To The Members of The Western India Plywoods Limited
Report on the Audit of the standalone Financial Statements
We have audited the accompanying standalone financial statements of THE WESTERN INDIAPLYWOODS LIMITED ("the Company")which comprises the Balance Sheet as at 31stMarch 2020and the Statement of Profit and Loss (including other comprehensive income)the statement of Changes in Equity and the statement of Cash flow for the year then endedand notes to the Financial statement including a summary of the significant accountingpolicies and other explanatory information.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 (Act') in the manner so required and give a true and fairview in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at 31st March 2020 and profit (including othercomprehensive income) its changes in equity and cash flows for the year ended on thatdate.
Basis for opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder Section 143(10) of the Companies Act2013. Our responsibilities under thosestandards are further described in the Auditor's Responsibilities for the audit of thestandalone financial statements section of our report. We are independent of the companyin accordance 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 Companies Act2013 and the rules madethere under and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that in our Professional judgement were of mostsignificance in our audit of the standalone financial statements of the current period.These matters were addressed in the context of our audit of the financial statements as awhole and in forming our opinion thereon and we do not provide a separate opinion onthese matters. We have determined the matters described below to be the key audit mattersto be communicated in our report.
|The Key Audit Matters ||Auditor's Response |
|1 Impairment testing of investment in subsidiary ||Our Audit procedure included but were not limited to the following; |
|Refer note no 4.02 to the accompanying standalone financial statements || |
|The equity as well as the preference shares investment in the subsidiary company named Mayabandar Doors limited account for a significant percentage of the company's total investments. || We Evaluated the Company's process regarding the impairment assessment and fair valuation by involving independent expert to confirm that the assessment are made in line with the relevant Ind AS |
|As at 31 March 2020 the carrying amount of equity investment in subsidiary company Viz. Mayabandar Doors Limited is Rs. 23225459/-. Further the company has also invested in 6% Non-cumulative redeemable as well as 8% redeemable cumulative preference share capital of the above said subsidiary the carrying amount of which as at 31st March 2020 is Rs.34000000/- as well as Rs.18000000/- respectively. || We assessed the carrying value/fair value calculation of the investment in subsidiary to determine whether the valuation is within the acceptable range determined by us. |
|As the carrying amount of the investment in the above said subsidiary exceeds the carrying amounts in the financial statements of the subsidiaries Net assets the management has performed an impairment assessment and has estimated the recoverable amount of its investment in subsidiaries through an independent valuer. || We assessed the professional competence objectivity and capabilities of the valuation specialist engaged by the management. |
|The accounting for investment in above subsidiary is a Key Audit Matter as the estimation of recoverable amount involve the use of significant estimate and assumptions that are dependent on expected future market and economic conditions. || We evaluated the adequacy of disclosure made in the standalone financial statement. |
|As per such assessment done by the management there is no impairment loss as disclosed in note 4.02 to this standalone financial statement. ||Based on the above procedure performed we did not identify any significant exception in the management's assessment in relation to the impairment loss and the carrying value of investments in subsidiary. |
|2. Recoverability of insurance claim receivable ||Our audit procedures included but were not limited to the following; |
|Refer note no 13.01 to the accompanying standalone financial statements || We have assessed and reviewed the issue in detail and discussed with management the recent developments and the present status. |
|As on 31st March 2020 as per the financial statement an amount of Rs.21036634/- is outstanding as insurance claim and interest receivable from the insurance company based on the judgement in favour of the company by the Kerala State Consumer Disputes Redressal Commission || |
| || Considered the Judgment in favor of the company by the Kerala State Consumer Disputes Redressal Commission. |
|However the insurance Company filed an appeal against the above said judgement and the condonation petition in respect of the same is yet to be heard. || We considered external legal opinions where relevant obtained by management. |
|Considering the materiality involved and the uncertainty about the ultimate outcome of the appeal the above matter is identified as Key Audit matters. || We assessed the adequacy of the company's disclosures in the financial statement |
| ||Based on our above procedure the management's assessment and disclosure in respect of the above matter is considered to be reasonable. |
The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Company's Annual Report but doesnot include the standalone financial statements and our auditor's report thereon.
Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the standalone financial statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated. If based on thework we have performed we conclude that there is a material misstatement of this otherinformation we are required to report that fact. We have nothing to report in thisregard.
Responsibilities of Management and those charged with governance for the StandaloneFinancial Statements
The Company's Board of Directors are responsible for the matters stated in section134(5) of the the Companies Act 2013("the Act") with respect to the preparationof these standalone financial statements that give a true and fair view of the financialposition financial performance including other comprehensive income changes in equityand Cash flow of the Company in accordance with the accounting principles generallyaccepted in India including the Accounting Standards specified under section 133 of theAct. This responsibility also includes maintenance of adequate accounting records inaccordance with the provision of the Act for safeguarding of 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 financial controlthat were operating effectively for ensuring the accuracy and completeness of theaccounting records relevant to the preparation and presentation of the financialstatement that give true and fair view and are free from material misstatement whetherdue to fraud or error.
In preparing the financial statements the Board of Directors is responsible forassessing the company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessthe Board of Directors either intends to liquidate the Company or to ceases operations orhas no realistic alternative but to do so.
Those Board of Directors are responsible for overseeing the company's financialreporting process.
Auditor's Responsibilities for the audit of the Financial Statements
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.
As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.
Obtain an understanding of internal controls relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Companies Act 2013 we are also responsible for expressing an opinion on whetherthe company has adequate internal financial controls system in place and the operatingeffectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.
