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Supreme Engineering Ltd.

BSE: 535105 Sector: Metals & Mining
NSE: SUPREMEENG ISIN Code: INE319Z01021
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Supreme Engineering Ltd. (SUPREMEENG) - Auditors Report

Company auditors report

To the Members of

SUPREME ENGINEERING LIMITED

(Formerly Known as Supreme Heatreaters Private Limited)

Report on the Audit of the Ind AS Financial Statement

Opinion

We have audited the accompanying Ind AS Financial Statement of Supreme EngineeringLimited (Formerly known as Supreme Heatreaters Private Limited) ("theCompany") which comprise the Balance Sheet as at March 31 2022 the Statement ofProfit and Loss (including the Statement of Other Comprehensive Income) the Statement ofCash Flows and the Statement of Changes in Equity for the year then ended and notes to theInd AS Financial Statement including a summary of significant accounting policies andother explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS Financial Statement give the information required by theCompanies Act 2013 as amended ("the Act") in the manner so required and give atrue and fair view in conformity with the Ind AS & accounting principles generallyaccepted in India:

a) In the case of the balance sheet of the state of affairs of the Company as at March312022; and

b) In the case of the statement of profit and loss of the loss including othercomprehensive income for the year ended on that date.

c) In the case of the statement of cash flows of the cash flows for the year ended onthat date.

d) In the case of the statement of changes in equity of the changes in equity sharecapital and other equity for the year ended on that date.

Basis for opinion

We have conducted our audit of the Ind AS Financial Statement in accordance with theStandards on Auditing ("SAs") as specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the ‘Auditor'sResponsibilities for the Audit of the Ind AS Financial Statement' section of our report.We are independent of the Company in accordance with the ‘Code of Ethics' issued bythe Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of the Ind AS Financial Statement under the provisions ofthe Act and the Rules thereunder and we have fulfilled our other ethical responsibilitiesin accordance with these requirements and the ICAI Code of Ethics.

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

Emphasis of Matter

We draw attention to the fact that;

• The Corresponding figures are presented and the prior period's financialstatements were audited by a predecessor auditor. The auditor is not prohibited by law orregulation from referring to the predecessor auditor's report on the corresponding figuresand has decided to do so.

• The Company is required to get cost audit conducted as per the requirement ofsection 148 of the Companies Act 2013 however the same has not been conducted.

• The Company had Secured Loans account which has turned NPA on August 2021 andhas stopped servicing the borrowing repayment and interest from that day. The Company hasincurred a net loss of Rs. 908.46 Lakhs during the year ended March 31 2022 and as ofthat date Net worth has reduced by Rs.902.09 Lakhs. The Company's current liabilitiesborrowings have become NPA and Net worth is reduced to Rs. 2834.61 Lakhs from Rs.3736.70Lakhs which has resulted in erosion of the net worth of the company. In spite of theseevents or conditions which may cast a doubt on the ability of the company to continue as agoing concern the management is of the opinion that going concern basis of accounting isappropriate in view of the restructuring in process of the loans and the wide asset basethe company carries.

• The company has not provided for accrued interest charges penalty or any othercharges from the date of becoming classified as Non Performing Assets and the impact ofthe same on the financial result and statement remain unaccounted for.

• The Company is required to file Audit report under the Income tax Act 1961 andfile corresponding Return under the act however the same has not been done for last 3financial years.

• The Company is required to file Audit under the Goods and Service Tax Act andfile corresponding Annual Return and Audit Report however the same has not been done forlast 3 years.

• The Company has not paid the statutory tax dues like TDS PF ESIC and Incometax etc. which has become overdue and remain unpaid. Interest Penalty in respect of thesame has remained unascertained and unaccounted.

• The Company has Trade Receivables including Advances Trade Payables includingAdvances to Suppliers and Others Recoverable Advances in Cash or Kind Borrowings CashCredit account in back etc. includes balances which remain outstanding for a substantialperiod. The reported Financials may have consequential / subsequent impact which remainsunascertained.

• Forensic Audit has been conducted for a period from 01/06/2018 till 30/09/2021the report of the same for the observations is awaited.

Our opinion is not modified in respect of above matters.

Other Information

The Companys Board of Directors is responsible for the other information. The otherinformation comprises the Board of Directors' Report but does not include the Ind ASFinancial Statement and our Auditor's report thereon.

Our opinion on the Ind AS Financial Statement does not cover the other information andwe do not express any form of assurance conclusion thereon.

In connection with our audit of the Ind AS Financial Statement our responsibility isto read the other information and in doing so consider whether such other information ismaterially inconsistent wdth the Ind AS Financial Statement or our knowledge obtained inthe audit or otherwise appears to be materially misstated. 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. We have nothing to report in this regard.

Management's Responsibility for the Ind AS Financial Statement

The Company's Board of Directors is responsible for the matters stated in section134(5) the Act with respect to the preparation of these Ind AS Financial Statement thatgive a true and fair view of the financial position financial performance including othercomprehensive income cash flows and changes in equity of the Company in accordance withthe accounting principles generally accepted in India Indian Accounting Standards (IndAS) specified under Section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended.

This responsibility also includes the maintenance of adequate accounting records inaccordance with the provision of the Act for safeguarding of the assets of the Company andfor preventing and detecting the frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial control that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS Financial Statement that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

In preparing the Ind AS Financial Statement the management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Company's financialreporting process.

Auditor's Responsibilities for the audit of the Ind AS Financial Statement

Our objectives are to obtain reasonable assurance about whether the Ind AS FinancialStatement 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 Ind AS Financial Statement.

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 Ind AS FinancialStatement 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)(0)of Act we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls system in place and the operating effectiveness ofsuch 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 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 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 Ind AS Financial Statement or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date ourauditor's report. However future events or conditions may cause the Company to continueas a going concern.

• Evaluate the overall presentation structure and content of the Ind AS FinancialStatement including the disclosures and whether the Ind AS Financial Statement representthe underlying 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.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors 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 in the paragraph3 and 4 of the order.

2. As required by section 143(3) of Act we:

a) We have reasonably sought and obtained third and explanations which to the best ofour knowledge and belief were necessary 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 the statement of profit and loss including the statement of othercomprehensive income the statement of cash flows and Statement of Changes in Equity dealtwith by this report are in agreement with the books of account.

d) In our opinion the aforesaid Ind AS Financial Statement comply with the IndianAccounting Standards specified under Section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 as amended. Since the Company has become NPAIND AS 23 on Borrowing Cost is not applied.

e) On the basis of written representations received from the directors as on 31 March2021 taken on record by the Board of Directors none of the directors is disqualified ason 31 March 2021 from being appointed as a director in terms of Section 164(2) of theAct;

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".

g) In our opinion the managerial remuneration for the year ended 31st March 2022 hasbeen provided by the Company to its directors in accordance with the provisions of Section197 read with Schedule V of the Act;

h) with respect to the other matters to be included in Auditors Report in accordancewith Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to thebest of our information and according to explanations given to us:

i. The Company does not have any pending litigations which would impact its financialposition;

ii. The Company did not have any long term contracts including derivative contracts forwhich 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 S.R. Dhariwal and Co.

Chartered Accountants

FRN: 102466W

Niral K Saboo

Proprietor

M. No. 158054

UDIN: 22158054AKKROE6914

Date: 7th June 2022

Place: Mumbai.

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