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Salem Erode Investments Ltd.

BSE: 540181 Sector: Financials
NSE: N.A. ISIN Code: INE894E01028
BSE 00:00 | 23 Feb 2.27 0
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2.27

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NSE 05:30 | 01 Jan Salem Erode Investments Ltd
OPEN 2.27
PREVIOUS CLOSE 2.27
VOLUME 1
52-Week high 2.27
52-Week low 1.37
P/E 2.39
Mkt Cap.(Rs cr) 3
Buy Price 2.27
Buy Qty 140253.00
Sell Price 1.89
Sell Qty 2.00
OPEN 2.27
CLOSE 2.27
VOLUME 1
52-Week high 2.27
52-Week low 1.37
P/E 2.39
Mkt Cap.(Rs cr) 3
Buy Price 2.27
Buy Qty 140253.00
Sell Price 1.89
Sell Qty 2.00

Salem Erode Investments Ltd. (SALEMERODEINV) - Auditors Report

Company auditors report

To the Members of SALEM ERODE INVESTMENTS LIMITED

Report on the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of SALEM ERODEINVESTMENTS LIMITED ('the Company') which comprise the Balance Sheet as at 31stMarch 2019 the Statement of Profit and Loss (including other comprehensive income) theCash Flow Statement for the year ended on that date and a summary of the significantaccounting policies and 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 trueand fair view in conformity with the Indian Accounting Standards prescribed under section133 of the Act read including accounting principles generally accepted in India of thestate of affairs of the Company as at 31 March 2019 the profit/loss (financialperformance) including other comprehensive income and its cash flows for the yearended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing (SAs) specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Standalone Financial Statements section of ourreport. We are independent of the Company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India (ICAI) together with the ethicalrequirements that are relevant to our audit of the standalone financial statements underthe provisions of the Actand the Rules made thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the standalone financial statements.

Key Audit Matters

Key Audit Matters Key audit matters are those matters that in our professionaljudgment were of most significance in our audit of the standalone financial statements ofthe current period. These matters were addressed in the context of our audit of thestandalone financial statements as a whole and in forming our opinion thereon and we donot provide a separate opinion on these matters. We have determined the matters describedbelow to be the key audit matters to be communicated in our report.

Serial No. Key Audit Matter Auditor’s Response
1. Valuation of Investment We have assessed the procedure of sale and purchase of investments including year end valuation. We have obtained all sources of documents for valuation of unquoted shares and its subsequent sale.
2. Revenue Recognition and Provision for doubtful debts We have reviewed the procedure of revenue recognition in relation to interest income. No income has been recorded for NPA assets. The loans which have become NPA necessary provisions are made in the books.
3. Evaluation for provision for investments We assessed the Company’s process to identify the reason for making provision on appreciation/diminution in the value of investments. Provisions are made when there is a difference between cost and market value of Rs.25000/- or above.

Management's Responsibility for Standalone Financial 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 standalonefinancial statements that give a true and fair view of the financialposition financial performance total comprehensive income and cash flows of the Companyin accordance with the accounting principles generally accepted in India including theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingof the assets of the Company and for preventing and detecting frauds and otherirregularities; 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 standalone financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so. The Board of Directors are also responsible foroverseeing the company's financial reporting process.

Auditor's Responsibility for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone 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 standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• 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 standalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a 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.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order 2016 (‘theOrder’) as amended issued by the Central Government of India in terms ofsub-section (11) of section 143 of the Act we give in the Annexure-A a statement on thematters specified in the Order to the extent applicable.

2. As required by Section143(3) of the Act we report that:

(a) 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.

(b) The Balance Sheet the Statement of Profit and Loss including other comprehensiveincome and the Cash Flow Statement dealt with by this Report are in agreement with thebooks of account.

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

(e) The observations on financial transactions do not reveal any matters which have anyadverse effect on the functioning of the Company.

(f) On the basis of the 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 31st March 2019 from being appointed as a director in terms of Section164 (2) of the Act.

