You are here » Home » Companies » Company Overview » Tata Steel Long Products Ltd

Tata Steel Long Products Ltd.

BSE: 513010 Sector: Metals & Mining
NSE: TATASTLLP ISIN Code: INE674A01014
BSE 12:01 | 27 Jan 707.20 -10.50
(-1.46%)
OPEN

740.00

HIGH

740.00

LOW

707.20

NSE 11:54 | 27 Jan 711.15 -7.30
(-1.02%)
OPEN

715.00

HIGH

718.75

LOW

707.05

OPEN 740.00
PREVIOUS CLOSE 717.70
VOLUME 3506
52-Week high 1174.55
52-Week low 571.00
P/E 3.43
Mkt Cap.(Rs cr) 3,189
Buy Price 707.15
Buy Qty 6.00
Sell Price 707.70
Sell Qty 2.00
OPEN 740.00
CLOSE 717.70
VOLUME 3506
52-Week high 1174.55
52-Week low 571.00
P/E 3.43
Mkt Cap.(Rs cr) 3,189
Buy Price 707.15
Buy Qty 6.00
Sell Price 707.70
Sell Qty 2.00

Tata Steel Long Products Ltd. (TATASTLLP) - Auditors Report

Company auditors report

To the Members of Tata Steel Long Products Limited (formerly Tata Sponge Iron Limited)

Report on the Audit of the Standalone Financial Statements

Opinion

1. We have audited the accompanying Standalone Financial Statements of Tata Steel LongProducts Limited ("the Company") which comprise the Balance Sheet as at March31 2021 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 Standalone Financial Statements including a summary of significantaccounting policies and other explanatory information (hereinafter referred to as"the Standalone Financial Statements").

2. 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 ("the Act") in the manner so required and give a trueand fair view in conformity with the accounting principles generally accepted in India ofthe state of affairs of the Company as at March 31 2021 its total comprehensive income(comprising profit and other comprehensive income) its changes in equity and its cashflows for the year then ended.

Basis for opinion

3. We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditor's responsibilities for the Audit of the Standalone FinancialStatements section of our report. We are independent of the Company in accordance with theCode of Ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the Standalone Financial Statementsunder the provisions of the Act and the Rules 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

4. Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Standalone Financial Statements of the current year.These matters were addressed in the context of our audit of the Standalone FinancialStatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters.

Key Audit Matter How our audit addressed the key audit matter
Recovery of expenses and related disclosures of contingent liabilities for Radhikapur (East) Coal Block [Refer to Note 33(d) to the Standalone Financial Statements] As at March 31 2021 the Company has financial exposure in books aggregating `178.81 Crores incurred in earlier years on the Radhikapur (East) Coal Block which was deallocated pursuant to the Order of the Hon'ble Supreme Court of India in 2014. Our audit procedures included the following:
The Coal Mines (Special Provisions) Rules 2014 and subsequent amendments thereto promulgated pursuant to the aforesaid Order prescribes that the prior allottee (i.e. the Company) shall be compensated for the expenses incurred towards land and mine infrastructure. During the year the Ministry of Coal (MoC) has carried out an auction of the coal block and the coal block has been re-allotted to a successful bidder. The Company is awaiting directions from MoC on the determination of just fair and adequate compensation in respect of the aforesaid amounts incurred. The Company expects to recover such expenses in due course. • Evaluation of the design and testing of operating effectiveness of the controls implemented by the management to assess the recoverability of expenses incurred towards Radhikapur (East) Coal Block and related disclosures in the Standalone Financial Statements.
• Obtained an updated understanding of the basis of the management's judgement including discussion with the Company's inhouse and external legal counsel.
• Tested a sample of expenses incurred on the coal block.
• Considered the external legal opinion obtained by the management to understand the status and the management's assessment of the likely outcome of the on-going litigation.
• Obtained evidence supporting the on-going discussions of the Company with the MoC/ Nominated Authority of MoC and the allotment to the successful bidder.
Further as stated in Note 33(d)(ii) the MoC had also issued notice Based on the above work performed we found the management's for invocation of the bank guarantee of `32.50 Crores towards delay judgement on assessment of recoverability of the related expenses in achieving the milestones towards the development of the coal incurred and the disclosure of the contingent liability in respect of block. The Company is contesting the matter that the delay is not performance guarantee for coal block allocation to be reasonable.
attributable to the Company. Pending finalisation of the matter the amount of bank guarantee has been disclosed as contingent liability.
This is considered to be a key audit matter as significant judgements are involved regarding recoverability of the aforesaid amounts incurred and possible obligation related to bank guarantee that is subject to decision/approvals of the regulatory authorities.

