You are here » Home » Companies » Company Overview » Sunil Agro Foods Ltd

Sunil Agro Foods Ltd.

BSE: 530953 Sector: Agri and agri inputs
NSE: N.A. ISIN Code: INE224D01012
BSE 00:00 | 04 Jun 25.30 0
(0.00%)
OPEN

25.30

HIGH

26.55

LOW

25.20

NSE 05:30 | 01 Jan Sunil Agro Foods Ltd
OPEN 25.30
PREVIOUS CLOSE 25.30
VOLUME 725
52-Week high 33.40
52-Week low 16.00
P/E 12.40
Mkt Cap.(Rs cr) 8
Buy Price 25.30
Buy Qty 50.00
Sell Price 26.50
Sell Qty 10.00
OPEN 25.30
CLOSE 25.30
VOLUME 725
52-Week high 33.40
52-Week low 16.00
P/E 12.40
Mkt Cap.(Rs cr) 8
Buy Price 25.30
Buy Qty 50.00
Sell Price 26.50
Sell Qty 10.00

Sunil Agro Foods Ltd. (SUNILAGROFOODS) - Auditors Report

Company auditors report

To the Members of M/s Sunil Agro Foods Limited

Opinion

We have audited the accompanying Standalone financial statements of M/s. Sunil AgroFoods Limited ("the Company") which comprises the Balance Sheet as at March 312019 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of changes in Equity and the Statement of Cash Flows for the year then ended andnotes to the financialstatements including a summary of significant accounting policiesand other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31March 2019 and its Profit total comprehensive income the changes in equity and its cashflows for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing (SAs) specified under section 143(10) of the Companies Act 2013.Our responsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Financial Statements section of our report. We areindependent of the Company in accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India together with the ethical requirements that are relevantto our audit of the financial statements under the provisions of the Companies Act 2013and the Rules thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the Code of Ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for ouropinion.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financialstatements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.For each matter below our description of how our audit addresses the matter is providedin that context.

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

We have fulfilledthe responsibilities for the audit of the Standalone FinancialStatements section of our report including in relation to these matters. Accordingly ouraudit included the performance of procedures designed to respond to our assessment of therisks of material misstatement of the Standalone Financial Statements. The results of ouraudit procedures including the procedures performed to address the matters below providethe basis for our audit opinion on the accompanying Standalone Financial Statements.

The Companyhascertainsignificantopen legal proceedings under arbitration for variouscomplex matters with the Government of India and other parties continuing from earlieryears which are as under : a) Claims against the Company from the Central ExciseDepartment related to period from 05/08/2010 to 31/10/2013. The company has filed anappeal against the order demanding interest and penalty with the Customs Excise andService Tax Appellate Tribunal. (Refer Note 33) Due to the complexity involved in theselitigation matters management's judgement regarding recognition and measurement ofprovisions for these legal proceedings is inherently uncertain and might change over timeas the outcomes of the legal cases and determined. Accordingly it has been considered as aKey Audit Matter.

Our Audit procedures included and were not limited to the following :

• Discussion with the management on the development in these litigations duringthe year ended March 312019

• Review of the disclosures made by the Company in the Financial Statements inthis regard.

• Obtained representation letter from the management on the assessment of thesematters.

Responsibility of Management for the Standalone 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 including other comprehensive income cash flows and changes in equity of theCompany in accordance with the Indian Accounting standards (Ind AS) prescribed undersection 133 of the Act read with the Companies (Indian Accounting standards) Rules 2015as amended and other accounting principles generally accepted in India. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection application implementation andmaintenance of appropriate of accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone financial statement that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so. The Board of Directors is also responsible for overseeing thecompany's financial reporting process

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

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 decisions of users taken on the basis of thesefinancial statements:

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 Companies Act 2013 we give in the "Annexure A" statement on thematters specified 3 and 4 of the Order to the extent applicable.

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 Statement of changes in Equity and the Statement of Cash Flow dealt with by thisReport are in agreement with the books of account.

d. In our opinion the aforesaid standalone financial statements comply with the IndianAccounting Standards specified under Section 133 of the Act read with the Companies(Indian Accounting standards) Rules 2015.

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 controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B". Our Report expresses an Qualifiedopinion on the adequacy and operating effectiveness of the company's internal financialcontrols over financial 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 as amended inour opinion and to the best of our information and according to the explanations given tous;

i. The Company has disclosed the impact of pending litigations which could impact itsfinancial position the as mentioned in note no.33 Contingent Liability.

ii. The Company did not have any long-term contracts including derivatives contractsfor which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.

For GRV & PK.
Chartered Accountants
Firm Reg. No. 008099S
Place : Bengaluru Kamal Kishore
Date : 29.05.2019 Partner
Membership No. 205819

ANNEXURE - A TO INDEPENDENT AUDITORS' REPORT

The Annexure referred to in Independent Auditors' Report to the members of M/s.Sunil Agro Foods Limited ("the Company") on the standalone financialstatements for the year ended 31 March 2019 we report that:

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

b. These fixed assets have been physically verified by the management at reasonableintervals; no material discrepancies were noticed on such verification.

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) On basis of information and explanation given to us Physicalverification of Inventory has been conducted at reasonable intervals by themanagement.

(b) Procedure of physical verification of Inventory followed by the management isreasonable & adequate in relation to the size of company and nature ofits business.

(c) In our opinion and according to the information and explanations given tous the Company has maintained proper records of its inventories and nomaterial discrepancies were noticed on physical verification of stocks as comparedto book records.

(iii) In our opinion and according to the information and explanations given to us TheCompany has not granted any unsecured loans to any of the parties covered in the Registermaintained under Section 189 of the Companies Act 2013. Accordingly clause (iii) of theorder is not applicable.

