You are here » Home » Companies » Company Overview » Sanrhea Technical Textile Ltd

Sanrhea Technical Textile Ltd.

BSE: 514280 Sector: Industrials
NSE: N.A. ISIN Code: INE589J01015
BSE 00:00 | 28 Jun 102.55 4.85
(4.96%)
OPEN

102.55

HIGH

102.55

LOW

102.00

NSE 05:30 | 01 Jan Sanrhea Technical Textile Ltd
OPEN 102.55
PREVIOUS CLOSE 97.70
VOLUME 1474
52-Week high 125.75
52-Week low 16.21
P/E 9.86
Mkt Cap.(Rs cr) 44
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 102.55
CLOSE 97.70
VOLUME 1474
52-Week high 125.75
52-Week low 16.21
P/E 9.86
Mkt Cap.(Rs cr) 44
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sanrhea Technical Textile Ltd. (SANRHEATECH) - Auditors Report

Company auditors report

To the Members of Sanrhea Technical Textiles Limited

Report on the Audit of Financial Statements

Opinion

We have audited the accompanying financial statements of Sanrhea Technical TextilesLimited ("the Company") which comprise the Balance Sheet as at March 31 2021the Statement of Profit and Loss including the Statement of Other Comprehensive Incomethe Cash Flow Statement and the Statement of Changes in Equity for the year then endedand notes to the financial statements including a summary of significant accountingpolicies and other explanatory information (hereinafter referred as the "financialstatements").

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 standards prescribed under section 133 of theAct read with the Companies (Indian Accounting Standards) Rules 2015 as amended("Ind AS") and other accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2021 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 of the financial statements in accordance with the Standards onAuditing (‘SAs') as specified under section 143(10) of the Act. Our responsibilitiesunder those Standards are further described in the ‘Auditor's Responsibilities forthe Audit of the Financial Statements' section of our report. We are independent of theCompany in accordance with the ‘Code of Ethics' issued by the Institute of CharteredAccountants of India together with the ethical requirements that are relevant to our auditof the financial statements under the provisions of the Act and the Rules thereunder andwe have fulfilled our other ethical responsibilities in accordance with these requirementsand ICAI's Code of Ethics. We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our audit opinion on the financialstatements.

Emphasis of Matter

We draw attention to Note no. 42 of the Statement which describes the Management'sevaluation of COVID-19 impact on the future performance of the Company. Our opinion is notmodified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements for the financial year ended March31 2021. These matters were addressed in the context of our audit of the financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report.

We have fulfilled the responsibilities described in the Auditor's responsibilitiesfor the audit of the financial statements section of our report including in relationto these matters. Accordingly our audit included the performance of procedures designedto respond to our assessment of the risks of material misstatement of the financialstatements. The results of our audit procedures including the procedures performed toaddress the matters below provide the basis for our audit opinion on the accompanyingfinancial statements.

Key audit matters How our audit addressed the Key Audit Matter
Inventory Existence and Valuation
The Company recognised inventory of Rs.813.85 Lakhs at March 31 2021. Inventory is held by Company's plants. We focused on this matter because of the: Our audit procedure in this area included:
• significance of the inventory balance to the profit and statement of financial position • Testing the Company's controls by checking approvals over reviewing selling price and cost forecasts authorising and recording of costs.
• Complexity involved in determining valuation of Inventory. • Testing of the valuation of inventory as per applicable Indian Accounting Standard -2.
• Testing a sample of inventory items to assess whether they were recorded at a value higher than that for which they could be sold.
• We attended inventory physical count on the date of reporting date. We performed following procedure at each location:
• selected a sample of inventory items and compared the quantities we counted with the quantities recorded and for the differences found during physical verification if any we have verified that the same has been accounted.
• Made enquiries regarding non-moving inventory items and inspected the conditions of items counted.
There were no significant exceptions noted from these procedures.

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

The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexures to Board's Report CorporateGovernance and Shareholder's Information but does not include the financial statementsand our auditors' report thereon. The other information is expected to be made availableto us after the date of this auditors' report.

