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Ruchi Soya Industries Ltd.

BSE: 500368 Sector: Industrials
NSE: RUCHI ISIN Code: INE619A01035
BSE 00:00 | 28 Jul 1093.95 -7.20
(-0.65%)
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1101.15

HIGH

1111.20

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1085.00

NSE 00:00 | 28 Jul 1088.40 -13.35
(-1.21%)
OPEN

1114.70

HIGH

1117.85

LOW

1084.90

OPEN 1101.15
PREVIOUS CLOSE 1101.15
VOLUME 2656
52-Week high 1377.00
52-Week low 405.00
P/E 47.54
Mkt Cap.(Rs cr) 32,365
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 1101.15
CLOSE 1101.15
VOLUME 2656
52-Week high 1377.00
52-Week low 405.00
P/E 47.54
Mkt Cap.(Rs cr) 32,365
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Ruchi Soya Industries Ltd. (RUCHI) - Auditors Report

Company auditors report

To the Members of

Ruchi Soya Industries Limited

Report on the Audit of Standalone Financial Statements Opinion

We have audited the standalone financial statements ofRuchi Soya Industries Limited ("theCompany") which comprise the Balance Sheet as at 31st March 2020 and the statementof Profit and Loss (including other comprehensive income) statement of changes in equityand the statement of cash flows for the year then ended and notes to the financialstatements including a summary significantaccounting policies and of other explanatoryinformation (hereinafter referred to as "standalone 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 the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India including Ind AS specified under Section 133 of theAct of the financial position of the Company as at 31st March 2020 and its financialperformance including other comprehensive income its cash flows and changes in equity forthe 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 Rules thereunder and we have fulfilled our other ethical responsibilities in accordance with theserequirements and the Code of Ethics. We believe that the audit evidence we have obtainedis sufficientand 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 standalone financial statements for the year ended 31stMarch 2020. These matters were addressed in the context of our audit of the standalonefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. We have determined the matters described below to bekey audit matters to be communicated in our report.

Key Audit Matters How our audit addressed the key audit matter
(i) Accounting treatment for the effects of the Resolution Plan
Refer Note 32 to the standalone Financial Statements for the details regarding the resolution plan implemented in the Company pursuant to a corporate insolvency resolution process concluded during the year ended 31st March 2020 under Insolvency and Bankruptcy Code 2016. Owing to the size of the over-due credit facilities multiplicity of contractual arrangements and large number of operational and financial creditors determination of the carrying amount of related liabilities at the date of approval of Resolution Plan was a complex exercise. We have performed the following procedures to determine whether the effect of Resolution Plan has been appropriately recognised in the Financial Statements:
Reviewed management's process for review and implementation of the Resolution Plan.
Reviewed the provisions of the Resolution Plan to understand the requirements of the said Plan and evaluated the possible impact of the same on the financial statements.
Verified the balances of liabilities as on the date of approval of Resolution Plan from supporting documents and computations on a test check basis.
In respect of de-recognition of operational and financial creditors difference amounting to Rs 752560.48 Lakh between the carrying amount of financial liabilities extinguished and consideration paid is recognised in statement of profit and loss account in accordance with "Ind AS - 109" "Financial Instruments" prescribed under section 133 of the Companies Act 2013 and accounting policies consistently followed by the Company and disclosed as an "Exceptional items". Accounting for the effects of the resolution plan is considered by us to be a matter of most significance due to its importance to intended users understanding of the Financial Statements as a whole and materiality thereof. Verified the Resolution Plan.
Tested the implementation of provisions of the Resolution Plan in computation of balances of liabilities owed to financial and operational creditors.
Evaluated whether the accounting principles applied by the management fairly present the effects of the Resolution Plan in financial statements in accordance with the principles of Ind AS.
Tested the related disclosures made in notes to the financial statements in respect of the implementation of the resolution plan.
Key Audit Matters How our audit addressed the key audit matter
(ii) Litigations Matters & Contingent liabilities
Refer Note 33 to the standalone financial statements. Prior to the approval of the Resolution Plan the Company was a party to certain litigations. Pursuant to the approval of the Resolution Plan it was determined that no amounts are payable in respect of those litigations as they stand extinguished. We have performed the following procedures to test the recoverability of payments made by the Company in relation to litigations instituted against it prior to the approval of the Resolution Plan:
Verified the underlying documents related to litigations and other correspondences with the statutory authorities.
The Company had also made certain payments to the relevant authorities in respect of those litigations which were presented as recoverable under "Deposits paid under protest" and "Indirect Tax Refund Receivable" in the standalone financial statements. Reviewed the provisions of the Resolution Plan to understand the requirements of the said Plan and evaluated the possible impact.
The estimates related to expect outcome of litigations and recoverability of payments made in respect thereof have high degree of inherent uncertainty due to insufficient judicial precedents in India in respect of disposal of litigations involving companies admitted to Corporate Insolvency Resolution Process. Evaluated whether the accounting principles applied by the management fairly present the amounts recoverable from relevant authorities in financial statements in accordance with the principles of Ind AS.
Discussion with the management on the development in theses litigations during the year ended 31st March 2020.
Obtaining representation letter from the management on the assessment of those matters as per SA 580 (revised) - written representations.

