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Indian Wood Products Company Ltd.

BSE: 540954 Sector: Others
NSE: N.A. ISIN Code: INE586E01020
BSE 00:00 | 27 Feb 39.00 -0.10
(-0.26%)
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NSE 05:30 | 01 Jan Indian Wood Products Company Ltd
OPEN 39.50
PREVIOUS CLOSE 39.10
VOLUME 13518
52-Week high 95.65
52-Week low 33.50
P/E 22.03
Mkt Cap.(Rs cr) 249
Buy Price 38.20
Buy Qty 11.00
Sell Price 39.75
Sell Qty 100.00
OPEN 39.50
CLOSE 39.10
VOLUME 13518
52-Week high 95.65
52-Week low 33.50
P/E 22.03
Mkt Cap.(Rs cr) 249
Buy Price 38.20
Buy Qty 11.00
Sell Price 39.75
Sell Qty 100.00

Indian Wood Products Company Ltd. (INDIANWOODPROD) - Auditors Report

Company auditors report

To The Members of

The Indian Wood Products Co Ltd

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the standalone financial of The Indian Wood Products Co Ltd ("theCompany") which comprise the standalone balance sheet as at 31st March 2019 and thestatement of Profit and statement of changes in equity and statement of cash flows for theyear then ended and notes to the standalone financial statements including a summary ofsignificant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 ("the Act") in the manner so required and give a trueand fair view in conformity with Indian Accounting Standards prescribed under section 133of the Act read with the Companies (Indian Accounting Standards) Rules 2015 as amended("Ind AS") and other accounting principles generally accepted in India of thestate of affairs of the Company as at 31st March 2019 and its profit totalcomprehensive income the changes in equity and its cash flows for the year ended on thatdate.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. 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 Loss issued by the Institute of CharteredAccountants of India together with the ethical requirements that are relevant to our auditof the standalone financial statements under the provisions of the Companies Act 2013 andthe

Rules thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the Code of Ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for ouropinion.

Key Audit Matters

Key audit matters (‘KAM') are those matters that in our professional judgmentwere of most significance in our audit of the standalone financial statements of thecurrent period. These matters were addressed in the context of our audit of the standalonefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters.

The Key Audit Matters Auditors response
Revenue Recognition
Accuracy of recognition measurement presentation and disclosures of revenues and other related balances in view of Ind AS -115 Principal Audit procedures
As described in Note 2(f) to the standalone financial statements the Company has adopted Ind AS 115 Revenue from Contracts with Customers (‘Ind AS 115') which is the new revenue accounting standard. The application and transition to this accounting standard is complex and is an area of focus in the audit. The revenue standard establishes a comprehensive framework for determining whether how much and when revenue is recognized. This involves certain key judgments relating to identification of distinct performance obligations determination of transaction price of identified performance obligation the appropriateness of the basis used to measure revenue recognized over a period. Our audit approach was a combination of test of internal controls and substantive procedures including:
• Assessing the appropriateness of the Company's revenue recognition accounting policies in line with Ind AS 115 ("Revenue from Contracts with Customers") and testing thereof.
• Evaluating the design and implementation of Company's controls in respect of revenue recognition.
• Testing the effectivenessof such controls over revenue cut off at year-end.
Additionally the standard mandates robust disclosures in respect of revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. The Company adopted Ind AS 115 and applied the available exemption provided therein to not restate the comparative periods. evaluation of uncertain tax positions • Testing the supporting documentation for sales transactions recorded during the period closer to the year end and subsequent to the year end and testing the sample of revenues disaggregated by type and service offerings was tested with the performance obligations specified in the underlying contracts.
• Performing analytical procedures on current year revenue based on monthly trends and where appropriate conducting further enquiries and testing.
The Company has material uncertain tax positions including matters under dispute which involves significant procedures: judgement to determine the possible outcomes of these disputes. Our audit procedures include the following substantive
Refer Note 46 to the Standalone Financial Statements • Obtained understanding of key uncertain tax positions; and
• We along with our internal tax experts –
• Read and analysed select key correspondences external legal opinions / consultations by management for key uncertain tax positions;
• Discussed with appropriate senior management and evaluated management's underlying key assumptions in estimating the tax provisions; and
• Assessed management's estimate of the possible outcome of the disputed cases.

