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Rushil Decor Ltd.

BSE: 533470 Sector: Others
NSE: RUSHIL ISIN Code: INE573K01017
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OPEN 103.60
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VOLUME 236
52-Week high 194.00
52-Week low 65.90
P/E 6.71
Mkt Cap.(Rs cr) 155
Buy Price 102.75
Buy Qty 42.00
Sell Price 108.20
Sell Qty 5.00
OPEN 103.60
CLOSE 104.25
VOLUME 236
52-Week high 194.00
52-Week low 65.90
P/E 6.71
Mkt Cap.(Rs cr) 155
Buy Price 102.75
Buy Qty 42.00
Sell Price 108.20
Sell Qty 5.00

Rushil Decor Ltd. (RUSHIL) - Auditors Report

Company auditors report

T0 THE MEMBERS 0F RUSHIL DECOR LIMITED

REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS

Opinion

We have audited the accompanying standalone financial statements of M/s RUSHIL DECORLIMITED (‘'the Company") which comprise the balance sheet as at 31st March2019 and the statement of profit and loss (including other comprehensive income)statement of changes in equity and statement of cash flows for the year then ended andnotes to the financial statements including a summary of significant accounting policiesand other explanatory information.

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 Companies Act 2013 (the Act) in the manner so required and give a true and fairview in conformity with the accounting principles generally accepted in India includingIndian Accounting standards (Ind AS) specified under section 133 of the Act of the stateof affairs (financial Position )of the Company as at 31st March 2019 and its losses(financial performance including other comprehensive income) its Cash flows and changesin equity for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing specified undersection 143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditor's Responsibilities for the Audit of the Financial Statementssection of our report. We are independent of the Company in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India (ICAI) together with theethical requirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor 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 of the current period.These matters were addressed in the context of our audit of the financial statements as awhole and in forming our opinion thereon and we do not provide a separate opinion onthese matters.

KeyAudit Matter: Revenue Recognition Refer Note 53 to the standalone Ind AS financial statements
Description of Key audit Matter Our response and results
Revenue of the company comprises of sale of industrial and decorative laminates to its domestic and international customers and sale of medium density fiber boards (plane and pre laminated) to its domestic customers. The Company sells its products through a network of distributors and dealers in the relevant markets and a part of the sales is also made as institutional sales/project sales directly to the end use customers. Revenue recognition is a significant audit risk across the company. Specifically there is a risk that revenue is recognised on sale of goods before the control in the goods is transferred. 0ur key audit procedures to assess the recognition of revenue on sale of goods included the following:
• We assessed the appropriateness of the Company's revenue recognition policies including those related to discounts and incentives;
• We obtained an understanding of process and assessed the design implementation and operating effectiveness of management's key internal controls in relation to revenue recognition from sale of goods. We also tested the Company's controls over timing of revenue recognition;
• We also tested on a sample basis whether specific revenue transactions around the year end had been recognised in the appropriate period on the basis of the terms of sale of the contract particularly with reference to the transfer of control in the goods in question with regard to the year end transactions.
• We inspected key customer contracts/ purchase orders to identify terms and conditions related to acceptance of goods and the right to return and assessing the Company's revenue recognition policies with reference to the requirements of the prevailing accounting standards;

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.

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

In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact. We have nothing to report in this regard.

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 Act with respect to the preparation of these standalone financial statementsthat give a true and fair view of the state of affairs (financial position)Profit orloss(financial performance including other comprehensive income) changes in equity andcash flows of the Company in accordance with the accounting principles generally acceptedin India including the Indian Accounting Standards (‘Ind AS') specified undersection 133 of the Act. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding of theassets of the Company and for preventing and detecting frauds and other irregularities;selection and application of appropriate accounting policies; making judgments andestimates that are reasonable and prudent; and design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial 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.

Those Board of Directors are also responsible for overseeing the Company's financialreporting process.

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 error.and 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 withStandards on Auditing will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if; individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these financial statements

As part of an audit in accordance with Standards on Auditing we exercise professionaljudgment and maintain 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 Act we are also responsible for expressing our opinion on whether thecompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

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

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial statement 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 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 section 197(16) of the Act we report that the company has paidremuneration to its directors during the year in accordance with the provisions of andlimits laid down under section 197 read with schedule V to the Act. The remuneration paidto any director is not in excess of the limit laid down under section 197 of the Act. TheMinistry of Corporate Affairs has not prescribed other details under Section 197(16) whichare required to be commented upon by us.

2. As required by the Companies (Auditor's Report) 0rder 2016 (‘'the0rder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the "Annexure A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order.

3. 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 Statement dealt withby this Report are in agreement with the books of account.

d. In our opinion the aforesaid standalone financial statements comply with the IndianAccounting Standards specified under section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.

e. On the basis of written representations received from the directors as on 31stMarch 2019 taken on record by the Board of Directors none of the Directors isdisqualified as on 31 st March 2019 from being appointed as a director in terms ofSection 164(2) of the Act.

f. With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B". 0ur report expresses an unmodified opinion onthe adequacy and operating effectiveness of the company's internal financial control overfinancial reporting.