Other Information

5. The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information in the Corporate Profile and the Director's Reportalong with the Annexures to the Director's Report included in the Company's annual report(titled as Tata Steel Long Products Limited Integrated Report & Annual Accounts2020-21) but does not include the financial statements and our auditor's report thereon.

Our opinion on the Standalone Financial Statements does not cover the other informationand we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Financial Statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the Standalone Financial Statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated. If based on thework we have performed we conclude that there is a material misstatement of this otherinformation we are required to report that fact. We have nothing to report in thisregard.

Responsibilities of management and those charged with governance for the StandaloneFinancial Statements

6. The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these Standalone Financial Statementsthat give a true and fair view of the financial position financial performance changesin equity and cash flows of the Company in accordance with the accounting principlesgenerally accepted in India including the Accounting Standards specified under section133 of the Act. This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding of the assets of theCompany and for preventing and detecting 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 controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Standalone Financial Statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

7. In preparing the Standalone Financial Statements 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. The Board of Directors is also responsible foroverseeing the Company's financial reporting process.

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

8. 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.

9. As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the StandaloneFinancial Statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• 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 Act we are also responsible for expressing our opinion on whether the Companyhas adequate internal financial controls with reference to Standalone Financial Statementsin place and the operating effectiveness 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 Standalone Financial Statements or if such disclosures are inadequate to modify ouropinion. 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 StandaloneFinancial Statements including the disclosures and whether the Standalone FinancialStatements represent the underlying transactions and events in a manner that achieves fairpresentation.

10. We communicate with those charged with governance regarding among other mattersthe planned scope and timing of the audit and significant audit findings including anysignificant de_ciencies in internal control that we identify during our audit.

11. We also provide those charged with governance with a statement that we havecomplied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may reasonably be thought to bear onour independence and where applicable related safeguards. 12. From the matterscommunicated with those charged with governance we determine those matters that were ofmost significance in the audit of the Standalone Financial Statements of the current yearand are therefore the key audit matters. We describe these matters in our auditor's reportunless law or regulation precludes public disclosure about the matter or when inextremely rare circumstances we determine that a matter should not be communicated in ourreport because the adverse consequences of doing so would reasonably be expected tooutweigh the public interest benefits of such communication.

Report on other legal and regulatory requirements

13. As required by the Companies (Auditor's Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the Annexure B a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.

14. As required by Section 143(3) of the Act we report that: (a) We have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purposes of our audit. (b) In our opinion proper books ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books. (c) The Balance Sheet the Statement of Profit and Loss(including other comprehensive income) the Statement of Changes in Equity and theStatement of Cash Flows dealt with by this Report are in agreement with the books ofaccount.

(d) In our opinion the aforesaid Standalone Financial Statements comply with theAccounting Standards specified under Section 133 of the Act.

(e) On the basis of the written representations received from the directors taken onrecord by the Board of Directors none of the directors is disqualified as on March 312021 from being appointed as a director in terms of Section 164 (2) of the Act.

(f) With respect to the adequacy of the internal financial controls with reference tofinancial statements of the

Company and the operating effectiveness of such controls refer to our separate Reportin "Annexure A".

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

i. The Company has disclosed the impact if any of pending litigations as at March 312021 on its financial position in its Standalone Financial Statements – Refer Note 33to the Standalone Financial Statements;

ii. The Company has long-term contracts as at March 31 2021 for which there were nomaterial foreseeable losses. The Company did not have long term derivative contracts.Refer Note 46 to the Standalone Financial Statements.

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company during the year ended March 312021 except for amounts aggregating to `0.06 crores which according to the informationand explanations provided by the management is held in abeyance due to pending legalcases. Refer Note 47 to the Standalone Financial Statements. iv. The reporting ondisclosures relating to Specified Bank Notes is not applicable to the Company for the yearended March 31 2021.

15. The Company has paid/ provided for managerial remuneration in accordance with therequisite approvals mandated by the provisions of Section 197 read with Schedule V to theAct.

