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Som Distilleries & Breweries Ltd.

BSE: 507514 Sector: Consumer
NSE: SDBL ISIN Code: INE480C01012
BSE 00:00 | 18 Feb 103.05 -0.25
(-0.24%)
OPEN

104.50

HIGH

104.50

LOW

99.25

NSE 00:00 | 18 Feb 101.45 -0.85
(-0.83%)
OPEN

104.40

HIGH

104.40

LOW

99.10

OPEN 104.50
PREVIOUS CLOSE 103.30
VOLUME 2596
52-Week high 170.90
52-Week low 99.25
P/E 16.20
Mkt Cap.(Rs cr) 335
Buy Price 100.15
Buy Qty 100.00
Sell Price 103.05
Sell Qty 500.00
OPEN 104.50
CLOSE 103.30
VOLUME 2596
52-Week high 170.90
52-Week low 99.25
P/E 16.20
Mkt Cap.(Rs cr) 335
Buy Price 100.15
Buy Qty 100.00
Sell Price 103.05
Sell Qty 500.00

Som Distilleries & Breweries Ltd. (SDBL) - Auditors Report

Company auditors report

TO THE MEMBERS OF SOM DISTILLERIES & BREWERIES LIMITED

REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS

OPINION

We have audited the standalone financial statements of SOM DISTILLERIES &BREWERIES LIMITED (‘the Company') which comprise the standalone balance sheet asat 31st March 2019 standalone statement of profit and loss (including OtherComprehensive Income) standalone statement of changes in equity and standalone statementof cash flows for the year then ended and notes to the standalone financial statementsincluding a summary of significant accounting policies 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 (‘Act') in the manner so required and give a true and fairview in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2019 and its profit/loss changes inequity and its cash flows for the year ended on that date.

BASIS FOR OPINION

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rulesthereunder 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 opinion.

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.

OTHER INFORMATION

The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexures to Board's Report BusinessResponsibility Report Corporate Governance and Shareholder's Information but does notinclude 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 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 material misstatementof this other information we are required to report that fact. We have nothing to reportin this regard.

RESPONSIBILITIES OF MANAGEMENT AND THOSE CHARGED WITH GOVERNANCE FOR THE STANDALONEFINANCIAL 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 totalcomprehensive income changes in equity and cash flows of the Company in accordance withthe 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.

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

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 high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis 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 orderto design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Companies Act 2013 we are also responsible for expressing our opinionon 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 our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa 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.

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 issued by theGovernment of India in terms of subsection 11 of section 143 of the Act (hereinafterreferred to as the ‘Order') and on the basis of such checks of the books and recordsof the Company as we considered appropriate and according to information and explanationsgiven to us we give in the Annexure A a statement on the matters specified in paragraphs3 and 4 of the Order.

2. As required by subsection 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 Changes in Equity and the Cash Flow Statement dealt with by thisReport are in agreement with the books of account.

d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 as amended.

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 aredisqualified as on 31st March 2019 from being appointed as a Director in termsof subsection 2 of Section 164 of the Act.

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.

3. 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 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 on its financialposition in its standalone financial statements Refer Note 39 to the standalonefinancial statements;

ii) As per the information given to us the Company does not foresee any losses on anylong-term contracts and has therefore not made any provision. We have been informed thatthe Company has not entered into any derivative contracts;

iii) The amount of unpaid dividend required to be transferred to the Investor Educationand Protection Fund during the year ended 31.03.2019 as per the records of the Companyhas been so transferred on 24.06.2019.

4. With respect to the matter to be included in the Auditor's Report under section197(16):

In our opinion and according to the information and explanations given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under section 197(16) which arerequired to be commented upon by us.

For R. N. GUPTA & ASSOCIATES
Chartered Accountants
Firm Registration No. 001419C
R.N. Gupta
Place: Bhopal Proprietor
Dated: 03.07.2019 Membership No. 070590

SOM DISTILLERIES & BREWERIES LIMITED

ANNEXURE A

TO THE INDEPENDENT AUDITOR'S REPORT on the standalone financial statements

YEAR ENDED 31ST MARCH 2019

(Referred to in para 1 under ‘Report on other Legal and Regulatory Requirements'section of our Report of even date)

i. (a) As per the information given to us the Company is reported to have maintainedproper records showing full particulars including quantitative details and situation ofits fixed assets.

(b) We have been informed that the fixed assets have been physically verified by theManagement at the close of the financial year and no discrepancies are reported have beennoticed on such verification.

(c) As per the records and information and explanations given to us the title deeds ofimmovable properties are held in the name of the Company.

ii. As per the information given to us the inventory has been physically verified atreasonable intervals during the year by the Management and no material discrepancies arestated to have been noticed.

iii. As per the information and explanations given to us the Company has not grantedany loans secured or unsecured to Companies firms Limited Liability Partnerships orother parties covered in the register maintained under Section 189 of the Act other thanto a wholly owned subsidiary. Accordingly the provisions of paragraph 3(iii) are notapplicable.

