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Shree Renuka Sugars Ltd.

BSE: 532670 Sector: Agri and agri inputs
NSE: RENUKA ISIN Code: INE087H01022
BSE 14:54 | 01 Jul 45.60 -0.80
(-1.72%)
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46.50

HIGH

46.50

LOW

45.10

NSE 14:39 | 01 Jul 45.55 -0.85
(-1.83%)
OPEN

46.50

HIGH

46.50

LOW

45.10

OPEN 46.50
PREVIOUS CLOSE 46.40
VOLUME 835480
52-Week high 63.25
52-Week low 21.50
P/E
Mkt Cap.(Rs cr) 9,706
Buy Price 45.50
Buy Qty 6228.00
Sell Price 45.60
Sell Qty 350.00
OPEN 46.50
CLOSE 46.40
VOLUME 835480
52-Week high 63.25
52-Week low 21.50
P/E
Mkt Cap.(Rs cr) 9,706
Buy Price 45.50
Buy Qty 6228.00
Sell Price 45.60
Sell Qty 350.00

Shree Renuka Sugars Ltd. (RENUKA) - Auditors Report

Company auditors report

To the Members of Shree Renuka Sugars Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of Shree Renuka SugarsLimited ("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.

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 as amended ("the Act") in the manner so required andgive a true and fair view in conformity with the accounting principles generally acceptedin India of the state of affairs of the Company as at March 31 2021 its profitincluding other comprehensive income its cash flows and the changes in equity for theyear ended on that date.

Basis for Opinion

We conducted our audit of the standalone 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 standalone financial statements' section of ourreport. We are independent of the Company in accordance with the ‘Code of Ethics'issued by the Institute of Chartered Accountants of India together with the ethicalrequirements 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 audit opinion on the standalone financial statements.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone financial statements for the financial yearended March 31 2021. 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. For each matter below our description ofhow our audit addressed the matter is provided in that context.

We have determined the matters described below to be the key audit matters to becommunicated in our report. We have fulfilled the responsibilities described in theAuditor's responsibilities for the audit of the standalone financial statements section ofour report including in relation to these matters. Accordingly our audit included theperformance of procedures designed to respond to our assessment of the risks of materialmisstatement of the standalone financial statements. The results of our audit proceduresincluding the procedures performed to address the matters below provide the basis for ouraudit opinion on the accompanying standalone financial statements.

Other Information

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 standalone financial statements and our auditor's report thereon. The annual report isexpected to be made available to us after the date of this auditor's report.

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

In connection with our audit of the standalone financial statements our responsibilityis to read the other information identified above when it becomes available and in doingso consider whether such other information is materially inconsistent with the standalonefinancial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated.

When we read the annual report if we conclude that there is a material misstatementtherein we are required to communicate the matter to those charged with governance andshall comply with the relevant applicable requirements of the Standard on Audit for theAuditors Responsibility in relation to Other Information in documents containing theaudited financial statements.

Responsibilities of Management for the Standalone 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 standalone 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 accounting principles generally accepted in India including the IndianAccounting Standards (Ind AS) specified under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and the designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone financialstatements that give a true and fair view and are free from material misstatement whetherdue 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. Those Board of Directors are also responsible foroverseeing the Company's financial reporting process.

Auditor's Responsibilities 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 orderto design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls with reference to financial statements inplace and the operating effectiveness of such controls.

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

Conclude on the appropriateness of management's 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 theCompany's ability 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 statements 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 standalonefinancial statements including the disclosures and whether the standalone financialstatements represent 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 withthose charged with governance we determine those matters that were of most significancein the audit of the standalone financial statements for the financial year ended March 312021 and are therefore the key audit matters. We describe these matters in our auditor'sreport unless law or regulation precludes public disclosure about the matter or when inextremely rare circumstances we determine that a matter should not be communicated in ourreport because the adverse consequences of doing so would reasonably be expected tooutweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Act we give in the "Annexure 1" 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 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 standalone 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 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 of the internal financial controls over financialreporting of the Company with reference to these standalone financial statements and theoperating effectiveness of such controls refer to our separate Report in "Annexure2" to this report;

(g) In our opinion the managerial remuneration for the year ended March 31 2021 paidby the Company to the Chairman and the Executive Director are in accordance with theprovisions of section 197 read with Schedule V to the Act. Managerial remunerationprovided by the Company to its Independent Directors is subject to approval from theshareholders in the ensuing general meeting;

(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 has disclosed the impact of pending litigations on its financialposition in its standalone financial statements – Refer Note 38(c) to the standalonefinancial statements;

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long-term contracts includingderivative contracts – Refer Note 24 to the standalone financial statements;

iii. There has been an instance of delay of 56 days in transferring amounts of INR 2.90million in respect of unclaimed dividend required to be transferred to the InvestorEducation and Protection Fund by the Company.

