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MRF Ltd.

BSE: 500290 Sector: Auto
NSE: MRF ISIN Code: INE883A01011
BSE 00:00 | 22 Feb 54860.95 132.25
(0.24%)
OPEN

54800.00

HIGH

55138.00

LOW

54687.35

NSE 00:00 | 22 Feb 54960.80 250.15
(0.46%)
OPEN

54720.00

HIGH

55150.00

LOW

54553.50

OPEN 54800.00
PREVIOUS CLOSE 54728.70
VOLUME 404
52-Week high 81423.00
52-Week low 53901.45
P/E 20.26
Mkt Cap.(Rs cr) 23,261
Buy Price 54830.00
Buy Qty 5.00
Sell Price 54860.95
Sell Qty 1.00
OPEN 54800.00
CLOSE 54728.70
VOLUME 404
52-Week high 81423.00
52-Week low 53901.45
P/E 20.26
Mkt Cap.(Rs cr) 23,261
Buy Price 54830.00
Buy Qty 5.00
Sell Price 54860.95
Sell Qty 1.00

MRF Ltd. (MRF) - Auditors Report

Company auditors report

TO THE MEMBERS OF MRF LIMITED

1. REPORT ON THE STANDALONE FINANCIAL STATEMENTS

1.1 We have audited the accompanying standalone financial statements of MRF LIMITED(“the Company”) which comprise the Balance Sheet as at 31st March 2018 theStatement of Profit and Loss (including other comprehensive income) the statement ofchanges in Equity and the Cash Flow Statement for the year then ended and a summary ofthe significant accounting policies and other explanatory information.

2. MANAGEMENT'S RESPONSIBILITY FOR THE STANDALONE FINANCIAL STATEMENTS.

2.1 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 state ofaffairs (financial position) profit or loss (financial performance including othercomprehensive income) changes in equity and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (IND AS) prescribed under Section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 as amended.

2.2 This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; the 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 Standalone financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

3. AUDITOR'S RESPONSIBILITY

3.1 Our responsibility is to express an opinion on these standalone financialstatements based on our audit. We have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder and the orderissued under Section 143 (11) of the Act.

3.2 We conducted our audit of the Standalone financial statements in accordance withthe Standards on Auditing specified under Section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the Standalone financial statements are free frommaterial misstatement.

3.3 An audit involves performing procedures to obtain audit evidence about the amountsand the disclosures in the Standalone financial statements. The procedures selected dependon the auditor's judgment including the assessment of the risks of material misstatementof the standalone financial statements whether due to fraud or error. In making thoserisk assessments the auditor considers internal financial control relevant to theCompany's preparation of the Standalone financial statements that give a true and fairview in order to design audit procedures that are appropriate in the circumstances. Anaudit also includes evaluating appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the Standalone financial statements.

3.4 We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the standalone financial statements.

4. OPINION

4.1 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 Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs (financialposition) of the Company as at 31st March 2018 its profit (financial performanceincluding other comprehensive income) the changes in equity and its cash flows for theyear ended on that date.

5. REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

5.1 As required by the Companies (Auditor's Report) Order 2016(“the Order”)issued by the Central Government in terms of Section 143 (11) of the Act we give in“Annexure A” - a statement on the matters specified in paragraphs 3 and 4 of theOrder.

5.2 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 ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books.

c) The Balance Sheet the Statement of Profit and Loss including other comprehensiveincome Statement of Changes in Equity and the Cash Flow Statement dealt with by thisReport are in agreement with the books of account.

d) In our opinion the aforesaid standalone financial statements comply with the IndianAccounting Standards prescribed under Section 133 of the Act. e) On the basis of thewritten representations received from the directors as on 31st March 2018 taken on recordby the Board of Directors none of the directors is disqualified as on 31st March 2018from 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 financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in “nnexure B”. 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 information andaccording 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 27 (O) to the Standalonefinancial statements;

ii. The Company has long-term contracts including derivative contracts for which therewere no material foreseeable losses; and

iii. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the company during the year ended 31st March2018.

For SCA AND ASSOCIATES For MAHESH VIRENDER & SRIRAM
Chartered Accountants Chartered Accountants
Firm Regn. No. 101174W Firm Regn. No. 001939S
Shivratan Agarwal B R Mahesh
Partner Partner
Mem. No. 104180 Mem. No. 18628
Chennai Dated May 03 2018

ANNEXURE ”A” TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS OF MRF LIMITED

i) In respect of its Fixed Assets:

a) The company has maintained proper records showing full particulars includingquantitative details and situation of Fixed Assets;

b) As explained to us the Assets have been physically verified by the management inaccordance with a phased programme of verification which in our opinion is reasonableconsidering the size and the nature of its business. The frequency of verification isreasonable and no material discrepancies have been noticed on such physical verification;

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 inventory has been physically verified by the management during the year. Inour opinion the frequency of verification is reasonable. No material discrepancies werenoticed on such physical verification. As regards materials lying with third partiesconfirmations have been obtained;

iii) The company has not granted any loans secured or unsecured during the year tocompanies firms limited liability partnerships or other parties covered in the registermaintained under section 189 of the Act. Accordingly the clauses 3(iii) (a) (b) and (c)of the Order are not applicable to the Company.

