Unimers India Ltd.
|BSE: 524264||Sector: Industrials|
|NSE: N.A.||ISIN Code: INE980B01039|
|BSE 00:00 | 04 Mar||Unimers India Ltd|
|NSE 05:30 | 01 Jan||Unimers India Ltd|
|BSE: 524264||Sector: Industrials|
|NSE: N.A.||ISIN Code: INE980B01039|
|BSE 00:00 | 04 Mar||Unimers India Ltd|
|NSE 05:30 | 01 Jan||Unimers India Ltd|
To The Members of Unimers India Limited
1. Report on the Financial Statements
We have audited the accompanying financial statements of Unimers India Limited("the Company") which comprise the Balance Sheet as at 31st March 2016 theStatement of Profit and Loss and the Cash Flow Statement for the year then ended and asummary of the significant accounting policies and other explanatory information.
2. Management's Responsibility for the 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 financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.
3. Auditor's Responsibility
Our responsibility is to express an opinion on these financial statements based on ouraudit.
We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement. An audit involves performingprocedures to obtain audit evidence about the amounts and the disclosures in the financialstatements.
The procedures selected depend on the auditor's judgment including the assessment ofthe risks of material misstatement of the financial statements whether due to fraud orerror. In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the financial statements that give a true andfair view in order to design audit procedures that are appropriate in the circumstances.An audit also includes evaluating the appropriateness of the accounting policies used andthe reasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our qualified audit opinion on the financial statements.
4. Basis of Qualified Opinion
(a) The accumulated losses of the Company as at the year end exceeds its entire networth; however the Company has been advised that since certain conditions as per the SickIndustrial Companies (Special Provisions) Act 1985 were not being met it was noteligible to make a reference to BIFR.
However should the legal status as regards the validity of the closure of the plantchange appropriate steps will have to be taken by the Company in this regard. Moreoverthe plant operations were suspended since October 2007 and thereafter formally closed andworkers retrenched effective from 26th June 2008. These financial statements havehowever been prepared by the management on a "going concern" basis consideringthe various revival/restructuring options being pursued by the management. This being atechnical matter and in view of uncertainty we are unable to express an opinion as towhether the Company can now operate as a going concern. However as explained should theCompany be unable to continue as a going concern there would be impact on the assets& liabilities of the Company. The extent of the effect of the resultant adjustments tothe accumulated losses assets and liabilities as at the year end is presently notascertainable.
(b) We are unable to express an opinion as to when and to what extent the carryingvalue of Building of Rs. 240.64 lacs would be realised (impairment loss) in view of theclosure of all manufacturing activities since October 2007 (subsequently formally closedand workers retrenched effective from 26th June 2008) the impact whereof on the loss forthe year accumulated losses assets and liabilities as at the year end is presently notascertainable.
(c) The accounts of certain lenders aggregating to Rs. 4945.06 lacs (Previous yearRs.4945.06 lacs) Securities application money due for refund of Rs. 75.21 lacs (PreviousYear Rs. 75.21 lacs) Advances from customers of Rs. 385.55 lacs (Previous Year Rs.374.34lacs) Trade Payables of Rs. 887.05 lacs (Previous Year Rs. 712.96 lacs) Bank balances(Dr.) of Rs. 0.27 lacs (Previous Year Rs.0.27 lacs) Loans & Advances recoverable ofRs. 121.58 lacs (Previous Year Rs. 119.65 lacs) being subject to confirmations /reconciliations and adjustments if any having consequential impact on the loss for theyear assets liabilities and accumulated losses as at the close of the year the amountof adjustment if any are as explained by the management presently not ascertainable andtherefore not accounted for.
(d) The Company has not yet deposited long outstanding amount of Rs.164.69 lacs(Previous year Rs.164.69 lacs) to the Investor Education & Protection Fund (IEPF) andconsequential unascertained liability of interest / other charges on the same
(e) Other than stated in para "f" below liability as may arise towardsinterest/compound interest/penalty on delayed/non-payment to certain lenders / tradepayables / statutory / workers dues has not been ascertained and not provided for.
(f) The Company has not provided interest payable of Rs. 613.04 lacs (Previous Year Rs.522.38 lacs) in respect of public debentures Rs. 1922.76 lacs (Previous Year Rs. 1500.86lacs) in respect of secured / unsecured loans and Rs.574.69 lacs (Previous Year Rs. 476.12lacs) in respect of certain other liabilities. As explained the management is indiscussions with the parties concerned in respect of interest payable and is hopeful ofits waiver.
We further report that without considering the matter referred in para4(a) to 4(e)above the effect of which could not be determined had the observation made by us in para4(f) above been considered the loss before tax for the year would have been Rs. 3386.49lacs (as against reported loss of Rs.276.00 lacs) accumulated losses would have been Rs.12869.26 lacs (as against reported figure of Rs.9758.77 lacs) other current liabilitieswould have been Rs 9070.53 lacs (as against reported figure of Rs 5960.04 lacs);PreviousYear loss for the year would have Rs. 2636.57 lacs(as against reported loss of Rs. 137.21lacs) accumulated losses would have been Rs. 11982.13 lacs(as against reported figure ofRs.9482.77 lacs) other current liabilities would have been Rs 8282.55 lacs (as againstreported figure of Rs 5883.19 lacs).
In our opinion and to the best of our information and according to the explanationsgiven to us except for the effects of the matters described in the Basis for QualifiedOpinion paragraph above the aforesaid financial statements give the information requiredby the 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 2016 and its loss and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
(i) As required by the Companies (Auditor's Report) Order(''the Order'') 2016 issuedby the Central Government of India in terms of Section 143 (11) of the Companies Act2013 we give in the 'Annexure A' a statement on the matters specified in paragraphs 3 and4 of the said Order.
