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National Fittings Ltd.

BSE: 531289 Sector: Engineering
NSE: N.A. ISIN Code: INE643C01015
BSE 00:00 | 20 Feb 29.00 -0.45
(-1.53%)
OPEN

29.45

HIGH

31.25

LOW

29.00

NSE 05:30 | 01 Jan National Fittings Ltd
OPEN 29.45
PREVIOUS CLOSE 29.45
VOLUME 1541
52-Week high 137.00
52-Week low 23.10
P/E 10.86
Mkt Cap.(Rs cr) 26
Buy Price 29.00
Buy Qty 651.00
Sell Price 30.00
Sell Qty 755.00
OPEN 29.45
CLOSE 29.45
VOLUME 1541
52-Week high 137.00
52-Week low 23.10
P/E 10.86
Mkt Cap.(Rs cr) 26
Buy Price 29.00
Buy Qty 651.00
Sell Price 30.00
Sell Qty 755.00

National Fittings Ltd. (NATIONALFITTING) - Auditors Report

Company auditors report

TO THE MEMBERS OF NATIONAL FITTINGS LIMITED

Report on the Audit of the Ind AS Financial Statements

We have audited the accompanying Ind AS financial statements of National FittingsLimited ("the Company") which comprise the Balance Sheet as at31March2018theStatement Profitand Loss the Statement of Changes in Equity and theStatement of Cash Flows for the year then ended and other explanatory information summaryof the significant

Management's Responsibility for the Ind AS Financial Statements

The Company's Board of Directors is responsible for the preparation of these Ind ASfinancial in terms of the requirement of the Companies Act 2013 (hereinafter referred toas "the Act") that give a true and fair view of the state of affairs profit(including other comprehensive income) changes in equity and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards (Ind AS) prescribed under Section 133 of the Act. The Board ofDirectors of the company are responsible for 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 Ind AS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error which have been used for the purpose ofpreparation of the Ind AS financial statements by the directors of the Company.

Auditor's Responsibility

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

While conducting the 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.

We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe Ind AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the Ind AS financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of theInd AS financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to the Company'spreparation of the Ind AS financial statements that give a true and fair view in order todesign audit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of the accounting policies used and the reasonableness ofthe accounting estimates made as well as evaluating the overall presentation of the IndAS financial We believe that the audit evidence we have obtained is sufficient andappropriate to provide 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 aforesaid Ind AS financial statements give the information required bythe 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 of the Companyas at 31 March 2018 its profit (including other comprehensive income) its changes inequity and its cash flows for the year ended on that date.

Other Matter

The financial information of the Company for the year ended March 31 2017 and thetransition date opening balance sheet as at April 1 2016 included in these financialstatements are based on the previous issued statutory financial statements for the yearsended March 31 2017 & March 31 2016 prepared in accordance with the Companies(Accounting Standards) Rules 2006 (as amended) which were audited by other auditor andwhose report has been furnished to us by the Management. The financial statements ofInterfit India Limited and Merit Industries Limited were audited by other auditor andwhose report has been furnished to us by the Management which were included in thefinancial statements pursuant to amalgamation with the Company (refer Note 2.32) and ouropinion on the merged financial statements in so far as it relates to the amounts anddisclosure included in respect of Interfit India Limited and Merit Industries Limited isbased solely on the reports of the other auditor.

Emphasis of Matter

As per the Order of the National Company Law Tribunal Chennai bench("NCLT")on the scheme of Amalgamation of Interfit India Limited and Merit Industries Limited (theTransferor Companies) with National Fittings Limited (the Transferee Company") thefinancials have been restated with effect from April 1 2017 being the appointed date forcoming into force of the scheme. The Order of the NCLT dated 25th March 2019 was receivedon 25th March 2019 and the effect of amalgamation have been given by incorporating all thetransactions in the books of accounts of Transferee Company with effect from April 12017 to comply with the Order.

