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Union Quality Plastics Ltd.

BSE: 526799 Sector: Industrials
NSE: N.A. ISIN Code: INE338N01019
BSE 00:00 | 12 Aug 6.52 0.31
(4.99%)
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NSE 05:30 | 01 Jan Union Quality Plastics Ltd
OPEN 6.52
PREVIOUS CLOSE 6.21
VOLUME 1
52-Week high 20.00
52-Week low 5.23
P/E
Mkt Cap.(Rs cr) 5
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 6.52
CLOSE 6.21
VOLUME 1
52-Week high 20.00
52-Week low 5.23
P/E
Mkt Cap.(Rs cr) 5
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Union Quality Plastics Ltd. (UNIONQUALPLA) - Auditors Report

Company auditors report

TO The Members Of UNION QUALITY PLASTICS LIMITED

Qualified Opinion:-

1. We have audited the accompanying financial statements of UNION QUALITY PLASTICSLIMITED ("the Company") which comprise the Balance Sheet as at March 31 2021and the Statement of Profit and Loss (including Other Comprehensive Income) the Statementof Changes in Equity and the Statement of Cash Flows for the year then ended and a summaryof the significant accounting policies and other explanatory information In our opinionand to the best of our information and according to the explanations given to us exceptfor the possible effects of the matters described in the Basis for Qualified Opinionparagraph the aforesaid financial statements give the information required by theCompanies Act 2013 ("the Act") in the manner so required and give a true andfair view in conformity with the Indian Accounting Standards prescribed under section 133of the Act read with the Companies (Indian Accounting Standards) Rules 2015 as amended("IND AS") and other accounting principles generally accepted in India of thestate of affairs of the Company as at 31st March 2021 and its profit totalcomprehensive income its cash flows and the changes in equity for the year ended on thatdate.

Basis for Qualified Opinion:-

A. Creditor's Confirmation

The Company's Closing balances of Creditors equals to Rs.157118823 /- .Out of theseCreditors We Received Confirmations from some Creditors which amounts to Rs.69362092/-. We haven't received the confirmations from the Creditors amounting to Rs.87756731/-. And also some of the creditors had filed cases before NCLT against thecompany which are pending for disposal by NCLT.

In the absence of such Confirmations from the Creditors and Pending cases with theNCLT we are not in a position to determine its impact on the Financial Statements andalso the Final Liability towards Such Creditors of the company.

B. Valuation of Inventory:

In our opinion the internal controls in respect of inventory management and valuationof inventory were not properly placed .In the absence of proper internal controls we areunable to comment on the requirement of IND AS-2 with reference to valuation of inventoryat lower of cost or net realizable value.

C. Provision for Gratuity :

No Provision has been made in the books of accounts for gratuity for the year underConsideration. The Management stated that new provision for gratuity for the year is notrequired as the previous year provision is Sufficient.

Basis the aforesaid points and owing to their materiality we are unable to determineany adjustment that may be required in the financial statements of the Company.Accordingly we express an Qualified opinion on the financial results and other financialinformation of the Company. We conducted our audit in accordance with the Standards onAuditing (SAs) specified under Section 143(10) of the Act. Our responsibilities underthose SAs are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Act and the Rules there under and wehave fulfilled our other ethical responsibilities in accordance with these requirementsand the Code of Ethics. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our opinion.

Other Information:-

The Company's Board of Directors are responsible for the other information. The otherinformation comprises the information included in the annual report for exampleManagement Discussion and Analysis Board's Report including Annexures to Board's ReportBusiness Responsibility Report Corporate Governance and Shareholder's Information butdoes not include the financial statements and our auditor's report thereon. The otherinformation as stated above is expected to be made available to us after the date of thisauditor's report.

Our opinion on the financial statements does not cover the other information and we donot express any form of assurance conclusion thereon. In connection with our audit of thefinancial statements our responsibility is to read the other information identified abovewhen it becomes available and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated.

When we read the other information as stated above if we conclude that there is amaterial misstatement therein we are required to communicate the matter to those chargedwith Governance.

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 including other comprehensive income cash flows and changes inequity of the Company in accordance with the Indian Accounting Standards (Ind AS)prescribed under section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended and other accounting principles generally accepted inIndia. 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 financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the financial statements management and Board of Directors areresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

Board of Directors is also responsible for overseeing the Company's financial reportingprocess

Auditors' Responsibility for the Financial Statements:-

2. 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 the economic decisions of users taken on thebasis of these financial statements.

3. Identify and assess the risks of material misstatement of the financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control.

4. Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under Section 143(3)(i) of theAct we are also responsible for expressing our opinion on whether the company hasadequate internal financial controls with reference to financial statements in place andthe operating effectiveness of such controls.

5. Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.

6. 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 financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditors'report.

7. Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.Materiality is the magnitude of misstatements in the financial statements thatindividually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in

(i) planning the scope of our audit work and in evaluating the results of our work; and

(ii) to evaluate the effect of any identified misstatements in the financialstatements.

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. From the matters communicated withthose charged with governance we determine those matters that were of most significancein the audit of the financial statements of the current period and are therefore the keyaudit matters. We describe these matters in our auditors' report unless law or regulationprecludes public disclosure about the matter or when in extremely rare circumstances wedetermine that a matter should not be communicated in our report because the adverseconsequences of doing so would reasonably be expected to outweigh the public interestbenefits of such communication.

