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Sanrhea Technical Textile Ltd.

BSE: 514280 Sector: Industrials
NSE: N.A. ISIN Code: INE589J01015
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NSE 05:30 | 01 Jan Sanrhea Technical Textile Ltd
OPEN 20.50
PREVIOUS CLOSE 20.50
VOLUME 50
52-Week high 25.35
52-Week low 13.51
P/E 25.31
Mkt Cap.(Rs cr) 8
Buy Price 20.50
Buy Qty 261.00
Sell Price 21.50
Sell Qty 539.00
OPEN 20.50
CLOSE 20.50
VOLUME 50
52-Week high 25.35
52-Week low 13.51
P/E 25.31
Mkt Cap.(Rs cr) 8
Buy Price 20.50
Buy Qty 261.00
Sell Price 21.50
Sell Qty 539.00

Sanrhea Technical Textile Ltd. (SANRHEATECH) - Auditors Report

Company auditors report

To the members of Sanrhea Technical Textile Limited Report on the Audit of the Ind ASFinancial Statements Qualified Opinion

We have audited the accompanying Ind AS financial statements of Sanrhea TechnicalTextile Limited (the "Company") which comprise the Balance sheet as at March31 2019 the Statement of Profit and Loss including the statement of Other ComprehensiveIncome the Cash Flow Statement and the Statement of Changes in Equity for the year thenended and notes to the financial statements including a summary of significantaccounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us except for the possible effects of the matter described in the Basis forQualified Opinion section of our report the aforesaid Ind AS financial statements givethe information required by the Companies Act 2013 (the "Act") in the mannerso required and give a true and fair view in conformity with the accounting standardsprescribed under section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended ("Ind AS") and other accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 31 2019the profit and total comprehensive income changes in equity and its cash flows for theyear ended on that date.

Basis for Qualified Opinion

As mentioned in note no. 42 of the financial statement we are unable to substantiatethe management's assertion regarding recoverability of trade receivables outstanding frommore than one year amounting to Rs 30.36 Lacs and therefore are unable to determine theeffect of any adjustment that may be required in relation to the recoverability of thisamount.

We conducted our audit of the Ind AS financial statements in accordance with theStandards on Auditing ('SAs')as specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the 'Auditor'sResponsibilities for the Audit of the Ind AS FinancialStatements'section of ourreport. We are independent of the Company in accordance with the 'Code of Ethics'issued bythe Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of thefinancial statements under the provisions of the Actand the Rules thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and ICAI's Code of Ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for ourqualified opinion on the Ind AS financial statements.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Ind AS financial statements for the current period. Thesematters were addressed in the context of our audit of the Ind AS financial statements as awhole and in forming our opinion thereon and we do not provide a separate opinion onthese matters. We have determined that there are no key audit matters to communicate inour report.

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 Management Discussion and AnalysisBoard's Report including Annexures to Board's Report Business Responsibility ReportCorporate Governance and Shareholder's Information but does not include the financialstatements and our auditor's report thereon.

Our opinion on the Ind AS financial statements does not cover the other information andwe do not express any form of assurance conclusion thereon.

In connection with our audit of the Ind AS financial statements our responsibility isto read the 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 have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.

Responsibilities of Management for the Ind AS Financial 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 Ind AS financial statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income cash flows and changes in equity of the Company in accordancewith 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 Ind AS financial statementsthat give a true and fair view and are free from material misstatement whether due tofraud or error.

In preparing the Ind AS financial statements management is responsible for assessingthe Company's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.

The Board of Directors are also responsible for overseeing the Company's financialreporting process. Auditor's Responsibilities for the Audit of the Ind AS FinancialStatements

Our objectives are to obtain reasonable assurance about whether the Ind AS 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 Ind AS financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional scepticism throughout the audit. We also:

- Identify and assess the risks of material misstatement of the Ind AS 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 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 system in place and the operating effectiveness ofsuch controls.

- 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 significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

- Evaluate the overall presentation structure and content of the Ind AS financialstatements including the disclosures and whether the Ind AS financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

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 Ind AS financial statements forthe financial year ended March 31 2019and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would 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 in paragraphs 3 and 4of 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 ofOther Comprehensive Income the Cash Flow Statement and Statement of Changes in Equitydealt with by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid Ind AS financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended;

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

(f) With respect to the adequacy of the internal financial controls over financialreporting of the Company with reference to these Ind AS financial statements and theoperating effectiveness of such controls refer to our separate Report in "AnnexureB" to this report;

(g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended

In our opinion the managerial remuneration for the year ended March 31 2019 has beenpaid / provided by the Company to its directors in accordance with the provisions ofsection 197 read with Schedule V to the Act;

(h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company 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 contracts forwhich there were any material foreseeable losses;

iii. During the year the Company is not required to transfer any amount to theInvestor Education and Protection Fund.