(iv) In our opinion and according to the information and explanations given to us thecompany has not provided any loans guarantees and Investments to which the provision ofsec 185 of the act apply. However regarding loans guarantees and Investments to whichthe provision of sec 186 apply such investment are within the limit provided under Section186 of the act.

(v) The company has not received any public deposits during the year to which section73 to 76 or any other relevant provisions of the act are applicable. Accordingly clause(v) of the order is not applicable.

(vi) As informed to us the Central Government has not prescribed maintenance of costrecords under sub-section (1) of Section 148 of the Act in respect of the activitiescarried on by the Company.

(vii) a) According to the records of the company and information and explanations givento us and on the basis of our examination of the records of the company the Company hasgenerally been regular in depositing undisputed statutory dues including Provident Fundemployees state insurance (ESI) Investor Education and Protection Fund Income-tax Taxdeducted at sources Tax collected at source Professional Tax GST Cess and othermaterial statutory dues applicable to it with the appropriate authorities. As explainedto us the company did not have any dues on account of employee's state insurance and dutyof excise:

(b) According to the information and explanations given to us there were no undisputedamounts payable in respect of Provident fund Income-tax Custom Duty sales tax VATGST Cess and other material statutory dues in arrears /were outstanding as at 31 March2019 for a period of more than six months from the date they became payable except ExciseDuty.

(c) According to the information and explanations given to us details of disputedExcise duty which have not been deposited as on 31st March 2019 on account of any disputeare given below:

Name of the statue Nature of Dues Disputed amount pending Period to which the amount relates (Financial Years) Forum whare dispute is pending
Central Excise Act 1944 Central Excise duty Rs. 19551297/- 05/08/2010 to 31/10/2013 Until payment made Appeal against order is pending before CESTAT
Excise duty Penalty Excise duty Interest Rs. 19551297/- Department yet to quantity the interest liability

(viii) In our opinion and according to the information and explanations given to usthe company has not defaulted in the repayment of dues to financial institutions andbanks.

(ix) No money has been raised by way of initial public offer or further public offer(including debt instruments) during the year but Term Loans has been utilized for thepurposes for which they were raised during the year.

(x) To the best of our knowledge and according to the information and explanationsgiven to us no material fraud by the Company and no material fraud on the Company by itsofficers or employees has been noticed or reported during the 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 managerial remuneration has been provided inaccordance with the requisite approvals mandated by the provisions of Sec 197 read withSchedule V to the Act with respect to Managerial Remuneration.

(xii) In our opinion and according to the information and explanations given to us thecompany is not a Nidhi Company. Accordingly clause (xii) of the order is not applicable.

(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 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 under review. Accordingly clause (xiv) of the order is not applicable.

(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 any non-cashtransactions with directors or persons connected with him. Accordingly clause (xv) of theorder is not applicable.

(xvi) The company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

For GRV & PK.
Chartered Accountants
Firm Reg. No. 008099S
Place : Bengaluru Kamal Kishore
Date : 29.05.2019 Partner
Membership No. 205819

ANNEXURE - B TO INDEPENDENT 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 M/s.Sunil Agro Foods Limited ("the Company") as of 31 March 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 (‘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 ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects. Our auditinvolves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system over financialreporting and their operating effectiveness. Ouraudit of internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting the risk that amaterial 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 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 reporting and the regarding the reliability of financialpreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A financial reporting company's internal financialincludes those policies and procedures that (1) pertain to the maintenance of recordsthat 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 generally accepted accounting principles and that receipts and expenditures ofthe company are being made only in accordance with authorisations of management anddirectors of the company; and (3) provide reasonable assurance regarding prevention ortimely detection of unauthorised acquisition use or disposition of the company's assetsthat 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 financial ofcollusion or improper management override of controls material misstatements due to erroror fraud may occur and not be detected. Also projections of any evaluation of the futureinternalfinancial controls over financial reporting to periods are subject to the riskthat the internal financial control over financial because of changes in conditions orthat the degree of compliance with the policies or procedures may deteriorate. Accordingto the information and explanation given to us and based on our audit the followingmaterial weaknesses have been identified as at March 31st 2019.

a) The company does not have appropriate control system over cash handling as somany payments at factory are made in cash this could potentially result in unauthorisedcash payments resulting in fraudulent transactions.

b) The company did not have an appropriate internal control system for obtainingexternal balance confirmation on periodic basis. This could potentially result ininaccurate assets and liabilities disclosed in the books of accounts.

A ‘'material weakness'' is a deficiency or a combination of deficiencies ininternal financial control over financial reporting such that there is a reasonablepossibility that a material misstatement of the company's annual or interimfinancialstatements will not be prevented or detected on a timely basis.

Qualified Opinion

In our opinion except for the effects/possible effects of the material weaknessesdescribed above on the achievement of the objectives of the control criteria theCompany has in all material respects an adequate internal financial controls system overfinancialreporting and such internal financial controls over financial reporting wereoperating effectively as at 31 March 2019 based on the internal control overfinancialreporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia. We have considered the material weaknesses identifiedand reported above indetermining the nature timing and extent of audit tests applied in our audit of theMarch 31 2019 standalone financial statements of the Company and our aforesaid reportand opinion on Internal Financial Control over Financial Reporting should be read inconjunction with our report of even date issued on the standalone financial statements ofthe Company.

For GRV & PK.
Chartered Accountants
reporting including the possibility
Firm Reg. No. 008099S
Place : Bengaluru Kamal Kishore
Date : 29.05.2019 Partner
Membership No. 205819
reporting may become inadequate