Information Other than the Financial Statements and Auditor's Report Thereon

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Annual Report (but does not includethe financial statements and our auditor's report thereon) which is expected to be madeavailable to us after that date.

Our opinion on the financial statements does not cover the other information and we donot and will not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements our responsibility is to readthe other information identified above and in doing so consider whether the otherinformation is materially inconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated.

When we read the other information identified above if we conclude that there is amaterial misstatement therein we are required to communicate the matter to those chargedwith governance.

Responsibilities of Management and Those Charged with Governance for the StandaloneFinancial Statements

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 financial statements that give a true and fair view of the financial positionfinancial performance including other comprehensive income cash flows and changes inequity of the Company in accordance with the accounting principles generally accepted inIndia including the Indian Accounting Standards (‘Ind AS') prescribed under Section133 of the Act read with relevant rules issued there under. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding the assets of the Company and for preventing and detecting fraudsand other irregularities; selection and application of appropriate accounting policies;making judgments and estimates that are reasonable and prudent; and design implementationand maintenance of adequate internal financial controls that were operating effectivelyfor ensuring 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.

That Board of Directors is also responsible for overseeing the Company's financialreporting process.

Auditor's Responsibilities for the Audit of the Standalone 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 financial statementswhether due to fraud or error design and perform audit procedures responsive tothoserisksandobtainauditevidencethatis and appropriate to provide a basis for ouropinion. The risk of not detecting a material misstatement resulting from fraud is higherthan for one resulting from error as fraud may involve collusion forgery intentionalomissions misrepresentations or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3) (i) ofthe Companies act 2013 we are also responsible for expressing our opinion on whether thecompany has adequate internal financial controls the operating effectiveness of suchcontrols.

Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.

Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast the Company's ability to continue asa significant going concern. If we conclude that a material uncertainty exists we arerequired to draw attention in our auditor's report to the related disclosures in thefinancial statements or if such disclosures are inadequate to modify our opinion. Ourconclusions 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 financial statementsincluding the disclosures and whether the financial statements represent the underlyingtransactions 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 year 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 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 system in place and and according to the information andexplanations given to us we give in the "Annexure A" a statement on thematters specified in paragraphs 3 and 4 of the Order.

2. Further to our comment in the Annexure A as required by Section 143 (3) of the Actwe report that: a. We have sought and obtained all the information and explanations whichto the best of 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 the Companyso far as it appears from our examination of those books; c. The Balance Sheet theStatement of Profitand Loss (including other comprehensive income) the Cash FlowStatement and the Statement of Changes in Equity dealt with by this report are inagreement with the books of account; d. In our opinion the aforesaid standalone financialstatements comply with Ind AS prescribed under Section 133 of the Act read with relevantrules there under; e. On the basis of the written representations received from thedirectors of the Company as on 31st March

