You are here » Home » Companies » Company Overview » Suditi Industries Ltd

Suditi Industries Ltd.

BSE: 521113 Sector: Industrials
NSE: SUDITIND ISIN Code: INE691D01012
BSE 00:00 | 10 Jul 11.28 0
(0.00%)
OPEN

11.28

HIGH

11.28

LOW

11.28

NSE 05:30 | 01 Jan Suditi Industries Ltd
OPEN 11.28
PREVIOUS CLOSE 11.28
VOLUME 201
52-Week high 24.75
52-Week low 6.64
P/E 13.93
Mkt Cap.(Rs cr) 20
Buy Price 11.28
Buy Qty 63.00
Sell Price 11.28
Sell Qty 36.00
OPEN 11.28
CLOSE 11.28
VOLUME 201
52-Week high 24.75
52-Week low 6.64
P/E 13.93
Mkt Cap.(Rs cr) 20
Buy Price 11.28
Buy Qty 63.00
Sell Price 11.28
Sell Qty 36.00

Suditi Industries Ltd. (SUDITIND) - Auditors Report

Company auditors report

To

THE MEMBERS OF

SUDITI INDUSTRIES LIMITED

Report on the Audit of Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of SUDITI INDUSTRIESLIMITED ("the Company") which comprise the Balance Sheet as at March 31 2019the Statement of Profit and Loss (including Other Comprehensive Income) for the periodended on that date the Statement of Changes in Equity and the Statement of Cash Flows forthe year ended on that date and a summary of the significant accounting policies andother explanatory information (hereinafter referred to as "the financialstatements").

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 Act in the manner so required and give a true and fair view in conformitywith Indian Accounting Standard prescribed under section 133 of the Companies Act2013('the Act') and other accounting principles generally accepted in India of the stateof affairs of the Company as at March 31 2019 of total comprehensive income (comprisingprofit and other comprehensive income) for the period ended on that date changes inequity and its cash flows for the year then ended.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing (SAs) issued by the Institute of Chartered Accountants of India(ICAI). Our responsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Standalone Financial Statements section of ourreport. We are independent of the Company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India together with the independencerequirements that are relevant to our audit of the standalone financial statements underthe provisions of the Act and the Rules made thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our opinion.

Key Audit Matters:

Key audit matters are those matters that in our professional judgement were of mostsignificance in our audit of the financial statements of the current period and includethe most significant assessed risks of material misstatement (whether or not due to fraud)that we identified. These matters included those which had the greatest effect on: theoverall audit strategy the allocation of resources in the audit; and directing theefforts of the engagement team. These matters were addressed in the context of our auditof the financial statements as a whole and in forming our opinion thereon and we do notprovide a separate opinion on these matters.

Key Audit matter description How the scope of our audit responded to the key audit matter
Inventory valuation:
As described in para k) of the Significant Accounting policies and Notes 35 36 and 37onInventories the Company carries inven- tory at the lower of cost and fair value less costs to sell using the weighted average cost basis. The Company provides for changes in value based on forecast inventory usage. This meth- odology relies upon assumptions made in determining appropri- ate provisioning percentages to apply to inventory balances. Contingent liabilities The Company has ongoing legal matters relating to previous corporate transactions which require management judgement to be applied in order to determine the likely outcome. Judgement is required in assessing the nature of these exposures and their accounting and disclosure requirements. Refer Note no.52. Retail technology environment including IT security The Company's retail operations utilise a range of information systems. Although Tally is the main accounting software the other operational retail applications are connected through an interface. The absence of robust and accurate working of these software impacts the correct recording of amounts in Tally which could have an adverse impact on the Company's controls and financial reporting systems.

We obtained a detailed understanding and evaluated the design and implementation of controls that the Company has estab- lished in relation to inventory valuation. We obtained assurance over the appropriateness of management's assumptions applied in calculating the value of inventory provi- sions by: -- verifying the value of a sample of inventory items to confirm whether they are held at the lower of cost and net realizable value through comparison to vendor invoices and sales prices; -- using data analytics to identify unusual inventory usage char- acteristics completing assumption tolerance testing and recalcu- lating the provision in totality. In assessing the potential exposures to the Company we have completed a range of procedures including: -- assessing the design and implementation of controls in relation to the monitoring of known exposures; -- reading Board and other meeting minutes to identify areas subject to Company consideration; -- meeting with the Company's internal legal advisors in under- standing ongoing and potential legal matters impacting the Com- pany; -- reviewing the proposed accounting and disclosure of actual and potential legal liabilities drawing on third party assessment of open matters. We continued to challenge and assess changes to the IT environ- ments through the testing of remediated controls and concluding on the sufficiency and appropriateness of management's changes. During the year we have assessed the design and implementa- tion of the Company's controls over the information systems that are important to financial reporting. Where we noted deficiencies which affected applications and databases within the scope of our audit we extended the scope of our substantive audit procedures.

