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Remsons Industries Ltd.

BSE: 530919 Sector: Auto
NSE: REMSONSIND ISIN Code: INE474C01015
BSE 14:20 | 18 Sep 91.95 -0.10
(-0.11%)
OPEN

91.00

HIGH

91.95

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90.90

NSE 14:29 | 18 Sep 90.00 -2.00
(-2.17%)
OPEN

94.55

HIGH

94.55

LOW

89.30

OPEN 91.00
PREVIOUS CLOSE 92.05
VOLUME 22
52-Week high 119.00
52-Week low 43.20
P/E 23.58
Mkt Cap.(Rs cr) 53
Buy Price 90.65
Buy Qty 4.00
Sell Price 91.65
Sell Qty 85.00
OPEN 91.00
CLOSE 92.05
VOLUME 22
52-Week high 119.00
52-Week low 43.20
P/E 23.58
Mkt Cap.(Rs cr) 53
Buy Price 90.65
Buy Qty 4.00
Sell Price 91.65
Sell Qty 85.00

Remsons Industries Ltd. (REMSONSIND) - Auditors Report

Company auditors report

To

The Members of

REMSONS INDUSTRIES LIMITED

Report on the Audit of the financial statements

Opinion

We have audited the accompanying financial statements of REMSONS INDUSTRIES LIMITED ("theCompany") which comprise the Balance Sheet as at March 31 2019 the Statement ofProfit and Loss (including Other Comprehensive Income) the Statement of Changes inEquity the Statement of Cash Flows for the year the ended and notes to the financialstatements including a summary of significant accounting policies and other explanatoryinformation (hereinafter referred to as "the financial statements")

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by theCompanies Act 2013 ("the Act") in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2019 the profit and total comprehensiveincome changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

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 Companies Act 2013 and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our 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.

We have determined the matters described below to be the key audit matters to becommunicated in our report.

A. Provision for slow moving and non moving inventories.

Description of Key Audit Matters

The company carries a sizeable portion of inventory which is a material portion of thetotal assets of the company. The management has the process of identifying the slow movingand non moving inventories. This estimate has inherent uncertainty as it involvesestimation/ judgment on the part of the management.

Description of Auditors Response

Our procedures included discussion with the management on the control on the data andits effectiveness. Our audit approach was a combination of test of internal controls andsubstantive procedures which included the following:

• Evaluated the design of internal controls relating to identifying the slowmoving and non moving items and tested the controls pertaining to the same.

• Reviewed the age-wise inventory reports and movement of inventory and productionof items in which such inventories are being used.

• Discussed with the operating personnel about the alternate use of such items.

• Reviewed the net realizable value of such non moving and slow moving items

• Performed analytical procedures and test of details for reasonableness of theprovisions.

B. Valuation of Employee Benefits

Description of Key Audit Matters

The Company has Present Value of Obligations for Gratuity of Rs. 202.93 lakhs andprovision for Leave Encashment of Rs. 43.32 lakhs as of March 31 2019. The assumptionsthat underpin the valuation of the Gratuity and Leave Encashment are important and alsobased on subjective judgements. Management has obtained advice from actuarial specialistsin order to calculate the amount of Gratuity and Leave Encashment to be recognised asuncertainty arises as a result of estimates made based on the Company's expectations aboutlong-term trends and market conditions. As a result the actual surplus or deficitrealised by the Company may be significantly different to that recognised on the balancesheet since small changes to the assumptions used in the calculation materially affect thevaluation.

Description of Auditors Response

Our procedures included discussion with the management on the control on the data andreasonableness of the assumptions

• We reviewed the scheme rules to ensure our understanding is correct. We testedthe input data used by the actuary to company records.

• We evaluated the key actuarial assumptions with the assistance of ourspecialists to determine if these were within an acceptable range.

• We compared with the actuarial gain/loss of earlier years to understand theimpact of the variation in the assumptions

Management's Responsibility for the financial statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of Companies Act 2013 ("the Act") with respect to the preparation andpresentation of these financial statements that give a true and fair view of the financialposition financial performance changes in equity and cash flows of the Company inaccordance withthe accounting principles generally accepted in India including AccountingStandards specified under Section 133 of the Act. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding 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 design implementation andmaintenance of adequate internal financial controls 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 free from material misstatement whether due 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 responsible for overseeing the Company's financial reportingprocess.

Auditor's Responsibilities for the Audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these 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 control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Companies Act 2013 we are also responsible for expressing our opinion on whetherthe company 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

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 Companies Act 2013 we give in the "Annexure A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

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.

(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 Statement of Changes in Equity and the Statement of Cash Flow dealt with by thisReport are in agreement 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.

(e) On the basis of the written representations received from the directors as on March31 2019 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2019 from being appointed as a director in terms of Section 164 (2) oftheAct.

(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 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements – Refer Note No. 28 to the financial statements;

ii. The Company did not have any long-term contracts including derivative contracts forwhich 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 by the Company during the year ended March31 2019.

3. With respect to the matter to be included in the Auditors' report under Section197(16) :

In our opinion and according to the information and explanations given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of Section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under Section 197(16) which arerequired to be commented upon by us.

