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Lloyd Rock Fibres Ltd.

BSE: 531527 Sector: Industrials
NSE: N.A. ISIN Code: INE640D01019
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Lloyd Rock Fibres Ltd. (LLOYDROCKFIBRE) - Auditors Report

Company auditors report

TO THE MEMBERS OF LLOYD ROCKFIBRES LIMITED NEW DELHI

Report on the Ind AS Financial Statements

We have audited the accompanying Ind AS financial statements of LLOYD ROCKFIBRESLIMITED ("the Company") which comprises the Balance Sheet as at 31st March2018 the Statement of Profit and Loss including the statement of Other ComprehensiveIncome the Cash Flow Statement and the Statement of Changes in Equity for the year thenended and a summary of significant accounting policies and other explanatory informationwhich we signed under reference to this report.

Management's Responsibility for the Ind AS Financial Statements

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 Ind AS financial statements that give a true and fair view of the financialposition financial performance including other comprehensive income cash flows andchanges in equity of the Company in accordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards(Ind AS) specified underSection 133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015(as amended).

This responsibility also includes the maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting the frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these Ind AS financial statements basedon our audit.

We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made there under.

We conducted our audit of the Ind AS financial statements in accordance with theStandards on Auditing issued by the Institute of Chartered Accountants of India asspecified under section 143(10) of the Act. Those Standards require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the Ind ASfinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of theInd AS financial statements that give true and fair view in order to design auditprocedures that are appropriate in the circumstances. An audit also includes evaluatingthe appropriateness of accounting policies used and the reasonableness of the accountingestimates made by Company's Directors as well as evaluating the overall presentation ofthe Ind AS financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the Ind AS financial statements give the information required by the Act inthe manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31stMarch 2018 its comprehensive income as per the statement of Profit & Loss its cashflows and the changes in equity for the year ended on that date.

Emphasis of matter

Attention may be drawn to ‘Notes Forming Part of Accounts' ‘C-Other NotesPoint 5 & 6' regarding complete erosion of Net Worth of the Company due toaccumulated losses and cash losses.

Report on other Legal and Regulatory requirements

1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")as amended issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the "Annexure –A" statement onthe matters Specified in paragraphs 3 and 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 the Statement of OtherComprehensive Income the Cash Flow Statement and Statement of Changes in Equity dealtwith by this Report are in agreement with the books of account;

d) In our opinion the aforesaid Ind AS financial statements comply with the AccountingStandards specified under Section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 (as amended). e) On the basis of writtenrepresentations received from the directors as on 31 March 2018 and taken on record bythe Board of Directors none of the directors is disqualified as on 31 March 2018 frombeing appointed as a director in terms of Section 164(2) of the Act;

f) With respect to the adequacy of the internal financial control over financialreporting of the Company and the operating effectiveness of such control refer to ourseparate report in

"Annexure B".

g) In our opinion and to the best of our information and according to the explanationsgiven to us we report as under with respect to other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules2014:

(a) The Company has some pending litigations which may impact its financial position asmentioned in the ‘Notes to Accounts – Point ‘O' as ‘ContingentLiability' please refer to ‘Notes on Accounts – Point ‘O'(i) Point no. e f& g.

(b) The Company did not have any long-term contracts including derivatives contractsfor which there were any material foreseeable losses.

(c) There were no amounts which were required to be transferred by the Company to theInvestor Education and Protection Fund.

For Barry and Company
Chartered Accountants
FRN – 017988N
(K. Yash Barry)
Place : New Delhi F.C.A. (Prop.)
Dated : 22.05.2018 M. No. – 012513

‘Annexure – A' referred to in our Independent Auditors' Report of even dateto the members of LLOYD ROCKFIBRES LIMITED ("the Company") for the year ended 31stMarch 2018.

On the basis of such checks as we considered appropriate and according to theinformation and explanation given to us during the course of our audit we report that:

(i) In respect of Fixed Assets

(a) The company has maintained proper records showing full particulars includingquantitative details of its fixed assets.

(b) As explained to us fixed assets have been physically verified by themanagement at reasonable intervals; no material discrepancies were noticed on suchverification.

(c) In our opinion and according to the information and explanations given to usand on the basis of our examination of the records of the Company the title deeds ofimmovable properties are held in the name of the company.

(ii) In respect of Inventory

According to the information & explanations provided by the management physicalverification of inventory has been conducted at reasonable intervals by the management andno material discrepancies were noticed at the time of verification.