(g) There is no qualification in relation to accounts maintained by the Company.

(h) 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.

(i) 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 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company does not have any pending litigations which would impact its financialposition.

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

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and

Protection Fund by the Company in accordance with the provisions of Companies Act2013 (18 of 2013) and rules made there under.

For S. MANDAL & CO.
Chartered Accountants
(Firm's Registration No. 314188E)
(S. L. Mandal)
Place: Kolkata Partner
Date: The 27th day of May 2019 Membership No. 051834

ANNEXURE – "" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1 under "Report on Other Legal and RegulatoryRequirements" section of our report to the Members of SALEM ERODE INVESTMENTSLIMITED (The Company) of even date.)

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

b) These assets have been physically verified by the management at reasonableintervals. No material discrepancies were noticed on such verification.

c) According to the information and explanation given to us the company does not holdany immovable properties in its name.

2. Clause (ii) of the order is not applicable in case of this Company.

3. a) The Company has granted unsecured loan to a party covered in the registermaintained under section 189 of the Companies Act 2013 and the maximum amount involvedduring the year is ` 538 Lacs however year ending balance is Nil.

b) The company is regular in receipt of Principal and interest due on loan.

c) No amount is overdue for more than 90 days.

4. According to the information and explanation given to us the provisions of section185 and 186 of the Companies Act 2013 have been complied with.

5. The Company has not accepted any deposits under the provisions of section 73 to 76or any other relevant provisions of the Companies Act 2013.

6. Clause (vi) of the order is not applicable in case of this company.

7. a) The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income tax Sales Tax Service taxGoods and Services Tax Value Added Tax Custom Duty Excise Duty Cess and any otherstatutory dues applicable to it with the appropriate authorities.

b) There has been no undisputed amounts payable in respect of Provident FundEmployees' State Insurance Income tax Sales Tax Service tax Goods and Services TaxValue Added Tax Custom Duty Excise Duty Cess and any other statutory dues in arrears asat 31 March 2019 for a period of more than six (6) months from the date they becamepayable.

b) According to the information and explanation given to us there is no disputed amountin case of Income tax Sales Tax Service Tax Value Added Tax Goods and Services taxwhich has not been deposited as at 31 March 2019.

8. Clause (viii) of the order is not applicable in case of this company as it has nottaken any loan from banks financial institution or debenture holders.

9. Clause (ix) of the order is not applicable in case of this company as it has notraised money by way of initial public offer or further public offer (including debtinstruments) and term loans.

10. According to the information and explanations given to us there is no noticed orunreported fraud on or by the company during the year under audit.

11. According to the information and explanations given to us and based on ourexamination of records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by provisions of Section197 read with Schedule V to the Act.

12. Clause (xii) is not applicable in case of this Company as it is not a NidhiCompany.

13. According to the information and explanations given to us all transactions with therelated parties are in compliance with Section 188 and 177 of Companies Act 2013 whereapplicable and the details have been disclosed in the Financial Statements etc as requiredby the accounting standards and Companies Act 2013.

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

15. 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.

16. The Company is registered under section 45-IA of the Reserve Bank of India Act1934.

For S. MANDAL & CO.
Chartered Accountants
(Firm's Registration No. 314188E)
(S. L. Mandal)
Place: Kolkata Partner
Date: The 27th day of May 2019 Membership No. 051834

ANNEXURE – 'B' TO AUDITORS' REPORT

(Referred to in paragraph 3(h) under 'Report on Other Legal and RegulatoryRequirements' section of our report of even date)

Report on the Internal Financial Controls over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("The Act")

We have audited the internal financial controls over financial reporting of SALEMERODE INVESTMENTS LIMITED as of March 31 2019 in conjunction with our audit of thefinancial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Board of Director of the Company 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. 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 both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

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.

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 2019 based on"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".

For S. MANDAL & CO.
Chartered Accountants
(Firm's Registration No. 314188E)
(S. L. Mandal)
Place : Kolkata Partner
Date : The 27th day of May 2019 Membership No. 051834

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