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Sreeleathers Ltd.

BSE: 535601 Sector: Others
NSE: SREEL ISIN Code: INE099F01013
BSE 00:00 | 28 Jul 173.70 -11.70
(-6.31%)
OPEN

188.00

HIGH

189.95

LOW

171.90

NSE 00:00 | 28 Jul 173.40 -11.95
(-6.45%)
OPEN

187.90

HIGH

190.85

LOW

172.50

OPEN 188.00
PREVIOUS CLOSE 185.40
VOLUME 22394
52-Week high 233.95
52-Week low 116.05
P/E 36.11
Mkt Cap.(Rs cr) 403
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 188.00
CLOSE 185.40
VOLUME 22394
52-Week high 233.95
52-Week low 116.05
P/E 36.11
Mkt Cap.(Rs cr) 403
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sreeleathers Ltd. (SREEL) - Auditors Report

Company auditors report

To The Members of Sreeleathers Limited

Report on the Audit of the Financial Statements

We have audited the accompanying standalone Ind AS financial statements of SreeleathersLimited (‘the Company') which comprise the Balance Sheet as at March 312020 theStatement of Profit and Loss (including other comprehensive income) the Statement ofChanges in Equity and the Statement of Cash Flows for the year then ended and 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 Ind AS financial statements give the informationrequired by the Companies Act 2013 (the Act) in the manner so required and give a trueand fair view in conformity with the accounting principles generally accepted in Indiaincluding Ind AS as amended specified under Section 133 of the Act of the state ofaffairs of the Company as at 31 March 2020 and its profit ( including other comprehensiveincome) its cash flows and the changes in equity for the year ended on that date.

Basis of Opinion

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing specified under section 143(10) of the Act . Our responsibilitiesunder those Standards are further described in the Auditor's Responsibility for the Auditof the Standalone Financial Statements section of our report. We are independent of theCompany in accordance with the Code of Ethics issued by the Institute of CharteredAccountants of India (ICAI) together with the ethical requirements that are relevant toour audit of the standalone financial statements under the provisions of the Act and theRules made thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the ICAI's Code of Ethics. We believe that theaudit evidence obtained by us is sufficient and appropriate to provide a basis for ouraudit opinion on the standalone financial statements.

Emphasis of Matter

We draw attention to note 35 to the accompanying standalone financial statements whichdescribes the effects of uncertainties relating to Covid-19 pandemic outbreak on theCompany's operations and management's evaluation of its impact on the accompanyingstandalone financial statements as at 31st March 2020 the impact of which is dependent onfuture developments. Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the 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.

Completeness existence and accuracy of Revenue Recognition
Key Audit Matters How the matter was addressed in our audit
The Company's major part of revenue relates to retail and wholesale sales which comprises of high volumes of small transactions recorded in the books through journals. In view of the significance of the matter we applied the following audit procedures in this area among others to obtain sufficient appropriate audit evidence:
Revenue from the sale of goods is recognized when the Company performs its obligation to its customers and the amount of revenue can be measured reliably and recovery of the consideration is probable. a) Obtaining an understanding of and assessing the design implementation and operating effectiveness of management's key internal controls relating to the recognition of revenue including those related to the reconciliation of sales records to cash / credit card / online receipts preparation posting and approval of manual journal entries relating to revenue recognition.
The timing of such recognition in case of sale of goods is when control agreement with the cash / credit card / online receipts and deposit of cash amounts recorded in daily cash reports with bank remittances on sample basis. over the same is transferred to the customer which is mainly upon delivery. b) Testing the accuracy of retail revenue recorded during the year by examining that the sale of goods transactions are in
The timing of revenue recognition is relevant to the reported performance of the Company. The management considers revenue as a key measure for evaluation of performance. c) Testing whether the sales have been recorded in the correct period by selecting samples of reconciliation between sales transactions and cash / credit card / online and agreeing those reconciliations through supporting documentation.
Since revenue comprises of high volumes of individually small transactions the process of summarizing and recording sales revenue is critical with regard to the completeness existence and accuracy of retail sales revenue. d) Obtaining reconciliation of retail sales as per books of account with the sales as per Indirect tax records and inquire about reasons for differences if any.
e) Performing an analysis of the manual journal entries passed during the year.