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 loans and making investment.

v) The Company has complied with the directives issued by Reserve Bank of India and theProvisions of Section 73 to 76 of the Act and the rules framed thereunder with regard todeposits accepted from the public. We are informed by the management that no order hasbeen passed by the Company Law Board or National Company Law Tribunal or Reserve Bank ofIndia or any court or any other Tribunal on the Company.

vi) We have broadly reviewed the books of account maintained by the company pursuant tothe rules made by the Central Government for the maintenance of cost records under section148 (1) of the Act and are of the opinion that prima facie the prescribed accounts andrecords have been made and maintained.

vii) a) The company is regular in depositing undisputed statutory dues includingProvident Fund Employees' State Insurance Income Tax Sales-Tax Service Tax GoodsService Tax duty of customs duty of excise value added tax cess and any otherstatutory dues with appropriate authorities where applicable. According to theinformation and explanations given to us there are no undisputed amounts payable inrespect of such statutory dues which have remained outstanding as at 31st March 2018 fora period of more than six months from the date they became payable.

b) According to the records of the company the dues outstanding of income-taxsales-tax service tax duty of customs duty of excise and value added tax on account ofany dispute are as follows:

Statute and nature of dues Financial year to which the matter pertains Forum where the dispute is pending ` Crores
CENTRAL SALES TAX
ACT 1956 and VAT LAWS
Sales tax / VAT and penalty 1999-2000 2000-01 2002-03 2003-04 2005-06 2006-07 2008- 09 2009-10 2010-11 and 2012-13 to 2017-18 Appellate Commissioner 5.40
1997-98 2001-02 2003-04 2004-05 2006-07 to 2010-11 2013-14 2014-15 and 2016-17 Appellate Tribunal 13.87
2006-07 to 2016-17 High Court 28.86
1996-97 2000-01 to 2002-03 Supreme Court 0.01
CUSTOMS ACT 1962
Customs Duty and penalty 2016-17 Appellate Tribunal 11.23
1992-93 to 1994-95 High Court 74.89
CENTRAL EXCISE ACT 1944 and Finance Act 1994
Excise duty Service tax and penalty 1997-98 2006-07 2008-09 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 and 2017-18 Appellate Commissioner 7.93
2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 and 2015-16 Appellate Tribunal 0.44
INCOME TAX 1961 2001-02 Supreme Court 0.06
Income Tax 2008-09 to 2014-15 Appellate Tribunal 91.13
2002-03 and 2004-05 High Court 4.51

viii) The company has not defaulted in repayment of its loans or borrowings to banksand debenture holders.

ix) The Company has not raised any moneys by way of Initial public offer or furtherPublic offer (Including debt instruments) during the year. Moneys raised by way of TermLoan were applied for the purpose for which those are raised.

x) On the basis of our examination and according to the information and explanationsgiven to us no fraud by the Company or any material fraud on the company by its officersor employees has been noticed or reported during the year nor have we been informed ofany such case by the management.

xi) The managerial remuneration has been paid/provided in accordance with the requisiteapprovals mandated by the provisions of Section 197 read with Schedule V to the Act.

xii) The company is not a nidhi Company and accordingly provisions of clause (xii)ofPara 3 of the order are not applicable to the Company.

xiii) On the basis of our examination and according to the information and explanationsgiven to us we report that all the transaction with the related parties are in compliancewith Section 177 and 188 of the Act and the details have been disclosed in the Financialstatements in Refer Note 27(e) as required by the applicable accounting standards.

xiv) The company has not made any preferential allotment or private placement of shareor fully or partly paid convertible debentures during the year and accordingly provisionsof clause (xiv) of Para 3 of the Order are 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 directors or persons connected with the directors. Accordinglyprovisions of clause (xv) of Para 3 of the Order are not applicable to the company.

xvi) The company is not required to be registered under section 45-IA of the ReserveBank of India Act1934 and accordingly provisions clause (xvi) of Para 3 of the Order arenot applicable to the Company.

For SCA AND ASSOCIATES For MAHESH VIRENDER & SRIRAM
Chartered Accountants Chartered Accountants
Firm Regn. No. 101174W Firm Regn. No. 001939S
Shivratan Agarwal B R Mahesh
Partner Partner
Mem. No. 104180 Mem. No. 18628
Chennai Dated May 03 2018

“ANNEXURE B” TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS OF MRF LIMITED.

1. REPORT ON THE INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING UNDERCLAUSE (I) OF SUB-SECTION 3 OF SECTION 143 OF THE COMPANIES ACT 2013 (“TheAct”)

We have audited the internal financial controls over financial reporting of MRF LIMITED(“the Company”) as of March 31 2018 in conjunction with our audit of thestandalone financial statements of the Company for the year ended on that date.

2. MANAGEMENT'S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Act.

3. 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”) issued by Institute of Chartered accountants of India andthe Standards on Auditing prescribed under section 143(10) of the Companies Act 2013 tothe extent applicable to an audit of internal financial controls. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively 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 judgement including the assessment of the risks ofmaterial misstatement of the financial statements 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.

4. 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.

5. 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.

6. 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 March 31 2018 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note issued by theInstitute of Chartered Accountants of India.

For SCA AND ASSOCIATES For MAHESH VIRENDER & SRIRAM
Chartered Accountants Chartered Accountants
Firm Regn. No. 101174W Firm Regn. No. 001939S
Shivratan Agarwal B R Mahesh
Partner Partner
Mem. No. 104180 Mem. No. 18628
Chennai Dated May 03 2018