(ii) As required by Section 143 (3) of the Act with respect to the adequacy of theinternal financial controls over financial reporting of the Company and the operatingeffectiveness of such controls we give in 'Annexure B' a separate report on the same.
(iii) As required by Section 143 (3) of the Act we further report that:
(a) Except for the effects of the matters described in the Basis for Qualified Opinionparagraph 4(c) above we have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit.
(b) Except for the effects of the matters described in the Basis for Qualified Opinionparagraph 4(b)(d)(e) and (f) above in our opinion proper books of account as requiredby law have been kept by the Company so far as it appears from our examination of thosebooks.
(c) The Balance Sheet the Statement of Profit and Loss and the Cash Flow Statementdealt with by this Report are in agreement with the books of account.
(d) Except for the effects of the matters described in the Basis for Qualified Opinionparagraph 4(b) above in our opinion the aforesaid financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.
(e) On the basis of the written representations received from the directors as on 31stMarch 2016 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2016 from being appointed as a director in terms of Section164 (2) of the Act.
(f) The matters described in the Basis for Qualified Opinion paragraph above in ouropinion may have an adverse effect on the functioning of the Company.
(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 of pending litigations on its financialposition in its financial statements - Refer Note 17 (c) to the financial statements.
(ii) The Company did not have any long-term contracts including derivative 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 except as disclosed in note 4(d) of basis ofQualified Opinion paragraph above.
Annexure referred to in paragraph "Report on Other Legal and RegulatoryRequirements" of our report of even date on the Financial Statements as at and forthe year ended March 31 2016 of Unimers India Limited:
(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) All the fixed assets have been physically verified by the management at the year -end which is reasonable considering the size of the Company and nature of its business. Nomaterial discrepancies were noticed on such verification.
(c) Based on verification and examination of records the title deed of immovableproperties are held in the name of company.
(ii) (a) The inventory has been physically verified by the management at the year-endwhich is considered reasonable having regard to the size of the Company and nature of itsbusiness.
(b) The procedures for physical verification of inventory followed by the managementare reasonable and adequate in relation to the size of the Company and nature of itsbusiness.
(c) The Company is maintaining proper records of inventory. No discrepancies werenoticed on physical verification of inventories as compared to book records.
(iii) During the year the Company has not granted any loans secured or unsecured tocompanies firms or other parties covered in the register maintained under Section 189 ofthe Act.
(iv) The Company has not given any loans made investment issued guarantees andsecurities under the provisions of section 185 and 186 of the Act. Accordingly paragraph3(iv) of the order is not applicable to the Company.
(v) No deposits within the meaning of directives issued by the Reserve Bank of Indiaand Sections 73 to 76 or any other provisions of the Companies Act 2013 and rules framedthereunder have been accepted by the Company.
(vi) Since plant operations have been discontinued from October 2007. Accordinglyparagraph 3(vi) of the order is not applicable to the Company.
(vii) (a) The Company is generally regular in depositing undisputed statutory duesincluding Provident Fund employee's state insurance income tax wealth tax sales taxservice tax duty of customs value added tax and other material statutory dues applicableto the Company with the appropriate authorities during the year. There were no undisputedamount payable on account of the above dues outstanding as on March 31 2016 for a periodof more than six months from the date they became payable except as mentioned below:
* Excluding interest and other charges/penalties as may be leviable owing to delayedpayment of the aforesaid amount.
(b) According to information and explanations given to us there are no dues of incometax sales tax wealth tax service tax custom duty and value added tax during the yearwhich have not been deposited on account of any disputes except the following:
(viii) According to the information and explanations given to us and considering thatloans from financial institutions and Banks have already been assigned to bodies corporate(refer note no. 6 to the Financial Statements). The Company has defaulted in repayment ofdues of Rs. 1478.73 lacs (Previous year Rs. 1478.73 lacs) (last installment due sinceMarch 31 2012) to debenture holders.[Also refer para 4(e) & (f) of the Basis ofQualified opinion paragraph in main report]
(ix) According to the information and explanations given to us the Company has notraised any money by way of initial public offer or further public offer and term loansduring the year.
(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing standards in India andaccording to the information and explanations given to us we have neither come across anyinstance of fraud on or by the Company noticed or reported during the year nor have webeen informed of such case by the management.
(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not paid/provided formanagerial remuneration under provisions of section 197 read with Schedule V to the Act.Accordingly paragraph 3(xi) of the order is not applicable to the Company.
(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) 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 give 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.
(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 non-cashtransactions with directors or persons connected with him under section 192 of the Act.Accordingly paragraph 3(xv) of the Order is not applicable. (xvi) The Company is notrequired to be registered under section 45-IA of the Reserve Bank of India Act 1934.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Act
1. We have audited the internal financial controls over financial reporting of UnimersIndia Limited ("the Company") as of March 31 2016 in conjunction with our auditof Company 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.
3. 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 deemed to be prescribedunder section 143(10) of the Act to the extent applicable to an audit of internalfinancial controls both applicable to an audit of internal financial controls and bothissued by the ICAI. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the 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.
5. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our qualified audit opinion on the Company's internal financialcontrols system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
6. 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:
(a) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(b) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and
(c) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
7. 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.
8. The Company's operations were suspended since October 2007 and thereafter formallyclosed and workers retrenched from June 26 2008 however in respect of minimal activitycarried on by the Company it has in all material respect has established adequateinternal finance control over financial reporting and such internal finance controls wereoperating effectively as on March 31 2016 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.