The financial statements of erstwhile Interfit India Limited (the Transferor Company -1) as audited by other auditor were included in the financial statements pursuant toamalgamation with the Company (refer Note 2.32) which constitute total assets of 2227.26Lakhs as at March 31 2017 total revenue of 2159.36 Lakhs and net profit of 362.52 Lakhsfor the period then ended.

The financial statements of erstwhile Merit India Limited (the Transferor Company - 2)as audited by other auditor were included in the financial statements pursuant toamalgamation with the Company (refer Note 2.32) which constitute total assets of 1913.21Lakhs as at March 31 2017 total revenue of 1405.05 Lakhs and net profit of 37.18 Lakhsfor the period then ended.

Report on other Legal and Regulatory Requirements

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

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 of the aforesaidCompany's

IND AS financial statements

(b) In our opinion proper books of account as required by law relating to preparationof the aforesaid Company's IND AS financial statements have been kept by the Company sofar as it appears from our examination of those books.

(c) The Balance Sheet the Statement of Profit and Loss the Statement of Changes inEquity Statement of Cash Flows dealt with by this Report are in agreement with the booksof account maintained for the purpose of the aforesaid Company's IND AS financialstatements (d) In our opinion the aforesaid Ind AS financial statements comply with theIndian Accounting Standards prescribed under Section 133 of the Act.

(e) On the basis of the written representations received from the directors of theCompany which is incorporated in India as on 31 March 2018 and taken on record by theBoard of Directors none of the directors of the Company incorporated in India isdisqualified as on 31 March 2018 from being appointed as a director in terms of Section164(2) of the Act.

(f) With respect to the adequacy of the internal financial controls with reference tofinancial statements of the Company incorporated in India and the operating effectivenessof such controls refer to our separate Report in "Annexure B".

(g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company did not have any long term contracts incudling derivative contracts forwhich there were any material foreseeable losses;

ii. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company;

iii. The Company has no pending litigation as at 31st March 2018; and

iv. The disclosure regarding details of specified bank notes held and transacted during8 November 2016 to 30 December 2016 has not been made since the requirement does notpertain to financial year ended 31 March 2018.

For V Krish & Associates
Chartered Accountants
Firm's Registration No. 01452 S
Sd/- B. SATHISHKUMAR
Place : COIMBATORE Partner
Date : 30.03.2019 Membership No. 218445

Annexure A to the Independent Auditors' Report

With reference to the Annexure A referred to in the Independent Auditor's Report to themembers of the Company on the Ind AS financial statements for the year ended 31 March2018 we report the following:

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

(b) The Company has a regular programme of physical verification of its fixed assetsby which all fixed assets are verified in a phased manner over a period of three years. Inour opinion this periodicity of physical verification is reasonable having regard to thesize of the Company and the nature of its assets. Pursuant to the programme certain fixedassets were physically verified during the year and no material discrepancies were noticedon such 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 propertiesincluded in fixed assets are held in the name of the Company.

In respect of immovable properties been taken on lease and disclosed as property plantand equipment in the Ind AS financial statements the lease agreements are in the name ofthe Company.

(ii) The inventory has been physically verified by the management during the year. Inour opinion the frequency of such verification is reasonable. The Company has maintainedproper records of inventory. The discrepancies noticed on verification between thephysical stock and the book records were not material.

(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms limited liabilitypartnerships or other parties covered in the register maintained under section 189 of theAct. Accordingly the provisions of clause 3(iii) (a) (b) and (c) of the Order are notapplicable to the Company.

(iv) The Company has not granted any loans made investments issued guarantees orprovided any security to any Director or any other person as specified in the Act andhence this clause is not applicable to the Company for this year.

(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) As per information and explanation given by the management The Central Governmenthas not prescribed the maintenance of cost records under Section 148(1) of the Act.

(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 Employees' StateInsurance Income-tax Sales tax Service tax Goods and Services tax duty of Customsduty of Excise Value added tax Cess and other material statutory dues have generallybeen regularly deposited during the year by the Company with the appropriate authorities.

