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Sharda Motor Industries Ltd.

BSE: 535602 Sector: Auto
NSE: SHARDAMOTR ISIN Code: INE597I01010
BSE 00:00 | 16 Aug 963.00 17.95
(1.90%)
OPEN

926.15

HIGH

971.00

LOW

926.15

NSE 00:00 | 16 Aug 963.05 6.65
(0.70%)
OPEN

990.00

HIGH

990.00

LOW

923.60

OPEN 926.15
PREVIOUS CLOSE 945.05
VOLUME 54
52-Week high 2050.00
52-Week low 891.05
P/E 6.84
Mkt Cap.(Rs cr) 573
Buy Price 963.00
Buy Qty 4.00
Sell Price 1009.00
Sell Qty 3.00
OPEN 926.15
CLOSE 945.05
VOLUME 54
52-Week high 2050.00
52-Week low 891.05
P/E 6.84
Mkt Cap.(Rs cr) 573
Buy Price 963.00
Buy Qty 4.00
Sell Price 1009.00
Sell Qty 3.00

Sharda Motor Industries Ltd. (SHARDAMOTR) - Auditors Report

Company auditors report

To the Members of M/s. SHARDA MOTOR INDUSTRIES LIMITED

Report on the Standalone lnd AS Financial Statements

We have audited the accompanying standaloneIndASfinancialstatements of Sharda MotorIndustries Limited ("the Company") which comprise the Balance Sheet as atMarch 31 2018 and the Statement of Profit and Loss (including Other ComprehensiveIncome) the Cash Flow Statement and the Statement of Changes in Equity for the year thenended and a summary of the significant accounting policies and other explanatoryinformation (hereinafter referred to as "Ind AS financial statements").

Management's Responsibility for the Standalone lnd AS 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 standalone Ind AS financial statements that give a true and fair view of the stateof affairs (financial (financial performance including other comprehensive income) cashflows and changes in equity of position)profit & loss the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards(lnd AS) prescribed under Section 133 of the Act read with the companies (Indianaccounting Standards) Rule 2015 as amended.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalonelndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these lnd AS financial statements basedon our audit.

We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder.

We conducted our audit of the standalone IndAS financial statements in accordance withthe Standards on Auditing specified under Section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone lnd AS financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind AS procedures selected depend on the auditor'sjudgment including the assessment of the risks of material financial misstatement of thestandalone lnd AS financial statements whether due to fraud or error. In making thoserisk assessments the auditor considers internal financial control relevant to theCompany's preparation of the standalone IndAS financial statements that give a true andfair view in order to design audit procedures that are appropriate in the circumstances.An audit also includes evaluating the appropriateness of the accounting policies used andthe reasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the standalone Ind AS financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India including the Ind AS of thestate of affairs (financial position) of the Company as at March 31 2018 and its Profit(including other comprehensive income) its cash flows and the changes in the equity forthe year ended on that date.

Other Matter

The comparative financial information of the Company for the year ended March 31 2017and the transition date opening balance sheet as at April 01 2016 included in thesestandalone Ind AS financial statements are based on the previously issued statutoryfinancial statements prepared in accordance with the Companies (Accounting Standards)Rules 2006 audited by the predecessor auditor whose report for the year ended March 312017 and March 31 2016 dated May 30 2017 and May 27 2016 respectively expressed anunmodified opinion on those standalone financial statements as adjusted for thedifferences adopted by the Company on transition to the Ind AS which have been audited byus. Our opinion is not modified in respect of above matter.

Report on Other Legal and Regulatory Requirements

1. 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 purpose of our audit;

(b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books;

(c) The Balance Sheet the Statement of Profit and Loss including other comprehensiveincome the Cash Flow Statement and the Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account;

(d) In our opinion the aforesaid Ind AS financial statements comply with the IndianAccounting Standards specified under Section 133 of the Act read with relevant rulesissued thereunder;

(e) On the basis of written representations received from the directors as on March31 2018taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2018 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 and the operating effectiveness of such controls refer to ourseparate Report in "AnnexureA"; and

(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 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 Ind AS statements- Refer Note 21.1 to the standalone lnd ASfinancial statements;

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

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

2. 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 B" a statement specified in paragraphs 3 onthe matters and 4 of the said Order.