Information Other than the Financial Statements and Auditor's Report Thereon

The company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Company's Annual Report but doesnot include the standalone financial statements and our auditor's report thereon.

Our opinion on financial statements does not cover the other information and we do notexpress any form of assurance conclusion thereon.

In connection with our audit of the standalone Ind AS financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone financial statements orour knowledge obtained during the course of our audit or otherwise appears to bematerially misstated. If based on the work we have performed we conclude that there is amaterial misstatement of this other information we are required to report that fact. Wehave nothing to report in this regard.

Management's responsibility for the Ind AS 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 Ind AS financial statements that give a true and fair view of the stateof affairs profit/loss and other comprehensive income changes in equity and cash flowsof the Company in accordance with the Indian Accounting Standards (Ind AS) prescribedunder section 133 of the Act read with the Companies (Indian Accounting Standards) Rules2015 as amended and other accounting principles generally accepted in India.

This responsibility also includes the maintenance of adequate accounting records inaccordance with the provisions of the act for safeguarding the assets of the company andfor preventing and detecting the frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgment and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial control that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone Ind AS financial statements that give a true and fair view and are freefrom material misstatement 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 charged with governance are also responsible for overseeing the Company'sfinancial reporting process.

Auditors' Responsibility

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 Ind AS 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 misstatements 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.

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 of India in terms of sub-section (11) of Section 143 ofthe Act we give in the "Annexure I" a statement on the matters specified inparagraphs 3 and 4 of the Order.

2. As required by section 143(3) of the Act based on our audit to the extentapplicable 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 Statement of Profit and Loss including Other ComprehensiveIncome Cash Flow Statement and statement of changes in Equity dealt with by this reportare in agreement with the books of account;

d. in our opinion the aforesaid standalone Ind AS financial Statement comply with theIndian Accounting Standards referred to in section 133 of the Companies Act 2013.

e. on the basis of written representations received from the directors as on March312020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2020 from being appointed as a director in terms of sub section (2) ofsection 164 of the Companies Act 2013.

f. with respect to the adequacy of the internal financial controls over financialreporting of the company and the operating effectiveness of such controls we give ourseparate reports in "Annexure II".

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 opinionand to the best of our information and according to the explanations given to us theremuneration paid/provided 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 included in the auditor's report in accordancewith Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to bestof our information and according to the explanation given to us:

1) The company has disclosed the impact of pending litigation if any on its financialposition in its Standalone Ind AS financial statement.

2) The company did not have any long term contract including derivative contracts forwhich there were any material foreseeable losses

3) There has been no delay in transferring amounts required to be transferred to theinvestor's education and protection fund by the company.

4) The disclosures in the standalone financial statements regarding holdings as well asdealings in specified bank notes during the period from 8 November 2016 to 30 December2016 have not been made in these financial statements since they do not pertain to thefinancial year ended 31st March 2020.

For Chanani & Associates
Chartered Accountants
Firm's Regn. No. : 325425E
Madhaw Chanani
Partner
Kolkata Membership No. : 060624
30th July 2020 ICAI UDIN 20060624AAAAAK5375

ANNEXURE I TO AUDITOR'S REPORT Companies (Audit Report) Order 2016

Statement referred to our report of even date to the Members of Sreeleathers Limited onthe Ind AS financial statements for the year ended 31st March 2020 we report that:

i. (a) The Company has generally maintained proper records showing full particularsincluding quantitative

details and situation of fixed assets.

(b) Fixed assets have been physically verified by the management at reasonableintervals and no material discrepancies have been noticed by the management of thecompany on such verification.

(c) The title deeds of immovable properties recorded in the books of accounts of thecompany are held in the name of the company.

ii. As explained to us the inventories were physically verified during the year by theManagement at reasonable intervals and no material discrepancies were noticed on physicalverification.

iii. The company has not granted loans secured or unsecured to the companies LLPsfirms or other parties covered in the register maintained under section 189 of theCompanies Act 2013. In view of this para 3(iii) of the order is not applicable.