Other Information:

The Directors are responsible for the other information. The other informationcomprises the information included in the annual report-Chairman's Statement DirectorsReport Management Discussion & Analysis and Corporate Governance Report-- other thanthe financial statements and our auditor's report thereon. Our opinion on the financialstatements does not cover the other information and except to the extent otherwiseexplicitly stated in our report we do not express any form of assurance conclusionthereon. In connection with our audit of the financial statements our responsibility isto read the other informationand in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If we identify such materialinconsistencies or apparent material misstatements we are required to determine whetherthere is a material misstatement of the other information. If based on the work we haveperformed we conclude that there is a material misstatement of this other information; weare required to report that fact. The Chairman's Statement Directors Report ManagementDiscussion & Analysis and Corporate Governance Reports are expected to be madeavailable to us after the date of this auditor's report. When we read these reports if weconclude that the other information is materially inconsistent with the standalonefinancial statements or our knowledge obtained during the audit or otherwise appears to bematerially misstated therein we are required to communicate the matter to those chargedwith governanceandtake appropriate action as applicable under the laws and regulations.

Responsibilities of the Management and Those Charged with Governance for the StandaloneFinancial Statements

Company's Board of Directors is responsible for the preparation and presentation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance total comprehensive incomechanges in equity and cashflows of the Company in accordance with Ind AS and other accounting principles generallyaccepted in India. The Board of Directors of the Company are responsible for maintenanceof adequate accounting records in accordance with the provisions of the Act forsafeguarding the assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the Standalone financial statements that give a true andfair view and are free from material misstatement whether due to fraud or error whichhave been used for the purpose of preparation of the standalone financial statements bythe Board of Directors of the Company as aforesaid.

In preparing the standalone financial statements the Board of Directors of the Companyare responsible for assessing the ability of the Company to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

The Board of Directors of the Company are also responsible for overseeing the financialreporting process of the Company.

Auditor's Responsibilities for the Audit of the Standalone Financial Statements

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 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 therisks of material misstatement of the standalone financial statements whether due tofraud or error design and perform audit procedures responsive to those risks and obtainaudit evidence that is sufficient and appropriate to provide a basis for our opinion. Therisk of not detecting a material misstatement resulting from fraud is higher than for oneresulting from error as fraud may involve collusion forgery intentional omissionsmisrepresentations or the override of internal control.

--Obtain an understanding of internal financial controls relevant to the audit in orderto design audit procedures that are appropriate in the circumstances but not for thepurpose of expressing an opinion on effectiveness of the Company's internal financialcontrols.

--Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.

--Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the ability ofthe Company to continue as a going concern. If we conclude that a material uncertaintyexists we are required to draw attention in our auditor's report to the relateddisclosures in the standalone financial statements or if such disclosures are inadequateto modify our opinion.

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 standalone financialstatements including the disclosures and whether the standalone financial statementsrepresent 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 withthose charged with governance we determine those matters that were of most significancein the audit of the standalone financial statements of the current period and aretherefore the key audit matters. We describe these matters in our auditor's report unlesslaw or regulation precludes public disclosure about the matter or when in extremely rarecircumstances we determine that a matter should not be communicated in our report becausethe adverse consequences of doing so would reasonably be expected to outweigh the publicinterest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of India in terms of subsection (11) of Section 143 of the Act (hereinafterreferred to as the "Order") and on the basis of such checks of the books ofaccounts and records of the Company as we considered appropriate and according to theinformation and explanations given to us we give in the Annexure A hereto a statement onthe matters specified in the paragraphs 3 and 4 of the said Order to the extentapplicable.

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

(a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.

(c) The Balance Sheet the Statement of Profit and Loss (including other comprehensiveincome) the Statement of Changes in Equity and the Cash Flow Statement dealt with by thisReport are in agreement with the books of account.

