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Orient Abrasives Ltd.

BSE: 504879 Sector: Engineering
NSE: ORIENTABRA ISIN Code: INE569C01020
BSE 00:00 | 20 Jul 29.55 -0.40
(-1.34%)
OPEN

30.55

HIGH

31.00

LOW

29.30

NSE 00:00 | 20 Jul 29.55 -0.40
(-1.34%)
OPEN

31.40

HIGH

31.40

LOW

29.00

OPEN 30.55
PREVIOUS CLOSE 29.95
VOLUME 4525
52-Week high 67.00
52-Week low 27.05
P/E 20.81
Mkt Cap.(Rs cr) 353
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 30.55
CLOSE 29.95
VOLUME 4525
52-Week high 67.00
52-Week low 27.05
P/E 20.81
Mkt Cap.(Rs cr) 353
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Orient Abrasives Ltd. (ORIENTABRA) - Auditors Report

Company auditors report

To the Members of Orient Abrasives Limited

Report on the Financial Statements

We have audited the accompanying financial statements of Orient Abrasives Limited("the Company") which comprise the Balance Sheet as at March 31st2017 the Statement of Profit and Loss and Cash Flow Statement for the year then endedand a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of theCompanies Act 2013 ("the Act")with respect to the preparation ofthese financial statements that give a true and fair view of the financialpositionfinancial performance and cash flows of the Company in accordance with accountingprinciples generally accepted in India including the Accounting Standards specified undersection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014 and theCompanies (Accounting Standards) Amendment Rules 2016. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and the design implementationand maintenance of adequate internal financial control that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are freefrom material misstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit. 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 thereunder. We conducted our audit inaccordancewith the Standards on Auditing issued by the Institute of Chartered Accountants of Indiaas specified 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 financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal financial control relevant to the Company's preparation of thefinancialstatements that give a true and fair viewin order to design audit procedures thatareappropriate in the circumstances. An audit also includes evaluatingthe appropriatenessof accounting policies used and the reasonableness of the accounting estimates made bytheCompany's Directors as well as evaluating the overall presentation of the financialstatements. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for ouraudit opinion on the financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the financial statements give the information required by the Act in themanner so required and givea true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2017 its profit andits cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. 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 ofthe Act we give in the Annexure 1 a statement on the matters specified in paragraphs 3and 4 of the Order.

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 purpose 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 Statement of Profit and Loss and Cash Flow Statement dealt withby this Report are inagreement with the books of account;

(d) In our opinion the aforesaid financial statements comply with the AccountingStandards specified under section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014 and the Companies (Accounting Standards) Amendment Rules 2016;

(e) On the basis of written representations received from the directors as on March 312017 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of section 164 (2) ofthe 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 2" to this report;

(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 has disclosed the impact of pending litigations on its financialposition in its financial statements – Refer Note 27 to the financial statements;

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

iv. The Company has provided requisite disclosures in Note 40 to these financialstatements as to the holding of Specified Bank Notes on November 8 2016 and December 302016 as well as dealings in Specified Bank Notes during the period from November 8 2016to December 30 2016. Based on our audit procedures and relying on the managementrepresentation regarding the holding and nature of cash transactions including SpecifiedBank Notes we report that these disclosures are in accordance with the books of accountsmaintained by the Company and as produced to us by the Management.

For S R B C & CO. LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

Sd/-

per Arpit K. Patel

Partner

Membership No.: 34032

Place : Ahmedabad

Date : May 30th 2017

ANNEXURE REFERRED TO IN PARAGRAPH ON REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTSOF OUR REPORT OF EVEN DATE

Re: Orient Abrasives Limited ("the Company")

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

(b) All fixed assets have not been physically verified by the management during theyear but there is a regular programme of verification which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. No materialdiscrepancies were noticed on such verification.

(c) According to information and explanations given by the management the title deedsof immovable properties included in fixed assets are held in the name of the company.