For Gupta Vigg & Co.

Chartered Accountants

Firm's Registration Number 001393N

(CA. Deepak Pokhriyal)

Partner

Membership Number: 524778

Place of Signature: Nashik Maharashtra

Date: May 26 2018

Annexure ‘A' To the Independent Auditors' Report

(Referred to in paragraph 1(f) under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date to the Members of Sharda Motor IndustriesLimited)

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 ShardaMotor Industries Limited ("the Company") as of March 31 2018 in conjunctionwith our audit of the standalone lnd AS financial statements of the Company for the yearended on 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 (‘ICAl'). 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 CompaniesAct 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financial

We conducted our audit in accordance with the Guidance Note on audit of InternalFinancial Controls over Financial Reporting (the "Guidance Note") and theStandards on Auditing issued by ICAI and deemed to be prescribed under section 143(10) ofthe Companies

Act 2013 to the extent applicable to an audit of internal financial controls bothapplicable to an audit of Internal Financial Controls and both issued by the Institute ofChartered Accountants of India. Those Standards and the Guidance Note require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects. Our audit involves performing procedures to obtain audit evidence about theadequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgment including the assessment of therisks of material 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 reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally acceptedaccounting principles. A company's internal financial financial reporting includes thosepolicies and procedures that (1) controlover pertain to the maintenance of records thatin reasonable detail accurately and fairly reflect the transactions and dispositions ofthe assets of the company; (2) provide reasonable assurance that transactions are recordedas necessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorisations of management and directors of thecompany; 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 internal financial control over financialreporting may become inadequate because of changes in conditions or that the degree ofcompliance 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 were operatingeffectively as at March 31 2018 based on "the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India.

For Gupta Vigg & Co.

Chartered Accountants

Firm's Registration Number: 001393N

(CA. Deepak Pokhriyal)

Partner

Membership Number: 524778

Place of Signature: Nashik Maharashtra

Date: May 26 2018

Annexure ‘B' To the Independent Auditors' Report

The Annexure referred to in Independent Auditors' Report to the members of the Companyon the standalone Ind AS financial statements for the year ended March 31 2018 we reportthat:

(i) In respect of fixed assets:

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

(b) The Company has a regular programme of physical verification of its fixed assets bywhich fixed assets are verified at periodic intervals. In our opinion this periodicity ofphysical verification is reasonable having regard to the size of the Company and thenature of its assets. No material discrepancies were noticed on such verification.

(c) On the basis of information and explanation provided by the management the titledeeds of immovable properties are held in the name of the Company. One title deed has beenmortgaged with a bank for securing the short term borrowing detail of the same aredisclosed in Note No. 17 of the standalone Ind AS financial statements.

(ii) On the basis of information and explanation provided by the managementinventories have been physically verified by the management during the year except forstock-in-transit and stocks lying with third parties. In our opinion the frequency ofsuch verification is reasonable. According to the information and explanations given tous discrepancies noticed on such verification between physical stocks and the bookrecords were not material and these have been properly dealt with in the books of account.

(iii) According to the information and explanations given to us the Company has notgranted any loan secured or unsecured to companies firms Limited Liability Partnerships(LLPs) or other parties covered in the register maintained under Section 189 of the Act.Accordingly the provisions of paragraphs 3(iii)(a) 3(iii)(b) and 3(iii)(c) of the Orderare not applicable.

(iv) According to the information and explanations given to us the Company has notentered into any transaction covered under Sections 185. The company has complied with theprovisions of Sections 186 of the Act in respect of investments made. The Company has notgranted any loans and has not provided any guarantees or securities to parties coveredunder Section 186 of the Act.

(v) In our opinion and according to the information and explanation given to us theCompany has not accepted any deposits from the public in accordance with the provisions ofSections 73 to 76 of the Act and the rules framed there under. Accordingly paragraph 3(v)of the Order is not applicable to the Company.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules prescribed by the Central Government for maintenance of cost records undersubsection (I) of Section 148 of the Act in respect of product covered and are of theopinion that prima facie the prescribed accounts and records have been made andmaintained. However we have not made a detailed examination of the records.

