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Gulf Oil Lubricants India Ltd.

BSE: 538567 Sector: Industrials
NSE: GULFOILLUB ISIN Code: INE635Q01029
BSE 00:00 | 28 Jul 638.05 -9.80
(-1.51%)
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651.75

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651.75

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636.80

NSE 00:00 | 28 Jul 637.40 -10.50
(-1.62%)
OPEN

648.00

HIGH

651.00

LOW

635.40

OPEN 651.75
PREVIOUS CLOSE 647.85
VOLUME 1444
52-Week high 846.15
52-Week low 565.10
P/E 16.05
Mkt Cap.(Rs cr) 3,213
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 651.75
CLOSE 647.85
VOLUME 1444
52-Week high 846.15
52-Week low 565.10
P/E 16.05
Mkt Cap.(Rs cr) 3,213
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Gulf Oil Lubricants India Ltd. (GULFOILLUB) - Auditors Report

Company auditors report

To the Members of Gulf Oil Lubricants India Limited

Report on the audit of the financial statements

Opinion

1. We have audited the accompanying financial statements of Gulf Oil Lubricants IndiaLimited (“the Company”) which comprise the balance sheet as at March 31 2020and the statement of Profit and Loss (including Other Comprehensive Income) statement ofchanges in equity and statement of cash flows for the year then ended and notes to thefinancial 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 total comprehensive income(comprising of profit and other comprehensive income) changes in equity and its cashflows for the year then ended.

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 together with the ethicalrequirements 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 judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.

Key audit matter description How our audit addressed the key audit matter
Our procedures included the following :
Estimation of year-end secondary trade accruals towards rebates and discounts [Refer to note 2.3 (D) to the financial statements] • Understood and evaluated the design and tested the operating effectiveness of the controls over calculation and completeness of recording of the secondary trade accruals.
Revenue from sale of goods is measured net of rebates and discounts given to customers on the Company's sales. • Obtained management's calculations for the secondary trade accruals in respect of relevant schemes and validated the information (generated from the Company's systems and applications) and assessed the reasonableness of assumptions used by the management in determining the amount of accruals as at the year end.
The provision for rebates and discounts relating to secondary sales (i.e. sales made by Company's distributors/retailers to their customers) (“the secondary trade accruals towards rebates and discounts”) has been considered as a key audit matter as it's computation involves estimation and judgment in determination of the likelihood of the amount at which these are expected to be settled. • Assessed the reasonableness of estimates made by the Company for secondary trade accruals by comparing the provisions recognised in earlier periods with the subsequent claims settled by the Company and checked that there were no significant adjustments to the estimates made in the past.
The estimation of the year-end secondary trade accruals towards rebates and discount requires evaluation of various schemes for rebates and discounts which are often revised considering the market and competitive factors. Management considers historical and secondary sales forecast for the respective schemes to determine the likely amount at which the secondary trade accruals are expected to be settled. • Verified the credit notes for rebates and discounts issued subsequent to the balance sheet date to assess the reasonableness of the amounts recognised and to identify any significant unaccounted secondary trade accruals. Based on the above procedures performed we found the management's estimate for the year-end secondary trade accruals towards rebates and discounts to be reasonable.
The secondary trade accruals as at March 31 2020 accounts for approximately between 1% to 2% of the Company's revenue from operation for the year ended March 31 2020.

Other Information

5. The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the annual report but does not includethe financial statements and our auditor's report thereon. The annual report is expectedto be made available to us after the date of this auditor's report.

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

In connection with our audit of the financial statements our responsibility is to readthe other information identified above when it becomes available and in doing soconsider 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 andtake appropriate action as applicable under the relevant laws and regulations.

Responsibilities of management and those charged with governance for the financialstatements

6. The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these financial statements that givea true and fair view of the financial position financial performance changes in equityand cash flows of the Company in accordance with the accounting principles generallyaccepted in India including the accounting Standards specified under section 133 of theAct. This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statement that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

7. 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. Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.

Auditor's responsibilities for the audit of the financial statements

8. 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.

9. As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional scepticism 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 for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional 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 controls with reference to financial statements in place andthe operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management. Conclude on theappropriateness of management's use of the going concern basis of accounting and based onthe audit evidence obtained whether a material uncertainty exists related to events orconditions that may cast significant doubt on the Company's ability to continue as a goingconcern. If we conclude that a material uncertainty exists we are required to drawattention in our auditor's report to the related disclosures in the financial statementsor if such disclosures are inadequate to modify our opinion. Our conclusions are basedon the audit evidence obtained up to the date of our auditor's report. However futureevents or conditions may cause the Company to cease to continue as a 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.