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 in respect ofthe loans and guarantees and security provided by it to the extent applicable.

v. According to the information given to us the Company has not accepted any depositsfrom the public within the meaning of Sections 73 74 75 and 76 of the Act and the Rulesframed there under to the extent notified.

vi. As per the explanations given to us the Central Government has not specifiedmaintenance of cost records in respect of the Company's products.

vii. (a) According to the records of the Company it is regular in depositing theundisputed statutory dues with the appropriate authorities including Provident Fund SalesTax State Excise duty Value Added Tax and cess etc except Employees State InsuranceScheme the liability of which is yet to be determined by the concerned authority.

(b) As per the information and explanations given to us the statutory dues which havenot been deposited on account of disputes are as follows:

NAME OF STATUTE NATURE OF DUES AMOUNT (RUPEES IN LACS) PERIOD TO WHICH THE AMOUNT RELATES (FINANCIAL YEAR) FORUM WHERE DISPUTE IS PENDING
M P Entry Tax Act 1976 Entry Tax 37.42 2007-08 Madhya Pradesh High Court Jabalpur
M P Entry Tax Act 1976 Entry Tax 13.95 2012-13 Appeal Board Commercial Tax Bhopal
Income Tax Act 1961 Tax after assessment 4.26 2010-11 Commissioner of Income Tax Appeals
Income Tax Act 1961 Tax after assessment 56.18 2012-13 Commissioner of Income Tax Appeals
Income Tax Act 1961 Tax after assessment 317.31 2013-14 Commissioner of Income Tax Appeals
Income Tax Act 1961 Demand 11.48 2015-16 Commissioner of Income Tax Appeals

viii. As per the records of the Company examined by us and the information andexplanation given to us the Company has not defaulted in repayments of loans orborrowings to any financial institutions or bank or Government or dues to debentureholders as applicable as at balance sheet date.

ix. According to the information and explanations given to us the moneys raised by wayof term loans have been applied on an overall basis for the purpose for which they wereobtained. The Company has not raised any moneys by way of initial public offer or anyother further public offer (including debt instruments).

x. During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted accounting practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.

xi. According to the information and explanations given to us and based on ourexamination of the records the Company has paid or provided for managerial remunerationin accordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Act. xii. As it is not a Nidhi company and the Nidhi Rules 2014 arenot applicable to it the provisions of Clause 3(xii) of the Order are not applicable tothe Company.

xiii. The Company has entered into transactions with related parties in compliance withthe provisions of section 177 and 188 of the Act where applicable. The details of relatedparty transactions have been disclosed in the standalone financial statements as requiredby the applicable accounting standards.

xiv. The Company has made preferential allotment or private placement of shares duringthe year under review. On the basis of our examination of its books and records thecompany has complied with the requirement of Sec 42 of the Companies Act 2013 and theamounts raised have been used in the purposes for which they were raised.

xv. According to the information and explanations given to us by the Management theCompany has not entered into any non-cash transactions with its Directors or personsconnected with them. Accordingly the provisions of Clause 3(xv) of the Order are notapplicable 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 clause 3(xvi) of the Order are notapplicable to the Company.

For R. N. GUPTA & ASSOCIATES
Chartered Accountants
Firm Registration No. 001419C
R.N. Gupta
Place: Bhopal Proprietor
Dated: 03.07.2019 Membership No. 070590

SOM DISTILLERIES & BREWERIES LIMITED

ANNEXURE B

TO THE INDEPENDENT AUDITORS REPORT on the standalone financial statements

YEAR ENDED 31ST MARCH 2019

REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) OF SUB-SECTION 3 OF SECTION143 OF THE COMPANIES ACT 2013 (‘THE ACT')

{REFERRED TO IN PARA 2 (F) UNDER ‘REPORT ON OTHER LEGAL AND REGULATORYREQUIREMENTS' SECTION OF OUR REPORT OF EVEN DATE}

OPINION

We have audited the internal financial controls over financial reporting of SOMDISTILLERIES & BREWERIES LIMITED NEW DELHI (the Company') as of 31stMarch 2019 in conjunction with our audit of the standalone financial statements of theCompany for the year ended on that date.

In our opinion the Company has in all material respects an adequate internalfinancial control 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.

However despite it being a less complex Company for more effective financial controlsit needs to:

a) formally codify the system of internal financial controls

b) document operations and effectively monitor controls and

c) more effectively segregate duties.

We have considered the matters identified and reported above and they do not affect ouropinion on the financial statements of the Company.

MANAGEMENT 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 adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to the Company's policies the safeguarding of its assetsthe prevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.

AUDITOR'S RESPONSIBILITY

1. 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 deemed to beprescribed under subsection 10 of section 143 of the Act to the extent applicable to anaudit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the ICAI. Those Standards and the Guidance Note require thatwe comply 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.

2. Our audit involves performing procedures to obtain audit evidence about the adequacyof the 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 auditor's judgement including the assessment of the risks ofmaterial misstatement of the standalone financial statements whether due to fraud orerror.

3. 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 statement inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorizations ofmanagement 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.

For R. N. GUPTA & ASSOCIATES
Chartered Accountants
Firm Registration No. 001419C
R.N. Gupta
Place: Bhopal Proprietor
Dated: 03.07.2019 Membership No. 070590