ANNEXURE A TO INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 14(f) of the Independent Auditors' Report of even date to themembers of Tata Steel Long Products Limited (formerly Tata Sponge Iron Limited) on theStandalone Financial Statements for the year ended March 31 2021

Report on the Internal Financial Controls with reference to the Standalone FinancialStatements under Clause (i) of Sub-section 3 of Section 143 of the Act

1. We have audited the internal financial controls with reference to StandaloneFinancial Statements of Tata Steel Long Products Limited ("the Company") as ofMarch 31 2021 in conjunction with our audit of the Standalone Financial Statements of theCompany for the year ended on that date.

Management's Responsibility for Internal Financial Controls

2. 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). 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 Act.

Auditors' Responsibility

3. Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to Standalone Financial Statements based on our audit. Weconducted our audit in accordance with the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting (the "Guidance Note") and the Standards onAuditing deemed to be prescribed under section 143(10) of the Act to the extent applicableto an audit of internal financial controls both applicable to an audit of internalfinancial controls and both issued by the ICAI. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls with reference toStandalone

Financial Statements was established and maintained and if such controls operatedeffectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the internal financial controls system with reference to Standalone FinancialStatements and their operating effectiveness. Our audit of internal financial controlswith reference to Standalone Financial Statements included obtaining an understanding ofinternal financial controls with reference to Standalone Financial Statements assessingthe risk that a material weakness exists and testing and evaluating the design andoperating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgement including the assessment of the risks ofmaterial misstatement of the Standalone Financial Statements whether due to fraud orerror.

5. 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 Standalone Financial Statements.

Meaning of Internal Financial Controls with reference to financial statements

6. A company's internal financial controls with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial controlswith reference to financial statements includes those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.

Inherent Limitations of Internal Financial Controls with reference to the financialstatements

7. 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 controls 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

8. In our opinion the Company has in all material respects an adequate internalfinancial controls system with reference to Standalone Financial Statements and suchinternal financial controls with reference to Standalone Financial Statements wereoperating effectively as at March 31 2021 based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India.

For Price Waterhouse & Co Chartered Accountants LLP

Firm Registration Number: 304026E/ E-300009 Chartered Accountants

Pinaki Chowdhury
Partner
Kolkata Membership Number: 057572
April 20 2021 UDIN: 21057572AAAAAM7193

ANNEXURE B TO INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 13 of the Independent Auditors' Report of even date to themembers of Tata Steel Long Products Limited (formerly Tata Sponge Iron Limited) on theStandalone Financial Statements as of and for the year ended March 31 2021 i. (a) TheCompany is maintaining proper records showing full particulars including quantitativedetails and situation of fixed assets.

(b) The fixed assets of the Company are physically verified by the Management accordingto a phased programme designed to cover all the items over a period of three years whichin our opinion is reasonable having regard to the size of the Company and the nature ofits assets. Pursuant to the programme a portion of the fixed assets has been physicallyverified by the Management during the year and no material discrepancies have been noticedon such verification.

(c) The title deeds of immovable properties as disclosed in Note 3 on Property Plantand Equipment and Note 4 on Right-of-use assets to the standalone financial statementsare held in the name of the Company except for the following immovable propertiesacquired pursuant to the business acquisition as stated in Notes 3.01 and 4 (e)respectively to the standalone financial statements whose title deeds are not held in theCompany's name:

Particulars Gross Block Net Block
(Rs.in crores) (Rs.in crores)
Freehold Land 77.35 77.35
Building 0.71 0.52
Leasehold Land 0. 87 0.81
Leasehold Building 3.30 3.15

ii. The physical verification of inventory (excluding stocks with third parties) havebeen conducted at reasonable intervals by the Management during the year. In respect ofinventory lying with third parties these have substantially been confirmed by them. Thediscrepancies noticed on physical verification of inventory as compared to book recordswere not material. iii. The Company has not granted any loans secured or unsecured tocompanies firms Limited Liability Partnerships or other parties covered in the registermaintained under Section 189 of the Act. Therefore the provisions of Clause 3(iii)(iii)(a) (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 185 and 186 of the Companies Act 2013in respect of the loans and investments made and guarantees and security provided by itas applicable. v. The Company has not accepted any deposits from the public within themeaning of Sections 73 74 75 and 76 of the Act and the Rules framed there under to theextent notified. vi. Pursuant to the rules made by the Central Government of India theCompany is required to maintain cost records as specified under Section 148(1) of the Actin respect of its products.