For M L BHUWANIA AND CO LLP
Chartered Accountants
FRN: 101484W/W100197
Place: Mumbai Vijay Kumar Jain
Date: May 29 2019 Partner
Membership No. 108374

ANNEXURE A TO THE INDEPENDENT AUDITOR'S REPORT

Referred to in paragraph 2 of 'Report on other Legal and Regulatory Requirements' inour Report of even date on the accounts of REMSONS INDUSTRIES LIMITED for the year endedMarch 31 2019

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

(b) The fixed assets are physically verified by the Management in accordance with aregular programme of verification which in our opinion provides for physicalverification of all the fixed assets at reasonable intervals. Pursuant to the programme aportion of the fixed assets has been physically verified by the Management anddiscrepancies noticed on such verification were not material and have been properly dealtwith in the accounts.

(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. During the year the inventories have been physically verified by the management.In our opinion the frequency of verification is reasonable. The discrepancies noticed onphysical verification of inventories as compared to the book records have been properlydealt with in the books of accounts.

iii. As informed to us the Company has not granted loans secured or unsecured tocompanies firms limited liability partnerships or other parties covered in the registermaintained under Section 189 of the Act. Hence sub clauses (a) to (c) of clause 3(iii) arenot applicable to the Company.

iv. The company has complied with provisions of sections 186 of the Companies Act 2013in respect of investments made and loan given. Section 185 of the Companies Act 2013 isnot applicable as there were no loans securities and guarantees given during the year.

v. The Company has not accepted any deposits from the public within the meaning ofSections 73 74 75 and 76 of the Act and the rules framed there under to the extentnotified and therefore clause 3(v) is not applicable.

vi. The Central Government has not prescribed maintenance of cost records under subsection (1) of section 148 of the Companies Act 2013 for any of the products of thecompany and therefore clause 3 (iv) is not applicable.

vii. (a) The Company is generally regular in depositing with appropriate authoritiesundisputed statutory dues including provident fund employees' state insurance incometax sales tax service tax duty of custom duty of excise duty value added tax cessGoods & Service Tax and any other material statutory dues applicable to it with theappropriate authorities. According to the information and explanations given to us noundisputed arrears of statutory dues were outstanding as at March 31 2019 for a period ofmore than six months from the date they became payable.

(b) According to the information and explanation given to us and the records of theCompany examined by us there are no dues of Income Tax Sales Tax Value Added Tax Goodsand Service Tax Custom Duty Excise Duty and cess which have not been deposited onaccount of any dispute. The disputed amounts that have not been deposited in respect ofService Tax are as under:

Sr. No. Name of the Statute Nature of the dues FINANCIAL YEAR TO WHICH IT RELATES Forum where the dues is pending र (In Lakhs)
1. Finance Act 1994 Service Tax Dues 2010-11 & 2011-12 Commissioner (Appeals) of Income tax र 9.95/-

viii. According to the records of the Company examined by us and information andexplanation given to us the Company has not defaulted in repayment of dues to banksduring the year. The company has not taken any loan or borrowing from governmentfinancial institution and has not issued debentures during the year.

ix. The Company has not raised any money by way of public issue/ further offer(including debt instruments). The money raised on term loans has been applied for thepurpose for which it was raised.

x. To the best of our knowledge and according to the information and explanation givento us no fraud by the Company and no fraud on the Company by its officers or employeeshas been noticed or reported during the year.

xi. In our opinion and according to the information and explanations given to us themanagerial remuneration has been paid or 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 and according to the information and explanations given to us thenature of the activities of the company does not attract any special statue applicable toNidhi Company. Accordingly clause 3(xii) of the order is not applicable to the company.

xiii. According to the information and explanation given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with Sec 177 and 188 of Companies Act 2013 where applicable and details ofsuch transactions have been disclosed in the financial statements as required by theapplicable accounting standards.

xiv. In our opinion and according to the information and explanations given to us andbased on our examination of the records of the Company the company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the year. Accordingly clause 3 (xiv) of the Order is not applicable tothe Company.

xv. In our opinion and according to the information and explanations given to us andbased on our examination of the records of the Company the company has not entered intoany non-cash transactions with directors or persons connected with him. Accordinglyclause 3 (xv) of the Order is not applicable to the Company.

xvi. The company is not required to be registered under Sec 45-IA of the Reserve Bankof India Act 1934. Accordingly clause 3 (xvi) of the Order is not applicable to theCompany.

For M L BHUWANIA AND CO LLP
Chartered Accountants
FRN: 101484W/W100197
Place: Mumbai Vijay Kumar Jain
Date: May 29 2019 Partner
Membership No. 108374

ANNEXURE B TO THE INDEPENDENT AUDITORS' REPORT

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 internalfinancial controls over financial reporting of REMSONS INDUSTRIES the Company) as of 31stMarch 2019 in LIMITED (" " conjunction with our audit of the financialstatements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's Board of Directors are responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting issued 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 ICAI and deemedto be prescribed under Section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls 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 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 ofmanagement and directors of the Company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized 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 to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2019 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note onAudit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.

For M L BHUWANIA AND CO LLP
Chartered Accountants
FRN: 101484W/W100197
Place: Mumbai Vijay Kumar Jain
Date: May 29 2019 Partner
Membership No. 108374