(d) In our opinion the aforesaid standalone financial statements comply with theIndian Accounting Standards (Ind AS) specified under Section 133 of the Act.

(e) On the basis of the written representations received from the directors as on 31stMarch 2019 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2019 from being appointed as a director in terms of Section164 (2) of the Act.

(f) With respect to the adequacy of the internal financial control over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in Annexure B.

(g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended:

In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its directors during the year is inaccordance with the provisions of section 197 of the Act.

(h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company's pending litigation comprise of proceedings pending with Sales TaxAuthorities. The Company has reviewed all its pending litigations and proceedings anddisclosed the contingent liabilities in its financial statements. The Company does notexpect the outcome of these proceedings to have a material impact on its financialposition. (refer Note No:52 for details on contingent liabilities)

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 which were required to betransferred to the Investor Education and Protection Fund by the Company.

For Chaturvedi & Partners

Chartered Accountants (Firm Registration No.: 307068E)

(Khyati Shah)

Partner (Membership No.: 117510)

ICAI UDIN :19117510AAAAAT6055

Place : Mumbai Date : May 30 2019

ANNEXURE A TO THE INDEPENDENT AUDITORS' REPORT

The Annexure referred to in our Independent Auditors' Report to the members of SuditiIndustries Limited ("the Company") for the year ended March 31 2019 we reportthat: 1) a. The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets except for assets under installation.b. All the fixed assets have not been physically verified by the management during theyear but there is a regular program of verification which in our opinion is reasonablehaving regard to the size of the Company and nature of its assets. No materialdiscrepancies were noticed on such verification. c. According to the information &explanation given to us and on the basis of our verification the title deeds of allimmovable properties (which are included under the head "Property Plant &Equipment") are held in the name of the company.

2) As explained to us the inventories of the company have been physically verifiedduring the year by the management and no material discrepancies were noticed on suchverification as compared to book records. In our opinion the frequency of verification isreasonable.

3) According to the information & 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. In view of the foregoing the provisions of clause 3 (iii) (a) (b)and (c) of the said order are not applicable.

4) The Company has complied with the provisions of section 185 and 186 of the CompaniesAct 2013 in respect of investments and has not provided any loans guarantees andsecurity as per the provisions of section 185 and 186 of the Companies Act 2013.

5) During the year the Company has not accepted any deposits from the Public withinthe meaning of Sections 73 to 76 of the Companies Act 2013 and the rules framed thereunder as also the directives issued by the Reserve Bank of India. The Company has compliedwith the applicable statutory provisions. The Company has not received any order passed byCompany Law Board or National Company Law Tribunal or Reserve Bank of India or any courtor any other tribunal.

6) Provisions of Section 148 on Maintenance of Cost Records do not apply to the Companysince as explained to us the prescribed limits have not been crossed for the applicabilityof cost audit and maintenance of Cost Records.

7) 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 undisputedstatutory dues including provident fund employees' state insurance income-tax goods andservices tax value added tax cess and any other statutory dues to the appropriateauthorities. There were no dues outstanding as on the last day of the financial year for aperiod of more than six months from the date they became payable. b. According to thebooks of accounts and records as produced and examined by us in accordance with thegenerally accepted auditing practices in India as at 31st March 2019 the following arethe particulars of dues that have not been deposited on account of dispute:

Name of the Statute Nature of dues Amount (Rs. in lacs) Forum where dispute is pending Financial year to which the amount relates
B.S.T. ACT 1959 BST 51.01 Asst. Commissioner Sales Tax 1996-97
C.S.T ACT1956 CST 14.16 Asst. Commissioner Sales Tax 1996-97
MVAT ACT2002 VAT 110.77 Deputy Commissioner of Sales Tax 2005-06
MVAT ACT2002 VAT 19.98 Deputy Commissioner of Sales Tax 2009-10
C.S.T ACT1956 CST 37.15 Deputy Commissioner of Sales Tax 2009-10
C.S.T ACT1956 CST 43.71 Deputy Commissioner of Sales Tax 2010-11
MVAT ACT2002 VAT 5.90 Deputy Commissioner of Sales Tax 2011-12
C.S.T ACT1956 CST 30.32 Deputy Commissioner of Sales Tax 2011-12
MVAT ACT2002 VAT 78.54 Deputy Commissioner of Sales Tax 2012-13
C.S.T ACT1956 CST 16.60 Deputy Commissioner of Sales Tax 2012-13
MVAT ACT2002 VAT 10.85 Deputy Commissioner of Sales Tax 2013-14
C.S.T ACT1956 CST 26.18 Deputy Commissioner of Sales Tax 2013-14
MVAT ACT2002 VAT 3.29 Deputy Commissioner of Sales Tax 2014-15
C.S.T ACT1956 CST 11.28 Deputy Commissioner of Sales Tax 2014-15
Total 459.74

