You are here » Home » Companies » Company Overview » Shiva Cement Ltd

Shiva Cement Ltd.

BSE: 532323 Sector: Industrials
NSE: N.A. ISIN Code: INE555C01029
BSE 00:00 | 03 Dec 36.30 0.40
(1.11%)
OPEN

35.90

HIGH

36.80

LOW

35.70

NSE 05:30 | 01 Jan Shiva Cement Ltd
OPEN 35.90
PREVIOUS CLOSE 35.90
VOLUME 127161
52-Week high 45.60
52-Week low 17.24
P/E
Mkt Cap.(Rs cr) 708
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 35.90
CLOSE 35.90
VOLUME 127161
52-Week high 45.60
52-Week low 17.24
P/E
Mkt Cap.(Rs cr) 708
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Shiva Cement Ltd. (SHIVACEMENT) - Auditors Report

Company auditors report

To

The Members of SHIVA CEMENT LIMITED

Report on the Audit of the Financial Statements

Opinion

We have audited the accompanying financial statements of Shiva Cement Limited("the Company") which comprise the balance sheet as at March 31 2020 and thestatement of profit and loss (including other comprehensive income) statement of cashflows and statement of changes in equity for the year then ended and notes to thefinancial statements including a summary of significant accounting policies and otherexplanatory information (hereinafter referred to as "the financial statements").

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 principles generally accepted in India of thestate of affairs of the Company as at March 31 2020 its loss total comprehensiveincome its cash flows and changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the financial statement in accordance with the Standards onAuditing (SAs) specified under sub-section (10) of Section 143 of the Act. Ourresponsibilities under those Standards are further described in the 'Auditor'sResponsibilities for the Audit of the Financial Statements' section of our report. We areindependent of the Company in accordance with the 'Code of Ethics' issued by the Instituteof Chartered Accountants of India together with the ethical requirements that are relevantto our audit of the financial statements under the provisions of the Act and the Rulesthere under and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion on thefinancial statements.

Material Uncertainty related to going concern

We draw attention to note no 31(l) to the financial statement which indicates thatduring the year ended March 31 2020 the Company has incurred loss of Rs.2301.67 lakhs andas on March 31 2020 the Company's accumulates loss is Rs.9271.18 lakhs resulting inerosion of net worth of the Company. The financial statements of the Company have beenprepared on a going concern basis for the reason stated in the said note. The validity ofthe going concern assumption would depend upon the performance of the Company as per itsfuture business plan. Our opinion is not qualified 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 of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.For each matter below our description of how our audit addressed the matter is providedin 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 the Auditor's responsibilities forthe audit of the financial statements section of our report including in relation tothese matters. Accordingly our audit included the performance of procedures designed torespond 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.

The Key Audit Matter Auditor's Response
Provision for Mines Restoration - Refer to the accounting policies in Note 2(D) to the financial statements: Provision for mine restoration; Note 3 to the financial statements: use of estimates and judgements – determination of provision for mine restoration to the financial statements
The provision for Mines Restoration relates to mines located at Khaturbahal (Kutra District) In evaluating the reasonability of provisions for closure and restoration costs we performed detailed assessment of the Management's assumptions. Our audit procedures included the following:
The calculation of the provisions requires significant management's judgment because of the inherent complexity in estimating future costs. These costs are provided at the present value of expected costs to settle the obligation using estimated cash flows. The provisions are subject to the effects of any changes in local regulations Management's expected approach to decommissioning and discount rates. • As at March 31 2020 we reviewed the assumptions used by the Management in their calculations and verified the calculations and assessed the assumptions used.
• W e also recalculated the provision based on these assumptions used by the Management for the discount rates areas to be rehabilitated the nature of expenses to be incurred (i.e. related to asset or expense).
The provision for Mines Restoration was identified as a key audit matter due to the significance of the Management's judgement involved in the determination of forecasted closure and restoration costs life of mines and discount rate. We assessed the competence of the work of the Management's expert who produced the cost estimates.

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 Annual report but does not includethe financial statements and our auditor's report thereon. The Annual is expected to bemade available to us after the date of this auditor's 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 workwe have performed we conclude that there is a material misstatement of this otherinformation we are required to report that fact. We have nothing to report in thisregard.

Responsibilities of the Management for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in sub-section(5) of Section 134 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 of equity of the Company inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards specified under Section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 as amended. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.

In preparing the financial statements the management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless themanagement 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 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 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 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 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 todesign audit procedures that are appropriate in the circumstances. Under clause (i) ofsub-section (3) of Section 143 of the Act we are also responsible for expressing ouropinion on whether the company has adequate internal financial controls with reference tofinancial statements in place and the operating effectiveness of such controls.

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

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe 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 ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.

• Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the financial statements thatindividually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in

(i) planning the scope of our audit work; and

(ii) to evaluate the effect of any identified misstatements in the financialstatements.

