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Ugar Sugar Works Ltd.

BSE: 530363 Sector: Agri and agri inputs
NSE: UGARSUGAR ISIN Code: INE071E01023
BSE 10:53 | 25 Mar 15.70 -0.55
(-3.38%)
OPEN

15.80

HIGH

16.25

LOW

15.70

NSE 10:44 | 25 Mar 15.95 -0.20
(-1.24%)
OPEN

16.20

HIGH

16.25

LOW

15.65

OPEN 15.80
PREVIOUS CLOSE 16.25
VOLUME 7699
52-Week high 20.85
52-Week low 11.08
P/E
Mkt Cap.(Rs cr) 177
Buy Price 15.70
Buy Qty 450.00
Sell Price 15.90
Sell Qty 104.00
OPEN 15.80
CLOSE 16.25
VOLUME 7699
52-Week high 20.85
52-Week low 11.08
P/E
Mkt Cap.(Rs cr) 177
Buy Price 15.70
Buy Qty 450.00
Sell Price 15.90
Sell Qty 104.00

Ugar Sugar Works Ltd. (UGARSUGAR) - Auditors Report

Company auditors report

Independent Auditors’ Report

To the members of

The Ugar Sugar Works Limited

Report on the Financial Statements

We have audited the accompanying Ind AS financial statements of The Ugar Sugar WorksLimited ("the Company") which comprise the Balance Sheet as at 31st March 2018and the Statement of Profit and Loss (including Other Comprehensive Income) the Statementof Cash Flow and the Statement of Changes in Equity for the year then ended and a summaryof the significant accounting policies and other explanatory information (hereinafterreferred to as "the Ind AS financial statements").

Management’s Responsibility for the Ind AS Financial Statement

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 Ind AS financial statements that give a true and fair view of the financialposition financial performance including other comprehensive income cash flows andchanges in equity of the Company in accordance with the accounting principles generallyaccepted in India including the Indian Accounting Standards (Ind AS) prescribed underSection 133 of the Act.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the Ind ASfinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error

Auditor’s Responsibility

Our responsibility is to express an opinion on these Ind AS financial statements basedon our audit.

In conducting our audit we have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit of the Ind AS financial statements in accordance with theStandards on Auditing specified under Section 143(10) of the Act. Those Standards requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the Ind AS financial statements are free from materialmisstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the Ind AS financial statements. The procedures selected depend on theauditor’s judgment including the assessment of the risks of material misstatement ofthe Ind AS financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to theCompany’s preparation of the Ind AS financial statements that give a true and fairview in order to design audit procedures that are appropriate in the circumstances. Anaudit also includes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company’s Directors as wellas evaluating the overall presentation of the Ind AS financial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our audit opinion on the Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS financial statements give the information required bythe Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at 31st March 2018 and its loss total comprehensive loss its cash flows and thechanges in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. 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 A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act based on our audit we report to theextent applicable 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 Cash Flow and Statement of Changes in Equity dealt with by thisReport are in agreement with the relevant books of account.

d. In our opinion the aforesaid Ind AS financial statements comply with the IndianAccounting Standards prescribed under section 133 of the Act. e. On the basis of thewritten representations received from the directors as on 31st March 2018 taken on recordby the Board of Directors none of the directors is disqualified as on 31st March 2018from 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 over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company’s internal financial controlsover 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 on its financialposition in its Ind AS financial statements – Refer Note D-1 to Ind AS financialstatements;

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 required to be transferred tothe Investor Education and Protection Fund by the Company

For Kirtane & Pandit LLP
Chartered Accountants
Firm Reg. No. 105215W / W100057
Parag Pansare
Place : Pune Partner
Date : 25-05-2018 Membership No: 117309

Annexure "A" to the Independent Auditor’s Report

(Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements’ section of our report of even date)

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of property plant and equipment.

(b) The Company has a program of verification of property plant and equipment to coverall the items in a phased manner over a period of three years which in our opinion isreasonable having regard to the size of the Company and the nature of its assets. Pursuantto the program certain property plant and equipment were physically verified by themanagement during the year. According to the information and explanations given to us nomaterial 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) The inventory has been physically verified at reasonable intervals by theManagement and no material discrepancies were noticed on such verification. In ouropinion the frequency of verification is reasonable and adequate considering the size ofthe Company and the nature of its business.

(iii) The Company has not granted any loans secured or unsecured to Companies FirmsLimited Liability Partnerships or other parties covered in the register maintained underSection 189 of the Companies Act. Accordingly paragraph 3(iii) of the Order is notapplicable.

(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 Act in respect ofloans investments guarantees and security.

(v) According to information and explanation given to us the Company has not acceptedany deposits from public. Accordingly the reporting under Clause 3(v) of the Companies(Auditor’s Report) Order 2016 is not applicable.

However 2 (Two) public depositors have not claimed their deposits after maturity as on31st March 2018 and the amount outstanding as on that date was Rs.2.62 Lakhs. Theseamounts are lying with the Company as there is litigation amongst the heirs about the trueownership of the deposits. As informed to us they will be paid as soon as the court orderis received.

(vi) The Central Government has specified maintenance of cost records under Sub-Section(1) of Section 148 of the Act and we are of the opinion that prima facie such accounts andrecords are made and maintained. We have not however made a detailed examination of therecords with a view to determine whether they are accurate or complete.

(vii) (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted/ accrued in the books ofaccount in respect of undisputed statutory dues including Provident Fund Income TaxSales Tax Value Added Tax Duty of Customs Duty of Excise Service Tax Goods &Service Tax Cess and any other material statutory dues have been generally regulardepositing during the year by the Company with appropriate authorities.