10. 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.

11. We also 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.

12. 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

13. 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 Act we give in the Annexure B a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.

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

(a) We have sought and obtained all the information and explanations which tothe best of 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 (including other comprehensiveincome) the Statement of Changes in Equity and the Cash Flow Statement dealt with by thisReport are in agreement with the books of account.

(d) In our opinion the aforesaid financial statements comply with the AccountingStandards specified under Section 133 of the Act.

(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 31 2020 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 with reference tofinancial statements of the Company and the operating effectiveness of such controlsrefer to our separate Report in “Annexure A”.

(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 its financial statements Refer Note 38 to the financial statements.

ii. The Company has long-term contracts as at March 31 2020 for which there were nomaterial foreseeable losses. The Company does not have long-term derivative contracts asat March 31 2020.

iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company during the year ended March 31 2020.

iv. The reporting on disclosure relating to Specified Bank Notes is not applicable tothe Company for the year ended March 31 2020.

15. The Company has paid/provided for managerial remuneration in accordance with therequisite approvals mandated by the provision of section 197 read with Schedule V to theAct.

For Price Waterhouse LLP

Firm Registration Number: 301112E/ E300264

Chartered Accountants

Arunkumar Ramdas

Partner

Membership Number: 112433

UDIN: 20112433AAAAGC5173

Place: Mumbai

Date: June 17 2020

ANNEXURE A TO INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 14(f) of the Independent Auditors' Report of even date to themembers of Gulf Oil Lubricants India Limited on the financial statements for the yearended March 31 2020

Report on the Internal Financial Controls with reference to financial statements underClause (i) of Subsection 3 of Section 143 of the Act

1. We have audited the internal financial controls with reference to financialstatements of Gulf Oil Lubricants India Limited (“the Company”) as of March 312020 in conjunction with our audit of the financial statements of the Company for the yearended on that date.

Management's Responsibility for Internal Financial Controls

2. The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India (ICAI). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Act.

Auditors' Responsibility

3. Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to financial statements based on our audit. We conducted our auditin accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the “Guidance Note”) and the Standards on Auditing 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. Those Standards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether adequate internal financial controls with reference to financial statementswas established and maintained and if such controls operated effectively in all materialrespects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the internal financial controls system with reference to financial statements and theiroperating effectiveness. Our audit of internal financial controls with reference tofinancial statements included obtaining an understanding of internal financial controlswith reference to financial statements assessing the risk that a material weaknessexists and testing and evaluating the design and operating effectiveness of internalcontrol based on the assessed risk. The procedures selected depend on the auditor'sjudgement including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error.

5. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemwith reference to financial statements.

Meaning of Internal Financial Controls with reference to financial statements

6. A company's internal financial controls with reference to financial statements is aprocess 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 controlswith reference to financial statements includes those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial 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 financialstatements.

Inherent Limitations of Internal Financial Controls with reference to financialstatements

7. Because of the inherent limitations of internal financial controls with reference tofinancial statements 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 withreference to financial statements to future periods are subject to the risk that theinternal financial controls with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.

Opinion

8. In our opinion the Company has in all material respects an adequate internalfinancial controls system with reference to financial statements and such internalfinancial controls with reference to financial statements were operating effectively as atMarch 31 2020 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.

For Price Waterhouse LLP

Firm Registration Number: 301112E/ E300264

Chartered Accountants

Arunkumar Ramdas

Partner

Membership Number: 112433

UDIN: 20112433AAAAGC5173

Place: Mumbai

Date: June 17 2020

ANNEXURE B TO INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 13 of the Independent Auditors' Report of even date to themembers of Gulf Oil Lubricants India Limited on the financial statements as of and for theyear ended March 2020 31

i. (a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) The fixed assets of the Company have been physically verified by the Managementduring the year and no material discrepancies have been noticed on such verification. Inour opinion the frequency of verification is reasonable.