8) Based on our audit procedures and according to the information and explanationsgiven to us we are of the opinion that the Company has not defaulted in repayment ofloans or borrowings to financial institution bank Government or debenture holders.

9) According to the information and explanations given to us and based on the recordsand documents produced before us in our opinion the term loans have been applied for thepurposes for which they were obtained. During the year the Company has not raised anymoneys by way of initial public offer or further public offer (including debtinstruments).

10) During the course of our examination of the books of accounts and records of theCompany carried out by us in accordance with the generally accepted auditing practices inIndia we have neither come across any instance of fraud on the Company by its officers oremployees noticed or reported during the year nor have we been informed of such case bythe management.

11) According to the information and explanations given to us and based on the recordsand documents produced before us managerial remuneration has been paid by the Company inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Companies Act.

12) The Company is not a Nidhi Company and in view of the foregoing the question ofreporting on Clause 3 (xii) of the said order does not arise.

13) According to the information and explanations given to us transactions withrelated parties are in compliance with sections 177 and 188 of Companies Act 2013 and thedetails have been disclosed in the standalone Financial Statements as required by theapplicable Ind AS. Refer note no.49.1 in standalone financial statements for details.

14) According to the information and explanations given to us and based on the recordsand documents produced before us the company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the year.

15) As per the information and explanations given to us the company has not enteredinto any non-cash transactions with directors or persons connected with them. Accordinglyparagraph 3(xv) of the Order is not applicable.

16) As per the information and explanations given to us the Company is not required tobe registered under section 45-IA of the Reserve Bank of India Act 1934.

For Chaturvedi & Partners

Chartered Accountants (Firm Registration No.: 307068E)

(Khyati Shah)

Partner (Membership No.: 117510)

ICAI UDIN :19117510AAAAAT6055

Place : Mumbai Date : May 30 2019

ANNEXURE B TO THE INDEPENDENT AUDITORS REPORT

Referred to in paragraph 2(f) of 'Report on Other Legal and Regulatory Requirements' ofour report of even date.

Report on the Internal Financial Controls with reference to financial statements underClause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("theAct")

We have audited the internal financial controls with reference to financial statementsof Suditi Industries Limited ("the Company") as of March 31 2019 in conjunctionwith our audit of the standalone 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". 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 with reference to financial statements based on our audit. We conducted our auditin accordance with the Guidance Note on Audit of Internal Financial Controls withreference to financial statements (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 with reference tofinancial statements was established and maintained and if such controls operatedeffectively in all material respects. Our audit involves performing procedures to obtainaudit evidence about the adequacy of the internal financial controls system with referenceto financial statements and their operating effectiveness. Our audit of internal financialcontrols with reference to financial statements included obtaining an understanding ofinternal financial controls with reference to financial statements assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone 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 systemwith reference to financial statements.

Meaning of Internal Financial Controls with reference to Financial Statements

A company's internal financial control with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of standalone financial statements for external purposes inaccordance with generally accepted accounting principles. A company's internal financialcontrol with reference to financial statements 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 ofstandalone financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorizations of management and directors of the company; and (3) providereasonable assurance regarding prevention or timely detection of unauthorized acquisitionuse or disposition of the company's assets that could have a material effect on thestandalone financial statements.

Inherent Limitations of Internal Financial Controls with reference to FinancialStatements.

Because of the inherent limitations of internal financial controls with reference tofinancial statements including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls withreference to financial statements to future periods are subject to the risk that theinternal financial control with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system with reference to financial statements and such internalfinancial controls with reference to financial statements were operating effectively as atMarch 31 2019 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".

For Chaturvedi & Partners

Chartered Accountants (Firm Registration No.: 307068E)

(Khyati Shah)

Partner (Membership No.: 117510)

ICAI UDIN :19117510AAAAAT6055

Place : Mumbai Date : May 30 2019

Ref.No. 190821/016/R