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Sturdy Industries Ltd.

BSE: 530611 Sector: Metals & Mining
NSE: N.A. ISIN Code: INE134F01026
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NSE 05:30 | 01 Jan Sturdy Industries Ltd
OPEN 0.42
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VOLUME 2000
52-Week high 0.44
52-Week low 0.22
P/E 0.17
Mkt Cap.(Rs cr) 6
Buy Price 0.40
Buy Qty 501.00
Sell Price 0.42
Sell Qty 2000.00
OPEN 0.42
CLOSE 0.42
VOLUME 2000
52-Week high 0.44
52-Week low 0.22
P/E 0.17
Mkt Cap.(Rs cr) 6
Buy Price 0.40
Buy Qty 501.00
Sell Price 0.42
Sell Qty 2000.00

Sturdy Industries Ltd. (STURDYINDUSTRIE) - Auditors Report

Company auditors report

To the Members of Sturdy Industries Limited.

Report on the Financial Statements as per Ind AS

We have audited the accompanying standalone financial statements of SturdyIndustries Limited ("the Company") which comprise the Balance Sheet as atMarch 31 2019 and the Statement of Profit and Loss Statement of change in Equity andCash Flow Statement for the year then ended and a summary of significant accountingpolicies 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 in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at March 31 2019 andits loss and its cash flows for the yearended on that date.

Basis of Qualified Opinion

a). Attention is invited to Note No 2 of the financial statements in respectofProperty Plant and Machinery and Equipments and depreciation on assets thereon. Thecompany has already booked depreciation amounting to Rs. 4.51 Crupto 31/12/2018. Duringthe current quarter the company has re-accessed the life of plant and machinery throughChartered Engineer as per his certificate dated 09/03/2019 the management of the companyhas taken the accessed useful lifeof plant and machinery to 35 Years against 25 Years asspecified in part ‘C' of ScheduleII of the companies Act 2013 as result of whichdepreciation for the current Quarter ending 31st March 2019 isNegative to theextent of Rs 1.26 Crs and as a result of this readjustment in useful life of plant andmachinery depreciation and Net Block has been adjustedaccordingly which has resulted inincrease in the net profit to the extent 1.26 Cr for the year.

b.) Attention is invited to Note No.9 of the financial statements in respect ofShort Term Loan and Advances amounting to Rs. 1243.77 Lacsshown as recoverable in respectof Claims to be received on account of subsidy/incentives/other Govt. claims out of whichRs. 1019.67 Lacshas been considered as income during the year (Refer note 22 of financialstatements)although the same has not been acknowledged by the concerned departments andright to receive has not been established. Hence profit to that extent has been overstatedin financial statements.

Our opinion is not modified in respect of these matters.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us except for the effects of the matter described in basis for Qualifiedopinion paragraph above the aforesaid standalone financial statements give theinformation required by the Act in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at March 31 2019 and itsloss and its Cash Flow for theyear ended on that date.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of the mostsignificant in our audit of the standalone financial statements of the current period.These matters addressed in the contest of our audit of the financial statements as awhole and in forming our opinion thereon and we do not provide a separate opinion onthese matters.

We have determined the matters described below to be the key audit matters to becommunicated in our report.

Key Audit Matter How our report addressed the Key audit matter.
1.Change in useful life and residualvalue of Plant and machinery. Our Audit Procedure include the following:-
As at March 31 2019 the company has a gross block of Rs. 8372.30 Lacs in plant and machinery which constitute 69.36% of the property plant and equipments ( Refer Note 2 of the financial statements) • Assessment of useful life of plant and machinery determined by external expert i:e Chartered Engineer and has relied upon his certificate.
In the current year the company has revised the useful life of the plant and machinery. Assessment of the useful life of plant and machinery in an integrated and complex plants involves management judgment consideration of historical experience anticipated technological changes. • Examining the useful economic life and residual value with reference to companies historical experience technical evaluation by third party and our understanding of future utilization of assets by the company.
Accordingly it has been determined as Key Audit matter. • Review of disclosure made by the company in the financial statements in this regard.
• Assessing whether the impact on account of changes has been appropriately recognized in the financial statements.
2.Evaluation of Uncertain tax positions Our audit procedure include the following substantive procedures;-
The Company is having tax jurisdiction in Delhi region and is subject to periodic challenges by the local tax authorities on the rage of tax matters during the normal course of business. These involve significant management judgment to determine the possible outcome of the uncertain tax positions consequently having impact on related accounting and disclosures in the standalone financial statements. • Obtained understanding of key uncertain tax positions; and
Refer Para 7 ( c) of CARO. • We along with company tax experts:-
a) Read and analyzed select key correspondences consultation by the management with the external tax professionals working on key uncertain tax positions.
b) Discussed with the appropriate senior management and evaluated management's underlying key assumptions in estimating the tax provisions if any to be made; and
c) Assessed management's estimate of the possible outcome of the disputed cases;