2020 and taken on record in the meeting of Board of Directors we report that none ofthe directors is disqualified as on 31st March 2020 from being appointed as a director interms of Section 164(2) of the Act; f. With respect to the adequacy of the internalfinancial controls over financial reporting of the Company and the operating effectivenessof such controls refer to our separate Report in "Annexure B"; g. Withrespect to the other matters to be included in the Auditor's Report in accordance with therequirements of section 197 (16) of the Act; In our opinion and to the best of ourinformation and according to the explanations given to us the remuneration paid by theCompany to its directors during the year is in accordance with the provisions of section197 of the Act. h. With respect to the other matters to be included in the Auditor'sreport in accordance with Rule 11 of the Companies (Audit and Auditor's) Rules 2014 inour opinion and to the best of our information and according to the explanations given tous: i. The Company as detailed in Note no. 33 to the standalone financial statements hasdisclosed the impact of pending litigations on its financial position. ii. The Company didnot have any material foreseeable losses on long term contracts including derivativecontracts for which there were any material foreseeable losses. iii. There has been nodelay in transferring amounts required to be transferred to the Investor Education andProtection Fund by the Company.

ForChaturvedi & Shah LLP
Chartered Accountants
Registration Number: 101720W/W100355
Vijay Napawaliya
Partner
Place: Mumbai Membership Number: 109859
Date : 26th June 2020 UDIN: 20109859AAAACF5412

"Annexure A" to the Independent Auditors' Report

(Referred to in paragraph 1 under the heading "Report on Other Legal andRegulatory Requirements" of our report of even date to the members of the Ruchi SoyaIndustries Limited on the Standalone Financial Statements for the year ended 31stMarch 2020)

(i) In respect of fixed assets:-

(a) The Company has maintained proper records showing full particulars includingquantitative details and situation of the fixed assets. (b) As explained to us the fixedassets are physically verified by the management during the year which in our opinion isreasonable having regard to the size of the Company and the nature of its assets. Nomaterial discrepancies were noticedverificationas compared such physical with theavailable records.

(c) In our opinion and according to information and explanations given to us and on thebasis of our examination of available records of the Company the title deeds of immovableproperties are held in the name of the Company except the following :-

(Rs In Lakh)
Particulars Leasehold Land Freehold Land Total
No. of cases 1 1 2
Gross Block as on 31st March 2020 71.55 4.73 76.28
Net Block as on 31st March 2020 - 4.73 4.73

(ii) In respect of its inventories:-

As explained to us inventories have been physically verified during the year by themanagement except goods in transit. In our opinionthefrequencyofverificationis reasonable.Discrepancies noticed on physical verification of the inventories between the physicalinventories and book records were not material having regard to the size of theoperations of the Company and the same have been properly dealt with.

(iii) The Company has not granted any loans secured or unsecured to companies firmsLimited Liability Partnerships or other parties covered in the register maintained undersection 189 of the Companies Act 2013. Therefore the provision of paragraph 3 (iii) ofthe Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to usduring the year the Company has not made any loan investment and guarantees to anyperson of the Companies Act 2013. Therefore the provisions of paragraph 3(iv) of theOrder are not applicable to the Company.

(v) The Company has not accepted any deposits from the public within the meaning ofSections 73 to 76 of the Act and the Rules framed there under to the extent notified.During the year no order has been passed by the Company Law Board or National Company LawTribunal or Reserve Bank of India or any court or any other Tribunal.

(vi) Pursuant to the rules made by the Central Government of India the Company isrequired to maintain cost records as specified under Section 148(1) of the Act in respectof its products. We have broadly reviewed the same and are of the opinion that primafacie the prescribed accounts and records have been made and maintained. We have nothowever made a detailed examination of the records with a view to determine whether theyare accurate or complete.

(vii) (a) According to the records of the Company and information and explanationsgiven to us the Company has generally been regular in depositing undisputed statutorydues including provident fund employees' state insurance income tax duty of customsgoods and service tax cess and any other statutory dues except in few cases to theappropriate authorities as applicable during the year. According to the information andexplanations given to us no undisputed amounts payable in respect of such statutory dueswere outstanding as at 31st March 2020 for a period of more than six months from the datethey became payable.