Other Information

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Company's annual report but does notinclude the standalone financial statements and our auditors' report thereon.

Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated.

If based on the work we have performed on the other information obtained prior to thedate of this auditor's report we conclude that there is a material misstatement of thisother information we are required to report that fact. We have nothing to report in thisregard.

Responsibility of Management and those Charged with Governance for Standalone FinancialStatements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performancechanges in equity and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theIndian

Accounting Standards specified under section the Act. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate 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 statement give a true and fairview and are free from material misstatement whether due to fraud or error.

In preparing the standalone 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 for overseeing the Company's financialreporting process

Auditor's Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements whole are free from material misstatement whether due to fraud orerror and to issue an auditor's report that includes our opinion. Reasonable assurance isa 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 Financial Statements.of As part of an audit inaccordance with SAs we exercise professional judgement and maintain professionalscepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the Ind AS financialstatementswhether 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 that as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

• 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 Companies Act2013we 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 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 asmaya cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe Standalone Financial Statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.

• Evaluate the overall presentation structure and content of the standalonefinancial statements the disclosuresand whether the standalone statements represent theunderlying transactions and events in a manner that achieves fair presentation.

• Materiality is the magnitude of misstatements in the standalone financialstatements that individually or aggregate make it probable that the economic decisionsof a reasonably knowledgeable user of the standalone 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 any identified misstatements in the standalone financial statements.

We also communicate with those charged with governance regarding among other mattersthe planned scope and timing of the audit and audit findings that we identify during ouraudit.

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 financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen 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

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 Companies Act 2013 we give in the Annexure "B" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

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

(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 book

(c) The Standalone Balance Sheet the Standalone Statement of Profit and Loss includingComprehensive Income the Standalone Cash Flow Statement and the Standalone Statement ofChanges in significant Equity dealt with by this Report are in agreement with the books ofaccount.

(d) In our opinion the aforesaid Standalone Financial Statements comply with theIndian Accounting Standards specified under Section 133 of the Act read with relevantrules issued thereunder.

(e) On the basis of the written representations received from the directors as on 31stMarch 2019 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2019 from being appointed as a director in terms 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 A". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.

(g) With respect to the matter to be included in the Auditor's Report under section197(16)

In our opinion and according to the information and explanation given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under section 197 (16) which arerequired to be commented upon by us.

(h) 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 Standalone Financial Statements Refer Note No.- 46

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 the amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1(f) under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSubsection for ensuring the 3 of Section 143 of the Companies Act 2013 ("theAct")

We have audited the internal financial controls over financial reporting of The IndianWood Products Co Ltd ("the Company") as of March 31 2019 to the extent ofrecords available with us in conjunction with our audit of the standalone financialstatements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating orderly and efficient conduct of effectively itsbusiness the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the internal financial controls overfinancial reporting the Company based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") issued by the Institute of Chartered Accountants of Indiaand the Standards on Auditing prescribed under Section 143(10) of the Companies Act 2013to the extent 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 maintained and if such controlseffectivelyin all operated material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on assessed risk. The proceduresselected depend on the auditor's judgement including the assessment of the risks ofmaterial misstatement of the standalone financial statements whether due to fraud orerror.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our opinion on the Company's internal financial controls system overfinancial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A Company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external as at March 31 purposes in accordancewith generally accepted accounting principles. A Company's internal control over financialreporting includes those and procedures that

(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of Standalone Financial Statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the Standalone Financial Statements.

Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrolsthe material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thataudit the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating 2019 based on the internal effectively control over financialreporting criteria established by the financial

Company. policies

ANNEXURE ‘B' TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2 under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date) i. In respect of the Company's fixedassets:

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

(b) The Company has a regular program of verification to cover all the items offixedassets in a phased manner which in our opinion is reasonable having regard to thesize of the Company and the nature of its assets.