Emphasis of Matter

a)Attention is invited to Note No. 4 of the financial statements in which the companyhas outstanding from Govt. Departments in shape of various claims amounting to Rs. 1139.37Lakhs and advance to other parties amounting to Rs. 704.35 Lakhs which are outstandingsince long for which the company has not madc any provision as the management considers itas good as recoverable.

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 standalone financial statements that give a true and fair view of the financialposition financial performance including other comprehensive income cash flows andchange in equityof the Company in accordance with the Accounting principles generallyaccepted in India including theIndian Accounting Standard Ind AS specified under Section133 of the Act read with the provision of the Companies ( Indian accounting Standards)Rules 2015 as amended . This responsibility includes the maintenance of adequateaccounting records in accordance with the provision of the Act for safeguarding of theassets of the Company and for preventing and detecting the frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance ofadequate internal financial control that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentations of the financial statements that give a true and fair viewand free from material misstatement whether due to fraud or error.

In preparing the standalone financial statements management is responsible forassessing the company ability to continue as a going concern disclosing as applicablematter relating to going concern and using the going concern basis of accounting unlessmanagement either intents to liquidate the company or to ceaseoperation or hasnorealistic alternative but to do so.

Those board of directors are responsible for overseeing the company's financialreporting process.

Auditor's Responsibility

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.

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 Requirement's

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 of the Act we give inthe Annexure A a statement on the matters specified in the paragraph 3 and 4 of theOrder to the extent applicable.

2. As required by section 143(3) of the Act we report that:-

a) We have sought and obtained allthe information and explanations which to the best ofour 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 appears from our examination of those books.

c) The Balance Sheet Statement of Profit and Loss and Cash Flow Statement dealt withby this Report are in agreement with the books of account.

d) Except for the effects of the matter described in the basis for Qualified opinionparagraph above in our opinion the aforesaid standalone financial statements comply withthe Indian Accounting Standards (Ind As) specified under Section 133 of the Companies Act2013 read with Rule 7 of the Companies(Accounts) Rules2014;

e)The matters described in the basis for Qualified Opinion paragraph and Emphasis ofmatter paragraph above in our opinion can adversely affect the functioning of thecompany.

f) 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 2019 from being appointed as a director in terms of section 164(2) of theCompanies Act 2013.

(ANNUAL REPORT 2018-19)g)The qualification relating to the maintenance of accountsand other matters connected therewith are as stated in the Basis for Qualified Opinionparagraph above.

h) with respect to the adequacy of the internal financial controls over financialreporting of the company and the operating effectiveness of such control refer to ourseparate report in Annexure "B and

i) With respect to the other matters included in the Auditor's Reportin accordance withRule 11 of Companies (Audit and Auditors)Rules 2014 in our opinion and to thebest of ourinformation and according to explanations given to us:

i. The Company has not disclosed the impact of pending litigations in its financialstatements with respect to suits on or by the company in respect of suits filed by thecompany for acquisition of properties or recovery of advances as referred to in note 5.1and 5.2 of the financial statements.

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

iii. There no amounts which required to be transferred to the Investor Education andProtection Fund by the company.

FOR K SINGH &ASSOCIATES
CHARTERED ACCOUNTANTS
Firm No. 012458N
Sd/-
Kultar Singh
Partner
Membership No. 091673
PLACE: Chandigarh
DATED:30/05/2019

Annexure- A to the Independent Auditors' Report

Referred to in paragraph 1 under ‘Report on other Legal and RegulatoryRequirements' section of our report of even date. We report that:

1.(a) The company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets.

(b) As explained to us fixed assets have been physically verified by the management atreasonable intervals; no material discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanations given to us thecompany immovable properties in its name. the title deeds of immovable properties are heldin the name of the company.

2. As explained to us inventories have been physically verified during the year by themanagement at reasonable intervals and no material discrepancy was noticed on physicalverification of stocks by the management as compared to book records.

3. According to information and explanations given to us the company has not grantedunsecured loan to partiescovered under section 189 of the companies Act. 2013 Accordinglythe provisions of clause 3 (iii) (a) to (C) of the Order are not applicable to the Companyand hence not commented upon.