For S R B C & CO LLP
Chartered Accountants
ICAI Firm registration number: 324982E/E300003
per Shyamsundar Pachisia
Partner
Membership No.: 049237
UDIN: 21049237AAAABD7267
Place: Mumbai
Date: June 25 2021

Annexure 1: Annexure referred to in Paragraph 1 of the section on "Report on otherlegal and regulatory requirements" of our report of even date

Re: Shree Renuka Sugars Limited

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

(b) All fixed assets have not been physically verified by the management during theyear but there is a regular programme of verification which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. No materialdiscrepancies were noticed on such verification.

(c) According to the information and explanations given by the management and auditprocedures performed by us the title deeds of immovable properties included in propertyplant and equipment are held in the name of the Company except for the following caseswhere original title deeds were not available with the Company:

(INR in millions)

Sr. No. Type No. of cases Gross carrying amount Net carrying amount Remarks
1. Building 1 1.76 1.39 As represented title deeds are submitted to the debenture trustee. The same has not been independently confirmed by the debenture trustee.
2. Freehold land 2 22.62 22.62 Title deeds were not available with the Company.
3. Leasehold land 1 372.02 338.63 Only copy of the lease agreement is available with the Company.

(ii) The management has conducted physical verification of inventory at reasonableintervals during the year and no material discrepancies were noticed on such physicalverification.

(iii) (a) The Company has granted loans to two subsidiaries covered in the registermaintained under section 189 of the Companies Act 2013. According to the information andexplanations given to us in respect of loans given to both the subsidiaries interest forthese loans are not due upto the year 2021- 22 and accordingly in our opinion the termsand conditions of the loan are prejudicial to the interest of the Company.

(b) In respect of loans granted to two subsidiaries covered in the register maintainedunder section 189 of the Companies Act 2013 the schedule of repayment of principal andpayment of interest has been stipulated. Accordingly in respect of loans granted to boththe subsidiaries interest for these loans are not due upto the year 2021-22. Further inrespect of loan granted to one of these subsidiaries amounting to INR 136.27 million as atMarch 31 2021 interest accrued has been provided for by the Company.

(c) There are no amounts of loans granted to companies firms or other parties listedin the register maintained under section 189 of the Companies Act 2013 which are overduefor more than ninety days.

(iv) In our opinion and according to the information and explanations given to usduring the year the Company has not advanced loans to directors / to a company in whichthe Director is interested to which provisions of section 185 of the Companies Act 2013apply and hence not commented upon.

In our opinion and according to the information and explanations given to usprovisions of section 186 of the Companies Act 2013 in respect of loans and advancesgiven investments made and guarantees and securities given have been complied with bythe company.

(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76of the Act and the Companies (Acceptance of Deposits) Rules 2014 (as amended).Accordingly the provisions of clause 3(v) of the Order are not applicable.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Companies Act 2013 related to the manufacture of sugar industrialalcohol and generation of electricity and are of the opinion that prima facie thespecified accounts and records have been made and maintained. We have not however made adetailed examination of the same.

(vii) (a) Undisputed statutory dues including provident fund employees' stateinsurance income-tax duty of custom duty of excise goods and service tax cess andother statutory dues have generally been regularly deposited with the appropriateauthorities. As informed to us the provisions related to sales-tax service tax and valueadded tax are not applicable to the Company.

(b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income- tax duty ofcustom duty of excise goods and service tax cess and other statutory dues wereoutstanding at the year end for a period of more than six months from the date theybecame payable.

(c) According to the records of the Company the dues of income-tax sales-tax servicetax duty of custom duty of excise value added tax and cess on account of any disputeare as follows:

Name of the statute Nature of the dues Amount in INR Million** Period to which the amount relates Forum where the dispute is pending
Customs Act 1960 Customs 249.03 2003-2004 Supreme Court
Duty 1415.23 2006-2007 to 2016-2017 CESTAT
0.37 2017-2018 Commissioner Central Tax
Central Excise Act 1944 Excise duty 723.84 2004-2005 to 2013-2014 CESTAT
109.75 2013-2013 to 2015-2016 Commissioner (Appeals)
3.65 2003-04 Supreme Court
Finance Act 1994 Service Tax 11.04 2004-05 to 2010-11 Commissioner (Appeals)
32.78 2009-10 CESTAT
Goods and Service Tax 2007 GST 44.50 2017-2018 to 2018-2019 Joint Commissioner
Income Tax Act 1961 Income Tax 33.65 A.Y.-2008-09 CIT (Appeals)
Maharashtra Value Added Tax 2002 Sales Tax 11.28 2009-2010 and 2010- 2011 Sales Tax Tribunal Mumbai
West Bengal Value Added Tax Act 2003 Sales Tax 3.82 2016-2017 Additional Commissioner

