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Shiva Global Agro Industries Ltd.

BSE: 530433 Sector: Agri and agri inputs
NSE: N.A. ISIN Code: INE960E01019
BSE 14:56 | 28 Oct 42.35 -0.95
(-2.19%)
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42.05

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NSE 05:30 | 01 Jan Shiva Global Agro Industries Ltd
OPEN 42.05
PREVIOUS CLOSE 43.30
VOLUME 10965
52-Week high 54.45
52-Week low 11.01
P/E 11.14
Mkt Cap.(Rs cr) 42
Buy Price 41.60
Buy Qty 50.00
Sell Price 42.35
Sell Qty 25.00
OPEN 42.05
CLOSE 43.30
VOLUME 10965
52-Week high 54.45
52-Week low 11.01
P/E 11.14
Mkt Cap.(Rs cr) 42
Buy Price 41.60
Buy Qty 50.00
Sell Price 42.35
Sell Qty 25.00

Shiva Global Agro Industries Ltd. (SHIVAGLOBAL) - Auditors Report

Company auditors report

To

The Members of SHIVA GLOBAL AGRO INDUSTRIES LIMITED

Report on the audit of the Standalone Financial Statements

Opinion

We have audited the accompanying Standalone financial statements of Shiva Global AgroIndustries Limited ("the Company") which comprise the Balance sheet as at March31 2019 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Cash Flows and the Statement of Changes in Equity for the year then endedand notes to the financial statements including a summary of the 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 ("the Act") in the manner so required and give a trueand fair view in conformity with the Indian Accounting Standards prescribed under Section133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015 asamended ("Ind AS") and other accounting principles generally accepted in Indiaof the state of affairs of the Company as at March 31 2019 and its profit totalcomprehensive income its cash flows and the changes in equity for the year ended on thatdate.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing specified under Section 143(10) of the Act (SAs). Ourresponsibilities under those Standards are further described in the Auditor'sResponsibility for the Audit of the Standalone Financial Statements section of our report.We are independent of the Company in accordance with the Code of Ethics issued by theInstitute of Chartered Accountants of India (ICAI) together with the ethical requirementsthat are relevant to our audit of the standalone financial statements under the provisionsof the Act and the Rules made thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the ICAI's Code of Ethics. Webelieve that the audit evidence obtained by us is sufficient and appropriate to provide abasis for 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 of the current period.These matters were addressed in the context of our audit of the standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report.

Key Audit Matter Auditor's Response
1 Revenue recognition (as described in note 1.16 of the standalone financial statements)
For the year ended March 31 2019 the Company has recognized revenue from sale of products of Rs.11329.50 lakhs. Our audit procedures included the following :
• Evaluated the Company's revenue recognition policy and its compliance in terms of Ind AS 115 ‘Revenue from contracts with customers'.
Revenue from sale of products is recognized when the significant risk and rewards of ownership of the goods have been transferred to the customer which generally coincide with the delivery of goods recovery of consideration is probable the associated costs and possible return of goods can be estimated reliably there is no continuing management involvement with the goods and the amount of revenue can be measured reliably. The Company considers estimated time of delivery of goods and this has an impact on the timing and extent of revenue recognition from sale of products. The varied terms that define when title risk and rewards are transferred to the customer as well as the high volume of transactions give rise to the risk that revenue could be recognized in the incorrect period for sales transactions occurring on and around the year end. • Understood and tested the operating effectiveness of internal controls as established by the management in relation to revenue recognition.
• Performed sales transactions testing based on a representative sampling and traced to sales invoices and other related documents to ensure that the related revenues and trade receivables are recorded appropriately taking into consideration the terms and conditions of the agreements with customers including the shipping terms.
• Tested sales transactions made near the year end by agreeing a sample of sales transactions occurring around the year end to supporting documentation including customer confirmation of receipt of goods to establish that sales and corresponding trade receivables are properly recorded in the correct period.
Accordingly due to the significant risk associated with revenue recognition it has been determined to be a key audit matter in our audit of the standalone financial statements. • Performed monthly analytical review of revenue from sale of goods by streams to identify any unusual trends.
• Assessed the relevant disclosures made within the standalone financial statements

2 Impact of government policies/ notifications on recognition of subsidyaccruals/claims and their recoverability (as described in note 1.16 of the standalonefinancial statements)

