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Hariyana Ship Breakers Ltd.

BSE: 526931 Sector: Others
NSE: N.A. ISIN Code: INE400G01011
BSE 00:00 | 24 Jan 44.00 -0.35
(-0.79%)
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47.00

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NSE 05:30 | 01 Jan Hariyana Ship Breakers Ltd
OPEN 47.00
PREVIOUS CLOSE 44.35
VOLUME 1050
52-Week high 78.00
52-Week low 36.20
P/E 3.53
Mkt Cap.(Rs cr) 27
Buy Price 42.10
Buy Qty 1000.00
Sell Price 47.00
Sell Qty 5.00
OPEN 47.00
CLOSE 44.35
VOLUME 1050
52-Week high 78.00
52-Week low 36.20
P/E 3.53
Mkt Cap.(Rs cr) 27
Buy Price 42.10
Buy Qty 1000.00
Sell Price 47.00
Sell Qty 5.00

Hariyana Ship Breakers Ltd. (HARIYANASHIP) - Auditors Report

Company auditors report

To

The members of Hariyana Ship Breakers Limited

Report on the Audit of the Standalone Ind AS Financial Statements

Opinion

We have audited the accompanying standalone Ind AS financial statements of HariyanaShip Breakers Limited (“the Company”) which comprises the Balance Sheet as atMarch 31 2019 the Statement of Profit and Loss (including Other Comprehensive Income)statement of changes in equity and statement of cash flow for the year then ended andnotes to the financial statements including a summary of significant accounting policiesand other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Companies Act 2013 (“the Act”) in the manner so required andgive a true and fair view in conformity with the accounting principles generally acceptedin India of the state of affairs of the Company as at March 31 2019 and totalcomprehensive income (comprising of profit and other comprehensive income) changes inequity and its cash flows for the year ended.

Basis for Opinion

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 Standalone Ind ASFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thestandalone Ind AS financial statements under the provisions of the Act and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone Ind AS financial statements of the currentperiod. These matters were addressed in the context of our audit of the standalone Ind ASfinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report.

Key Audit Matter Auditor's Response
Evaluation of uncertain tax positions Principal Audit Procedures
The Company has material uncertain tax positions including matters under dispute which involves significant judgment to determine the possible outcome of these disputes. Obtained details of completed tax assessments and demands for the year ended March 31 2019 from management.
Obtained understanding of key uncertain tax positions.
- Discussed with appropriate senior management and evaluated management's underlying key assumptions in estimating the tax provisions.
- Assessed management's estimates of the possible outcome of the disputed cases.

Information Other than the Standalone Ind AS Financial Statements and Auditor's ReportThereon

The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the AnnualReport but does not include the standalone Ind AS financial statements and our auditor'sreport thereon.

Our opinion on the standalone Ind AS financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone Ind AS financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone Ind AS financialstatements or our knowledge obtained during the course of our audit or otherwise appearsto be materially misstated.

If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.

Responsibility of Management and those charged with governance for the Standalone IndAS Financial Statements

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 standalone Ind AS 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 ofadequate accounting records in accordance with the provisions of the Act for safeguardingof the assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate implementation and maintenance ofaccounting 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 standalone Ind AS financialstatement that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone Ind AS 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. Those Board of Directors are also responsible foroverseeing the company's financial reporting process.

Auditor's Responsibility for the Audit of the Standalone Ind AS Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone Ind ASfinancial 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. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone Ind AS financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the standalone Ind ASfinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstate- mentresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal financial controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for ex- pressing our opinion on whether theCompany has adequate internal financial controls with reference to standalone Ind ASfinancial statements in place and the 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 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 uncer- taintyexists we are required to draw attention in our auditor's report to the relateddisclosures in the standalone Ind AS 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 condi- tionsmay cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of the standalone IndAS financial statements includ- ing the disclosures and whether the standalone Ind ASfinancial statements represent the underlying transac- tions and events in a manner thatachieves fair presentation.

We communicate with those charged with governance regarding the planned scope andtiming of the audit and significant audit findings including any significant deficienciesin internal control that we identify during our audit.

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

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone Ind AS 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 ofthe Act we give in the Annexure - A statement on the matters specified in the paragraph 3and 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 (including other comprehensiveincome) the state- ment of changes in equity and the cash flow statement dealt with bythis Report are in agreement with the books of account;

d. in our opinion and except for the effects of our qualified opinion the aforesaidstandalone Ind AS financial statements comply with the Accounting Standards 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 March31 2019 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2019 from being appointed as a director in terms of Section 164 (2) of theAct;

f. with respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in “Annexure B” to this report; and

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 accord- ing to the explanations given to us:

i. the Company has disclosed impact of pending litigations which could materiallyimpact its financial statements - Refer Note 3.10 of the standalone Ind AS financialstatements

ii. the Company has made provisions wherever applicable for material foreseeablelosses if any on long term contracts. The company did not have any long term derivativecontracts as at March 31 2019.

iii. there has been no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.

