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Srikalahasthi Pipes Ltd.

BSE: 513605 Sector: Metals & Mining
NSE: SRIPIPES ISIN Code: INE943C01027
BSE 00:00 | 19 Jul 197.15 -9.75
(-4.71%)
OPEN

203.50

HIGH

206.85

LOW

195.00

NSE 00:00 | 19 Jul 197.15 -9.70
(-4.69%)
OPEN

204.20

HIGH

207.80

LOW

194.50

OPEN 203.50
PREVIOUS CLOSE 206.90
VOLUME 19092
52-Week high 448.85
52-Week low 195.00
P/E 6.25
Mkt Cap.(Rs cr) 921
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 203.50
CLOSE 206.90
VOLUME 19092
52-Week high 448.85
52-Week low 195.00
P/E 6.25
Mkt Cap.(Rs cr) 921
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Srikalahasthi Pipes Ltd. (SRIPIPES) - Auditors Report

Company auditors report

to the members of

Srikalahasthi pipes Limited report on the Indian accounting Standards (Ind aS)financial Statements

We have audited the accompanying Ind AS financial statements of SRIKALAHASTHI PIPESLIMITED ("the Company" or "SPL") which comprise the Balance Sheet asat 31st March 2017 the Statement of Profit and Loss (including Other ComprehensiveIncome) the Statement of cash flows and the Statement of Changes in Equity for the yearthen ended and a summary of significant accounting policies and other explanatoryinformation (herein after referred to as "Ind AS Financial Statements").

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 Ind AS Financial Statements that give a true and fair view of the financialposition financial performance including other comprehensive income cash flows andchanges in equity of the Company in accordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards (Ind AS) specified in theCompanies (Indian Accounting Standards) Rules 2015 (as amended) under Section 133 of theAct. This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgements and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofaccounting records relevant to the preparation and presentation of the Ind AS FinancialStatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

auditor's responsibility

Our responsibility is to express an opinion on these Ind AS Financial Statements basedon our audit. We have taken into account the provisions of the Act and the Rules madethereunder including the accounting and auditing standards and matters which are requiredto be included in the audit report under the provisions of the Act and the Rules madethere under.

We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe Ind AS Financial Statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the Ind AS Financial Statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of theInd AS Financial Statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial controls relevant to the Company'spreparation of the Ind AS Financial Statements that give a true and fair view in order todesign audit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of accounting policies used and the reasonableness of theaccounting estimates made by the Company's Directors as well as evaluating the overallpresentation of the Ind AS Financial Statements.

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

opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind-AS Financial Statements give the information required bythe Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2017 and its profit (including other comprehensive income) its cashflows and the changes in equity for the year ended on that date.

other matter

The financial information of the Company for the year ended March 31 2016 and thetransition date opening balance sheet as at April 1 2015 included in these Ind ASfinancial statements are based on the previously issued statutory financial statementsfor the years ended March 31 2016 and March 31 2015 prepared in accordance with theCompanies (Accounting Standards) Rules 2006 (as amended) which were audited by us onwhich we expressed an unmodified opinion dated May 9 2016 and April 30 2015respectively.

The adjustments to those financial statements for the differences in accountingprinciples adopted by the Company on transition to the Ind AS have been audited by us.

Our opinion is not qualified in respect of this matter.

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 and on the basis of such checks of the books and records of the Company as weconsidered appropriate and according to the information and explanations given to us wegive in the Annexure A a statement on the matters specified in paragraphs 3 and 4 of theOrder.

2. As required by section 143(3) of the Act we report that: a) we have obtained allthe information and explanations which to the best of our knowledge and belief werenecessary for the purpose of our audit; b. in our opinion proper books of account asrequired by law have been kept by the Company so far as it appears from our examination ofthose books; c. the Balance Sheet Statement of Profit and Loss (including othercomprehensive income) the Statement of Cash Flows and the Statement of Changes in Equitydealt with by this Report are in agreement with the books of account; d. in our opinionthe aforesaid Ind AS Financial Statements comply with the Indian Accounting Standardsspecified under Section 133 of the Act read with relevant rule issued thereunder; e. onthe basis of the written representations received from the directors as on March 31 2017taken on record by the Board of Directors none of the directors is disqualified as onMarch 31 2017 from being appointed as a director in terms of

Section 164 (2) of the Act; f. With respect to the adequacy of the internal financialcontrols over financial reporting of the Company and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure B"; and g. with respect tothe other matters to be included in the Auditor's Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules 2014 in our opinion and to the best of ourinformation and according to the explanations given to us:

i) the Company has disclosed the impact if any of pending litigations as at March 312017 on its financial position in its Ind AS Financial Statements– Refer Note 36; ii)the Company has made provision as at March 31 2017 as required under the applicable lawor accounting standards for material foreseeable losses if any on long term contractsincluding derivate contracts – Refer Note 35; iii) there has been no delay intransferring amounts required to be transferred to the Investor Education and ProtectionFund by the Company; iv) the Company has provided requisite disclosures in its Ind ASFinancial Statements as to holdings as well as dealings in Specified Bank Notes during theperiod from 8 November 2016 to 30 December 2016 and these are in accordance with the booksof accounts maintained by the Company. Refer Note 46 to the Ind AS Financial Statements.

