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Siyaram Silk Mills Ltd.

BSE: 503811 Sector: Industrials
NSE: SIYSIL ISIN Code: INE076B01028
BSE 00:00 | 19 Feb 225.80 -0.05
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NSE 00:00 | 19 Feb 225.40 0.10
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OPEN 225.25
PREVIOUS CLOSE 225.85
VOLUME 1299
52-Week high 467.00
52-Week low 192.05
P/E 11.13
Mkt Cap.(Rs cr) 1,058
Buy Price 224.50
Buy Qty 1.00
Sell Price 225.80
Sell Qty 205.00
OPEN 225.25
CLOSE 225.85
VOLUME 1299
52-Week high 467.00
52-Week low 192.05
P/E 11.13
Mkt Cap.(Rs cr) 1,058
Buy Price 224.50
Buy Qty 1.00
Sell Price 225.80
Sell Qty 205.00

Siyaram Silk Mills Ltd. (SIYSIL) - Auditors Report

Company auditors report

To the Members of SIYARAM SILK MILLS LIMITED

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the standalone financial statements of Siyaram Silk Mills Limited ("theCompany") which comprise the Balance Sheet as at 31st March 2019 andthe Statement of Profit and Loss (including other comprehensive income) Cash FlowStatement and Statement of Changes in Equity for the year then ended and notes to thestandalone financial statements including a summary of significant accounting policiesand other explanatory information (hereinafter referred to as "the standalonefinancial statements"). In our opinion and to the best of our information andaccording to the explanations given to us the aforesaid standalone financial statementsgive the information required by the Companies Act 2013 ("the Act") in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31March 2019 and its profit (including other comprehensive income) changes in equity andits cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) as specifiedunder Section 143(10) of the Act. Our responsibilities under those SAs are furtherdescribed in the Auditor's Responsibilities for the Audit of the Standalone FinancialStatements section of our report. We are independent of the Company in accordance with theCode of Ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the standalone financial statementsunder the provisions of the Act and the Rules thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our opinion.

Key Audit Matters

Key audit matters ('KAM') are those matters that in our professional judgment were ofmost significance in our audit of the standalone financial statements of the currentperiod. These matters were addressed in the context of our audit of the standalonefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report

Key Audit Matters How our audit addressed the key audit matter
Revenue Recognition
(as described in note 1 (i) of the standalone Ind AS financial statements)
For the year ended March 31 2019 the Company has recognized revenue from contracts with customers amounting to 181469.95 lakhs. Our audit procedures included the following:
• Assessed the Company's revenue recognition policy prepared as per Ind AS 115 'Revenue from contracts with customers'.
Revenue from contracts with customers is recognized when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The Company has generally concluded that as principal it typically controls the goods or services before transferring them to the customer. • Assessed the design and tested the operating effectiveness of internal controls related to revenue recognition discounts and rebates.
The variety of terms that define when control are transferred to the customer as well as the high value of the transactions give rise to the risk that revenue is not recognized in the correct period. • Performed sample tests of individual sales transaction and traced to sales invoices sales orders and other related documents. Further in respect of the samples checked that the revenue has been recognized as per the shipping terms.
• To test cut off selected sample of sales transactions made pre- and post-year end agreeing the period of revenue recognition to third party support such as transporter invoice and customer confirmation of receipt of goods.
Revenue is measured net of returns and allowances cash discounts trade discounts and volume rebates (collectively 'discount and rebates'). There is a risk that these discount and rebates are incorrectly recorded as it also requires a certain degree of estimation resulting in understatement of the associated expenses and accrual. • Tested the provision calculations related to management incentives discounts and rebates by agreeing a sample of amounts recognized to underlying arrangements with customers and other supporting documents.
Revenue is also an important element of how the Company measures its performance. The Company focuses on revenue as a key performance measure which could create an incentive for revenue to be recognized before the risk and rewards have been transferred.
Accordingly due to the significant risk associated with revenue recognition in accordance with terms of Ind AS 115 'Revenue from contracts with customers' it was determined to be a key audit matter in our audit of the standalone Ind AS financial statements.

Information other than the standalone 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 Company's annual report but doesnot include the standalone 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 in the audit or otherwise appears to be materially misstated. If based on thework we 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.

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 state of affairs profit or loss (including othercomprehensive income) changes in equity and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under Section 133 of the Act. 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 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 and Board of Directors areresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

Board of Directors is also responsible for overseeing the Company's financial reportingprocess.

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 order todesign audit procedures that are appropriate in the circumstances. Under Section 143(3)

(i) of the Act we are also responsible for expressing our opinion on whether thecompany has adequate internal financial controls with reference to standalone financialstatements 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 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 ourauditors' 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.

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 alsoprovide those charged with governance with a statement that we have complied with relevantethical requirements regarding independence and to communicate with them allrelationships 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 auditors' 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(Auditors' Report) Order 2016 ("the Order") issued by the Central Government ofIndia in terms of Section 143(11) of the Act we give in "Annexure A" astatement on the matters specified in paragraphs 3 and 4 of the Order to the extentapplicable.

2. (A) 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 other comprehensiveincome) the Statement of Changes in Equity and the Statement of Cash Flows dealt with bythis Report are in agreement with the books of account.

(d) In our opinion the aforesaid standalone financial statements comply with the IndAS specified under Section 133 of the Act.

(e) On the basis of the written representations received from the directors as on 31stMarch 2019 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2019 from being appointed as a director in termsof Section 164(2) of the Act.

(f) With respect to the adequacy of the internal financial controls over financialreporting of the Company with reference to these standalone financial statements of theCompany and the operating effectiveness of such controls refer to our separate Report in"Annexure B".