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 during thecourse of our audit or otherwise appears to be materially misstated.

If based on the work we have performed we conclude that there is a materialmisstatement of this other information; we are required to communicate the matter to thosecharged with governance as required under SA 720 'The Auditors' responsibilities relatingto other information'.

Responsibilities of Management and Board of Directors for the Financial Statements

The Company's management and the Board of Directors are responsible for the mattersstated in section 134(5) of the Act with respect to the preparation of these financialstatements that give a true and fair view of the financial position financial performanceincluding other comprehensive income cash flows and changes in equity of the Company inaccordance with the Ind AS and the accounting principles generally accepted in India. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; andthe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

In preparing the financial statements the management and the board of Directors areresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless Board of Directors either intends to liquidate the Company orto cease operations or has no realistic alternative but to do so.

The 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 financial statementas a whole is free from material misstatement whether due to fraud or error and to issuean Auditor's report that includes our opinion. Reasonable assurance is a high level ofassurance but is not a guarantee that an audit conducted in accordance with SAs willalways detect a material misstatement when it exists. Misstatements can arise from fraudor error and are considered material if individually or in the aggregate they couldreasonably be expected to influence the economic decisions of users taken on the basis ofthe financial statement.

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 statementwhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions 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) of theAct we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls with reference to financial statements in place andthe operating effectiveness of such controls.

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

- Conclude on the appropriateness of the Board of Directors' use of the going concernbasis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theability of the Company to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our Auditor's report to therelated disclosures in the financial statement or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our Auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.

- Evaluate the overall presentation structure and content of the financial statementincluding the disclosures and whether the financial statement represents 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 for thefinancial year ended March 31 2021 and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 (the 'Order') issued bythe Central Government of India in terms of sub-section (11) of section 143 of the Act wegive in the "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the Order.

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 the Statement of OtherComprehensive Income the Cash Flow Statement and Statement of Changes in Equity dealtwith by this Report 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 the Companies (IndianAccounting Standards) Rules 2015 as amended;

e. On the basis of the written representations received from the directors as on March31 2021 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2021 from being appointed as a director in terms of Section 164 (2) of theAct;

f. With respect to the adequacy and the operating effectiveness of the internalfinancial controls over financial reporting of the Company refer to our separate reportin "Annexure B" to this report;

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 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 litigation which would have impact on itsfinancial position.

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

iii. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company.

For Arpit Patel & Associates Chartered Accountants ICAI Firm registration number: 144032W
Place : Ahmedabad Date : June 30 2021 Arpit Patel Partner Membership No.: 034032 UDIN: 21034032AAAACA5134

Annexure A 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 Sanrhea Technical TextileLimited of even date)

The Annexure referred to in Independent Auditor's Report to the members of the Companyon the financial statements for the year ended March 31 2021.

We report that:

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

(b) According to the information and explanations given to us the Company has aregular programme of physical verification of its fixed assets by which fixed assets areverified on an annual basis. In accordance with this programme fixed assets were verifiedduring the year. In our opinion this periodicity of physical verification is reasonablehaving regard to the size of the Company and the nature of its assets. According to theinformation and explanations given to us no material discrepancies were noticed on suchverification.

(c) With respect to immovable properties of buildings according to the information andexplanations given to us and on the basis of our examination of the records of theCompany building shown in balance sheet is on leasehold for which lease agreement is notregistered in the name of the Company.

(ii) As explained to us inventories have been physically verified at reasonableintervals by the management during the period. In our opinion the frequency of suchverification is reasonable. No material discrepancies were noticed during suchverification.

(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under section 189 of theAct. Accordingly the provisions of clause 3(iii)(a) (b) and (c) of the Order are notapplicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Companies Act2013 in respect of grant of loans making investments and providing guarantees andsecurities as applicable.

(v) According to the information and explanations given to us the Company has notaccepted any deposit from public within the meaning of section 73 to 76 of the Act andrules made thereunder. Therefore the provision of clause 3(v) of the order is notapplicable.

