2013 wherever applicable and the details have been disclosed in the StandaloneFinancial Statement etc. as required by the applicable accounting standards.

14. According to the information and explanation given to us thecompany has not made any preferential allotment or private placement of shares or fully orpartly convertible debenture during the year and hence reporting under clause 3(xiv) ofthe order is not applicable to the company.

15. According to the information and explanations given to us and basedon our examination of the records of the Company the Company has not entered intonon-cash transactions with directors or persons connected with him. Accordingly clause(xv) of the paragraph 3 of the Order is not applicable.

16. The Company is not required to be registered under section 45-IA ofthe Reserve Bank of India Act 1934.

Ashwin Mankeshwar
Membership No. 046219
For and on behalf of
K.K. MANKESHWAR & CO.
Place : Nagpur Chartered Accountants
Date : 30th June 2020 Firm's Registration No. 106009W
UDIN:20046219AAAAEX9939

“ANNEXURE B” TO THE INDEPENDENT AUDITOR'S REPORT OF EVENDATE ON THE STANDALONE FINANCIAL STATEMENTS OF FACOR ALLOYS LIMITED

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

I We have audited the internal financial controls over financial freporting of Facor Alloys Limited as of March 31 2020 in conjunction with our audit ofthe Standalone financial statements of the Company for the year ended on that date.

Management's Responsibility for InternalFinancial Controls

The Company's management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting criteria established by ! the Company considering the essentialcomponents of internal * control stated in the 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 to company's policies the safeguarding 1of its assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as ! required under the Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting based on our audit. We conducted our audit inaccordance with the . Guidance Note on Audit of Internal Financial Controls Over ^Financial Reporting (the “Guidance Note”) and the Standards on Auditing issuedby ICAI and deemed to be prescribed Rs. under section 143(10) of the Companies Act 2013to the

^ extent applicable to an audit of internal financial controls both

applicable to an audit of Internal Financial Controls and both issuedby the Institute of Chartered Accountants of India. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was established

and maintained and if such controls operated effectively in all

r

material respects.

 

f Our audit involves performing procedures to obtain auditevidence about the adequacy of the internal financial controls system over financialreporting and their operating Rs. effectiveness. Our audit of internal financial controlsover financial reporting included obtaining an understanding of internal financialcontrols over financial reporting assessing the risk that a material weakness exists andtesting and evaluating the design and operating effectiveness of internal control based onthe assessed risk. The procedures selected depend on the auditor's judgement includingthe assessment s of the risks of material misstatement of the Standalone financial statementswhether 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 overFinancial Reporting

A company's internal financial control over financial reporting is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of Standalone financial statements for external purposes inaccordance with generally accepted accounting principles. A company's internal financialcontrol over financial reporting includes those policies and procedures that (1) pertainto the maintenance of records that in reasonable detail accurately and fairly reflectthe transactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of Standalonefinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the Standalonefinancial statements.

Inherent Limitations of Internal Financial Controls over FinancialReporting

Because of the inherent limitations of internal financial controls overfinancial 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 changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.

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 March 31 2020 basedon the 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.

Ashwin Mankeshwar
Partner
Membership No. 046219
For and on behalf of
K.K. MANKESHWAR & CO.
Place : Nagpur Chartered Accountants
Date : 30th June 2020 Firm's Registration No. 106009W
UDIN:20046219AAAAEX9939

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