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Rama Petrochemicals Ltd.

BSE: 500358 Sector: Industrials
NSE: RAMAPETRO ISIN Code: INE783A01013
BSE 00:00 | 08 Mar 3.92 0
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NSE 05:30 | 01 Jan Rama Petrochemicals Ltd
OPEN 3.92
PREVIOUS CLOSE 3.92
VOLUME 10
52-Week high 6.52
52-Week low 2.15
P/E
Mkt Cap.(Rs cr) 4
Buy Price 3.95
Buy Qty 50.00
Sell Price 3.92
Sell Qty 1335.00
OPEN 3.92
CLOSE 3.92
VOLUME 10
52-Week high 6.52
52-Week low 2.15
P/E
Mkt Cap.(Rs cr) 4
Buy Price 3.95
Buy Qty 50.00
Sell Price 3.92
Sell Qty 1335.00

Rama Petrochemicals Ltd. (RAMAPETRO) - Auditors Report

Company auditors report

To the Members of Rama Petrochemicals Limited Report on the Standalone FinancialStatements Qualified Opinion

We have audited the Standalone Financial Statements of Rama Petrochemicals Limited ("theCompany") which comprise of the Balance Sheet as at 31st March 2020 and theStatement of Profit and Loss Statement of Changes in Equity and Statement of Cash Flowsfor the year then ended and notes to the Financial Statements including a summary ofsignificant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us except for the effects of the matter described in the Basis for QualifiedOpinion section of our report the aforesaid financial statements give the informationrequired by the Companies Act 2013 ("the Act") in the manner so required andgive a true and fair view in conformity with the accounting principles generally acceptedin India

(a) in the case of the Balance Sheet of the state of affairs of the Company as atMarch 31 2020;

(b) in the case of the Statement of Profit and Loss of the Profit for the year endedon that date;

(c) in the case of the Statement of Changes in Equity of the changes in equity for theyear ended on that date; and

(d) in the case of the Cash Flow Statement of the cash flows for the year ended onthat date.

Basis for Qualified Opinion

Going Concern - We draw attention to Note 28 & 30 regarding the Company'sFinancial Statements having been prepared using the going concern basis of accounting.Management is responsible for assessing the Company's ability to continue as a goingconcern The Balance Sheet and Cash Flow Statement indicate that as on March 31 2020 theCompany's Current Liabilities are more than its Current Assets; and Company has incurrednet Operating Loss of ' 17519072/- during the year ended March 31 2020. Furtherdiscontinuance of production since last many years indicates that there is a significantdoubt on the Company's ability to continue as a going concern. Our opinion is modified inrespect of this matter.

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Act and the Rules thereunder and we havefulfilled our other ethical responsibilities in accordance with these requirements and theCode of Ethics.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our qualified opinion.

Key Audit Matters

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.

S.N. Key Audit Matters Auditor's Response
1. Impairment of assets. The Company has obtained a valuation report dt. 01/09/2015 from a registered valuer which indicates that there is no impairment of assets.
2. Ability to continue as a going concern Our opinion is suitably modified. Refer para on Basis for Qualified Opinion of the report above.

Information Other than the Standalone Financial Statements and Auditor's Report thereon

The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises of the information included in the ManagementDiscussion and Analysis Draft Board's Report including Annexures to the said Board'sReport Corporate Governance and Shareholder's Information but does not include thefinancial statements and our auditor's report thereon.

Our opinion on the standalone financial statements does not cover the other informationand we do not 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 during thecourse of our audit or otherwise appears to be materially misstated.

If based on the work we have performed we conclude that there is a materialmisstatement of this other information; we are required to report that fact. We havenothing to report in this regard.

Management's Responsibility for the Standalone Financial Statements

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 financial position financial performance changesin equity and cash flows of the Company in accordance with the Ind AS and other accountingprinciples generally accepted in India. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingof the assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate implementation and maintenance ofaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation 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 standalone financialstatement that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

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. The Board of Directors are also responsible for overseeing theCompany's financial reporting process.

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

Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

• Obtain an understanding of internal financial controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basisof accounting 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 financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen 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

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 Companies Act 2013 we give in the Annexure a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.

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 the Statement of Changes inEquity and the Cash Flow Statement dealt with by this Report are in agreement with therelevant books of account.

d) In our opinion the aforesaid financial statements comply with the Ind AS specifiedunder Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules2015.

e) On the basis of the written representations received from the directors as on 31stMarch 2020 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2020 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 over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate 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 has disclosed the impact of pending litigations on its financialposition in Note 27 of the standalone financial statements.

