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UPL Ltd.

BSE: 512070 Sector: Agri and agri inputs
NSE: UPL ISIN Code: INE628A01036
BSE 16:01 | 15 Nov 765.00 5.05
(0.66%)
OPEN

760.00

HIGH

770.00

LOW

757.00

NSE 15:54 | 15 Nov 763.65 3.40
(0.45%)
OPEN

761.95

HIGH

769.95

LOW

756.00

OPEN 760.00
PREVIOUS CLOSE 759.95
VOLUME 105062
52-Week high 830.00
52-Week low 537.90
P/E 75.07
Mkt Cap.(Rs cr) 38,965
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 760.00
CLOSE 759.95
VOLUME 105062
52-Week high 830.00
52-Week low 537.90
P/E 75.07
Mkt Cap.(Rs cr) 38,965
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

UPL Ltd. (UPL) - Auditors Report

Company auditors report

To the Members of UPL Limited

Report on the Audit of the Standalone Ind AS Financial Statements

We have audited the accompanying Standalone Ind AS financial statementsof UPL Limited ("the Company") which comprise the Balance Sheet as at 31 March2018 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Changes in Equity and Statement of Cash Flows for the year then ended and asummary of the significant accounting policies and other explanatory information (hereinafter referred to as "Standalone Ind AS financial statements").

Management's Responsibility for the Standalone Ind AS FinancialStatements

The Company's Board of Directors is responsible for the mattersstated in Section 134(5) of the Companies Act 2013 ("the Act") with respect tothe preparation of these Standalone Ind AS financial statements that give a true and fairview of the state of affairs profit (including other comprehensive income) changes inequity and cash flows of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) prescribedunder section 133 of the Act.

This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding 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 Ind AS financial statements that give a true and fair view and are freefrom material misstatement whether due to fraud or error.

In preparing the Standalone Ind AS financial statements management isresponsible 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.

Auditors' Responsibility

Our responsibility is to express an opinion on these Standalone Ind ASfinancial statements based on our audit.

We have taken into account the provisions of the Act the accountingand auditing standards and matters which are required to be included in the audit reportunder the provisions of the Act and the Rules made thereunder.

We conducted our audit of the Standalone Ind AS financial statements inaccordance with the Standards on Auditing specified under Section 143(10) of the Act.Those Standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the Standalone Ind AS financialstatements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence aboutthe amounts and the disclosures in the standalone Ind AS financial statements. Theprocedures selected depend on the auditor's judgment including the assessment of therisks of material misstatement of the standalone Ind AS financial statements whether dueto fraud or error. In making those risk assessments the auditor considers internalfinancial control relevant to the Company's preparation of the standalone Ind AS financialstatements that give a true and fair view in order to design audit procedures that areappropriate in the circumstances. An audit also includes evaluating the appropriateness ofthe accounting policies used and the reasonableness of the accounting estimates made bythe Company's Directors as well as evaluating the overall presentation of the standaloneInd AS financial statements.

We are also responsible to conclude on the appropriateness ofmanagement's use of the going concern basis of accounting and based on the auditevidence obtained whether a material uncertainty exists related to events or conditionsthat may cast significant doubt on the entity's ability to continue as a goingconcern. If we conclude that a material uncertainty exists we are required to drawattention in the auditor's report to the related disclosures in the financialstatements or if such disclosures are inadequate to modify the opinion. Our conclusionsare based on the audit evidence obtained up to the date of the auditor's report.However future events or conditions may cause an entity to cease to continue as a goingconcern.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Standalone Ind AS financialstatements.

Opinion

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid Standalone Ind AS financial statements give theinformation required by the Act in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at 31 March 2018 its profits (including other comprehensiveincome) changes in equity and its cash flows for the year ended on that date.