Subsidy income pertaining to fertilizer business is recognised on the basis of the rates notified from time to time by the Department of Fertilizers Government of India (‘GOI') in accordance with the Nutrient Based Subsidy (‘NBS') policy on the quantity of fertilizers sold by the Company for the period for which notification has been issued and for the remaining period based on estimates when there is a reasonable assurance that the Company will comply with all necessary conditions attached to Subsidy including Direct Benefit Transfer (‘DBT') System which was introduced by Government of India. For the year ended March 31 2019 subsidy income of Rs.2135.92 lakhs is recognized. Our audit procedures included the following:
• Obtained an understanding of the process and tested the design and operating effectiveness of controls as established by management in recognition and assessment of the recoverability of the subsidy
• Evaluated the management's assessment regarding reasonable certainty for complying with the relevant conditions as specified in the notifications and policies and collections of subsidy
• Read all the notifications issued by Department of Fertilizers applicable for subsidy recognized during the year
• Considered the relevant notifications and policies issued by Department of Fertilizers to ascertain the recognition of subsidy adjustments thereto recognised pursuant to changes in the rates and basis for determination of subsidy.
Recognition and realisability of subsidy income is dependent on GOI Policy and its various initiatives/schemes. • Tested the ageing analysis and assessed the information used by the management to determine the recoverability of the subsidy by considering collections against historical trends the level of credit loss charged over time and provisions made.
• Correlated the sales quantity considered for subsidy income with the actual sales made by the Company.
• Agreed the quantities sold as per the Company books with the customer acknowledgements as per the iFMS portal of the Department of Fertilisers and tested the DBT claims made by the Company.
• Enquired from the Management and discussed with the Board of Directors the appropriateness of the subsidy rates applied to recognise subsidy income.
• Assessed the related disclosure in 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 Directors' Report and ManagementDiscussion and Analysis but does not include the consolidated financial statementsstandalone financial statements and our auditor's report thereon.

Our opinion on the standalone financial statements does not cover the other informationand we do 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 and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained during the course of our audit or otherwise appears to be materially misstated.

If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.

Management's Responsibility 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 Ind AS and other accounting principles generally accepted in India. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding 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; anddesign implementation 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 for overseeing the Company's financialreporting process.

Auditor's Responsibility 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 financial control relevant to the audit inorder to 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 system in place and the operatingeffectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by the 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 standalone financial statements or if such disclosures are inadequate to modify ouropinion. 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 standalonefinancial statements including the disclosures and whether the standalone financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.

Materiality is the magnitude of misstatements in the standalone financial statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the standalone financial statements may be influenced. Weconsider quantitative materiality and qualitative factors in (i) planning the scope of ouraudit work and in evaluating the results of our work; and (ii) to evaluate the effect ofany identified misstatements in the standalone financial statements.

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 standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when 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 in terms of section 143(11) of the Act we give in the"Annexure A" a statement on the matters specified in paragraphs 3 and 4 of theOrder.

2. As required by section 143(3) of the Act based on our audit 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 Statement of Cash Flows 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 Standalone financial statements comply with theAccounting Standards prescribed under section 133 of the Act.

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 and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.

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 as at March 31 2019 onits financial position in its standalone financial statements –Refer Note 38 to thestandalone financial statements;

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

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company during the year ended March 312019.

For Aditya Falor & Associates
Chartered Accountants
Firm Registration No.: 127273W
Aditya G. Falor
Place : Nanded Proprietor
Date : May 30 2019 Membership Number : 122487

Annexure to Independent Auditor's Report

"Annexure A" to Independent Auditors' Report

(Referred to in Paragraph 1 under the heading of "Report on Other Legal andRegulatory Requirements" of our report of even date:) i. FIXED ASSETS :

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

(b) The fixed assets have been physically verified by the management at reasonableintervals. No material discrepancies were noticed on such verification.

(c) According to the information & explanations given to us & on the basis ofour examination of the records of the Company title deeds of all immovable properties areheld in the name of company.

ii. INVENTORY :

As explained to us the inventories except goods-in-transit were physically verifiedduring the year by the management at reasonable intervals. According to the information& explanation given to us no material discrepancies were noticed on suchverification.

iii. LOANS GRANTED TO PARTIES COVERED U/S 189 OF COMPANIES ACT 2013 :

The company has not granted any loans secured or unsecured to companies firmslimited liability partnerships or other parties covered in the register maintained undersection 189 of the Act during the year. Accordingly paragraph 3(iii)of the Order is notapplicable to the Company.

iv. COMPLIANCE WITH SEC. 185 & SEC. 186 OF THE COMPANIES ACT 2013 :

In our opinion & according to the information & explanations given to us theCompany has duly complied with the provisions of Section 185 & Section 186 of theCompanies Act 2013 with respect to the loans & investments made.

v. DEPOSIT :

