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Kovilpatti Lakshmi Roller Flour Mills Ltd.

BSE: 507598 Sector: Agri and agri inputs
NSE: KLRF ISIN Code: INE014E01015
BSE 16:01 | 11 Aug 43.60 0.20
(0.46%)
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47.60

HIGH

47.60

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42.60

NSE 05:30 | 01 Jan Kovilpatti Lakshmi Roller Flour Mills Ltd
OPEN 47.60
PREVIOUS CLOSE 43.40
VOLUME 3307
52-Week high 47.60
52-Week low 19.25
P/E 5.68
Mkt Cap.(Rs cr) 24
Buy Price 42.65
Buy Qty 5.00
Sell Price 45.90
Sell Qty 100.00
OPEN 47.60
CLOSE 43.40
VOLUME 3307
52-Week high 47.60
52-Week low 19.25
P/E 5.68
Mkt Cap.(Rs cr) 24
Buy Price 42.65
Buy Qty 5.00
Sell Price 45.90
Sell Qty 100.00

Kovilpatti Lakshmi Roller Flour Mills Ltd. (KLRF) - Auditors Report

Company auditors report

To the Members of Kovilpatti Lakshmi Roller Flour Mills Limited (formerly known KLRF Limited)

Report on the Audit of the Financial Statements

Opinion

I have audited the financial statements of Kovilpatti Lakshmi Roller Flour Mills Limited (the Company) which comprise the balance sheet as at 31st March 2019 and the statement of Profit and Loss statement of changes in equity and statement of cash flows for the year then ended and notes to the financial statements including a summary of significant accounting policies and other explanatory information in which are included the financial statements/ information for the year ended on that date audited by the branch auditors of the Company's branches located at Periyanaickenpalayam Coimbatore Tamilnadu.

In my opinion and to the best of my information and according to the explanations given to me the aforesaid financial statements give the information required by the Companies Act (the Act) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the state of affairs of the Company as at March 31 2019 its loss and other comprehensive income changes in equity and its cash flows for the year ended on that date.

Basis for opinion

I conducted my audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act 2013. My responsibilities under those Standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of my report. I am independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to my audit of the financial statements under the provisions of the Companies Act 2013 and the Rules thereunder and I have fulfilled my other ethical responsibilities in accordance with these requirements and the Code of Ethics. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Information other than the Financial Statements and Auditor's Report Thereon

The Company's Board of Directors are responsible for the other information. The other information comprises the Board's Report and the Corporate Governance Report but does not include the financial statements and my auditor's report thereon.

My opinion on the financial statements does not cover the other information and I do not express any form of assurance conclusion thereon.

In connection with my audit of the financial statements my responsibility is to read the other information and in doing so consider whether the other information is materially inconsistent with the financial statements or my knowledge obtained during the course of my audit or otherwise appears to be materially misstated. If based on the work I have performed I conclude that there is a material misstatement of this other information I am required to report that fact. I have nothing to report in this regard.I have determined the matter described below to be the key audit matter to be communicated in my report

Key Audit Matters

Key audit matters are those matters that in my professional judgment were of most significance in my audit of the financial statements of the current period. These matters were addressed in the context of my audit of the financial statements as a whole and in forming my opinion thereon and I do not provide a separate opinion on these matters.

Key Audit MatterHow the Key Audit Matter was addressed in my audit
Carrying Value of Property Plant and Equipment Assessed the reasonableness of the management's assertions and estimates regarding estimated useful lives and residual values based on historical experience.
 Discussed the indicators of possible impairment with the management.
 Analysed the assumptions and critical judgements based on historical data
Evaluation of uncertain tax positions Obtained details of completed tax assessments and demands for the year ended March 31 2019 from management.
 Reviewed the management's underlying assumptions in estimating the tax provision and the possible outcome of the disputes.
 Considered legal precedence and other rulings in evaluating management's position on these uncertain tax positions.
 Also considered the effect of new information in respect of uncertain tax positions to evaluate whether any change was required to management's position on these uncertainties.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act 2013 (the Act) with respect to the preparation of these financial statements that give a true and fair view of the financial position financial performance changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India including the accounting Standards specified under section 133 of the Act.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records relevant to the preparation and presentation of the financial statement that give a true and fair view and are free from material misstatement whether due to fraud or error.

In preparing the financial statements management is responsible for assessing the Company's ability to continue as a going concern disclosing as applicable matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations or has no realistic alternative but to do so.