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 of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh 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 A" a statement on the matters specified inparagraphs 3 and 4 of the Order.

2. As required by sub-section (3) of Section 143 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 other comprehensiveincome the statement of cash flow and the statement of changes in equity dealt with bythis 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 Companies (Indian AccountingStandards) Rules 2015 as amended.

e. On the basis of the written representations received from the directors as on March31 2020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2020 from being appointed as a director in terms of sub-section (2) ofSection 164 of the Act.

f. With respect to the adequacy of the internal financial controls over financialreporting with reference to financial statements of the Company and the operatingeffectiveness of such controls refer to our separate Report in "Annexure B" ofthis report.

g. In our opinion and according to information and explanations given to us theCompany has paid/provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of Section 197 read with Schedule V of 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 2015 in ouropinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements - Refer Note 31 (a) of the financial 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.

For SHAH GUPTA & CO.
Chartered Accountants
Firm Registration No.: 109574W
Vipul K Choksi
Partner
Place: Mumbai M. No. 037606
Date: May 12 2020 Unique Document Identification Number (UDIN) for this document is: 20037606AAAAAL4974

ANNEXURE A TO THE INDEPENDENT AUDITORS' REPORT

(Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements'section of our report to the Members of Shiva Cement Limited of even date)

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of property plant and equipment on the basis ofavailable information.

(b) The Company has a program of verification to cover all the items of property plantand equipment in a phased manner which in our opinion is reasonable having regard to thesize of the Company and the nature of its assets. Pursuant to the program certainproperty plant and equipment were physically verified by the Management during the year.According to the information and explanations given to us no material discrepancies werenoticed on such verification.

(c) According to the information and explanations given to us the records examined byus and based on the examination of in respect of immovable properties that have been takenon lease and disclosed as property plant and equipment or right of use assets in thefinancial statements the lease agreements are in the name of the Company where theCompany is the lessee in the agreement.

(ii) The inventory except goods in transit has been physically verified by theCompany at reasonable intervals during the year. In our opinion the frequency of suchverification is reasonable. In respect of inventory lying with third parties these havebeen substantially been confirmed by them. The discrepancies noticed on verificationbetween the physical stocks and the book records were not material.

(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 reporting under paragraph 3(iii) (a) (b) and (c) of the Order are notapplicable to the Company.

(iv) In our opinion and according to the information and explanations given to usthere are no loans investments guarantees and securities granted in respect of whichprovisions of Section 185 and 186 of the Act are applicable and accordingly reportingunder paragraph 3 (iv) of the Order is not applicable.

(v) According to the information and explanations given to us the Company has notaccepted any deposits from the public.

Accordingly reporting under paragraph 3(v) of the Order is not applicable to theCompany.

(vi) To the best of our knowledge and as explained the Central Government has notspecified the maintenance of cost records under sub-section (1) of section 148 of the Actfor the products / services of the Company. Accordingly reporting under paragraph 3 (vi)of the order is not applicable to the Company.

(vii) (a) According to the information and explanations given to us and the records ofthe company examined by us the Company is generally regular in depositing with theappropriate authorities undisputed statutory dues including provident fund employees'state insurance income tax service tax goods and service tax cess and other materialstatutory dues applicable to it.

According to the information and explanations given to us the undisputed amountspayable which were outstanding at the year end for a period of more than six months fromthe date are as below:

Name of the Statue Nature of dues Amount (Rs.in lakhs) Period to which the amount relates
Odisha VAT Act 2004 Interest on VAT 28.75 2014-15
Interest on VAT 4.94 2015-16
Orissa Entry Tax Act 1999 Interest on Entry Tax 0.59 2014-15
Interest on Entry Tax 2.14 2015-16
Interest on Entry Tax 0.14 2016-17
Orissa Employee State Insurance (ESI)
Act 1948 Interest on ESI 0.01 2011-12
Interest on ESI 0.02 2012-13
Interest on ESI 0.08 2013-14
Interest on ESI 0.25 2014-15
Interest and Penalty on ESI 2.60 2015-16
Interest and Penalty on ESI 1.10 2016-17
Income Tax Act 1961 Interest on Income Tax 47.29 2013-14
Interest on Income Tax 23.03 2014-15
Interest on Income Tax 2.14 2015-16

(b) According to the information and explanations given to us details of dues ofincome tax duty of customs duty of excise value added tax and cess which have not beendeposited as on March 31 2020 on account of disputes are given below :