Report on Other Legal and Regulatory Requirements:-

8. As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of Indian terms of sub-section (11) of section 143 of the Act ("theOrder") and on the basis of such checks of the book sand records of the Company aswe considered appropriate and according to the information and explanations given to uswe give in the Annexure B a statement on the matters specified in paragraph 3 and 4 of theOrder.

9. As required by Section 143 (3)of the Act we report that:

a. We have sought and obtained Except for the matters discussed in the basis ofQualified Opinion Paragraph all the information and explanations which to the best of ourknowledge and belief were necessary for the purposes of our audit.

b. Except for the possible effects of the matters discussed in the basis of QualifiedOpinion Paragraph in our opinion proper books of accounts required by law have been keptby the Company 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 Cash Flow Statement and the Statement of Changes in Equity dealt with by thisReport are in agreement with the books of accounts.

d. Except for the possible effects of matters discussed in the basis of QualifiedOpinion Paragraph in our opinion the aforesaid Ind AS financial statements comply withthe Indian Accounting Standards specified under Section 133 of the Act.

e. On the basis of the written representations received from the directors as on March31 2021 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 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 with reference tofinancial statements of the Company and the operating effectiveness of such controlsrefer to our separate Report in Annexure-A.

g. With respect to the other matters to be including the Auditors' Report in accordancewith Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to thebest of our knowledge and belief and according to the information and explanations givento us:

i. The Company has disclosed the impact if any of pending litigations as at March 312021 on its financial position in its Ind AS financial statements.

ii. The Company has not made provision as at March 31 2021 as required under theapplicable law or accounting standards.

h. With respect to the matter to be included in the Auditors' Report under section197(16) of the Act as amended in our opinion and to the best of our information andaccording to the explanations given to us the company has not provided/paid theremuneration to its directors during the year hence the provisions of the section 197 ofthe Act is not applicable.

Annexure A to the Auditors' Report

Annexure referred to in paragraph 1 under the heading of "Report on Other Legaland Regulatory Requirements" of our report of even date we report that:

(i) In respect of Fixed Assets

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

(b) The fixed assets have been physically verified by the management at reasonableintervals; we are informed that no material discrepancies were noticed on suchverification.

(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) In respect of its inventory:

In our opinion Physical verification in respect of inventory and valuation of inventorywere conducted by the management but not properly documented.

(iii) The Company has not granted any loans secured or unsecured to companies firmsor other Parties covered in the register maintained under section 189 of the CompaniesAct. Thus Clause 3(iii) (a)(b) and (c) of the Order are not applicable to the company.

(iv) In our opinion and according to the information and explanations given to us thecompany has not made investments and loans hence provisions of section 185 and 186 of theCompanies act order is not applicable.

(v) According to the information and explanations given to us the company had notaccepted any Public deposits within the meaning of sections 73 to 76 or any otherrelevant provisions of the Companies Act and the rules framed there under . Thereforeprovisions of clause (v) of paragraph 3 of the report is not applicable to the company

(vi) In respect of business activities of the company maintenance of cost records hasnot been specified by the central government under section 148(1) of the companies Act2013.

(vii) (a) According to the information and explanations given to us the company isgenerally regular in depositing undisputed statutory dues including provident fundemployees' state insurance income-tax sales-tax service tax duty of excise valueadded tax cess and any other statutory dues with the appropriate authorities and noundisputed outstanding statutory dues as at the last day of the financial year concernedare in arrears for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us there are no dues ofincome tax or sales tax or wealth tax or service tax or duty of customs or duty of exciseor value added tax or cess that have not been deposited on account of any dispute.

(viii) Based on our Audit procedures and on the information and explanations given bythe management we are of the opinion that the company has not defaulted in repayment ofdues to a financial institutions banks or debenture holders.

(ix) In our opinion and according to the information and explanations given to usmonies raised by way of the term loans during the year have been applied by the Companyfor the purposes for which they were raised.

(x) According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe 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 Company has provided for managerialremuneration in accordance with the provisions of Section 197 of Companies Act.

(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 us theCompany's transactions with its related party are in compliance with Sections 177 and 188of the Companies Act 2013 where applicable and details of related party transactionshave been disclosed in the financial statements etc. 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.

(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. Accordingly paragraph 3(xv) ofthe Order is not applicable.

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

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

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 UNIONQUALITY PLASTICS LIMITED ("the Company") as of March 31 2021 in conjunctionwith our audit of the financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the internal financial controls overfinancial reporting of the Company based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") issued by the Institute of

Chartered Accountants of India and the Standards on Auditing prescribed under Section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls. 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.

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 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 regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that

(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

(2) 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

(3) 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

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 to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2021 except for the matter prescribedin basis of qualified opinion para 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 NSVR ASSOCIATES& LLP
Chartered Accountants
(Firms' Registration No. 008801S/S200060)
VenkataRatnam P
Partner
(Membership No. 230675)
UDIN:21230675AAAAJX8558
Place: Hyderabad
Date: 30-06-2021

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