The Board of Directors are also responsible for overseeing the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements

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

I give in Annexure A a detailed description of Auditors; responsibilities for Audit of the Financial Statements

Other Matter

I did not audit the financial statements/ information of 2 (Two) branches included in the financial statements of the Company whose financial statements/financial information reflect total assets of ? 3936.05 lakhs as at 31st March 2019 and the total revenue of ? 8742.14 lakhs for the year ended on that date as considered in the financial statements/ information of these branches have been audited by the branch auditors whose reports have been furnished to me and my opinion in so far as it relates to the amounts and disclosures included in respect of branches is based solely on the report of such branch auditors.

My opinion is not modified in respect of these matters.

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 of the Companies Act 2013 I give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order to the extent applicable.

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

a) I have sought and obtained all the information and explanations which to the best of my knowledge and belief were necessary for the purposes of my audit.

b) The reports on the accounts of the branch offices of the Company audited under Section 143(8) of the Act by branch auditors have been sent to me and have been properly dealt with by me in preparing this report.

c) The Balance Sheet the Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account and with the returns received from the branches not visited by me.

d) In my opinion the aforesaid financial statements comply with the Accounting Standards specified under 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 31st March 2019 taken on record by the Board of Directors none of the directors is disqualified as on 31st March 2019 from being appointed as a director in terms of Section 164 (2) of the Act.

f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls refer to my separate Report in Annexure C.

g) with respect to the other matters to be included in the auditors' report in accordance with rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended in my opinion and to the best of my information and according to the explanations given to me:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - refer note no.; 37 to the financial statements

ii. The Company has no long-term contracts including derivative contracts; and

iii. There has been no delay in transferring amounts required to be transferred to the investor education and protection fund by the Company.

As required by the Companies (Amendment) Act 2017 in my opinion and according to the information and explanations given to me the remuneration paid by the Company to its directors is within the limits laid prescribed under Section 197 of the Act and the rules thereunder.

For M/s ARUN & CO
Chartered Accountants
Firm Registration No.0014464S
A.ARUN
Place : Coimbatore Proprietor
Date : May 29 2019 Membership No. 227831

Annexure A to the Independent Auditors' Report

(Referred to in Auditor's Responsibilities for the Audit of the Financial Statements section of my report to the members of Kovilpatti Lakshmi Roller Flour Mills Limited of even date)

Auditor's Responsibilities for the Audit of the Financial Statements

As a part of an audit in accordance with SA's I excercise professional judgement and maintain professional scepticism throughout the audit I also :

I. Identify and assess the risks of material misstatement of the financial statements whether due to fraud or error design and perform audit procedures responsive to those risks and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error as fraud may involve collusion forgery intentional omissions misrepresentations or the override of internal control.

II. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act 2013 I am also responsible for expressing my opinion on whether the company has adequate internal financial controls system in place and the operating effectiveness of such controls.

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

IV. Conclude on the appropriateness of management's use of the going concern basis of accounting and based on the audit evidence obtained whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If I conclude that a material uncertainty exists I am required to draw attention in my auditor's report to the related disclosures in the financial statements or if such disclosures are adequate to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my audit report. However future events or conditions may cause the company to cease to continue as a going concern.

V. Evaluate the overall presentation structure and content of the financial statements including the disclosures and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

I communicate with those charged with governance regarding among other matters the planned scope and timing of the audit and significant audit findings including any significant deficiencies in internal control that I identify during my audit.

I also provide those charged with governance with a statement that I have complied with relevant ethical requirements regarding independence and to communicate with them all relationship and other matters that may reasonably be thought to bear on my independence and where applicable related safeguards.

From the matters communicated with those charged with governance I determine those mater that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. I describe these matters in my auditors' report unless law or regulation precludes public disclosure about the matter or when in extremely rare circumstances I determine that the matter should not be communicated in my report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Annexure B to the Independent Auditor's

(Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements' section of my report to the members of Kovilpatti Lakshmi Roller Flour Mills Limited of even date)

1. In respect of the Company's fixed assets:

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

(b) The Company has a program of verification to cover all the items of fixed assets in a phased manner which in my opinion is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program certain fixed assets were physically verified by the management during the year. According to the information and explanations given to me no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to me the records examined by me and based on the examination of the conveyance deeds provided to me I report that the title deeds comprising all the immovable properties of land and buildings which are freehold are held in the name of the Company as at the balance sheet date.

2. The inventory has been physically verified by the management during the year. In my opinion the frequency of such verification is reasonable.

3. According to information and explanation given to me the company has not granted any loan secured or unsecured to companies firms limited liability partnerships or other parties covered in the register required under section 189 of the Companies Act 2013. Accordingly paragraph 3 (iii) of the order is not applicable.

4. In my opinion and according to information and explanation given to me the company has not granted any loans or provided any guarantees or given any security to which the provision of section 185 of the Companies Act are applicable. In respect of investments made by the Company the Company had complied with the provisions of section 186 of the Companies Act 2013.