For Lahoti Navneet & Co. For P. D. Goplani & Associates
Chartered Accountants Chartered Accountants
FRN : 116870W FRN : 118023W
Sd/- Sd/-
CA Sanjay Soni CA Prem Goplani
Partner Partner
M. No. 114835 M. No. 103765
Mumbai
May 30 2019

Annexure A to the Independent Auditors' Report

The Annexure referred to in our Independent Auditors' Report to the members of theCompany on the standalone Ind AS financial statements for the year ended March 31 2019we report that:

i) a) The Company has maintained proper records showing the full particulars includingthe quantitative de- tails and situation of its fixed assets.

b) All the assets have not been physically verified by the management during the yearbut as per the informa- tion and explanations provided to us there is a regular programmeof physical verification which in our opinion is reasonable having regard to the size ofthe Company and the nature of its assets. No material discrepancies were noticed on suchverification.

c) According to information and explanations given by the management the title deedsof immovable properties included under tangible fixed assets are held in the name of theCompany except as detailed in Annexure 1 the properties which are not in the name of thecompany. We were given to understand that the said immovable properties were owned andacquired by the company in the scheme of merger how- ever the title deeds of the sameare still in the name of erstwhile merging companies. Moreover in case of Green PlotDevelopment (Alang) the company has done redevelopment work on a lease hold plot at Alang(Alang Ship Breaking Yard Alang).

ii) The inventory has been physically verified during the year by the management. Inour opinion the frequency of verification is reasonable and no material discrepancieswere noticed on such physical verification.

iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under section 189 of theCompanies Act 2013. Accordingly the provisions of clause 3(iii)(a) (b) and (c) of theOrder are not applicable to the Company and hence not commented upon.

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 Act2013.

v) According to the information and explanations given to us the company has notinvited deposits as per the provisions of section 73 to 76 of the act.

vi) We have broadly reviewed the books of account maintained by the Company pursuant tothe rules made by the Central Government for the maintenance of cost records under section148(1) of the Companies Act 2013 and are of the opinion that prima facie the specifiedaccounts and records have been made and maintained. We have not however made a detailedexamination of the same.

vii) a) In our opinion and according to the information and explanations given to usthe Company is regular in depositing with appropriate authorities undisputed statutorydues including provident fund income-tax sales-tax service tax duty of customs dutyof excise value added tax cess and other material statutory dues applicable to it and nosuch undisputed amounts were in arrears for a period of more than six months from the datethey became payable.

b) According to the records of the Company the dues outstanding of income-taxsales-tax wealth-tax service tax duty of customs duty of excise value added tax andcess on account of any dispute are as follows:

Name of the authority (where the dispute is pending) Related period Nature Amount
Hon. ITAT Mumbai AY 2007-08 Income Tax Rs.396780
Hon. CIT (Appeal)-8 Mumbai AY 2014-15 Income Tax Rs.9853510

viii) In our opinion and according to the information and explanations given to us theCompany has not defaulted in the repayment of loans or borrowings to banks and financialinstitution. The Company has not taken any loan from government.

ix) In our opinion and according to the information and explanations given to us thecompany has not raised moneys by way of initial public offer or further public offer(including debt instruments) or tern loan during the year under report.

x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and as per the information and explanations given bythe management we report that no fraud by the Company or material fraud on the Company byits officers or employees has been noticed or reported during the year.

xi) According to the information and explanations given by the management we reportthat the managerial remuneration has been paid / provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

xii) In our opinion the Company is not a nidhi company. Therefore the provisions ofclause 3(xii) of the Order are not applicable to the Company and hence not commented upon.

xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe standalone Ind AS financial statements as required by the applicable accountingstandards.

xiv) According to the information and explanations given by the management and based onthe examinations of the records of the company the company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year under review.

xv) In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any non-cash transactions with itsdirectors or persons connected with him and hence provisions of section 192 of the Act arenot applicable.

xvi) According to the information and explanations given to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.

For Lahoti Navneet & Co. For P. D. Goplani & Associates
Chartered Accountants Chartered Accountants
FRN : 116870W FRN : 118023W
Sd/- Sd/-
CA Sanjay Soni CA Prem Goplani
Partner Partner
M. No. 114835 M. No. 103765
Mumbai
May 30 2019

Annexure 1 to Companies Auditors Report ( CARO 2016) Details of Para 3(i) (c) :Immovable Properties

Particulars Gross Block Value as at 31.03.2018 (Rs.) Net Block Value as at 31.03.2018(Rs.) Remarks
1 Godown 1929 Iron & Steel Market Yard Kalamboli Dist: Raigad 4817420 2742931 Held in the name of director of the company.

Annexure B to the Independent Auditors' Report

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 with reference to financial statementsof Hariyana Ship Breakers Limited (“the Company”) as of March 31 2019 inconjunction with our audit of the standalone Ind AS financial statements of the Companyfor 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 the Company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Act.

Auditor's Responsibility

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”) issued by the Institute of CharteredAccountant of India and the Standards on Auditing as specified under section 143(10) ofthe Companies Act 2013 to the extent applicable to an audit of internal financialcontrols both applicable to an audit of Internal Financial Controls. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe 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'sjudgment including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the internal financial controls system withreference to financial statements.

Meaning of Internal Financial Controls with reference to financial statements

A company's internal financial control 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 control withreference to financial statements 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 financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures 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 with reference to financialstatements

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 control 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

In our opinion and according to the best of information and explanations provided tous the Company has in all material respects an adequate internal financial controlssystem with reference to financial statements and such internal financial controls withreference to financial statements were operating effectively as at March 31 2019 basedon the internal control over financial reporting considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India.

For Lahoti Navneet & Co. For P. D. Goplani & Associates
Chartered Accountants Chartered Accountants
FRN : 116870W FRN : 118023W
Sd/- Sd/-
CA Sanjay Soni CA Prem Goplani
Partner Partner
M. No. 114835 M. No. 103765
Mumbai
May 30 2019