(vii) (a) The Company is generally regular in depositing undisputed statutory duesincluding provident fund employees' state insurance income tax sales tax service taxvalue added tax duty of excise duty of customs goods and service tax cess and otherapplicable statutory dues with appropriate authorities. Further there were no undisputedoutstanding statutory dues as on the last day of the financial year concerned for a periodof more than six months from the date they became payable except duty of custom of Rs.6.59lakhs.

(b) According to the information and explanations given to us there are no dues ofduty of customs which have not been deposited with the appropriate authorities on accountof any dispute. Further according to the information and explanations given to us exceptas stated below there are no dues of income-tax sales tax value added tax service taxand duty of excise which have not been deposited by the Company on account of anydisputes:

S. No. Nature of statute Nature of dues Amount Period to which amount relates Forum where dispute is pending
(Rs. in lakhs)*
1 U.P. Entry Tax Act Entry tax 0.90 F.Y. 2001-02 Appellate Authority UP Trade Tax
2 Maharashtra Sales Tax Act VAT 23.69 F.Y. 2010-11 Sales Tax Tribunal Nashik
9.39 F.Y. 2011-12 Joint Commissioner Nashik
3 Tamil Nadu Sales Tax Act VAT 29.72 F.Y. 2005-06 & 2006-07 High Court Madras
4 Service Tax under Finance Act 1994 Service Tax 34.02 F.Y. 2011-12 2012-13 2013-14 & 2014-15 CESTAT Chennai
8.16 F.Y. 2010-11 2011-12 2012-13 2013-14 & 2014-15 CESTAT Ahmedabad
4.30 F.Y. 2011-12 2012-13 2013-14 & 2014-15 CESTAT Mumbai
5 Central Excise Act Cenvat Credit 2.24 F.Y. 2007-08 Commissioner Central Excise & Service Tax (Appeals) LTU New Delhi
440.00 F.Y. 2008-09 & 2009-10 Hon'ble Supreme Court of India
0.83 F.Y. 2015-16 & 2016-17 Asst. Comm. Central excise & Ser- vice tax LTU New Delhi
1.39 F.Y. 2014-15 & 2015-16 CESTAT Chennai
7.35 F.Y. 2010-11 & 2011-12 CESTAT Mumbai
6 Income Tax Act Income Tax 41.55 A.Y. 2012-13 ITAT New Delhi

* Net of protest money paid.

(viii) On the basis of information and explanation provided to us Company has notdefaulted in repayment of loans and borrowings to financial institution and bank. TheCompany has not taken any loan from Government and has not issued any debentures.

(ix) According to the information and explanations given to us the Company has notraised any money by way of Initial public offer or future public offer (including debtinstruments) and term loans during the year. Accordingly the provisions of paragraph3(ix) of the Companies (Auditor's Report) Order 2016 are not applicable to the Company.

(x) According to the information and explanations given to us no fraud by the Companyor on the Company by its officers or employees has been noticed or reported during theyear.

(xi) The Company has paid or provided for managerial remuneration in accordance withthe requisite approvals mandated by the provisions of Section 197 read with Schedule V tothe Act. .

(xii) The Company is not a Nidhi company hence the provisions of paragraph 3(xii) ofthe Companies (Auditor's Report) Order 2016 are not applicable to the Company.

(xiii) Based on our examination of the books of account and records of the Company alltransactions entered with the related parties are in compliance with sections 177 and 188of Companies Act 2013 where applicable and the details have been disclosed in thestandalone Ind AS financial statements as required by the applicable Indian accountingstandards.

(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 the provisions of paragraph 3(xiv) of the Order are not applicable to theCompany.

(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly the provisions ofparagraph 3(xv) of the Order are not applicable to the Company.

(xvi) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934. Accordingly the provisions of paragraph 3(xvi) of the Order arenot applicable to the Company.

For Gupta Vigg & Co.

Chartered Accountants

Firm's Registration Number: 001393N

(CA. Deepak Pokhriyal)

Partner

Membership Number: 524778

Place of Signature: Nashik Maharashtra

Date: May 26 2018