(B) With respect to the matter to be included in the Auditors' Report under section197(16) of the Act as amended: In our opinion and according to the information andexplanations given to us the remuneration paid by the Company to its directors during thecurrent year is in accordance with the provisions of Section 197 of the Act. Theremuneration paid to any director is not in excess of the limit laid down under Section197 of the Act.

(C) With respect to the other matters to be included in the Auditors' Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations as at 31stMarch 2019 on its financial position in its standalone 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 has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

For Songira & Associates
Chartered Accountants
(Firm Reg. No. 128085W)
Dharmendra S. Songira
Partner
Membership No. 113275
Place: Mumbai
Date: 17th May 2019

Annexure - A to the Independent Auditors' Report

The Annexure referred to in Independent Auditors' Report to the members of the Companyon the standalone financial statements for the year ended 31st March 2019 wereport that:

(i) a) In our opinion the Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets.

b) As explained to us the company has a regular programme for physical verification ina phased periodic manner which in our opinion is reasonable having regards to the sizeof the Company and nature of its assets. According to the information and explanationsgiven to us no material discrepancies were noticed on such verification.

c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds/lease deeds of immovableproperties (which are included under the Note 2 of the financial statements -'Propertyplant and equipments') are held in the name of the Company except for the immovableproperties which were acquired by entities that have since been amalgamated with theCompany.

(ii) As explained to us physical verification of inventory has been conducted atreasonable intervals by the management and discrepancies noticed on such physicalverification between physical stocks and book records were not material considering theoperations of the Company and the same have been properly dealt with in the books ofaccount.

(iii) The Company has granted unsecured loans to a subsidiary company covered in theregister maintained under section 189 of the Act; and with respect to same;

a) In our opinion the terms and conditions of grant of such loans are not prima facieprejudicial to the Company's interest

b) The schedule of repayment of principal and payment of interest has been stipulatedand the repayment/ receipts of the principal amount and the interest are regular;

c) There is no overdue amount in respect of loans granted to such company.

iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Act with respectto loans and advances given investments made guarantees and securities made.

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposit within the meaning of Section 73 to 76 of the Actand the rules framed thereunder.

(vi) We have broadly reviewed the books of account maintained by the Company in respectof products where pursuant to the Rules made by the Central Government the maintenanceof cost records have been prescribed under Section 148 (1) of the Act and are of theopinion that prima facie the prescribed accounts and records have been made andmaintained. We have not however made a detailed examination of the records with a viewto determining whether they are accurate or complete.

(vii) (a) According to the records of the Company and the information and explanationsgiven to us the Company has generally been regularly depositing with the appropriateauthorities undisputed statutory dues including Provident Fund Employees' StateInsurance Income tax Sales-Tax Service tax Duty of Customs Duty of Excise Valueadded Tax Goods and Service Tax Cess and any other statutory dues applicable to it.There are no undisputed statutory dues as referred to above as at 31st March2019 outstanding for a period of more than six months from the date they become payable.

(b) According to the information and explanations given to us the dues in respect ofIncome Tax Sales Tax Duty of Customs Excise Duty and Service Tax that have not beendeposited with the appropriate authorities on account of dispute and the forum where thedisputes are pending are given below :-

Name of Statute Nature of Dues Amount (Rs. in lakhs) Period to which the Amount Relates Forum where dispute is pending
Income Tax Act Income Tax 1.26 2010-11 Assessing Authority of Income tax
Brihan Mumbai Mahanagar Palika Property Tax 340.01 April 2010 to March 2019 Bombay High Court
Textile Committee Act Cess 15.92 1998 2000 Bombay High Court
Central Excise And Service Tax Excise Duty/ Service tax 96.83 1992-94 Assessing authority
Act (Including Interest and 695.45 1998-00 Assessing authority
Penalty) 4.87 2003-04 Assessing authority

(viii) Based on our audit procedures and according to the information and explanationsgiven by the management the Company has not defaulted in repayment of loans from bank/government. Further as per the records of the Company during the year there were no loansor borrowings from any financial institution or debenture holders.

(ix) In our opinion and according to the information and the explanations given to usthe term loans have been applied for the purposes for which they were obtained. Further asper the records the Company did not raise any money by way of initial public offer orfurther public offer (including debt instruments).

(x) Based upon the audit procedures performed and to the best of our knowledge andbelief and according to the information and explanations given to us no fraud by thecompany or any fraud on the Company by its officers or employees has been noticed orreported during the year.

(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly paragraph 3(xii) of the Order is notapplicable.

(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableIndian Accounting Standards.

(xiv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year.

(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 paragraph 3(xv) ofthe Order is not applicable.

(xvi) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

For Songira & Associates
Chartered Accountants
(Firm Reg. No. 128085W)
Dharmendra S. Songira
Partner
Membership No. 113275
Place: Mumbai
Date: 17th May 2019

Annexure - B to the Independent Auditors' Report

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 SiyaramSilk Mills Limited ('the Company') as of 31stMarch 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 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'). These responsibilitiesinclude the design implementation and maintenance of internal financial controls withreference to financial statements 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 Companies Act 2013.

Auditors' 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 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 both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the internalfinancial controls with reference to financial statements over financial reporting andtheir operating effectiveness. Our audit of internal financial controls over financialreporting included obtaining an understanding of internal financial controls overfinancial reporting assessing the risk that a material weakness exists and testing andevaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgment including theassessment of the risks of material misstatement of the standalone financial statementswhether 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 authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

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 the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31st March 2019based on the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.

For Songira & Associates
Chartered Accountants
(Firm Reg. No. 128085W)
Dharmendra S. Songira
Partner
Membership No. 113275
Place: Mumbai
Date: 17th May 2019