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Refnol Resins & Chemicals Ltd.

BSE: 530815 Sector: Industrials
NSE: N.A. ISIN Code: INE428C01011
BSE 00:00 | 24 May 22.00 -0.85
(-3.72%)
OPEN

21.30

HIGH

24.50

LOW

21.30

NSE 05:30 | 01 Jan Refnol Resins & Chemicals Ltd
OPEN 21.30
PREVIOUS CLOSE 22.85
VOLUME 202
52-Week high 33.60
52-Week low 13.50
P/E 7.77
Mkt Cap.(Rs cr) 7
Buy Price 22.00
Buy Qty 400.00
Sell Price 25.00
Sell Qty 58.00
OPEN 21.30
CLOSE 22.85
VOLUME 202
52-Week high 33.60
52-Week low 13.50
P/E 7.77
Mkt Cap.(Rs cr) 7
Buy Price 22.00
Buy Qty 400.00
Sell Price 25.00
Sell Qty 58.00

Refnol Resins & Chemicals Ltd. (REFNOLRESINS) - Auditors Report

Company auditors report

TO THE MEMBERS OF REFNOL RESINS AND CHEMICALS LIMITED

Report on the Indian Accounting Standards (Ind AS) Financial Statements

1. We have audited the accompanying standalone financial statements of Refnol Resinsand Chemicals Limited ("the Company") which comprise the Balance Sheet asat March 31 2018 the statement of profit and loss (including Other ComprehensiveIncome) the Cash Flow Statement and the Statement of Changes in Equity for the year thenended and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Ind AS 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 to give a true and fair view of the financialposition financial performance (including other comprehensive income) cash flows andchanges in equity of the Company in accordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards specified in the Companies(Indian Accounting Standards) Rules 2015 (as amended) under Section 133 of the Act. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting 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 Ind AS financial statementsthat give a true and fair view and are free from material misstatement whether due tofraud or error.

Auditors' Responsibility

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

4. We have taken into account the provisions of the Act and the Rules made thereunderincluding the accounting and auditing standards and matters which are required to beincluded in the audit report under the provisions of the Act and the Rules madethereunder.

5. We conducted our audit of the Ind AS financial statements in accordance with theStandards on Auditing specified under Section 143(10) of the Act and other applicableauthoritative pronouncements issued by the Institute of Chartered Accountants of India.Those Standards and pronouncements require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether the standalone IndAS financial statements are free from material misstatement.

6. An audit involves performing procedures to obtain audit evidence about the amountsand the disclosures in the Ind AS financial statements. The procedures selected depend onthe auditors' judgment including the assessment of the risks of material misstatement ofthe Ind 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 by the Company's Directors as well as evaluating theoverall presentation of the Ind AS financial statements.

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

Opinion

8. 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 March 31 2018 and its profit (including other comprehensive income) its cashflows and the changes in equity for the year ended on that date.

Other Matter

9. 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 standalone IndAS financial statements are based on the previously issued statutory financial statementsfor the years ended March 31 2017 and March 31 2016 prepared in accordance with theCompanies (Accounting Standards) Rules 2006 (as amended) which were audited bypredecessor auditor on which they expressed an unmodified opinion dated May 10 2017 andMay 12 2016 respectively.

The adjustments to those financial statements for the differences in accountingprinciples adopted by the Company on transition to the Ind AS have been audited by us.

Report on Other Legal and Regulatory Requirements

10. As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of India in terms of sub-section (11) of section 143 of the Act ("theOrder") and on the basis of such checks of the books and records of the Company aswe considered appropriate and according to the information and explanations given to uswe give in the "Annexure-A" a statement on the matters specified in paragraphs 3and 4 of the Order.

11. 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 (including other comprehensiveincome) the Cash Flow Statement and the Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account.

(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Indian Accounting Standards specified under Section 133 of the Act.

(e) On the basis of the written representations received from the directors as on March31 2018 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2018 from being appointed as a director in terms of Section 164 (2) of theAct.

(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 Auditors' Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our knowledge and belief and according to the information andexplanations given to us:

i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements. Refer Note 25 to the financial statements.

ii. The Company did not have any long-term contracts including derivative contracts asat March 31 2018 for which there were any material foreseeable losses; and

iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company during the year ended March 31 2018.

For B. R. Shah & Associates
Firm Registration Number: 129053W
Chartered Accountants
Deval Desai
Place: Ahmedabad Partner
Date: May 10 2018 Membership Number: 132426

ANNEXURE-A TO THE INDEPENDENT AUDITORS' REPORT

Referred in paragraph 10 under the heading "Report on other legal and regulatoryrequirements" of our report of even date to the members of Refnol Resins andChemicals Limited on the financial statements as of and for the year ended March 31 2018

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

(b) The Company has a regular program of physical verification of its fixed assets bywhich fixed assets are verified in a phased manner over a period of three years.