** Amount paid under protest of INR 361.71 Million has been reduced in arriving atundeposited statutory dues disclosed above

(viii) In our opinion and according to the information and explanations given by themanagement the Company has not defaulted in repayment of loans or borrowing to afinancial institution bank. The Company did not have any outstanding loans or borrowingdues to government during the year. In case of listed non-convertible debentures(‘NCD) of the Company the Company has made payments to the debenture holder on thebasis of restructured balances as per the letter of intent received from the debentureholder and the Company is in the process of finalizing documentation with debentureholders.

(ix) In our opinion and according to the information and explanations given by themanagement and audit procedures performed by us the Company has utilised the moniesraised by way of term loans for the purpose for which they were raised. Further in ouropinion and according to information and explanations given by the management and auditprocedures performed by us the Company has not raised any money by way of initial publicoffer / further public offer / debt instruments and hence reporting under clause 3(ix) sofar as it relates to initial public offer / further public offer / debt instruments is notapplicable to the company and hence not commented upon.

(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the company or no fraud / materialfraud on the company by the officers and employees of the Company has been noticed orreported during the year.

(xi) According to the information and explanations given by the management and auditprocedures performed by us the managerial remuneration has been paid / provided inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Companies Act 2013. Managerial remuneration provided by theCompany to its Independent Directors is subject to approval from the shareholders in theensuing general meeting;

(xii) In our opinion the Company is not a nidhi company. Therefore the provisions ofclause 3 (xii) of the order are not applicable to the Company and hence not commentedupon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given by the management and auditprocedures performed by us the Company has complied with provisions of section 42 of theCompanies Act 2013 in respect of the preferential allotment of shares during the year.According to the information and explanations given by the management we report that theamounts raised have been used for the purposes for which the funds were raised. There hasbeen no preferential allotment or private placement of fully or partly convertibledebentures during the year.

(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in section 192 of Companies Act 2013.

(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 S R B C & CO LLP
Chartered Accountants
ICAI Firm registration number: 324982E/E300003
per Shyamsundar Pachisia
Partner
Membership No.: 049237
UDIN: 21049237AAAABD7267
Place: Mumbai
Date: June 252021

Annexure 2 – Annexure referred to in paragraph 2(f) of the section on "Reporton other legal and regulatory requirements" of our report of even date on thestandalone financial statements of Shree Renuka Sugars Limited

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 with reference to financial statementsof Shree Renuka Sugars Limited ("the Company") as of March 31 2021 inconjunction with our audit of the financial statements of the Company for the year endedon that date.

Management's Responsibility for Internal Financial Controls

The Company's Management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India ("ICAI"). 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 the Company's policies the safeguardingof its 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.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to these financial statements based on our audit. We conducted ouraudit in accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") and the Standards on Auditing asspecified under section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls both issued by ICAI. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls with reference tothese financial statements 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 with reference to these financial statements and theiroperating effectiveness. Our audit of internal financial controls with reference tofinancial statements included obtaining an understanding of internal financial controlswith reference to these financial statements assessing the risk that a material weaknessexists and testing and evaluating the design and operating effectiveness of internalcontrol based on the assessed risk. The procedures selected depend on the auditor'sjudgement including the assessment of the risks of material misstatement of the financialstatements 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 withreference to these financial statements.

Meaning of Internal Financial Controls With Reference to these Financial Statements

A company's internal financial controls with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial controlswith reference to financial statements includes those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.

Inherent Limitations of Internal Financial Controls With Reference to FinancialStatements

Because of the inherent limitations of internal financial controls with reference tofinancial statements including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls withreference to financial statements to future periods are subject to the risk that theinternal financial control with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.

Opinion

In our opinion the Company has in all material respects adequate internal financialcontrols with reference to financial statements and such internal financial controls withreference to financial statements were operating effectively as at March 31 2021 basedon the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Noteissued by the ICAI.

For S R B C & CO LLP
Chartered Accountants
ICAI Firm registration number: 324982E/E300003
per Shyamsundar Pachisia
Partner
Membership No.: 049237
UDIN: 21049237AAAABD7267
Place: Mumbai
Date: June 25 2021

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