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Star Paper Mills Ltd.

BSE: 516022 Sector: Industrials
NSE: STARPAPER ISIN Code: INE733A01018
BSE 00:00 | 20 Jul 148.45 1.05
(0.71%)
OPEN

147.90

HIGH

151.00

LOW

147.45

NSE 00:00 | 20 Jul 148.80 2.25
(1.54%)
OPEN

147.10

HIGH

151.65

LOW

146.00

OPEN 147.90
PREVIOUS CLOSE 147.40
VOLUME 9705
52-Week high 318.20
52-Week low 146.35
P/E 4.27
Mkt Cap.(Rs cr) 232
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 147.90
CLOSE 147.40
VOLUME 9705
52-Week high 318.20
52-Week low 146.35
P/E 4.27
Mkt Cap.(Rs cr) 232
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Star Paper Mills Ltd. (STARPAPER) - Auditors Report

Company auditors report

To the Members of Star Paper Mills Limited

Report on the Financial Statements

We have audited the accompanying financial statements of Star Paper Mills Limited("the Company") which comprise the Balance Sheet as at March 31 2017 and theStatement of Profit and Loss and Cash Flow Statement for the year then ended asignificant accounting policies and other notes for the year ended on that date.

Management's Responsibility for the 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 financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards specified undersection 133 of the Act read with relevant rules thereunder.

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 judgments 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 of theaccounting records relevant to the preparation and presentation of the financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit.

We have taken into account the provisions of the Act the Accounting and AuditingStandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder.

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 financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditors' judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assess -mentsthe auditor considers internal control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit pro -ceduresthat are appropriate in the circumstances but not for the purpose of expressing anopinion on whether the Company has in place an adequate internal financial control systemover financial reporting and the operating effectiveness of such controls. An audit alsoincludes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the financial statements. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for ourqualified audit opinion.

Basis for Qualified Opinion

Attention is drawn to the following notes to the financial statement:

Note no. 12.2 regarding non-provision for diminution in value of Investment in ISGTraders impact of which is presently not ascertainable and as such cannot be commentedupon by us.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us except for the possible effects of the matter described in the Basis for

Qualified Opinion paragraph the aforesaid financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of affairs of theCompany as at 31st March 2017 and its Profit and its Cash Flows for the year ended onthat date.

Report on Other Legal and Regulatory Requirements

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 A" a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.

Further to our comments in the annexure referred to in the paragraph above as requiredby Section 143(3) of the Act we report that:

a) Except for the matters described in the basis for qualified opinion we have soughtand obtained all the information and explanations which to the best of ourknowledge 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 appears from our examination of those books;

c) The Balance Sheet the Statement of Profit and Loss and the Cash Flow Statementdealt with by this Report are in agreement with the books of account;

d) Except for the possible effects of the matter described in the Basis for QualifiedOpinion paragraph in our opinion the Balance Sheet Statement of Profit and loss andCash Flow Statement comply with the Accounting Standards specified under section 133 ofthe Act;

e) On the basis of the written representations received from the directors as on March31 2017 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 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". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.

g) 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 ouropinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the effect of pending litigations on its financialpositions in its financial statement as required in terms of the accounting standards andprovisions of the Companies Act 2013- Refer Note No. 27.1 of the financial statement;

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses;

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company;

iv. The Company has provided requisite disclosures in the financial statements as toholdings as well as dealings in Specified Bank Notes (SBN's) during the period fromNovember 08 2016 to December 30 2016. Based on audit procedures and relying on themanagement representation we report that the disclosures are in accordance with books ofaccount maintained by the Company and as produced to us by the

. Management ReferNote34ofthefinancialstatements

For Lodha & Co.
Chartered Accountants
Firm's ICAI Registration No.:301051E
Place: New Delhi H. K. Verma
Date: 25th May 2017 Partner
Membership No: 055104

ANNEXURE "A" TO THE AUDITOR'S REPORT OF EVEN DATE:

i) a. The Company has maintained proper records showing full particulars includingquantitative details and situations of fixed assets

b. All the assets have not been physically verified by the management during the yearbut there is a regular programme of verification which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. As informed nomaterial discrepancies were noticed on such verifications.

c. According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.

ii) a. As informed the inventories of the Company except for materials in transitthose lying with third parties have been physically verified by the managementduring the year. In our opinion and according to the information and explanations given tous the frequency of such verification is reasonable. b. In our opinion theprocedure of physical verification of inventory followed by the management are reasonableand adequate in relation to the size of the company and nature of its business.

iii) The Company has not granted any loans secured or unsecured to companies firms orparties covered in the register maintained under Section 189 of the Act.Accordingly clause 3 (iii) of the Order is not applicable to the Company.

