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Lambodhara Textiles Ltd.

BSE: 590075 Sector: Industrials
NSE: LAMBODHARA ISIN Code: INE112F01022
BSE 00:00 | 17 Oct 29.40 0
(0.00%)
OPEN

29.10

HIGH

29.40

LOW

29.10

NSE 00:00 | 18 Oct 29.65 0.20
(0.68%)
OPEN

29.85

HIGH

30.25

LOW

29.25

OPEN 29.10
PREVIOUS CLOSE 29.40
VOLUME 50
52-Week high 59.40
52-Week low 23.50
P/E 3.76
Mkt Cap.(Rs cr) 28
Buy Price 29.10
Buy Qty 10.00
Sell Price 31.70
Sell Qty 20.00
OPEN 29.10
CLOSE 29.40
VOLUME 50
52-Week high 59.40
52-Week low 23.50
P/E 3.76
Mkt Cap.(Rs cr) 28
Buy Price 29.10
Buy Qty 10.00
Sell Price 31.70
Sell Qty 20.00

Lambodhara Textiles Ltd. (LAMBODHARA) - Auditors Report

Company auditors report

To the Members of Lambodhara Textiles Limited

Report on the Audit of the Standalone Financial Statements OPINION

1. We have audited the accompanying standalone financial statements of LambodharaTextiles Limited ('the Company') which comprise the Balance sheet as at 31 March 2019the statement of profit and loss (including Other Comprehensive Income) the Cash Flowstatement and the statement of changes in Equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information.

2. 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 true and fairview in conformity with the accounting principles generally accepted in India includingIndian Accounting Standards ('Ind AS') specified under Section 133 of the Act of thestate of affairs (financial position) of the Company as at 31 March 2019 and its profit(financial performance including other comprehensive income) its cash flows and thechanges in equity for the year ended on that date.

Basis for Opinion

3. We conducted our audit in accordance with the Standards on Auditing specified underSection 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 ('ICAI') together withthe ethical requirements that are relevant to our audit of the financial statements underthe provisions of the Act and the rules thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for 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. Wehave determined the matters described below to be the key audit matters to be communicatedin our report.

Key audit matters Auditor's Response
1. Revenue Recognition Principal Audit Procedures
Revenue from the sale of goods (hereinafter referred to as "Revenue") is recognised when the Company performs its obligation to its customers and the amount of revenue can be measured reliably and recovery of the consideration is probable. The timing of such recognition in case of sale of goods is when the control over the same is transferred to the customer which is mainly upon delivery. The timing of revenue recognition is relevant to the reported performance of the Company. The management considers revenue as a key measure for evaluation of performance. There is a risk of revenue being recorded before control is transferred. 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 integrity of the general information and technology control environment and testing the operating effectiveness of key IT application controls. and implementation of Evaluating the design Company's controls in respect of revenue recognition.
Testing the effectiveness of such controls over revenue cut off at year-end.
Refer Note 37 II (q) to the Financial Statements - Significant Accounting Policies Testing the supporting documentation for sales transactions recorded during the period closer to the year end and subsequent to the year end including examination of credit notes issued after the year end to determine whether revenue was recognised in the correct period.
Performing analytical procedures on current year revenue based on monthly trends and where appropriate conducting further enquiries and testing.
2. Litigations - Contingencies Principal Audit Procedures
The Company has ongoing litigations with various authorities and third parties which could have a significant impact on the results if the potential exposures were to materialise. Our audit approach was a combination of test of internal controls and substantive procedures including: Assessing the appropriateness of the design and implementation of the Company's controls over the assessment of litigations and completeness of disclosures.
The amounts involved are significant and the application of accounting standards to determine the amount if any to be provided as a liability or disclosed as a contingent liability is inherently subjective. Supporting documentation are tested for the positions taken by the management meetings are conducted with in-house legal counsel and/or legal team and minutes of Board to confirm the operating effectiveness of these controls.
Claims against the Company not acknowledged as debts are disclosed in the Financial Statements by the Company after a careful evaluation of the facts and legal aspects of the matters involved. The outcome of such litigation is uncertain and the position taken by management involves significant judgment and estimation to determine the likelihood and/or timing of cash outflows and the interpretation of preliminary and pending court rulings. Involving our direct and indirect tax specialists to assess relevant historical and recent judgements passed by the appropriate authorities in order to challenge the basis used for the accounting treatment and resulting disclosures.
Refer Note 39 to the Financial Statements

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

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.

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

In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Standalone IndAS Financial Statements

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 standalone financial statementsthat give a true and fair view of the state of affairs (financial position) profit orloss (financial performance including other comprehensive income) changes in equity andcash flows of the Company in accordance with the accounting principles generally acceptedin India including the Ind AS specified under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation 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 financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

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.

8. Those Board of Directors are also responsible for overseeing the Company's financialreporting process.

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

9. 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 withStandards on Auditing will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these financial statements.

10. As part of an audit in accordance with Standards on Auditing we exerciseprofessional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theAct we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls system in place and the operating effectiveness ofsuch controls.

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

Conclude on the appropriateness of management's use of the going concern basis ofaccounting 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 uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

Evaluate the overall presentation structure and content of the financial statementsincluding the disclosures and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation.

11. 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.

12. 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.

13. 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

14. As required by Section 197(16) of the Act we report that the Company has paidremuneration to its directors during the year in accordance with the provisions of andlimits laid down under Section 197 read with Schedule V to the Act.

15. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of section 143 (11) of the Act we givein the Annexure A a statement on the matters specified in the paragraph 3 and 4 of theOrder. 16. As required by Section 143 (3) of the Act we report that: (a) we have soughtand obtained all the information and explanations which to the best of our knowledge andbelief 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 sheetthe statement of profit and loss (including other comprehensive income) the cash flowstatement and the Statement of Changes in Equity dealt with by this Report are inagreement with the books of account; (d) in our opinion the aforesaid standalonefinancial statements comply with the Indian Accounting Standards specified under Section133 of the Act read with relevant rules issued thereunder; (e) on the basis of thewritten representations received from the directors as on 31 March 2019 taken on record bythe Board of Directors none of the directors is disqualified as on 31 March 2019 frombeing 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 financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in "Annexure B"; and (g) with respect to the other matters to beincluded in the Auditor's Report in accordance with Rule 11 of the Companies (Audit andAuditors) Rules 2014 (as amended) in our opinion and to the best of our knowledge andbelief and according to the information and explanations given to us: i. the Company hasdisclosed the impact of pending litigations on its financial position in its financialstatements as referred to in Note 39 to the financial statements; ii. the Company did nothave any long-term contracts including derivatives contracts for which there were anymaterial foreseeable losses; iii. There has been no delay in transferring amountsrequired to be transferred to the Investor Education and Protection Fund by the Companyduring the year ended 31st March 2019; iv. The disclosure requirementsregarding specified bank notes held and transacted during the period from 8th November2016 to 30 December 2016 has not been made since the requirement does not pertain to theyear ended 31st March 2019.

For Jain & Mohan
Chartered Accountants
FRN: 006896S
(Sd/-) C. Amrithalal Jain
Place : Coimbatore Partner
Date : 29th May 2019 M.No. 023060

Annexure - A to the Auditors' Report

The Annexure referred to in Independent Auditors' Report to the members of the Companyon the standalone financial statements for the year ended 31 March 2019 we report that:(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets (b) The Company has a regular programmeof physical verification of its fixed assets by which fixed assets are verified in aphased manner over a period of three years. In accordance with this programme certainfixed assets were verified during the year and no material discrepancies were noticed onsuch verification. In our opinion this periodicity of physical verification is reasonablehaving regard to the size of the Company and the nature of its assets.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.

(ii) The management has conducted physical verification of inventory at reasonableintervals during the year (except stock lying with third parties and in transitconfirmation / subsequent receipt has been obtained in respect of such inventory) and nomaterial discrepancies were noted on physical verification.

(iii) The Company has not granted any loans to companies firms Limited LiabilityPartnerships or other parties covered in the Register maintained under Section 189 of theCompanies Act 2013.

(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 Act with respectto the loans and investments made.

(v) The Company has not accepted any deposits from the public within the meaning of thedirectives issued by the Reserve Bank of India provisions of Section 73 to 76 of the Actany other relevant provisions of the Act and the relevant rules framed thereunder. (vi)The Company has maintained the cost records prescribed by the Central Government underSection 148 (1) of the Act however we have not made detailed examination of suchrecords.

(vii) (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted/ accrued in the books ofaccount in respect of undisputed statutory dues including provident fund employee's stateinsurance income-tax sales tax Goods and services tax service tax duty of customsduty of excise value added tax cess and other material statutory dues have beenregularly deposited during the year by the Company with the appropriate authorities.Further no undisputed amounts payable in respect thereof were outstanding at the year-endfor a period of more than six months from the date they became payable.

(b) In our opinion and according to the information and explanations given to us thereare no dues in respect of income tax sales tax service tax duty of customs duty ofexcise value added tax that have not been deposited on account of any dispute except

Nature of the Dues Amount Forum where dispute is pending
ESI र 562780 Employee Insurance Court.
TNVAT – 2007 - 2014 र 354967 CTO Enforcement

(viii) The Company has not defaulted in repayment of loans or borrowings from anyfinancial institution banks government or debenture holders during the year.

(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) during the year and the term loans receivedduring the year were applied for the purposes for which the loans were obtained.

(x) According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.

(xi) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has paid / provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable. (xiii) According to the information and explanations given to us and based onour examination of the records of the Company transactions with the related parties arein compliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

(xiv) During the year the Company has not made preferential allotment or privateplacement of shares or fully or partially convertible debentures. Accordingly provisionsof clause 3 (xiv) of the order are not applicable.

(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 non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

(xvi) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

For Jain & Mohan
Chartered Accountants
FRN: 006896S
(Sd/-) C. Amrithalal Jain
Place : Coimbatore Partner
Date : 29th May 2019 M.No. 023060

Annexure - B to the 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 over financial reporting of LambodharaTextiles Limited ("the Company") as of 31 March 2019 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

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 ('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 Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting 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") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls over financial reporting and theGuidance Note issued by the Institute of Chartered Accountants of India. Those Standardsand the Guidance Note require that we comply with ethical requirements and plan andperform the 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 toobtain audit evidence about the adequacy of the internal financial controls system overfinancial reporting and their operating effectiveness. Our audit of internal financialcontrols over financial reporting included obtaining an understanding of internalfinancial controls over financial reporting 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 Company's internal financial controls systemover financial 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 purposes in accordance with generallyaccepted accounting principles. A Company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the Company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the Company are being made only in accordance with authorisations ofmanagement and directors of the Company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of theCompany's assets that could have a material effect on the financial statements.

Inherent 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 ofcontrols 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 thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31 March 2019 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For Jain & Mohan
Chartered Accountants
FRN: 006896S
(Sd/-) C. Amrithalal Jain
Place : Coimbatore Partner
Date : 29th May 2019 M.No. 023060