For Arpit Patel & Associates
Chartered Accountants
ICAI Firm registration number:144032W
Arpit Patel
Place : Ahmedabad Partner
Date : May 30 2019 Membership No.: 034032

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 2019.

We report that:

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

(b) All fixed assets were physically verified by the management in the previous year inaccordance with a planned programme of verifying them once in three years which in ouropinion is reasonable having regard to the size of the Company and the nature of itsassets. 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 building shown in balance sheet is on leasedland for which lease agreement is not registered in the name of company. Refer Note no 39of financial statements

(ii) The inventory has been physically verified by the management during the year. Inour opinion the frequency of verification is reasonable. No material discrepancies werenoticed on such physical verification. Inventories lying with third parties have beenconfirmed by them as at March 31 2019 and no material discrepancies were noticed inrespect of such confirmations.

(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 usprovisions of section 185 and 186 of the Act in respect of loans to directors includingentities in which they are interested and in respect of loans and advances giveninvestments made and guarantees and securities given have been complied with by theCompany as applicable.

(v) According to the information and explanations given to us the Company has notaccepted any deposit form the public within the meaning of section 73 to 76 of the Act andthe Rules framed under. Therefore the provision of clause 3(v) of the Order is notapplicable.

(vi) As per the information and explanation given to us the cost accounting records asprescribed by the Central Government under section 148(1) of the Companies Act 2013 isnot applicable to the Company.

(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 employee stateinsurance income-tax goods and services tax sales tax value added tax duty ofcustoms duty of excise service tax cess and other material statutory dues havegenerally been regularly deposited during the year by the Company with the appropriateauthorities.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund goods and services tax sales tax value added taxduty of customs service tax cess and other material statutory dues were in arrears as at31 March 2019 except income tax amounting to Rs. 5.39 Lakhs for a period of more than sixmonths from the date they became payable.

(b) 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 ofgoods and service tax sales Tax income tax service tax value added tax custom dutyand excise duty / cess deposited with the appropriate authorities

(viii) Based on our examination of the records and according to information andexplanations given by the management the Company has not defaulted in repayment of duesto the banks. The Company has not taken any loan from financial institution or government.The Company has not obtained any borrowing by way of debentures.

(ix) Based on the information and explanations given by the management and on anoverall examination of the balance sheet we are of the opinion that term loans have beenapplied for the purposes for which they were raised.

(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practice in India andaccording to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.

(xi) According to the information and explanations given by the management themanagerial remuneration has been paid/provided in accordance with the 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 3(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 Section 177 and 188 of the Act. The details of suchrelated party transactions have been disclosed in the Ind AS Financial Statements asrequired by the applicable accounting standards.

(xiv) According to explanation and information given by management the Company hascomplied with provisions of section 42 of the Companies Act 2013 in respect of privateplacement of shares during the year. According to the information and explanation given bythe management we report that the amounts raised have been used for the purpose forwhich the funds were raised.

(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.

For Arpit Patel & Associates
Chartered Accountants
ICAI Firm registration number:144032W
Arpit Patel
Place : Ahmedabad Partner
Date : May 30 2019 Membership No.: 034032

Annexure B to the Independent Auditor's Report

(Referred to in paragraph 1(f) under 'Report on Other Legal and RegulatoryRequirements' section of our report to the Members of Sanrhea Technical Textile Limited ofeven date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Act

We have audited the internal financial controls over financial reporting of the Companyas of March 31 2019 in conjunction with our audit of the financial statements of theCompany for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Board of Directors 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 respective 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 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 Accountants of Indiaand the Standards on Auditing prescribed under Section 143(10) of the Act to the extentapplicable to an audit of internal financial controls. Those Standards and the GuidanceNote require that we comply with ethical requirements and plan and perform the audit toobtain reasonable assurance about whether adequate internal financial controls overfinancial 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 internal financial controls system overfinancial reporting of the Company.

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 to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2019 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note 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
Arpit Patel
Place : Ahmedabad Partner
Date : May 30 2019 Membership No.: 034032