Emphasis of matter

We draw attention to Note 45 of the standalone Ind AS financialstatements relating to the accounting treatment of goodwill aggregating H3697 croresarising on amalgamation of erstwhile Advanta Limited with the Company accounted during theyear ended 31 March 2017 and amortization of the said goodwill arising therefrom both ofwhich are different from the treatment prescribed under Indian Accounting Standard (IndAS) 103 - 'Business Combinations' for business combination of entities under commoncontrol. Had the accounting treatment prescribed under Ind AS 103 been followed profitafter tax reported for the year ended 31 March 2018 would have been higher by H370 crores.Our opinion is not modified in respect of this matter.

Other Matters

The audited Standalone Ind AS financial statements of the Company forthe corresponding year ended 31 March 2017 prepared in accordance with Ind AS included inthese standalone Ind AS financial statements have been audited by the predecessorauditors whose audit report dated 28 April 2017 expressed an unmodified opinion on thoseaudited Standalone Ind AS financial statements. Our opinion is not modified in respect ofthis matter.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor's Report) Order 2016(‘the Order') issued by the Central Government of India in terms of Section143(11) of the Act we give in the "Annexure A" a statement on the mattersspecified in the paragraphs 3 and 4 of the Order.

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

(a) 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) in our opinion proper books of account as required by law havebeen kept by the Company so far as it appears from our examination of those books;

(c) the Balance Sheet the Statement of Profit and Loss (includingother comprehensive income) the Statement of Cash Flows and Statement of Changes inEquity dealt with by this Report are in agreement with the books of account;

(d) in our opinion the aforesaid Standalone Ind AS financialstatements comply with the Indian Accounting Standards prescribed under section 133 of theAct;

(e) on the basis of the written representations received from thedirectors as on 31 March 2018 taken on record by the Board of

Directors none of the directors are disqualified as on 31 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 controlswith reference to financial statements of the Company and the operating effectiveness ofsuch controls refer to our separate Report in "Annexure B"; and

(g) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 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 itsfinancial position in its Standalone Ind AS financial statements; - Refer Note 35(c) tothe Standalone Ind AS financial statements;

(ii) The Company has made provision as required under the applicablelaw or accounting standards for material foreseeable losses if any on long-termcontracts including derivative contracts;- Refer Note 15 to the Standalone Ind ASfinancial statements.

(iii) There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company; and

(iv) The disclosures regarding details of specified bank notes held andtransacted during 8 November 2016 to 30 December 2016 has not been made since therequirement does not pertain to financial year ended 31 March 2018. Corresponding amountsas appearing in the audited Standalone Ind AS financial statements for the year ended 31March 2017 have been disclosed;- Refer Note 48 to the Standalone Ind AS financialstatements.

For B S R & Co. LLP

Chartered Accountants

Firm's Registration No: 101248W/W-100022
Bhavesh Dhupelia
Place : Mumbai

Partner

Date: 27 April 2018 Membership No: 042070

Annexure A to the Independent Auditors' Report – 31 March2018

(Referred to in our report of even date)

(i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets.

(b) The Company has a regular programme of physical verification of itsfixed assets by which all fixed assets are verified in a phased manner over a period ofthree years.

In our opinion this periodicity of physical verification is reasonablehaving regard to the size of the Company and the nature of its assets. Pursuant to theprogramme certain fixed assets were physically verified by the management during theyear. In our opinion and according to the information and explanations given to us nomaterial discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanationsgiven to us by the management and on the basis of an examination of the records of theCompany the title deed of the immovable properties as disclosed in Note 3 of thestandalone Ind AS financial statements are held in the name of the Company except in thecase of leasehold land freehold land and buildings with a carrying value of H11 CroresH2 Crores and H1 Crore (Gross block of

H11 Crores H2 Crores and H1 Crore) as at 31 March 2018 respectivelywherein as explained to us the Company is in process of reconciling fixed assets registerwith the title deeds and hence we are unable to comment on the same.

(ii) The inventory except goods in transit and stocks lying with thirdparties has been physically verified by the management at reasonable intervals during theyear. In our opinion the frequency of such verification is reasonable. For stocks lyingwith third parties at the year-end written confirmations have been obtained and inrespect of goods-in-transit subsequent goods receipts have been verified or confirmationshave been obtained from the parties. The discrepancies noticed on verification between thephysical stocks and the book records were not material and have been dealt with in booksof account.