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 2014as 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 the standalone Financial Statements (Refer Note No 37 to the StandaloneFinancial Statements.)

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

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

Annexure A

To the Independent Audit Report

OF EVEN DATE TO THE MEMBERS OF RUSHIL DECOR LTD: ON THE STANDALONE FIANCIAL STATEMENTSFOR THE YEAR ENDED31ST MARCH 2019

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of property plant and equipment.

(b) According to the information and explanations given to us the property plant andequipment are verified in a phased manner by the management during the year which in ouropinion is reasonable having regard to the size of the Company and nature of its assets.No material discrepancies were noticed on such verification.

(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) As explained to us the inventories have been physically verified by themanagement at reasonable intervals during the year. The discrepancies noticed onverification between physical stocks and the books of accounts were not material.

(iii) The Company has not granted any loans secured or unsecured loans to Companiesfirms Limited Liability Partnership or other parties covered in the register maintainedunder section 189 of the Companies Act 2013.(the Act).

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Act with respectto the loans given during the year and investment made during the year.

(v) The Company has not accepted any deposits from the public during the year underreview. (Also refer note No 55 of notes forming part of Standalone financial statement)

(vi) As explained to us the Central Government has not prescribed the maintenance ofCost records under sub section (1) of section 148 of the companies Act 2013.

(vii) (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted/ accrued in the books ofaccount in respect of undisputed statutory dues including provident fund income-taxsales tax value added tax duty of customs duty of exciseservice tax Goods &Service Tax cess and other material statutory dues have been regularly deposited duringthe year by the Company with the appropriate authorities. As explained to us the Companydid not have any dues on account of employeesRs. state insurance.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund income tax sales tax value added tax duty ofcustoms duty of excise service tax Goods & Service Taxcess and other materialstatutory dues were in arrears as at 31st March 2019 for a period of more than six monthsfrom the date they became payable.

(b) According to the information and explanations given to us there are no materialdues of sales tax service tax Goods & Service Tax and value added tax which have notbeen deposited with the appropriate authorities on account of any dispute. Howeveraccording to information and explanations given to us the following dues of Income Taxduties of Custom and Duty of Excise have not been deposited by the company on account ofDispute:

Nature of Statues Nature of Dues Amount (In ') (Net of payments) Period to which the amount relates Forum where dispute is pending
Income Tax Act 1961 Penalty 32270/- FY 2012-13 CIT (A) 9 Ahmedabad
Income Tax Act 1961 Penalty 230952/- FY 2011-12 CIT (A) 9 Ahmedabad
Central Excise Act1944 Excise Duty Interest& Penalty 1320210/- April 2015 to Feb 2016 Custom Excise & Service Tax Appellate
Central Excise Act1944 Excise Duty Interest& Penalty 7075855/- up to Sept-2012 Tribunal Ahmedabad Custom Excise & Service Tax Appellate Tribunal Ahmedabad
The Customs Act 1962 Custom Duty with Interest & Penalty 2255536/- with Interest 500000/- Penalty FY 2014-15 Custom Excise & Service Tax Appellate Tribunal Ahmedabad

(viii) According to information & explanations given to us the Company has notdefaulted in repayment of its dues to Banks or Financial institutions or Government. TheCompany does not have any borrowings from debenture holders.

(ix) According to the information & explanations given to us the Company did notraise any money by way of initial public offer or further public offer (including debtinstruments) during the year under review. However the term loans raised during the yearhas been applied for the purpose for which they were raised.

(x) According to the information and explanations given to usno fraud by the Companyor on the Company by its officers or employees has been noticed or reported during thecourse of our audit.

(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a nidhi company. Accordingly paragraph 3(xii) of the 0rder is notapplicable.

(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableInd AS.

(xiv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has made preferential allotment offully paid up equity shares during the year and the requirement of Section 42 of theCompanies Act 2013 have been complied with and the amount raised have been used for thepurposes for which the funds were raised.

(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe 0rder is not applicable.

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

Annexure B

to the Independent Auditor's Report of Even Date to the Members of RUSHIL DECOR LIMITEDon the Standalone Financial Statements of the year ended on 31 st March 2019

INDEPENDENT AUDITOR'S REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) OFSUB-SECTION 3 OF SECTION 143 OF THE COMPANIESACT 2013("THEACT")

In conjunction with our audit of the standalone financial statements of M/s RUSHILDECOR LIMITED ("the Company") as at and for the year ended 31st March 2019. Wehave audited the internal financial controls over financial reporting of the company as ofthat date.

Management's Responsibility for Internal Financial Controls

The Company's Board of Directors is 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 the company's business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Act.

Auditor's 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 Standards on Auditing issued by ICAI and deemed to be prescribed under section143(10) of the Act to the extent applicable to an audit of internal financial controlsover financial reporting and the Guidance Note issued by ICAI. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively 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 overfinancial reporting is a process designed toprovide 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 overfinancialreporting 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 31st March 2019 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note issued by theICAI.

For Parikh & Majmudar
Chartered Accountants
FR No. 107525W
[C.A (Dr) Hiten M. Parikh]
Partner
Membership No. 040230
Place: Ahmedabad
Date: 18th May 2019