(c) The title deeds of immovable properties as disclosed in Note 3 on Property Plant& Equipment to the financial statements are held in the name of the Company.

ii. The physical verification of inventory excluding stocks with third parties havebeen conducted at reasonable intervals by the Management during the year. In respect ofinventory lying with third parties these have substantially been confirmed by them. Thediscrepancies noticed on physical verification of inventory as compared to book recordswere not material.

iii. The Company has not granted any loans secured or unsecured to companies firmsLimited Liability Partnerships or other parties covered in the register maintained underSection 189 of the Act. Therefore the provisions of Clause 3(iii) (iii)(a) (iii)(b) and(iii)(c) of the said Order are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 185 and 186 of the Companies Act 2013in respect of the loans and investments made and guarantees and security provided by it.

v. The Company has not accepted any deposits from the public within the meaning ofSections 73 74 75 and 76 of the Act and the Rules framed there under to the extentnotified.

vi. Pursuant to the rules made by the Central Government of India the Company isrequired to maintain cost records as specified under Section 148(1) of the Act in respectof its products. We have broadly reviewed the same and are of the opinion that primafacie the prescribed accounts and records have been made and maintained. We have nothowever made a detailed examination of the records with a view to determine whether theyare accurate or complete.

vii. (a) According to the information and explanations given to us and the records ofthe Company examined by us in our opinion the Company is regular in depositing theundisputed statutory dues including provident fund employees' state insurance incometax sales tax service tax duty of customs duty of excise value added tax cess goodsand services tax and other material statutory dues as applicable with the appropriateauthorities

Further for the period March 1 2020 to March 31 2020 the Company has paid Goods andService Tax and filed Form No. GSTR 3B (after the due date but) within the timelinesallowed by Central Board of Indirect Taxes and Customs under the Notification No. 32/2020- Central Tax dated April 03 2020 on fulfillment of the conditions specified therein.

(b) According to the information and explanations given to us and the records of theCompany examined by us there are no dues of service tax duty of customs and goods andservices tax which have not been deposited on account of any dispute. The particulars ofdues of income tax sales tax value added tax and duty of excise as at March 31 2020which have not been deposited on account of a dispute are as follows:

Name of the statute Nature of dues Amount (Rs in lacs)* Period to which the amount relates Forum where the dispute is pending
Income Tax Act 1961 Income Tax 43.34 1999-2001 2003-2004 2005-2006 and 2012-2014 (Assessment Year) Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Income Tax 86.51 1998-1999 and 2011-2012 (Assessment Year) High Court
Income Tax Act 1961 Income Tax 15.05 2006-2007 (Assessment Year) Supreme Court
Income Tax Act 1961 Income Tax 13.26 2010-2011 (Assessment Year) Appellate Tribunal
Local Sales Tax Act VAT Act and Central Sales Tax Act Sales Tax 2105.13 2003-2005 and 2010-2011 Appellate Tribunal
Local Sales Tax Act VAT Act and Central Sales Tax Act Sales Tax 2647.62 2006-2013 and 2015-2016 Joint Commissioner of Sales Tax
Local Sales Tax Act VAT Act and Central Sales Tax Act Sales Tax 6.54 1999-2000 High Court
Local Sales Tax Act VAT Act and Central Sales Tax Act Sales Tax 10.57 1997-2000 and 2010-2011 Assistant Commissioner of Commercial Tax
Local Sales Tax Act VAT Act and Central Sales Tax Act Sales Tax 42.40 2012-2013 and 2014-2015 Commissioner of Sales Tax
Central Excise Custom and Service Tax Excise Duty 22.76 2007-2008 and 2009-2010 Appellate Tribunal

* Net of amounts paid under protest.

viii. According to the records of the Company examined by us and the information andexplanation given to us the Company has not defaulted in repayment of loans or borrowingsto any bank. The Company does not have any borrowings from any financial institution orgovernment nor has it issued any debentures as at the balance sheet date.

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

x. During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.

xi. The Company has paid/ provided for managerial remuneration in accordance with therequisite approvals mandated by the provisions of Section 197 read with Schedule V to theAct. Also refer paragraph 15 of our main audit report.

xii. As the Company is not a Nidhi Company and the Nidhi Rules 2014 are not applicableto it the provisions of Clause 3(xii) of the Order are not applicable to the Company.

xiii. The Company has entered into transactions with related parties in compliance withthe provisions of Sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the financial statements as required under IndianAccounting Standard (Ind AS) 24 Related Party Disclosures specified under Section 133 ofthe Act.

xiv. The Company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year under review. Accordingly theprovisions of Clause 3(xiv) of the Order are not applicable to the Company.

xv. The Company has not entered into any non-cash transactions with its directors orpersons connected with him. Accordingly the provisions of Clause 3(xv) of the Order arenot applicable to the Company.

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

For Price Waterhouse LLP

Firm Registration Number: 301112E/ E300264

Chartered Accountants

Arunkumar Ramdas

Partner

Membership Number: 112433

UDIN: 20112433AAAAGC5173

Place: Mumbai

Date: June 17 2020

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