(iii) The Company has granted unsecured loans to two companies coveredin the register maintained under Section 189 of the Act. There are no firms/LimitedLiability Partnership/other parties covered in the register maintained under Section 189of the Act.

(a) In respect of the aforesaid loans the terms and conditions underwhich such loans were granted are not prejudicial to the Company's interest.

(b) In respect of one loan the schedule of repayment of principal andpayment of interest has been stipulated and the party is repaying the principal amountsas stipulated and is also regular in payment of interest as applicable. In respect of ananother loan which is repayable on demand we are informed that the amount of interestand principal demanded by the Company has been paid during the year and thus there hasbeen no default on the part of the parties to whom the money has been lent.

(c) There are no amount overdue for more than ninety days at thebalance sheet date

(iv) In our opinion and according to the information and explanationgiven to us the Company has complied with provisions of Section 185 and 186 of the Act inrespect of grant of loans making investments and providing guarantees and securities asapplicable.

(v) In our opinion and according to the information and explanationsgiven to us the Company has not accepted any deposit from the public during the year interms of the provisions of Sections 73 to 76 or any other relevant provisions of the Actand the rules framed thereunder. Accordingly reporting under clause 3(v) of the Order isnot applicable to the Company.

(vi) We have broadly reviewed the books of account maintained by theCompany as specified under Section 148(1) of the Act for maintenance of cost records inrespect of the products manufactured by the Company and are of the opinion that primafacie the prescribed accounts and records have been made and maintained. However we havenot made a detailed examination of cost records with a view to determine whether they areaccurate or complete.

(vii) (a) According to the information and explanations given to us andon the basis of our examination of the records of the Company amounts deducted/accrued inthe books of account in respect of undisputed statutory dues including Provident fundEmployees' State Insurance Income-tax Sales-tax Value added tax Duty of exciseService tax Duty of Excise Goods and Service tax Duty of customs Cess and othermaterial statutory dues have generally been regularly deposited during the year by theCompany with the appropriate authorities though there has been slight delay in a fewcases.

According to the information and explanations given to us noundisputed amounts payable in respect of Provident fund Employees' State InsuranceIncome-tax Sales-tax Duty of excise Service tax Goods and Service tax Duty ofcustoms Value added tax Cess and other material statutory dues were in arrears as at 31March 2018 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and basedon our examination of the records of the Company there are no dues of Income-tax SalesTax Service tax Duty of customs Excise duty and Value added tax as at 31 March 2018which have not been deposited with the appropriate authorities on account of any disputeexcept as stated below:

Nature of the Statute Nature of dues Amount (in Crores) Amount paid under protest Period to which amounts relates Forum where dispute is pending
(in Crores)
Income tax Act 1961 Income tax demands 5 - 1995-96 1997-98 and 2004-05 Income-tax Appellate Tribunal
Sales tax Act Sales tax demands 22 9 1985-86 1995-96 to 2005-06 Supreme Court Jt Commissioner of Sales tax Sales tax Tribunal
Central Excise/Finance Act Excise duty/Service tax demands 68 1 1989-90 1994-2004 and 2007-2015 Commissioner (Appeals) Central Excise and Service tax Appellate Tribunal
Custom Act Custom duty demands 34 - 1992 to 1997 2000 2001 and 2004 Commissioner (Appeals) Central Excise and Service tax Appellate Tribunal
Foreign Trade (Development and regulation) Act Fiscal Penalty 33 - 1992 to 1997 Bombay High Court

(viii) In our opinion and according to the information and explanationsgiven to us the Company has not defaulted in repayment of loans or borrowings tofinancial institution bank or dues to debenture holders. The Company does not have anyloans or borrowings from the government during the year.

(ix) According to the information and explanations given to us theCompany did not raise money by way of initial public offer or further public offer(including debt instruments) and term loans during the year. Accordingly reporting underthe clause 3(ix) of the Order is not applicable to the Company.