Name of the Statue Nature of Dues Amount (Rs. in lakhs) Period to which the amount elates Forum where dispute is pending
Orissa Sales Tax Act 1947 Denial for incentive under various Industrial Policy Resolutions (IPRs) on the production of expanded unit of SCL's Unit-I Penalty on late payment etc. 0.89 1998-99 Asst. Commissioner of commercial Tax Rourkela
30.34 2003-04 Hon'ble High Court of Odisha
57.96 2004-05 Hon'ble High Court of Odisha
1.03 2003-04 Asst. Commissioner of commercial Tax Rourkela
Central Sales Tax Act 1956 Denial for incentive under various IPRs on the production of expanded unit of SCL's Unit-I Pending Form filings. 0.19 1988-99 Asst. Commissioner of Commercial Tax Rourkela
1.71 2003-04 Commissioner of Commercial Tax Cuttack
Orissa Entry Tax Act 1999 Tax-Credit levy of tax on certain raw materials procured. 0.38 1999-20 Asst. Commissioner of commercial Tax Rourkela
1.60 2001-02 Commissioner of commercial Tax. Cuttack
0.40 2003-04 Commissioner of commercial Tax Cuttack
1.95 2008-11 Addl. Commissioner of commercial Tax Cuttack
Finance Act 1994 Service Tax 7.11 2005-06 CESTAT Kolkata
Income Tax Act 1961 m Interest and Penalty 466.32 2015-16 Asst. Commissioner of Income Tax Sambalpur

(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 the banks duringthe year. The Company has not taken any loan from financial institution government or byway of issue of debentures.

(ix) Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven to us by the Management the Company did not raise any money by way of initialpublic offer or further public offer (including debt instruments) and term loans duringthe year under review. Accordingly reporting under paragraph 3(ix) of the Order is notapplicable to the Company.

(x) Based on the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven to us by the Management we report that no material fraud by the Company and on theCompany by its officer or employees has been noticed or reported during the year.

(xi) According to the information and explanations given to us and based on ourexamination of the records of the Company has paid/provided managerial remuneration inaccordance with the requisite approvals mandated by the provisions of Section 197 readwith Schedule V to the Act. (xii) In our opinion the Company is not a Nidhi Company.

Therefore reporting under paragraph 3 (xii) of the Order is not applicable to theCompany.

(xiii) Based on our audit procedures performed for the purpose of reporting the trueand fair view of the financial statements and according to the information andexplanations given to us by the Management transactions with the related parties are incompliance with Sections 177 and 188 of the Act where applicable and the details havebeen disclosed in the notes to the financial statements as required by the applicableaccounting standards.

(xiv) According to the information and explanations given to us and on an overallexamination of the Balance Sheet the Company has not made any preferentialallotment/private placement of shares or fully or partly convertible debentures during theyear.

(xv) Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements in our opinion and according to the information andexplanations given to us the Company has not entered into any non-cash transactions withdirectors or persons connected with him.

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

For SHAH GUPTA & CO.
Chartered Accountants
Firm Registration No.: 109574W
Vipul K Choksi
Partner
Place: Mumbai M. No. 037606
Date: May 12 2020 Unique Document Identification Number (UDIN) for this document is: 20037606AAAAAL4974

ANNEXURE B TO THE INDEPENDENT AUDITORS' REPORT

Report on the internal financial controls with reference to the aforesaid financialstatements under Clause (i) of sub-section (3) of Section 143 of the Act

We have audited the internal financial controls over financial reporting of ShivaCement Limited ("the Company") as of March 31 2020 in conjunction with ouraudit of the financial statements of the Company for the year ended 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 Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants of India.These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to 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 Company's internal financialcontrols over financial reporting with reference to these financial statements of theCompany based on our audit. We conducted our audit in accordance with the Guidance Noteissued by the Institute of Chartered Accountants of India and the Standards on Auditingprescribed under sub-section (10) of Section 143 of the Act to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute of Chartered Accountants of India. 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 with reference to these financial statementswas established and maintained and if such controls operated effectively in all materialrespects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting with reference to thesefinancial statements and their operating effectiveness. Our audit of internal financialcontrols over financial reporting included obtaining an understanding of internalfinancial controls over financial reporting with reference to these financial statementsassessing 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 internal financial controls system overfinancial reporting with reference to these financial statements.

Meaning of Internal Financial Controls Over Financial Reporting with reference to theseFinancial Statements

A Company's internal financial control over financial reporting with reference to thesefinancial statements is a process designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles. A Company'sinternal financial control over financial reporting with reference to these financialstatements 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 authorisations 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 withreference to these Financial Statements

Because of the inherent limitations of internal financial controls over financialreporting with reference to these financial statements including the possibility ofcollusion or improper management override of controls material misstatements due to erroror fraud may occur and not be detected. Also projections of any evaluation of theinternal financial controls over financial reporting with reference to these financialstatements 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 controlswith reference to these financial statements and such internal financial controls wereoperating effectively as at March 31 2020 based on the internal financial controls withreference to financial statements criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For SHAH GUPTA & CO.
Chartered Accountants
Firm Registration No.: 109574W
Vipul K Choksi
Partner
Place: Mumbai M. No. 037606
Date: May 12 2020 Unique Document Identification Number (UDIN) for this document is: 20037606AAAAAL4974

.