4.The company has not given any loans to directors or to any other persons in whom thedirector is interested or given any guarantee or provided any security in connection withany loan taken by him or such person as covered under section 185 of the Companies act2013

5The Company has not accepted deposits. Hence the provisions of Section 73 to 76 or anyother relevant provisions of the Act and the rules framed there under are not applicableto the Company.

6. We have broadly reviewed the cost records maintained by the company pursuant to thecompanies (Cost Records and Audit) Rules2014 as amended and prescribed by the centralGovernment under subsection (1) of section 148 of the companies Act2013 and are of theopinion that prime facie the prescribed cost records have been made and maintained. Wehave however not made detailed examination of the cost records with view to determiningwhether they are accurate of complete. 7.(a) Based on our audit procedures and on theinformation and explanations given by the management and on the basis of our examinationof records of the company amount deducted /accrued in the books of accounts in respect ofundisputed statutory dues including Provident Fund Employees' State Insurance

Income-tax GSTCustom Dutyand any other statutory dues with the appropriateauthorities b) According to the information and explanation given to us no undisputedamount payable in respect above were in arrearsas at 31/03/2019for a period of more thansix months from the date they become payable. c) Detail of dues of Excise Duty which havenot been deposited as on 31/03/2019 on account of dispute are given below:

Name of the Statute ( Nature of Dues) From where Dispute is pending Period to which the amount relates Amount Involved(Rs in Lacs)
Central Excise Act Tribunal 2010-11 13.00
Tribunal 2004-05 to 2013-14 202.28
Commissioner 2014-15 77.71

8. Based upon the audit procedures performed and the information and explanations givenby the management. The Company has defaulted in the repayment of dues to banks .The periodand amount of default lender wise is appended:

Particulars Amount of default as the balance sheet  date Period of default Remarks if any
1) Name of lenders: Punjab National Bank 21687.17 Lacs January18 to 31st March 2019 to 31st Resolution plan has been submitted repayment to the bank for of loan and matter is under consideration.

9. Based upon the audit procedures performed and the information and explanations givenby the management the Company did not raise any money by way of initial public offer orfurther public offer (including debt instruments) and term loans during the yeartherefore the provisions of para 3(ix) of the Order is not applicable to the Company.10.According to the information and explanations given to us no fraud by the Company oron the Company by its officers or employees has been noticed or reported during the year.11.The Company has paid any managerial remuneration during the financial year ending 31stMarch 2019 however the company has sought the necessary approval and mandated as per theprovisions of section 197read with schedule V of the Companies Act2013.12.In our opinionand according to the information and explanations given to us the Company is not a Nidhicompany therefore the provisions of para 3(xii) of the Order is not applicable to theCompany. 13.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.

14.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.

15.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 therefore the provisions ofpara 3(xv) of the Order is not applicable to the Company. 16.The Company is not requiredto be registered under section 45-IA of the Reserve Bank of India Act 1934.

FOR K SINGH & ASSOCIATES
CHARTERED ACCOUNTANTS
Firm No. 012458N
Sd/-
Kultar Singh
Partner
Membership No. 091673
PLACE: Chandigarh
DATED:30/05/2019

Annexure - B to the Auditors' Report

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 SturdyIndustries Limited ("the Company") as of 31st March 2019 inconjunction with our audit of the standalone financial statements of the Company for theyear 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'). 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 onAuditing issued by ICAI and deemed to be prescribed under section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controlsboth applicable to an audit of Internal Financial Controls and both issued by theInstitute of Chartered Accountants of India. Those Standards and the Guidance Note requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in allmaterial 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 judgment 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 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 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 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 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 ICAI.

forK Singh &Associates
Chartered Accountants
Firm's Registration Number: 012458N
Sd/-
CA. KultarSingh
Partner
Membership Number: 091673
Place of Signature: New Delhi
Date: 30th May 2019

15 Lease

The Company has not entered into any fresh operating leasing agreement during the yearCurrent Financial Year.

16 Disclosure under Micro Small and Medium Enterprises Development Act2006

For K.SINGH & ASSOICATES on behalf of the Board of Directors for STURDY INDUSTRIES LTD.
Chartered Accountants Firm No 012458N
Sd/- Sd/- Sd/- Sd/- Sd/-
(Kultar Singh)

Amit Bhatti

Gurwinder Singh

Ramesh Gupta

Amit Gupta

P A R T N E R

(C.F.O)

(C.S)

(Director)

(Director)

M.No 091673

M.No A52827

DIN-0161363

DIN-0161417

Dated:-30/05/2019
Place:-CHANDIGARH

.