In respect of deposits accepted in our opinion and according to the information andexplanations given to us directives issued by the Reserve Bank of India and theprovisions of Section 73 to 76 or any other relevant provisions of the Companies Act2013 and the rules framed there under to the extent applicable have been complied with.We are informed by the management that no order has been passed by the National CompanyLaw Tribunal or Reserve Bank of India or any Court or any other Tribunal.

vi. COST RECORDS :

The Central Government has prescribed the maintenance of Cost Records u/s 148(1) of theCompanies Act 2013. We have broadly reviewed the books of account maintained by theCompany pursuant to the Rules made by the Central Government for the maintenance of costrecords under section 148 of the Act and are of the opinion that prima facie theprescribed cost records have been made and maintained by the Company.

vii. STATUTORY DUES :

According to the information and explanations given to us in respect of statutorydues;

(a) The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income-tax Sales Tax Customs DutyExcise Duty Value Added Tax Cess and other material statutory dues applicable to it withthe appropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income-tax Sales Tax Services Tax Customs Duty Excise Duty ValueAdded Tax Cess and other material statutory dues in arrears as at March 31 2019 for aperiod of more than six months from the date they became payable.

(c) Details of dues of Customs Duty which has not been deposited as on March 31 2019on account of disputes are given below:

Name of Statute Nature of Dues Amount (Rs) Period to which s the amount relate Forum where the dispute is pending
The Customs Act1962 Custom Duty 1836639 2009-10 The Customs Excise and Service Tax Appellate Tribunal

viii. DUES TO FINANCIAL INSTITUTION/BANKS/GOVT./ DEBENTUREHOLDERS :

The Company has not defaulted in repayment of loans or borrowings to the financialinstitution banks government or has not issued any debentures.

ix. APPLICATION OF MONEY RAISED FROM INITIAL PUBLIC OFFER & TERM LOAN :

The Company has not raised any money by way of initial public offer or further publicoffer (including debt instruments) & term loans during the year. Accordinglyparagraph 3(ix) of the order is not applicable to the company.

x. FRAUD :

To the best of our knowledge and according to the information and explanations given tous no fraud by the Company or on the Company by its officers or employees has beennoticed or reported during the year.

xi. MANAGERIAL REMUNERATION :

The Managerial Remuneration has not been paid or provided and accordingly the requisiteapprovals mandated by the Provisions of Section 197 read with Schedule V of the CompaniesAct are not required.

xii. NIDHI COMPANY :

As the Company is not a Nidhi Company and hence reporting under paragraph 3(xii) of theOrder is not applicable.

xiii. RELATED PARTIES :

According to the information & explanations given to us & based on ourexamination of the records of the Company transactions with related parties are incompliance with the provisions of Section 177 & Section 188 of the Act whereapplicable & the details of the transactions are disclosed in the Financial Statementsas required by the applicable accounting standards.

xiv. PREFERENTIAL ALLOTMENT OR PRIVATE PLACEMENT OF SHARES/ CONVERTIBLE DEBENTURES :

The Company has not made any preferential allotment or private placement of shares orfully or partly paid convertible debentures during the year.

xv. COMPLIANCE OF SECTION 192 WITH REGARD TO NON-CASH TRANSACTIONS WITH DIRECTORS &CONNECTED PERSONS :

According to the information & explanations given to us & based on ourexamination of the records of the Company the Company has not entered in any non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

xvi. REGISTRATION U/S 45-IA OF THE RBI ACT1934 :

The Company is not required to be registered u/s 45-IA of the Reserve Bank of IndiaAct 1934.

For Aditya Falor & Associates
Chartered Accountants
Firm Registration No.: 127273W
Aditya G. Falor
Place : Nanded Proprietor
Date : May 30 2019 Membership No. 122487

Annexure to Independent Auditor's Report

"Annexure B" to the Independent Auditors' Report

(Referred to in paragraph 2(f) under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date)

Report on the Internal Financial Controls over Financial Reporting under Clause (i) ofsub-section 3 of Section 143 of the Companies Act 2013 (‘the Act')

We have audited the internal financial controls over financial reporting of ShivaGlobal Agro Industries Limited (‘the Company') as of March 31 2019 in conjunctionwith our audit of the standalone financial statements of the Company for the year ended onthat 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 financing 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 over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls over Financial Reporting(the ‘Guidance Note') and the Standards on Auditing both issued by ICAI and deemedto be prescribed under Section 143(10) of the Companies Act 2013 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 were 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 auditors' 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 Company's internal financial controls systemover financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A Company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A Company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance 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 authorizations of theManagement and Directors of the Company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of theCompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 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 Aditya Falor & Associates
Chartered Accountants
Firm Registration No.: 127273W
Aditya G. Falor
Place : Nanded Proprietor
Date : May 30 2019 Membership No. 122487

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