(iii) (a) Loans and advances granted to parties covered under section 189 of theCompanies Act 2013

According to the information & explanations provided by the management the companyhas not granted any loan secured or unsecured to companies firms or other partiescovered in the register maintained under Section 189 of the Act. Accordingly theprovisions of clauses 3(iii)(a) 3(iii)(b) and 3(iii)(c) of the Order are not applicable.

(b) The Company has accepted loan from NGP Industries Limited covered in theregister maintained under Section 189 of the Companies Act 2013. The maximum amountinvolved during the year was Rs. 24856210/- (Previous Year Rs. 35314373/-) and theyear end balance of loans taken from such parties was Rs. 24856210/- (Previous Year Rs.35314373/-). During the year Company has reversed the interest provided but not paidtill date aggregating to Rs. 11944005/- (Excluding TDS) to M/s. NGP Industries Ltd.

(c) In the case of the loans accepted from the bodies corporate listed in theregister maintained under Section 189 of the Act and it is repayable on demand. Asinformed the lenders have not demanded repayment of any such loan during the year thusthere has been no default on the part of the company. (iv) In our opinion andaccording to the information and explanations given to us the company has neither givenany loan nor made any investment or given any guarantee or securities as per Section 185and 186 of the Act the provisions of clauses 4 of the Order is not applicable.

(v) The company has not accepted any deposits from public during the year. In ouropinion and according to the information and explanation given to us the provisions ofsection 73 to 76 or any other relevant provisions of the Companies Act 2013 and Companies(Acceptance of Deposits) Rules 2014 with regard to deposits from public is not applicablein Current Year. No order has been passed by Company Law Board or National Company LawTribunal or Reserve Bank of India or any court or any other tribunal in this regard.

(vi) Since the Company is not doing any commercial production inour opinion theprovisions of clause 3(vi) of the Order are not applicable to the Company.

(vii) (a) According to the records of the company and information andexplanations given to us the Company has been regular in depositing undisputed statutorydues with appropriate authorities including Income-tax Value Added Tax (VAT) ServiceTax Custom Duty Excise Duty Cess and other material statutory dues applicable to itwith the appropriate authorities.

(b) According to the information and explanations given to us no undisputedamounts payable in respect of income-tax services tax or cess or any other statutory dueswith the appropriate authorities were in arrears as at 31st March 2018 for aperiod of more than six months from the date they became payable except as mentionedunder the head ‘Contingent Liabilities' under Notes on Account Point ‘O' formingpart of the Balance Sheet.

(viii) In our opinion and according to the information and explanations given tous the Company has not taken any loan from Banks or Financial Institutions. Accordinglyprovision of clause 3(viii) is not applicable to the company.

(ix) In our opinion and according to the information and explanations given to usthe Company has not raised any money by way of initial public offer or further publicoffer (including debt instruments) and term loans during the year. Accordingly theprovision of clause 9 of the Order is not applicable.

(x) According to the information and explanations given by the management wereport that no fraud by the Company or any fraud on the Company by the officers andemployees of the Company has been noticed or reported during the year.

(xi) According to the information and explanations given to us and based on ourexamination of the records of the company the Company has not paid/provided managerialremuneration under section 197 read with Schedule V of the Companies Act 2013.

(xii) In our opinion the Company is not a Nidhi company. Therefore the provisionsof clause 3(xii) of the order are not applicable to the Company.

(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act wherever applicable and details have beendisclosed in the Financial Statements as required by the applicable 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 convertible debentures during the year under reviewhence reporting requirements under section 42 of the Companies Act 2013 need not becompiled with. Accordingly the provisions of clause 3(xiv) of the Order are notapplicable 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 non-cashtransactions with directors or persons connected with him as per provisions of section 192of the Act. Accordingly clause 3(xv) of the Order is not applicable.

(xvi) Based on audit procedures the Company is not required to be registered undersection 45- IA of the Reserve Bank of India Act 1934 and accordingly the provisions ofclause 3(xvi) of the Order is not applicable to the Company.

For Barry and Company
Chartered Accountants
FRN: 017988N
(K. Yash Barry)
Place: New Delhi FCA (Prop.)
Date:22.05.2018 M. No. : 012513

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 over financial reporting of LLOYDROCKFIBRES LIMITED ("the Company") as of 31st March 2018 in conjunctionwith our audit of the standalone financial statements of the Company for the year ended onthat 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 (‘ICAI'). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required 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 both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all 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 the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit 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 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 2018 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 Barry and Company
Chartered Accountants
FRN: 017988N
(K. Yash Barry)
Place: New Delhi FCA (Prop.)
Date:22.05.2018 M. No. : 012513