Pursuant to the program certain fixed physically verified by the management during theyear

According to the information and explanations given to us no material discrepancieswere noticed on such verification.

(c) According to the information and explanations given to us and the records examinedby us including registered title deeds we report that the title deeds comprising allthe immovable properties are held in the name of the Company as at the balance sheetdate.

ii. According to the information and explanations given to us the inventory has beenphysically verifiedduring the year by the management at regular intervals. In our opinionthe frequency of such verification is reasonable.

No material discrepancies were noticed on physical verification. iii. The Company hasnot granted any loans secured or unsecured to Companies firms limited liabilitypartnerships or other persons covered in the Register maintained under section 189 of theCompanies Act 2013. Accordingly paragraph 3(iii) of the order is not applicable to theCompany

iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Act in respect ofgrant of loans making investments and providing guarantees and securities as applicable.

v. In our opinion and according to the information and explanations given to us theCompany has not accepted any deposit from the public in accordance with the provisions ofSections 73 to 76 or any other relevant provisions of the Act and the rules framedthereunder. Accordingly paragraph 3 (v) of the Order is not applicable to the Company.

vi. The Central Government of India has not prescribed the maintenance of cost recordsby the Company as required under section 148(1) of the Companies Act. 2013 for any of itsproducts.

vii. According to the information and explanations given to us in respect of statutorydues: assets were . (a) The Company has generally been regular in depositing undisputedstatutory dues including Provident Fund Employees' State Insurance Income Tax Goodsand Service Tax Cess and other material statutory dues applicable to it with theappropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income Tax Goods and Service Tax Cess and other material statutory duesin arrears as at March 31 2019 for a period of more than six months from the date theybecame payable.

(c) According to the records of the Company the dues outstanding of Sales tax Customon account of any dispute are as follows:-

Particulars Amount under dispute not yet deposited Financial year to which the amount relates Forum where dispute is pending
(Rs. in lakhs)
Central Sales tax New Delhi 0.23 1987-88 Appellate Tribunal
Central Sales tax New Delhi 74.58 2001-02 Appellate Tribunal
Central Sales tax New Delhi 2.16 2002-03 Additional Commissioner
Local Sales tax New Delhi 43.75 2002-03 Additional Commissioner
Mandi Samity 2.18 1997-98 Hon'ble High Court Allahabad
UP Sales Tax 0.46 2010-11 Appeal before Additional Commissioner
Custom Act 643.56 2017-18 CESTAT Nhava Seva

viii. In our opinion and according to the information and explanations given to us bythe management the Company has not defaulted in the repayment of dues to banks during theyear.

ix. The Company has not raised moneys by way of initial public offer or further publicoffer debt instruments) during the year. To the best of our knowledge and belief andaccording to the information and explanations given to us term loans availed by theCompany were applied for the purpose for which the loans were obtained.

x. To the best of our knowledge and according to the information and explanations givento us no fraud by the Company or no fraud on the Company by its officers or employees hasbeen noticed or reported during the year.

xi. According to the information and explanations given to us the Company has paid orprovided for managerial remunerations in accordance with the provisions of section 197read with Schedule V to the Act; xii. In our opinion and according to the information andexplanations given to us the Company is not a Nidhi Company and hence reporting underclause 3 (xii) of the Order is not applicable to the Company.

xiii. In our opinion and according to the information and explanations given to us theCompany is in compliance with Section 177 and 188 of the Companies Act 2013 whereapplicable for all transactions with the related parties and the details of related partytransactions have been disclosed in the Ind AS financial statements as required by theapplicable Indian accounting standards.

xiv. According to the information and explanations given to us and based on ourexamination of the records 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 and based on ourexamination of the records of the Company the Company has not entered into any non-cashtransactions with its Directors or persons connected with them. Accordingly paragraph 3(xv) of the Order is not applicable.

xvi. According to the information and explanation given to us the Company is notrequired to be registered under section 45-IA of the Reserve Bank of India Act 1934.

For Agrawal tondon & Co.
Chartered Accountants
FRN – 329088E
Radhakrishan Tondon
Place: Kolkata Partner
Dated: 24th May 2019 Membership No. 060534