(b) As mentioned in note 33 to the standalone financial statements as per approvedresolution plan which interalia resulted in extinguishment of all contingent liabilitiesand commitments claims and obligations which pertains to the period on or before theeffective date (i.e. 6th September 2019 pursuant to the implementation of the ResolutionPlan). There are no dues of income-tax sales-tax service-tax duty of customs duty ofexcise value added tax and goods and service tax which have not been deposited onaccount of any dispute. undersection 185 and section 186

(viii) The National Company Law Tribunal (‘NCLT') has approved the terms of theResolution Plan submitted by Resolution Applicant pursuant to which loans or borrowingsowed by the Company as at that date have been partially paid and balance amount has beenextinguished. Accordingly the Company has not defaulted in repayment of loans orborrowings to any financial institution or a bank or government or any dues todebenture-holders during the year.

(ix) According to the information and explanations given to us the Company did notraise any moneys by way of initial public offer further public offer (including debtinstruments). Term loans raised by Patanjali Consortium Adhigrahan Private Limited whichamalgamated with the Company were applied for the purpose for which the loans wereobtained. Therefore the provisions of Clause 3(ix) of the Order are not applicable to theCompany.

(x) During the course of our examination of the books and records of theCompany carried out in accordance with the generally accepted auditing practices inIndia and according to the information and explanations given to us we have neither comeacross any instance of material fraud by the Company or on the Company by its officers oremployees noticed or reported during the year nor have we been informed of any such caseby the Management. However we have been informed that Company has received communicationdated 10th May 2018 from Serious Fraud Investigation Office Ministry of CorporateAffairs New Delhi regarding investigation into the affairs of the Company under section212 (1) of the Companies Act 2013 the matter is still going on.

(xi) In our opinion and according to the information and explanations given to us theCompany has paid or provided managerial remuneration in accordance with the requisiteapprovals mandated by the provision of section 197 read with Schedule V to the Act.

(xii) As the Company is not a Nidhi Company and the Nidhi Rules 2014 are notapplicable to it the provisions of Clause 3(xii) of the Order are not applicable to theCompany.

(xiii) The Company has entered into transactions with related parties in compliancewith the provisions of Sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the standalone financial statements as required underIndian Accounting Standard (Ind AS) 24 Related Party Disclosures specified in theCompanies (Indian Accounting Standards) Rules 2015 (as amended) under Section 133 of theAct.

(xiv) According to information and explanations given to us the company has not madeany preferential allotment or private placement of shares or debentures during the year.All allotment of shares during the year were as per the NCLT order dated 24th July 2019and 4th September 2019 under section 31 of the IBC Code 2016.

(xv) According to the information and explanations given to us the Company has notentered into any non-cash transactions with directors or persons connected with him.Therefore the provisions of Clause 3(xv) of the Order are not applicable to the Company.

(xvi) The Company is not required to be registered under section 45-1A of the ReserveBank of India Act 1934.

ForChaturvedi & Shah LLP
Chartered Accountants
Registration Number: 101720W/W100355
Vijay Napawaliya
Partner
Place: Mumbai Membership Number: 109859
Date : 26th June 2020 UDIN: 20109859AAAACF5412

"Annexure B" to the Independent Auditors' Report

Referred to in paragraph 2(f) under the heading "Report on Other Legal andRegulatory Requirements" of our report of even date to the members of the Ruchi SoyaIndustries Limited on the standalone financial statements for the year ended 31stMarch 2020.

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 Ruchi SoyaIndustries Limited ("the Company") as of 31st March 2020 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe 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 prescribed under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls both issued by the Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand 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 performingprocedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal control based on the assessed risk. The procedures selected depend on theauditor's judgement including the assessment of the risks of material misstatement of thestandalone 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 standalone 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 (1) pertain to themaintenance of records that in reasonable detail accurately and fairlyreflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of standalonefinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management directors and RP of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the standalonefinancial 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

According to the information and explanations given to us and based on the audit oftest of controls in our opinion the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31st March 2020 basedon 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.

ForChaturvedi & Shah LLP
Chartered Accountants
Registration Number: 101720W/W100355
Vijay Napawaliya
Partner
Place: Mumbai Membership Number: 109859
Date : 26th June 2020 UDIN: 20109859AAAACF5412

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