In accordance with this program certain fixed assets were verified during the year andno material discrepancies were noticed on such verification. In our opinion thisperiodicity of physical verification is reasonable having regards to the size of thecompany and the nature of its assets.

(c) According to the information and explanations given to us and the records examinedby us and based on the examination of the records of the company provided to us we reportthat the title deeds comprising all the immovable properties of land and buildings whichare freehold are held in the name of the Company as at the balance sheet date. And withrespect to immovable properties of land that has been taken on lease the lease agreementsare in the name of the Company.

ii. Physical verification of inventory has been conducted by Management at reasonableintervals. In our opinion the frequency of verification is reasonable. On the basis ofour examination of the inventory records in our opinion the Company is maintainingproper records of inventory. The discrepancies noticed on physical verification ofinventory as compared to book records were not material.

iii. The Company has not granted any loans secured or unsecured to any parties coveredin the register mentioned under Section 189 of the Act. Therefore the provisions ofClause 3(iii) (a) (b) & (c) of the said Order are not applicable to the Company.

iv. The company has complied with provisions of section 185 and 186 of the companiesAct 2013 in respect of loans investments guarantees and security as applicable.

v. The Company has not accepted any deposits and thus reporting under clause 3(v) ofthe Order is not applicable to the Company.

vi. The company is not required to maintain the cost records under clause 148(1) of theCompanies Act 2013 and thus reporting under clause 3(vi) is not applicable to thecompany.

vii. (a) According to the information and explanations given to us and the records ofthe Company examined by us in our opinion the Company is regular in depositingundisputed statutory dues in respect of tax deducted at source provident fund ESIC andprofessional taxes though there have been delay in a few cases and is regular indepositing undisputed statutory dues including statutory dues as applicable with theappropriate authorities.

(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 statutory dueswere outstanding at the year end for a period of more than six months from the date theybecame payable except Penalty of late E-filing of TDS which remain unpaid exceeding sixmonths as on 31 March 2018 Rs 4.18 Lakhs.

viii. In our opinion and according to the information and explanations given to us theCompany has not defaulted in the repayment of loans and borrowings to financialinstitutions or banks.

ix. The Company has not raised money by way of initial public offer or further publicoffer (including debt instruments) and term loans. Accordingly the provisions of Clause3(ix) of the Order are not applicable to the Company.

x. During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyfraud by the company or any fraud on the company by its officers or employees has beennoticed or reported during the year nor have we been informed of any such case by theManagement.

xi. Managerial remuneration has been paid and provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the companiesAct.

xii. The company is not a Nidhi Company. Accordingly the provisions of Clause 3(xii)of the Order are not applicable to the Company.

xiii. All transaction with the related parties are in compliance with section 177 and188 of Companies Act 2013 and the details have been disclosed in the FinancialsStatements as required by the applicable accounting standards;

xiv. The company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year under review.

xv. According to the information and explanations given to us and the records of theCompany examined by us the company has not entered into any non-cash transactions withdirectors or any person connected to him.

xvi. The company is not required to be registered under sections 45- IA of the ReserveBank of India Act 1934. Accordingly the provisions of Clause 3(xvi) of the Order are notapplicable to the Company.

For B. R. Shah & Associates
Firm Registration Number: 129053W
Chartered Accountants
Deval Desai
Place: Ahmedabad Partner
Date: May 10 2018 Membership Number: 132426

ANNEXURE B TO INDEPENDENT AUDITORS' REPORT

Referred to in Annexure referred to in paragraph 11 (f) under the heading "Reporton other legal and regulatory requirements" of our report of even date to the membersof Refnol Resins and Chemicals Limited on the Ind AS financial statements as of and forthe year ended March 31 2018

Report on the Internal Financial Controls under Clause (i) of Subsection 3 of Section143 of the Companies Act 2013

We have audited the internal financial controls over financial reporting of RefnolResins and Chemicals 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

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). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to 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.

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 deemed to be prescribedunder section 143(10) of the Companies Act 2013 to the extent applicable to an audit ofinternal financial controls both applicable to an audit of internal financial controlsand both issued by the Institute of Chartered Accountants of India. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated 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 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 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 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 B. R. Shah & Associates
Firm Registration Number: 129053W
Chartered Accountants
Deval Desai
Place: Ahmedabad Partner
Date: May 10 2018 Membership Number: 132426