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

iii. There were no dues which were required to be transferred to Investor Education andProtection Fund by the company.

For Dayal and Lohia
Chartered Accountants
Firm Regn. No. 102200W
Anil Lohia
Place: Mumbai

(Partner)

Date: 30th June 2020. M. No. : 31626
UDIN : 20031626AAAABU5711

Annexure A to Independent Auditors' Report

The Annexure referred to in our report to the members of Rama Petrochemicals Limited(‘the Company') for the year Ended on 31st March 2020.

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

b) The Management of the Company has physically verified the fixed assets in accordancewith its policy of physical verification at reasonable intervals. The discrepancies ifany noticed during such verification have been suitably adjusted in the books of account.In our opinion this periodicity of physical verification is reasonable having regard tothe 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) a) According to the information and explanations given to us the management hasconducted physical

verification of the inventories at reasonable intervals.

b) In our opinion and according to the information and explanations given to us theprocedures followed by the management for physical verification of inventory arereasonable and adequate in relation to the size of the Company and the nature of thebusiness.

c) No material discrepancies have been noticed on physical verification of the stocksas compared to book records in so far as it appears from our examination of the books.

iii) According to the information and explanations given to us and on the basis of ourexamination of books of account the Company has not granted any loans secured orunsecured to companies firms limited liability partnerships or other parties covered inthe register maintained under section 189 of the Companies Act 2013. Therefore theprovision of clauses 3(iii)(a) (b) and (c) of the said Order are not applicable.

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 and guaranty and security provided.

v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public.

vi) According to the information and explanation given to us the government hasprescribed maintenance of cost records pursuant to Companies (Cost Accounting Records)Rules 2011 prescribed by the Central Government under sub-section (1) of section 148 ofthe Companies Act. Since there is no turnover of manufacturing goods in the precedingfinancial year the same is not applicable.

vii) a) According to the records of the Company undisputed statutory dues includingProvident Fund Employee's

State Insurance Sales Tax Income Tax Service Tax Custom Duty Excise Duty ValueAdded Tax Goods and Service Tax Cess and other statutory dues have been regularlydeposited with the appropriate authorities. According to the information and explanationsgiven to us no undisputed amounts payable in respect of aforesaid dues were outstandingas at 31st March 2020 for a period of more than six months from the date it becamepayable except:

Name of the statute Nature of the dues Amount Rupees Period to which the amount relates Due Date
The Customs Act 1962 Custom Duty on import of Catalyst 5932740/- 1998-1999 21.02.1998
Sales Tax Act Deferral Sales Tax Liability 310344140/- 1988-1997 30.04.2014

b) According to the information and explanations given to us and the records of theCompany examined by us there are no dues of Income Tax Service Tax Sales Tax ExciseDuty Custom Duty or Value Added Tax Goods and Service Tax which have not been depositedon account of any dispute

viii) On the basis of our examination of the books and according to the information andexplanations given to us there are no borrowings from financial institutions banks ordebenture holders.

ix) To the best of our knowledge and belief and according to the information andexplanations given to us the Company has not raise any money by way of initial publicoffer or further public offer (including debt instruments). Term loans raised during theyear is applied for the purpose for which it is 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 give 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 on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the standalone financial statements as required by theapplicable accounting standards

xiv) According to the information and explanations give 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.

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 them. Accordingly paragraph 3(xv)of the 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 Dayal and Lohia
Chartered Accountants
Firm Regn. No. 102200W
Anil Lohia
Place: Mumbai

(Partner)

Date: 30th June 2020. M. No. : 31626

ANNEXURE - B' TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONEFINANCIAL STATEMENTS OF RAMA PETROCHEMICALS LIMITED

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 RamaPetrochemicals Limited ("the Company") as of 31st March 2020 inconjunction with our audit of the standalone financial statements of the Company for theyear 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 (‘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 Institute ofChartered Accountants of India and deemed to be prescribed under section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controlsboth applicable to an audit of Internal Financial Controls and both issued by theInstitute of Chartered Accountants of India. Those Standards and the Guidance Note requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in allmaterial 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.

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 authorizations of management and directors of thecompany; and (3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial 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 31st March 2020based 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 Dayal and Lohia
Chartered Accountants
Firm Regn. No. 102200W
Anil Lohia
Place: Mumbai

(Partner)

Date: 30th June 2020. M. No. : 31626

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