For K. R. BAPUJI & Co.
Chartered Accountants
(Firm's Registration No. 000395S)
P. R. SATISH
Place: Chennai (Partner)
Date: May 12 2017 (Membership No. 219432)

annexure - a to the Independent auditors' report referred to in paragraph 1 under theheading of "report on other Legal and regulatory requirements" of our report ofeven date to the members of Srikalahasthi pipes Limited for the year ended march 31 2017.

i) In respect of its Fixed Assets: a) The Company has maintained proper records showingfull particulars including quantitative details and situation of fixed assets. b) Asexplained to us the fixed assets have been physically verified by the management duringthe year as per a detailed program drawn for the said purpose which in our opinion isreasonable having regard to the size of the Company and nature of its size. In ouropinion the periodicity and procedures of such physical verifications are reasonablehaving regard to the size of the Company and nature of its assets. c) The title deeds ofimmovable properties as disclosed in Note 5 on Property Plant and Equipment to thefinancial statements are held in the name of the Company except for two free hold landshaving original cost of Rs. 5851.77 lakhs and net book value of Rs. 5851.77 lakhs forwhich registration is pending in the name of the company accordingly title deeds are notavailable for the same.

ii) The management has conducted physical verification of inventories during the yearat reasonable intervals except the materials in transit/ materials lying with thirdparties. According to the information and explanations given to us no materialdiscrepancies were noticed on physical verification.

(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under section 189 of theCompanies Act 2013. Therefore the provisions of clause 3(iii) (iii)(a) (iii)(b) and(iii) (c) of the said Order are not applicable to the Company.

(iv) According to the information and explanations given to us the Company hascomplied with the provisions of section 185 and 186 of the Act with respect to the loansand investments made. However as per information and explanation given to us the Companyhas not given any guarantee or provided security in connection with a loan taken by anybody corporate or person.

(v) The Company has not accepted any deposits from the public.

(vi) We have broadly reviewed the cost records maintained by the Company relating toits products for which maintenance of cost records has been specified by the CentralGovernment under Section 148(1) of the Companies Act 2013 and are of the opinion thatprima facie the prescribed accounts and records have been made and maintained. We havehowever not made a detailed examination of the records with a view to determining whetherthey are accurate or complete.

(vii) With respect to Statutory Dues:

(a) According to the information and explanations given to us and the records of theCompany examined by us the Company is generally regular in depositing the undisputedstatutory dues including provident fund employees state insurance income-tax sales-taxwealth-tax service-tax duty of customs duty of excise cess and other materialstatutory dues as applicable to it with the appropriate authorities and there were noundisputed statutory dues outstanding as at 31st March 2017 for a period exceeding sixmonths from the date they became payable.

(b) According to the information and explanations given to us there are no dues ofWealth tax Service tax and Cess which have not been deposited on account of any disputeand the following are the details of dues of Sales tax Income tax and Excise duty thathave not been deposited on account of disputed matters pending before appropriateauthorities as at 31st March 2017:

Name of the Statute Nature of Amount Period to which Forum where dispute
Dues (in Rs. lakhs) the amount relates is pending
APGST Act 1957 Sales Tax 67.52* 1999-00 Sales Tax Appellate Tribunal
-do- -do- 40.51* 1999-00 -do-
-do- -do- 194.70* 2002-03 -do-
APVAT Act 2005 VAT 35.68 2011-12 -do-
-do- -do- 278.43 2014-15 ADC Kurnool
Central Sales Tax Act
1956 Sales Tax 158.71* 2000-01 Sales Tax Appellate Tribunal
-do- -do- 41.60 2000-01 High Court of Andhra Pradesh
-do- -do- 202.99 2003-04 Sales Tax Appellate Tribunal
-do- -do- 196.24 2004-05 -do-
Income Tax Act 1961 Income Tax 10.87* 2003-04 High Court of Andhra Pradesh
-do- -do- 1.85 2004-05 -do-
Central Excise Act
1944 Central Excise 3.76 2015-16 Commissioner Appeals Guntur
Karnataka Forest
Amendment Act Forest Development
2016 Fee 780.77 2016-17 High Court of Karnataka

*Stay of collection granted for the demands.

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of dues to banks. The Company has no borrowingsfrom financial institutions government or by way of debentures.

(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) during the year. The term loans availed by theCompany during the year are applied for the purposes for which they are raised.

(x) According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of 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 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 Ind AS financial statements as required by theapplicable 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 K. R. BAPUJI & Co.
Chartered Accountants
(Firm's Registration No. 000395S)
P. R. SATISH
Place: Chennai (Partner)
Date: May 12 2017 (Membership No. 219432)

annexure – B to the Independent auditors' report

referred to in paragraph 2(f) under the heading of "report on other Legal andregulatory requirements" of our report of even date to the members of Srikalahasthipipes Limited for the year ended march 31 2017.

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 ofSrikalahasthi Pipes Limited ("the Company") as of March 31 2017 in conjunctionwith our audit of the Ind AS 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'). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.

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 ethical requirementsand plan and perform the audit to obtain reasonable assurance about whether adequateinternal financial controls over financial reporting was established and maintained and ifsuch controls 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) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.

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 2017 based 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 K. R. BAPUJI & Co.
Chartered Accountants
(Firm's Registration No. 000395S)
P. R. SATISH
Place: Chennai (Partner)
Date: May 12 2017 (Membership No. 219432)