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RCI Industries & Technologies Ltd.

BSE: 537254 Sector: Metals & Mining
NSE: N.A. ISIN Code: INE140B01014
BSE 00:00 | 17 Oct 16.90 0.55
(3.36%)
OPEN

15.60

HIGH

17.00

LOW

15.55

NSE 05:30 | 01 Jan RCI Industries & Technologies Ltd
OPEN 15.60
PREVIOUS CLOSE 16.35
VOLUME 8390
52-Week high 117.00
52-Week low 15.55
P/E 1.34
Mkt Cap.(Rs cr) 23
Buy Price 16.90
Buy Qty 600.00
Sell Price 17.00
Sell Qty 75.00
OPEN 15.60
CLOSE 16.35
VOLUME 8390
52-Week high 117.00
52-Week low 15.55
P/E 1.34
Mkt Cap.(Rs cr) 23
Buy Price 16.90
Buy Qty 600.00
Sell Price 17.00
Sell Qty 75.00

RCI Industries & Technologies Ltd. (RCIINDUSTRIES) - Auditors Report

Company auditors report

TO

THE MEMBERS OF

RCI INDUSTRIES & TECHNOLOGIES LIMITED

Delhi.

Report on the Standalone Financial Statements

1. We have audited the accompanying standalone Ind AS financial statements of RCIINDUSTRIES AND TECHNOLOGIES LIMITED having their registered office at B-97 Wazirpurindustrial Area Delhi -110052 which comprise the Balance Sheet as at 31 March 2018 theStatement of Profit and Loss (including other comprehensive income) the Cash FlowStatement and the statement of changes in equity for the year then ended and a summary ofsignificant accounting policies and other explanatory information.

Management's Responsibility for the standalone Financial Statements

2. 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 Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) prescribedunder section 133 of the Act.

This responsibility also includes maintenance of proper accounting records inaccordance with the provision of the Act for safeguarding of the assets of the company andfor preventing and detecting the frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent and design implementation and maintenance of internal financialcontrol that were operating effectively for ensuring the accuracy and completeness of theaccounting records relevant to the preparation and presentation of the standalone Ind ASfinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

3. Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit.

In conducting 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.

4. 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 standalone Ind AS financial statements are free from material misstatement.

5. An audit involves performing procedures to obtain audit evidence about the amountsand disclosures in the financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation andfair presentation of the financial statements in order to design audit procedures that areappropriate in the circumstances. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made bymanagement as well as evaluating the overall presentation of the financial statements.

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

Opinion

6. 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:

i. in the case of the balance sheet of the state of affairs of the Company as at 31March 2018;

ii. in the case of the statement of profit and loss of the profit including othercomprehensive income for the year ended on that date; and

iii. in the case of the statement of change in equity of the changes in equityincluding other equity for the year ended on that date; and

iv. in the case of the cash flow statement of the cash flows for the year ended onthat date.

Report on Other Legal and Regulatory Requirements

7. As required by the Companies (Auditor's Report) Order 2016 as amended issued bythe Central Government of India in terms of sub-section (11) of section 143 of the Act weenclose in the "Annexure A" a statement on the matters specified in paragraphs 3and 4 of the said Order.

8. Subject to Para 7 of this report and as required by the section 143(3) of the Actwe report that:

i. 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;

ii. 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;

iii. The Balance Sheet Statement of Profit and Loss including other comprehensiveincome Cash Flow Statement and changes in equity dealt with by this Report are inagreement with the books of account and with the returns received from the branches notvisited by us;

iv. In our opinion the aforesaid standalone financial statement comply with the IndianAccounting standards specified under Section 133 of the Act;

v. On the basis of written representations received from the directors as on 31 March2018 and taken on record by the Board of Directors we report that none of the directorsis disqualified as on 31 March 2018 from being appointed as a director in terms ofSection 164(2) of the Act;

vi. 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" and

vii. With respect to the other matters included in the Auditor's Report in accordancewith Rule 11 of the Companies (Audit and Accounts) Rules 2014 in our opinion and to thebest of our information and according to the explanation given to us:

a. The company does not have any pending litigations which would impact its financialposition materially.

b. The company did not have any long term contracts including derivatives contracts forwhich there were any material foreseeable losses.

c. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the company.

For RPMD &Associates

Chartered Accountants

ICAI Firm's registration number: 005961C

Sd/-

(Rahul Jain)

Partner

Membership number: 518352

Place: Delhi

Date: May 7th 2018

"Annexure A" to Auditor's Report

As referred to in Para 7 of our report of even date to the members of RCI Industries& Technologies Ltd on the standalone accounts of 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:

1.

a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets on the basis of available information;

b) As explained to us all the fixed assets have been physically verified by themanagement in a phased periodical manner which in our opinion is reasonable havingregard to the size of the Company and nature of its assets. No material discrepancies werenoticed on such physical verification.

c) In accordance with the manner of periodical checking by the management certainfixed assets were verified during the year and no material discrepancies were noticed onsuch verification. Consequently further comment on proper treatment thereof in the booksof accounts does not arise; and

d) According to the information and explanations given to us and the records examinedby us and based on the examination of the registered sale deed / transfer deed /conveyance deed provided to us we report that the title deeds comprising all theimmovable properties of land and buildings which are freehold are held in the name of theCompany as at the balance sheet date.

2. According to the information and explanation provided to us the physicalverification of the inventory has been conducted at regular intervals by the management.In our opinion the frequency of verification is reasonable.