We have broadly reviewed the same and are of the opinion that prima facie theprescribed accounts and records have been made and maintained. We have not however madea detailed examination of the records with a view to determine whether they are accurateor complete. vii. (a) According to the information and explanations given to us and therecords of the Company examined by us in our opinion the Company is generally regular indepositing undisputed statutory dues in respect of provident fund (also refer remarksbelow) though there has been a slight delay in a case and is regular in depositingundisputed statutory dues including income taxes employees' state insurance sales taxservice tax duty of customs duty of excise value added tax cess goods and service taxand other material statutory dues as applicable with the appropriate authorities. Alsorefer note 37.03 to the financial statements regarding management's assessment on certainmatters relating to provident fund. Further for the period April 1 2020 to April 302020 the Company has paid Goods and Service Tax and filed Form GSTR 3B after the due datefor one registration but within the timelines allowed by the Central Board of IndirectTaxes and Customs under the Notification Number 31/2020 dated April 3 2020 on fulfilmentof conditions specified therein.

(b) According to the information and explanations given to us and the records of theCompany examined by us there are no dues of service tax and goods and service tax as atMarch 31 2021 which have not been deposited on account of any dispute. The particularsof dues of Income -tax sales tax duty of customs duty of excise and value added tax asat March 31 2021 which have not been deposited on account of a dispute are as follows:

Name of the statute Nature of dues Amount (Rs.crores) Period to which the amount relates Forum where is the dispute pending
Income Tax Act 1961 Income tax 6.40 2014-15 Commissioner of Income
2015-16 Tax (Appeals)
Income Tax Act 1961 Income tax 2.21 2013-14 Income Tribunal Tax Appellate
Central Sales Tax Act 1957 Sales Tax 0.67 2005-06 High Court of Orissa
Central Sales Tax Act 1957 Sales Tax 0.06 1987-88 1992-93 1993-94 1998-99 Deputy Commissioner of Commercial Taxes
Orissa Sales Tax Act 1947 Sales Tax 0.02 1992-93 2000-01 Assistant Commissioner of Sales Tax
Orissa Sales Tax Act 1947 Sales Tax 0.06 1987-88 1989-90 1990-91 1988-89 Deputy Commissioner of Commercial Taxes
Customs Act 1962 Customs Duty 33.11 2012-13 Customs Excise and Service Tax Appellate Tribunal
Customs Act1962 Custom Duty 0.34 2019-20 Commissioner Appeals Customs
The Central Excise Act 1944 Excise Duty 2.05 2011-12 Customs Excise and Service Tax Appellate Tribunal
The Central Excise Act194 Excise Duty ** 2019-20 Commissioner Appeals GST & Central Excise
Orissa Value Added Tax Act 2004 Value Added Tax 0.07 2005-06 Commissioner of Commercial Taxes

**Amount below rounding off norm adopted in report.

viii. According to the records of the Company examined by us and the information andexplanations given to us the Company has not defaulted in repayment of loans orborrowings to any financial institution or bank or Government or dues to debentureholders as applicable as at the balance sheet date.

ix. In our opinion and according to the information and explanations given to us themoneys raised by way of term loans have been applied for the purposes for which they wereobtained. The Company has not raised any moneys by way of initial public offer and furtherpublic offer (including debt instruments).

x. During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.

xi. The Company has paid/ provided for managerial remuneration in accordance with therequisite approvals mandated by the provisions of Section 197 read with Schedule V to theAct. Also refer paragraph 15 of our main audit report.

xii. As the Company is not a Nidhi Company and the Nidhi Rules 2014 are not applicableto it the provisions of Clause 3(xii) of the Order are not applicable to the Company.

xiii. The Company has entered into transactions with related parties in compliance withthe provisions of Sections 177 and 188 of the Act. The details of related partytransactions have been disclosed in the financial statements as required under IndianAccounting Standard (Ind AS) 24 Related Party Disclosures specified under Section 133 ofthe Act.

xiv. The Company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year under review. Accordingly theprovisions of Clause 3(xiv) of the Order are not applicable to the Company.

xv. The Company has not entered into any non-cash transactions with its directors orpersons connected with him. Accordingly the provisions of Clause 3(xv) of the Order arenot applicable to the Company.

xvi. The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934. Accordingly the provisions of Clause 3(xvi) of the Order are notapplicable to the Company.

For Price Waterhouse & Co Chartered Accountants LLP

Firm Registration Number: 304026E/ E-300009 Chartered Accountants

Pinaki Chowdhury
Partner
Kolkata Membership Number: 057572
April 20 2021 UDIN: 21057572AAAAAM7193

.