According to the information and explanations given to us no undisputed amountspayable in respect of Provident fund Employees' State Insurance Income-tax Sales taxService tax Goods and Services tax duty of Customs duty of Excise Value added taxCess and other material statutory dues were in arrears as at 31 March 2018 for a periodof more than six months from the date they became payable.

(b) According to the information and explanations given to us and based on Managementrepresentation there are no dues of Income-tax or Sales tax or Service tax or Goods andServices tax or duty of Customs or duty of Excise or Value added taxes which have not beendeposited by the Company on account of disputes.

(c) According to the information and explanations given to us and also based on theManagement representation the disputed statutory dues in respect of erstwhile InterfitIndia Limited that have not been deposited on account of matters pending beforeAppropriate authorities are as under:

Name of the Statute Nature of Dues Amount Forum where the dispute is pending
(Rs. Lacs)
Central Excise Act 1944 Excise Duty 0.12 High Court
Central Excise Act 1944 Excise Duty 75.74 CESTAT
1.53
Employees State Insurance Act 1948 Insurance Premium (Against 6.80 demanded 5.27 has been paid) The Honourable Employees State Employee's State Insurance Court

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of loans or borrowings to banks.

(ix) In our opinion and according to the information and explanations given to us theCompany did not raise any money by way of initial public offer or further public offer(including debt instruments) and term loans during the year. Accordingly paragraph 3(ix)of the Order is not applicable to the Company.

(x) To the best of our knowledge and according to the information and explanationsgiven to us no material fraud by the Company or on the Company by its officers oremployees has been noticed or reported during the course of our audit.

(xi) In our opinion and according to the information and explanations given to us andbased on examination of the records of the Company the Company has paid/providedmanagerial remuneration in accordance with the requisite approvals mandated by theprovisions of Section 197 read with Schedule V to the Act.

(xii) According to the information and explanations given to us in our opinion theCompany is not a Nidhi Company as prescribed under Section 406 of the Act.

(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company all 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 Ind AS financial statements as required by theapplicable accounting standards.

(xiv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. Accordingly paragraph 3(xiv) of the Order is not applicable to the Company.

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

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

For V Krish & Associates
Chartered Accountants
Firm's Registration No. 01452 S
Sd/- B. SATHISHKUMAR
Place : COIMBATORE Partner
Date : 30.03.2019 Membership No. 218445

Annexure - B to the Independent Auditor's Report

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

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

We have audited the internal financial controls over financial reporting of NationalFittings Limited ("the Company") as of 31 March 2018 in conjunction with ouraudit of the Ind AS 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 which are incorporated in India are responsiblefor establishing and maintaining internal financial controls financial reporting criteriabased on the internal control over established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia ("ICAI"). These responsibilities include the design implementation andwere operating effectively for ensuring the orderly maintenance of adequate internalfinancial and efficient conduct of its business including adherence to the Company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's which are incorporated inIndia internal financial controls over financial reporting based on our audit. Weconducted our audit in accordance with the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting (the "Guidance Note") issued by the ICAI andthe Standards on Auditing issued by the ICAI and deemed to be prescribed under Section143(10) of the Act to the extent applicable to an audit of internal financial controlsboth applicable to an audit of Internal Financial Controls and both issued by ICAI. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial control 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 Ind AS 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 which are incorporated in Indiainternal financial controls system over 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 which is incorporated in India have in all materialrespects an adequate internal financial controls system over financial reporting and suchinternal financial controls over financial reporting were operating effectively as at 31March 2018 based on the internal control over financial reporting criteria established bythe Company considering the essential components of internal control stated in theGuidance Note issued by the ICAI.

For V Krish & Associates
Chartered Accountants
Firm's Registration No. 01452 S
Sd/- B. SATHISHKUMAR
Place : COIMBATORE Partner
Date : 30.03.2019 Membership No. 218445