We are informed that the discrepancies between the physical stocks and the books ofaccount were negligible;

3. According to the information and explanations provided to us in respect of theloans secured or unsecured granted by the Company to companies firms or other partiescovered in the register maintained under Section189 of the Companies Act 2013:

a) The terms and conditions of the grant of such loans are not prejudicial to thecompany's interest.

b) The schedule of the repayment has been stipulated and the receipt of the principalamount or interest is regular.

c) There is no overdue amount which has not been received.

4. According to the information and explanations provided to us the company hascomplied with the provisions of section 185 and 186 of the Act with respect to loans andinvestments made. Consequently further comment under this clause does not arise.

5. According to the information and explanations provided to us the Company has notaccepted any deposit from the public. Consequently further comment under this clause doesnot arise.

6. According to the information and explanations provided to us the company ismaintaining cost records in accordance with the requirements of sub section (1) of section148 of the Act read with Companies (Cost Records and Audit) 2014. Consequently furthercomment under this clause does not arise.

7.

a) According to the records of the company produced before us and as per theinformation and explanation provided to us the company is regular in depositing with theappropriate authorities undisputed statutory dues including Income Tax and other statutorydues and there does not exist any arrears of outstanding statutory dues as at the lastday of the financial year concerned for a period of more than six months from the datethey became payable.

b) According to the information and explanations provided to us there does not existany dues of income tax or sales tax or service tax or duty of customs or duty of excise orvalue added tax or cess which have not been deposited on account of dispute except asmentioned in Note 2.28 to Standalone financial statements wherein Rs. 556047/- has beenshown as contingent liabilities in respect of disputed demand pertaining to tax laws.

8. According to the information and explanations provided to us we are of the opinionthat the Company has not defaulted in repayment of dues to financial institutions orgovernment or bank. Consequently further comment under this clause does not arise.

9. According to the information and explanations provided to us the Company has notraised money by issue of public offer (including debt instruments) and term loan.Consequently further comment under this clause does not arise.

10. According to the information and explanations provided to us and based on ourexamination of the books of accounts maintained no fraud by the company or any fraud onthe company by its officers or employees has been noticed or reported during the year.Consequently further comment under this clause does not arise.

11. According to the information and explanations provided to us and based on ourexamination of the books of accounts maintained the company has paid managerialremuneration to the ‘Managing Director' which is in accordance with the provisions ofSection 197 read with Schedule V to the Act. Consequently further comment under thisclause does not arise.

12. According to the information and explanations provided to us the Company is not aNidhi Company as per section 406(1) of the Act. Consequently further comment under thisclause does not arise.

13. According to the information and explanations provided to us all transactions withrelated parties are in compliance with sections 177 and 188 of the Act and are disclosedin note 2.30 forming part of the standalone financial statements annexed to this auditreport in compliance of AS-18 Related Party Disclosures.

14. According to the information and explanations provided to us and based on ourexamination of the books of accounts maintained the company has made preferentialallotment on private placement basis of fully compulsorily convertible debentures duringthe year under review. To the extent of audit conducted by us we report that the companyhas complied with the requirements of Section 42 of the Companies Act.

During the year the Company has allotted 560000 unsecured zero coupon compulsorilyconvertible debentures (CCD) of the face value of INR 900 each by way of preferentialallotment on private placement basis as approved by the board of directors during themeeting held on March 31 2018. As per the terms of arrangement the CCDs shall beconverted into equity shares on or before the completion of 18 months from the date ofallotment of CCDs. 1 (one) CCD shall be converted into 4 (four) equity shares each. Theequity shares to be issued on conversion shall rank pari passu in all respects with theexisting equity shares of the company.

To the extent of audit conducted by us we report that the purposes for the allotmentof CCDs were to repay the Inter Corporate Deposit (ICD) of Rs. 30 Crores and to meet thecapital expenditure to support business expansion plan of the company. We observe that thecompany has repaid the ICD of Rs. 30 Crores. However as the funds were received on March31 2018 the capital expenditure is yet to be incurred.

15. According to the information and explanations provided to us the Company has notentered into any transactions with directors or persons connected with him or itssubsidiary company to transfer any assets for consideration other than cash under Section192 (1)(a) of the Act.

According to the information and explanations provided to us the Company has notentered into any transactions with directors or persons connected with him to acquire anyassets for consideration other than cash under Section 192 (1)(b) of the Act.

16. According to the information and explanations provided to us the company is notrequired to be registered under section 45 IA of the Reserve Bank of India Act 1934.Consequently further comment under this clause does not arise.

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

1. We have audited the internal financial controls over financial reporting of RCIIndustries & T echnologies Limited ("the Company") as of March 31 2018 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

2. 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". 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

3. 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.

4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the internal financial controls system over financial reporting and their operatingeffectiveness.

5. Our audit of internal financial controls over financial reporting included obtainingan understanding of internal financial controls over financial reporting assessing therisk that a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgement including the assessment of the risks of materialmisstatement 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

6. A company's internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that

a. pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

b. provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and

c. provide reasonable assurance regarding prevention or timely detection ofunauthorised 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

7. 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

8. 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 on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For RPMD & Associates

Chartered Accountants

ICAI Firm's registration number: 005961C Sd/-

(Rahul Jain)

Partner

Membership number: 518352

Place: Delhi

Date: May 7th 2018