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 the loans and investments made.

v. In our opinion and according to information and explanation given to us the companyhas not accepted deposits under the provisions of section 73 to 76 or any other relevantprovisions of the Companies Act 2013.

vi. The Central Government has not prescribed for the maintenance of cost records undersection 148 (1) of the Companies Act 2013 for the company.

vii. (a) The company as per information given is generally regular in depositingundisputed statutory dues

including provident fund employees state insurance income tax duty of Customs GSTcess and any other statutory dues applicable to it with appropriate authorities.

According to the information and explanations given to us no undisputed amountspayable in respect of Provident Fund Employees' State Insurance Income tax GST Duty ofCustoms Cess and other material statutory dues to the extent applicable were in arrearsas at 31 March 2020 for a period of more than six months from the date they becamepayable.

(b) According to the information and explanation given to us there are no dues ofincome tax wealth tax excise duty and cess which have not been deposited on account ofany dispute except as mentioned below:

Name of the Statute Nature of Dues Amount of Demand (in Rs.) Period to which the amount relates Forum where dispute is pending
The Income Tax Act 1961 Income Tax 2761843/- A.Y. 2017-18 Commissioner of Income Tax (Appeal)
Central Excise Act Excise Duty 9320010/- F.Y. 2006-07 Hon'ble Division Bench
F.Y. 2007-08 High Court at Calcutta
F.Y. 2008-09
F.Y. 2009-10
F.Y. 2010-11
F.Y. 2011-12

viii. As per the information and explanation given and according to records provided tous the company has not defaulted in repayment of dues to the financial institutions orbank or debenture holders.

ix. In our opinion and according to the information and explanations given to us theCompany has not taken any term loans during the year. The Company has not raised moneys byway of public offer (including debt instruments). Accordingly para 3(ix) of the order isnot applicable.

x. During the course of our examination of the books and records of the companycarried out in accordance with the generally accepted auditing 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. The company has paid/provided for managerial remuneration in accordance with therequisite approvals mandated by the provisions of Section 197 read with Schedule V to theAct.

xii. As the Company is not a Nidhi Company and the Nidhi rules 2014 are not applicableto it the provisions of Clause 3(xii) of the Order are not applicable to the Company.

xiii. The Company has entered into transactions with related parties in compliance withthe provisions of sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the Ind AS financial statements as required by theapplicable accounting standard.

xiv. The Company has not made any preferential allotment or private placement of sharesfully or partly convertible debentures during the year under review. Accordingly theprovisions of Clause 3(xiv) of the Order are not applicable to the Company.

xv. The Company has not entered into any non cash transactions with its directors orpersons connected with him. Accordingly the provisions of Clause 3(xv) of the Order arenot applicable 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 Chanani & Associates
Chartered Accountants
Firm's Regn. No. : 325425E
Madhaw Chanani
Partner
Kolkata Membership No. : 060624
30th July 2020 ICAI UDIN 20060624AAAAAK5375

ANNEXURE II TO INDEPENDENT AUDITORS' REPORT

Statement referred to in paragraph 2(f) of the Independent Auditors' Report of evendate to the members of Sreeleathers Limited on the standalone Ind AS financial statementsfor the year ended March 312020.

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Act

We have audited the internal financial controls over financial reporting ofSreeleathers Limited ("the Company") as of March 312020 in conjunction with ouraudit of the Ind AS financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal Control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial 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 company's policies the safeguarding of its assets theprevention 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

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 prescribed under section143(10) of the Act to the extent applicable to an audit of internal financial controls.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively 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 auditor's judgement including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the 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 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.

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 March 31 2020 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal Control stated in the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting issued by the Institute of CharteredAccountants of India.

For Chanani & Associates
Chartered Accountants
Firm's Regn. No. : 325425E
Madhaw Chanani
Partner
Kolkata Membership No. : 060624
30th July 2020 ICAI UDIN 20060624AAAAAK5375

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