(ii) (a) The inventory has been physically verified by the management during the year.In our opinion the frequency of verification is reasonable. No material discrepancieswere noticed on such physical verification. Inventories lying with third parties have beenconfirmed by them as at March 31 2017 and no material discrepancies were noticed inrespect of such confirmations.

(iii) (a) According to the information and explanations given to us the Company hasnot granted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under section 189 of theCompanies Act 2013. Accordingly the provisions of clause 3(iii)(a) (b) and (c) of theOrder are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to usthere are no loans investments guarantees and securities granted in respect of whichprovisions of section 185 and 186 of the Companies Act 2013 are applicable and hence notcommented upon.

(v) The Company has not accepted any deposits from the public.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Companies Act 2013 related to the manufacture of aluminium oxidegrains calcined products and monolithics and generation of power and are of the opinionthat prima facie the specified accounts and records have been made and maintained. Wehave not however made a detailed examination of the same.

(vii) (a) Undisputed statutory dues including provident fund employees' stateinsurance income-tax sales-tax service tax customs duty excise duty value added taxcess and other material statutory dues applicable to it have been regularly deposited withthe appropriate authorities though the delays in deposit of income tax provident fund andservice tax have not been serious.

(b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income-tax service taxsales-tax duty of custom duty of excise value added tax cess and other materialstatutory dues were outstanding at the year end for a period of more than six monthsfrom the date they became payable.

(c) According to the records of the Company the dues outstanding of income-tax sales-tax service tax duty of custom value added tax and cess on account of any dispute areas follows:

Name of the statute Nature of dues Amount (in Rs. lakhs) Forum where dispute is pending
Customs Act 1962 Differential custom duty on account of misclassification on import of coal. 54.51 Commissioner of Customs (Appeals)
Customs Act 1962 Redemption fine in lieu of confiscation u/s 125 of the Act 1.59 Additional Commissioner of Customs
Income Tax Act 1961 Penalty proceedings for error made in the return filed by the Company for the assessment year 2006-07 and 2009-10 47.49 Commissioner of Income Tax (Appeal)
Income Tax Act 1961 Disallowance of various expenses/deductions (under section 80IA) claimed by the Company for the year 2008-09 2010-11 2011-12 2012-13 and 2013-14 along with the penalty proceedings of the same for the year 2008-09 775.38 Commissioner of Income Tax (Appeal)
Income Tax Act 1961 Disallowance of deductions (under section 80IA) claimed by the Company for the year 2014-15 76.28 Assessing Officer

(viii) According to information and explanations given by the management we are of theopinion that the Company has not defaulted in repayment of dues to banks. The Company didnot have any outstanding dues in respect of a financial institution or debentures duringthe year.

(ix) In our opinion and according to information and explanations given by themanagement monies raised by the company by way of term loans were applied for the purposefor which they were raised. The Company has not raised any money way of initial publicoffer / further public offer / debt instruments).

(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud on or by the officers and employees ofthe Company has been noticed or reported during the year.

(xi) According to the information and explanations given by the management themanagerial remuneration has been paid / provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) In our opinion the Company is not a nidhi company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and on an overallexamination of the balance sheet the company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder review and hence reporting requirements under clause 3(xiv) are not applicable tothe company and not commented upon.

(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in section 192 of Companies Act 2013.

(xvi) According to the information and explanations given to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.

For S R B C & CO. LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

Sd/-

per Arpit K. Patel

Partner

Membership No.: 34032

Ahmedabad

May 30th 2017

ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONE FINANCIALSTATEMENTS OF ORIENT ABRASIVES LIMTED

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 OrientAbrasives Limited ("the Company") as of March 31st 2017 OrientAbrasives Limited in conjunction with our audit of the standalone financial statements ofthe Company for the year ended on that 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. 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 the 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.

Auditor's 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 as specified under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls and both issued by the Institute of Chartered Accountants of India.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and 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 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 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 March 31st 2017based on the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.

For S R B C & CO. LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

Sd/-

per Arpit K. Patel

Partner

Membership No.: 34032

Place : Ahmedabad

Date : May 30 2017