(vi) To the best of our knowledge and according to the information and explanationsgiven to us the Company is not required to maintain cost records pursuant to Companies(Cost Records and Audit) Rules 2014 as amended prescribed by the Central Governmentunder section 148(1) of the Companies Act 2013.

(vii) According to the information and explanations given to us in respect ofstatutory dues:

(a) The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Income-tax cess Goods and Services Tax Custom Duty and othermaterial statutory dues applicable to it to the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident Fund cess Goodsand Services Tax and other material statutory dues in arrears as at March 31 2021 for aperiod of more than six months from the date they became payable except in regards toIncome Tax which is as follows:

Name of Statute Nature of Dues Amount (' in lakhs) Period to which the amount relates Due date Date of payment
Income Tax Act 1961 Income Tax 5.63 2020-21 15-06-2020 29-06-2021
Income Tax Act 1961 Income Tax 11.27 2020-21 15-09-2020 29-06-2021

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the company there are no any disputed dues in respect ofProvident fund Income- tax cess Goods and Services Tax and Custom Duty deposited withthe appropriate authorities.

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of loans or borrowings to banks. TheCompany has not taken any loans or borrowings from government or has not issued anydebentures.

(ix) The Company has not raised moneys by way of initial public offer or further publicoffer and term loans during the year (including debt instruments). Accordingly theprovision of clause 3(ix) of the order is not applicable.

(x) In our opinion and according to the information and explanations given to us nomaterial fraud by the Company and no material fraud on the Company by its officers oremployees has been noticed or reported during the year.

(xi) According to the information and explanations given by the management themanagerial remuneration has been paid / provided in accordance with requisite approvalsmandated by the provisions of section 197 read with schedule V to the Act.

(xii) In our opinion the Company is not a Nidhi Company. Therefore the provisions ofclause (xii) of the Order is not applicable to the Company.

(xiii) Based on our examination of records of the Company and according to theinformation and explanations given to us the transactions with related parties are incompliance with the provisions of Sections 177 and 188 of the Companies Act 2013. Thedetails of such related party transactions have been disclosed in the Financial Statementsas required by the applicable accounting standard.

(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review.Accordingly provisions of clause 3(xiv) are not applicable to the Company.

(xv) Based on the examinations of the records and according to the information andexplanations given by the management during the year the Company has not entered intoany non-cash transactions with directors or persons connected with him. Accordinglyparagraph 3(xv) of the Order is not applicable.

(xvi) According to the information and explanations given to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.Accordingly paragraph 3(xvi) of the Order is not applicable.

For Arpit Patel & Associates Chartered Accountants ICAI Firm registration number: 144032W
Place : Ahmedabad Date : June 30 2021 Arpit Patel Partner Membership No.: 034032 UDIN: 21034032AAAACA5134

Annexure B to the Independent Auditor's Report

(Referred to in paragraph 2(f) under 'Report on Other Legal and RegulatoryRequirements' section of our report to the Members of Sanrhea Technical Textiles Limitedof even date)

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 SanrheaTechnical Textiles Limited ("the Company") as of March 31 2021 in conjunctionwith our audit of the financial statements of the Company for the year ended on that date.

Management and Board of Directors' Responsibility for Internal Financial Controls

The Management and the Board of Directors of the Company are responsible forestablishing and maintaining internal financial controls based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls over Financial Reporting issued by the Institute of Chartered Accountants ofIndia. These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to respective company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the internal financial controls overfinancial reporting of the Company based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") issued by the Institute of Chartered Accountantsof India and the Standards on Auditing prescribed under Section 143(10) of the CompaniesAct 2013 to the extent applicable to an audit of internal financial controls. 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 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 of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisation of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial 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 2021 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.

For Arpit Patel & Associates Chartered Accountants ICAI Firm registration number: 144032W
Place : Ahmedabad Date : June 30 2021 Arpit Patel Partner Membership No.: 034032 UDIN: 21034032AAAACA5134

.