According to the information and explanations given to us no undisputed amountspayable in respect of statutory dues were in arrears as at 31st March 2018 for a periodof more than six months from the date they became payable.

Details of dues of Income-tax Service Tax Customs Duty Excise Duty and Value AddedTax which have not been deposited as on 31st March 2018 on account of disputes are givenbelow:

Sl Name of Statute Nature of Dues Amount Rs. Lakh Period to which the amount relates Forum where dispute is pending
1 Central Excise Act Central Excise 14.61 2006-07 CESTAT Bangalore
2 Central Excise Act Central Excise 45.84 2007-08 CESTAT Bangalore
3 Central Excise Act Central Excise 15.36 2008-09 CESTAT Bangalore
4 Central Excise Act Central Excise 3.03 2010-11 CESTAT Bangalore
5 Central Excise Act Central Excise 151.34 2008-13 CESTAT Bangalore
6 Central Excise Act Central Excise 26.65 2012-13 Asst. Commissioner of
Central Excise Belagavi
7 Central Excise Act Central Excise 4.92 2010-12 Commissioner of Central
Excise (Appeals) Mysore
8 Central Excise Act Central Excise 16.38 2014 Commissioner of Central
Excise (Appeals) Mysore
9 Central Excise Act Central Excise 19.14 2014-15 Commissioner of Central
Excise (Appeals) Mysore
10 Central Excise Act Central Excise 159.07 2015 Commissioner of Central
Excise (Appeals) Mysore
11 Central Excise Act Central Excise 0.96 2015 Commissioner of Central
Excise (Appeals) Mysore
12 Central Excise Act Central Excise 30.09 2015 Commissioner of Central
Excise (Appeals) Mysore
13 Central Excise Act Central Excise 1.30 2015 Commissioner of Central
Excise (Appeals) Mysore
14 Central Excise Act Central Excise 2.45 2016 Superintendent of CGST
and Central Excise(Tech)
Belgaum Rural Division
Belgaum
15 Central Excise Act Central Excise 0.18 2016 Superintendent of Central
Excise Range-II Nippani
16 Income Tax Act 1961 Income Tax 189.53 AY 2012-13 Income Tax Appellate
Authority Pune
17 Income Tax Act 1961 Income Tax 9.27 AY 2014-15 Income Tax Appellate
Authority Pune
18 Karnataka Tax on Commercial Tax 20.14 FY 2011-12 Commissioner of
Entry of Goods Act Commercial Taxes
1979 (Appeals) Belagavi

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of loans or borrowings to financialinstitutions banks and government. The Company has not issued any debentures.

(ix) In our opinion and according to the information and explanations given to us theterm loans taken by the Company have been applied for the purpose for which they wereraised. The Company has not raised money by way of further public offer (including debtinstruments) during the year.

(x) According to the information and explanations given to us no fraud by the Companyor on the Company by its officers or employees has been noticed or reported during theyear.

(xi) In our opinion and according to the information and explanations given to us theCompany has paid/ provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly paragraph 3(xii) of the Order is notapplicable.

(xiii) In our opinion and according to the information and explanations given to usthe Company is in compliance with Section 177 and 188 of the Companies Act 2013 whereapplicable for all transactions with the related parties and the details of related partytransactions have been disclosed in the Ind AS financial statements as required by theapplicable accounting standards.

(xiv) During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures and hence reporting underparagraph 3(xiv) of the Order is not applicable to the Company.

(xv) In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any non-cash transactions with itsdirectors or persons connected with him. Accordingly paragraph 3(xv) of the Order is notapplicable.

(xvi) In our opinion the Company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934 and accordingly the provisions of clause 3(xvi) ofthe Order are not applicable to the Company and hence not commented upon.

For Kirtane & Pandit LLP
Chartered Accountants
Firm Reg. No. 105215W / W100057
Parag Pansare
Place : Pune Partner
Date : 25-05-2018 Membership No: 117309

"Annexure - B" to the Independant Auditors' Report

(Referred to in paragraph 2(f) under ‘Report on Other Legal and RegulatoryRequirements’ section of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of The UgarSugar Works Limited ("the Company") as of 31st March 2018 in conjunction withour audit of the Ind AS financial statements of the Company for the year ended on thatdate.

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 Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants of India.These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to Company’s policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

Auditor’s 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 issued by the Institute of Chartered Accountants of India and theStandards on Auditing prescribed under Section 143(10) of the Companies Act 2013 to theextent applicable to an audit of internal financial controls. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor’s judgement including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company’s internal financial controlssystem over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A Company’s internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A Company’s internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the Company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the Company are being made only in accordance with authorisations ofmanagement and directors of the Company; and (3) provide 64 2 reasonable assuranceregarding prevention or timely detection of unauthorised acquisition use or dispositionof the Company’s assets that could have a material effect on the financialstatements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the company has in all material aspects an adequate financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2018 except that there is scope forimprovement in certain areas which require strengthening of controls established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India. We have considered these weaknessesidentified in determining the nature timing and extent of audit tests applied in ouraudit of the March 31 2018 standalone financial statements of the Company and theseweaknesses do not affect our opinion on the financial statements of the company.

For Kirtane & Pandit LLP
Chartered Accountants
Firm Reg. No. 105215W / W100057
Parag Pansare
Place : Pune Partner
Date : 25-05-2018 Membership No: 117309