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

v) The Company has not accepted any deposits from public covered under Sections 73 to76 or any other relevant provisions of the Act and rules framed thereunder.

vi) We have broadly reviewed the books of account maintained by the company pursuant tothe Rules made by the Central Government for the maintenance of cost records under Section148 (1) of the Act in respect of the Company's products to which the said rules are madeapplicable and are of the opinion that prima facie the prescribed records have beenmaintained. We have however not made a detailed examination of the said records with aview to determine whether they are accurate or complete.

vii) a. According to the information and explanations given to us during the year theCompany has generally been regular in depositing with appropriate authorities undisputedstatutory dues including Provident Fund Investor Education Protection fund Employees'State Insurance Income Tax Sales Tax Wealth Tax Service tax Custom Duty Excise DutyValue Added Tax Cess and other statutory dues as applicable to it.

b. According to the information and explanations given to us the details of disputeddues of sales tax income tax customs duty wealth tax excise duty service tax andCess if any as at 31st March 2017 are as follows:

Name of the Statute Nature of Dues Amount (Rs. in lakhs) Period to which the amount relates Forum where dispute is pending
2010-2011
The Uttar Pradesh VAT Act 2008 VAT 29.85 2011-2012 Additional Commissioner (Appeals)
2013-2014
VAT 14.42 2009-2010 Tribunal
The Central Sales Tax Act 1956 Sales Tax 4.29 1996-1997 High Court
406.00 1995-1996 Tribunal
CESTAT New Delhi
The Central Excise Act Excise Duty 41.16 2009-2010 to 2011-2012
UP Krishi Utpadan Mandi Adhiniyam 1965 Interest on Mandi Tax 33.81 01.01.1993 to 31.12.2013 High Court
Mandi Tax 560.72 2004-2005 to 2015-16 High Court

viii) In our opinion and on the basis of information and explanations given to us bythe management we are of the opinion that the Company has not defaulted in repayment ofdues to banks.

ix) In our opinion and according to the information and explanations given to us theCompany did not raise any money by way of initial public offer or further public offer(including debt instruments).

x) During the course of our examination of books of account carried out in accordancewith generally accepted auditing practices in India we have neither come across anyincidence of fraud on or by the Company nor have we been informed of any such cases by themanagement.

xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided formanagerial remuneration in accordance with the requisite approvals mandated by theprovisions of section 197 read with Schedule V to the Act except as stated in Note no.24.1 regarding pending approval from shareholders.

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

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

xiv) According to the information and explanations give 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 as represented to usby the management and based on our examination of the records of the Company the Companyhas not entered into non-cash transactions with directors or persons connected with him.Accordingly paragraph 3(xv) of the 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 Lodha & Co.
Chartered Accountants
Firm's ICAI Registration No.:301051E
Place: New Delhi H. K. Verma
Date: 25th May 2017 Partner
Membership No: 055104

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph (f) under ‘Report on Other Legal and RegulatoryRequirements' of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of Star PaperMills Limited ("the Company") as of March 31 2017 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 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

Reporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinan -cial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

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 accor-dance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") issued by the Institute of Chartered Accountantsof India and the Standards on Auditing prescribed under Section 143(10) of the CompaniesAct 2013 to the extent applicable to an audit of internal financial controls.

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 performingprocedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their op -erating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal control based on the assessed risk. The procedures selected depend on theauditor's judgement including the assessment of the risks of material misstatement of thefinancial 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 ofrecords that in reasonable detail accurately and fairly reflect the trans -actions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2017 based on the inter -nal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of

Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.

For Lodha & Co.
Chartered Accountants
Firm's ICAI Registration No.:301051E
Place: New Delhi H. K. Verma
Date: 25th May 2017 Partner
Membership No: 055104