5. In my opinion and according to the information and explanations given to me the company has not accepted any deposits and accordingly paragraph 3 (v) of the order is not applicable.

6. In my opinion and according to the information and explanations given to me and based on the report of the branch auditors the Engineering Divisions of the company had maintained cost records specified under section 148 (1) (d) of the Companies Act 2013 and the relevant rules prescribed. However I have not carried out a detailed examination of the same.

7. According to the information and explanations given to me in respect of statutory dues:

(a) The Company has generally been regular in depositing undisputed statutory dues including Provident Fund Employees' State Insurance Income Tax Sales Tax Service Tax Goods and Service Tax Value Added Tax Customs Duty Excise Duty Cess and other material statutory dues applicable to it with the appropriate authorities.

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

(c) Details of dues of Income Tax Sales Tax Service Tax Excise Duty Value Added Tax and Goods and Service Tax which have not been deposited as at March 31 2019 on account of dispute are given below:

StatuteNature of duesAmount (? in lakhs)Period to which the amount relatesForum where the dispute is pending
Tamil Nadu Value Added Tax ActTNVAT25.05FY 2008-09 to 2013 -14Commercial Tax Appellate Tribunal Madurai.
Kerala Value Added Tax ActKVAT199.17July 2016 to December 2016 & April 2017 to June 2017Commercial Tax Appellate Tribunal Trivandrum.
Kerala Value Added Tax ActKVAT66.90January 2017 to March 2017Deputy Commissioner AppealKollam.
Finance Act 1994Service Tax4.88FY 2008-09 to 2012-13CESTAT

8. In my opinion and according to the information and explanations given to me the company has not defaulted in repayment of dues to its bankers during the year. According to the information and explanations given to me the company has no outstanding dues to any financial institutions or any government or any debenture holders during the year.

9. In my opinion and according to the information and explanations given to me the term loans taken by the Company have been applied for the purpose for which they were raised. The Company has not raised any money by way of initial public offer or further public offer (including debt instruments) during the year.

10. During the course of my audit examination of the books and records of the company carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to me I have neither come across any instance of material fraud by the company or on the Company by its officers or employees.

11. In my opinion and according to the information and explanations given to me the Company has paid/provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.

12. In my opinion and according to the information and explanations given to me the Company is not a Nidhi Company and hence reporting under clause 3 (xii) of the Order is not applicable to the Company.

13. According to the information and explanations given to me and based on my examination of the records of the company transactions with the related parties are in compliance with section 177 and 188 of the Act where applicable the details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

14. According to the information and explanations given to me and based on my examination of the records of the company the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly the provisions stated in paragraph 3 (xiv) of the order are not applicable.

15. According to the information and explanations given to me and based on my examination of the records of the company the company has not entered into non-cash transactions with directors or persons connected with them. Accordingly paragraph 3(xv) of the order is not applicable.

16. According to the information and explanations given to me and based on my examination of the records of the company the company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.

For M/s ARUN & CO
Chartered Accountants
Firm Registration No.0014464S
A.ARUN
Place : Coimbatore Proprietor
Date : May 29 2019 Membership No. 227831

Annexure C to the Independent Auditor's Report

(Referred to in paragraph 2 (f) under 'Report on Other Legal and Regulatory Requirements' section of my report to the Members of Kovilpatti Lakshmi Roller Flour Mills Limited of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub- section 3 of Section 143 of the Companies Act 2013 (the Act)

I have audited the internal financial controls over financial reporting of Kovilpatti Lakshmi Roller Flour Mills Limited (formerly known as KLRF Limited) (the Company) as of March 31 2019 in conjunction with my audit of the financial statements 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 maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business the safeguarding of its assets the prevention and detection of frauds and errors the accuracy and completeness of the accounting records and the timely preparation of reliable financial information as required under the Companies Act 2013.

Auditors' Responsibility

My responsibility is to express an opinion on the internal financial controls over financial reporting of the Company based on my audit. I conducted my audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the Guidance Note) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act 2013 to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

My audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. My audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting assessing the risk that a material weakness exists and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor's judgement including the assessment of the risks of material misstatement in the financial statements whether due to fraud or error.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion on the Company's internal financial control system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

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

Limitations of Internal Financial Controls Over Financial Reporting

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

Opinion

In my opinion and according to the information and explanations given to me the Company has in all material respects an adequate internal financial control system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31 2019 based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For M/s ARUN & CO
Chartered Accountants
Firm Registration No.0014464S
A.ARUN
Place : Coimbatore Proprietor
Date : May 29 2019 Membership No. 227831