(x) To the best of our knowledge and according to the information andexplanations given to us no fraud by the Company and no fraud on the Company by itsofficers or employees has been noticed or reported during the year nor have we beeninformed of such case by the management.

(xi) According to the information and explanations given to us themanagerial remuneration has been paid / provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the Act.

(xii) According to the information and explanations given to us theCompany is not a Nidhi company as prescribed under Section 406 of the Act. Accordinglyreporting under clause 3(xii) of the Order is not applicable to the Company.

(xiii) According to the information and explanations given to us alltransactions with the related parties are in compliance with provisions of Section 177 and188 of the Act where applicable and the details have been disclosed in the Standalone Ind

AS financial statements as required by the applicable Indian accountingstandards.

(xiv) According to the information and explanations given to us andbased on our examination of the records of the Company the Company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the year. Accordingly reporting under the clause 3(xiv) of the Order isnot applicable to the Company.

(xv) According to the information and explanations given to us andbased on our examination of the records of the Company the Company has not entered intoany non-cash transactions with directors or persons connected with them. Accordinglyreporting under the clause 3(xv) of the Order is not applicable to the Company.

(xvi) According to the information and explanations given to us theCompany is not required to be registered under Section 45-IA of the Reserve Bank of IndiaAct 1934. Accordingly reporting under the clause 3(xvi) of the Order is not applicableto the Company.

For B S R & Co. LLP

Chartered Accountants

Firm's Registration No: 101248W/W-100022
Bhavesh Dhupelia
Place : Mumbai

Partner

Date: 27 April 2018 Membership No: 042070

Annexure B to the Independent Auditors' Report – 31 March2018

(Referred to in our report of even date)

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

We have audited the internal financial controls with reference tofinancial statements of UPL Limited ("the Company") as at 31 March 2018 inconjunction with our audit of the Standalone Ind AS financial statements of the Companyfor the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing andmaintaining internal financial controls based on the internal financial controls withreference to financial statements criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls over Financial Reporting issued by the Institute of CharteredAccountants of India ("ICAI"). These responsibilities include the designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring the orderly and efficient conduct of its business includingadherence to company's policies the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial information as required under the Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internalfinancial controls with reference to financial statements based on our audit. We conductedour audit in accordance with the Guidance Note on Audit of Internal Financial ControlsOver Financial Reporting (the "Guidance Note") and the Standards on Auditingissued by ICAI and deemed to be prescribed under section 143 (10) of the Act to theextent applicable to an audit of internal financial controls both applicable to an auditof Internal Financial Controls and both issued by the ICAI. 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 controlswith reference to financial statements was established and maintained and if such controlsoperated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system with reference to financialstatements and their operating effectiveness. Our audit of internal financial controlswith reference to financial statements included obtaining an understanding of internal

financial controls with reference to 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 auditors' judgment 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 andappropriate to provide a basis for our audit opinion on the Company's internalfinancial controls with reference to financial statements.

Meaning of Internal Financial Controls with reference to _nancialstatements.

A company's internal financial control with reference to financialstatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposesin accordance with generally accepted accounting principles. A company's internalfinancial control with reference to financial statements includes those policies andprocedures that (1) pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of theCompany; (2) provide reasonable assurance that transactions are recorded as necessary topermit preparation of financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorizations of management and directors of the company; and (3)provide reasonable assurance regarding prevention or timely detection of unauthorizedacquisition use or disposition of the company's assets that could have a material effecton the financial statements.

Inherent Limitations of Internal Financial Controls with reference to_nancial statements.

Because of the inherent limitations of internal financial controls withreference to financial statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to financial statements to future periods are subject to the riskthat the internal financial control with reference to financial statements may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequateinternal financial controls with reference to financial statements and such internalfinancial controls with reference to financial statements were operating effectively as at31 March 2018 based on the internal control with reference to financial statementscriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls with referenceto financial statements issued by the ICAI.

For B S R & Co. LLP

Chartered Accountants

Firm's Registration No: 101248W/W-100022
Bhavesh Dhupelia
Place : Mumbai

Partner

Date: 27 April 2018 Membership No: 042070