Southern Gas Ltd.
|BSE: 509910||Sector: Industrials|
|NSE: N.A.||ISIN Code: INE532U01012|
|BSE 00:00 | 12 Sep||Southern Gas Ltd|
|NSE 05:30 | 01 Jan||Southern Gas Ltd|
|BSE: 509910||Sector: Industrials|
|NSE: N.A.||ISIN Code: INE532U01012|
|BSE 00:00 | 12 Sep||Southern Gas Ltd|
|NSE 05:30 | 01 Jan||Southern Gas Ltd|
The Southern Gas Limited
We have audited the standalone financial statements of The Southern Gas Limited("the Company") which comprise the balance sheet as at 31st March 2020 and thestatement of Profit and Loss statement of changes in equity and statement of cash flowsfor the year then ended and notes to the financial statements including a summary ofsignificant 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 Act in the manner so required and give a true and fair view in conformity with theIndian Accounting Standards prescribed under Section 133 of the Act read with Companies(Indian Accounting Standards) Rules 2015 as amended and other accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 31 2020and profit and total comprehensive income changes in equity and its cash flows for theyear 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 standalone financial statements of the current period. Thesematters were addressed in the context of our audit of the standalone financial statementsas a whole and in forming our opinion thereon we do not provide a separate opinion onthese matters. We have determined the matters described below to be key audit matters tobe communicated in our report.
Information other than the Standalone Financial Statements and Auditor's Report Thereon
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 Business Responsibility Report CorporateGovernance and shareholder's information but does not include the standalone financialstatements 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 materialmisstatement of this other information we are required to report the 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 Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance total comprehensive income changes in equity) and cashflows of the Company in accordance with the accounting principles generally accepted inIndia including the accounting Standards specified under section 133 of the Act. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateimplementation and maintenance of accounting policies; making judgments and estimates thatare reasonable and prudent; and design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statement that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing the financial statements 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 managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so. Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.
Auditor's Responsibilities for the Audit of the Standalone 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 section 143(3)(i)of the Companies Act 2013 we are also responsible for expressing our opinion on whetherthe company 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 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.
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 financial statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the 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 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 (Auditors Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in "Annexure A" statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.
2. 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 Cash Flow Statement & 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 Rule 7 of the Companies(Accounts) Rules 2014.
e) On the basis of written representations received from the directors as on March 312019 and 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 section 164 (2) ofthe 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" to this report
g) With respect to the other matters to be included in the Auditor's report inaccordance with the requirements of Section 197(16) of the Act as amended :
In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the company to its directors during the year is inaccordance with the provisions of Section 197 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 2014 in our opinionand to the best of our information and according to the explanations given to us:
(i) The Company has pending litigations which are disclosed in the ContingentLiabilities in Note No. 2.33 to the accounts. The impact of the same has been disclosed.
(ii) The Company does not have long-term contracts including derivative contracts; assuch the question of commenting on any material foreseeable losses thereon does not arise.
(iii) There has been no delay in transferring amounts which were required to betransferred to the Investor Education and Protection Fund by the Company during the year.
ANNEXURE "A" REFERRED TO IN PARAGRAPH 1 OF OUR REPORT ON THE ACCOUNTS FOR THEYEAR ENDED 31st MARCH 2020
(i) (a) The company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) As informed to us fixed assets have been physically verified by the management atreasonable intervals except for gas cylinders with customers. No material discrepancieswere noticed on such verification.
(c) Title deeds of immoveable properties are held in the name of the Company.
(ii) The inventory has been physically verified during the year by the management. Inour opinion the frequency of verification is reasonable and as informed to us nomaterial discrepancies were noticed.
(ii) The Company has not granted any unsecured loan to a company covered in theRegister maintained under Section 189 of the Companies Act 2013 which is outstanding atthe year end hence the sub clauses are inapplicable.
(iv) In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any transaction which is covered underthe provisions of Section 185 and 186 of the Act with respect to the loans investmentsand security made.
(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76of the Act and the Companies (Acceptance of Deposits) Rules 2014 (as amended).Accordingly this clause is inapplicable to the company.
(vi) The company is not covered under Maintenance of cost records specified by theCentral Government under sub-section (1) of section 148 of the Companies Act 2013 readwith Companies (Cost Records and Audit) Rules 2014.
(vii) (a) The company is regular in depositing undisputed statutory dues includingprovident fund employees' state insurance income-tax Central sales-tax service tax value added tax Goods and Service Tax Excise Duty and other material statutory dues withthe appropriate authorities though there have been delays in few cases.
(b) As explained to us no undisputed amounts payable thereof were outstanding at theyear- end for a period of more than six months from the date they became payable.
(c) According to the information and explanations given to us and as per verificationof records of the company all disputed amounts of taxes which have been deposited withthe authorities as at 31.03.2020.
(viii) According to the information and explanations given to us the Company has notdefaulted in repayment of loans or borrowings to a financial institution or bank. TheCompany has not borrowed any amount from Government or Debenture holders.
(ix) The Company has not raised money by way of public issue/ follow-on offer(including debt instruments) nor through term loans. Hence this clause is inapplicable tothe company.
(x) (iii)No fraud by the Company or on the Company by its officers or employees hasbeen noticed or reported during the period covered by our Audit.
(xi) According to the information and explanations given 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 the Company is not a Nidhi Company. Accordingly this clause isnot applicable to the Company.
(xiii) In our opinion all transactions with the related parties are in compliance withsections 177 and 188 of the Act where applicable and the requisite details have beendisclosed in the financial statements etc as required by the applicable accountingstandards.
(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 / private placement of shares or fully or partly convertible debentures duringthe year under review and hence this clause is inapplicable to the company.
(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 any non cashtransactions with directors or persons connected with them.
(xvi) The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934
ANNEXURE "B" TO THE INDEPENDENT AUDITORS' REPORT OF EVEN DATE ON THEFINANCIAL STATEMENTS OF THE SOUTHERN GAS LIMITED
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 THESOUTHERN GAS LIMITED ('the Company') as of 31st March 2020 in conjunction with our auditof 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. These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence tocompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable 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 auditinvolves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system over financial reporting and their operating effectiveness. Ouraudit of internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the Company's internal financial controls system over financialreporting. 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 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
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.
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 2020