Conclude on the appropriateness of the management's use of the going concernbasis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on thecompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the company to cease to continue as a going concern.
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.
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 with those charged with governance we determine thosematters that were of most significance in the audit of the financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the "Annexure A" a statement on the mattersspecified in the paragraph 3 and 4 of the order to the extent applicable.
2. As required by section 143(3) of the Act we report that:
a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purpose of our audit;
b) In our opinion proper books of account as required by law have been kept by theCompany so far as appears from our examination of those books;
c) The standalone Balance Sheet standalone Statement of Profit and Loss (includingother comprehensive income) the standalone statement of Cash Flows and the standalonestatement of changes in Equity dealt with by this Report are in agreement with the booksof account;
d) In our opinion the aforesaid standalone 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 written representations received from the directors as on March 312020 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2020 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 over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in "Annexure B".
g) With respect to the others matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended In our opinionand to the best of our information and according to the explanation given to us theremuneration paid by the Company to its directors during the year is in accordance withthe provisions of section 197 of the Act.
h) 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 does not have any pending litigations which would impact its financialposition.
(II) The Company did not have any long-term contracts including derivative contractsfor which 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 Sankar & Moorthy |
| ||Chartered Accountants |
| ||Firm Reg. No. 003575S |
| ||Jayaprakesh M C F.C.A. |
| ||(Partner) |
|Place: Kannur ||Mem. No. 215562 |
|Date: 29.06.2020 ||UDIN: 20215562AAAACA5023 |
"ANNEXURE A" REFERRED UNDER THE HEADING "REPORT ON OTHER LEGAL ANDREGULATORY REQUIREMENTS" OF OUR INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS OF THE WESTERN INDIA PLYWOODS LIMITED FOR THE YEAR ENDED31ST MARCH 2020
(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) In our opinion The fixed assets of the company are physically verified by themanagement in accordance with a phased programme at reasonable intervals and that nomaterial discrepancies have been 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 and based on the details of land and buildingsfurnished to us by the company the title deeds of immovable properties are held in thename of the Company.
(ii) In our opinion the physical verification of inventory (other than stock of timberlying in the pond and goods in transit) has been conducted by the management at reasonableinterval during the year and no material discrepancies between physical inventory and bookrecords were noticed on physical verification.
(iii) According to the information and explanations given to us and the records of thecompany examined by us during the year the Company has not granted any loans secured orunsecured to companies firms limited liability partnership or other parties covered inthe register maintained under section 189 of the Companies Act 2013. Accordingly thereporting requirements under clauses (iii) (a) to (c) paragraph 3 of the order are notapplicable.
(iv) According to the information and explanations given to us and the records of thecompany examined by us the company has not granted any loans or given any security orguarantee for which the provisions of sections 185 and 186 of the Act are applicable andthe Company has complied with the provisions of section 186 of the Act in respect ofinvestments as applicable.
(v) The Company has not accepted any deposits from the public during the year andhence the directives issued by the Reserve Bank of India and the provisions of section 73to 76 or any other relevant provisions of the Act and the rules framed there under are notapplicable.
(vi) To the best of our knowledge and according to the information and explanationgiven to us the Central Government has not prescribed the maintenance of cost recordsunder section 148 (1) of the Act for the company at this stage.
(vii) (a) As per the information and explanation furnished to us and according to ourexamination of the records of the Company The company has been generally regular indepositing undisputed statutory dues including Provident Fund Employees State insuranceIncome Tax Sales Tax Service Tax Goods & Service Tax Duty of Customs Duty ofExcise Value added Tax Cess and the other statutory dues as applicable to the companyto the appropriate authorities during the year.
There are no arrears of undisputed statutory dues outstanding at the last day of thefinancial year for a period of more than six months from the date on which they becomepayable.
(b) According to the information and explanations given to us and the records of theCompany examined by us there are no disputed amounts due to be deposited under Sales taxservice tax duty of customs duty of excise value added tax and income tax.
(viii) In our opinion and according to the information and explanations given to us andthe records of the company examined by us the company has not defaulted in repayment ofloans or borrowings to financial institution or banks. The company has not taken any loansor borrowings from government or raised any money by way of issue of debentures.
(ix) According to the information and explanations given to us and the records of thecompany examined by us no moneys were raised by way of initial public offer or furtherpublic offer (including debt instruments) in our opinion the term loan was applied forthe purpose for which the loan was obtained.
(x) During the course of our examination of the books and records of the companycarried out in accordance with generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the company or on the company by its officers or employeesnoticed or reported during the year nor have been informed of any such case by themanagement.
(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.
(xii) The Company is not a nidhi company. Accordingly the reporting requirement underparagraph 3(xii) of the Order is not applicable.
(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 Note.35 to the standalone financial statements asrequired by the applicable accounting standards.
(xiv) According to the information and explanations given to us and the records of thecompany examined by us the company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year.Accordingly the reporting requirements under clause (xiv) of the paragraph 3 of the orderare not applicable.
(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 any non-cashtransactions with directors or persons connected with the directors. Accordingly thereporting requirement under paragraph 3(xv) of the Order is not applicable.
(xvi) According to the information and explanations given to us and records of thecompany examined by us the company is not required to be register under section 45-IA ofthe Reserve Bank of India Act 1934. Accordingly the reporting requirement underparagraph 3 (xvi) of the order is not applicable.
| ||For Sankar & Moorthy |
| ||Chartered Accountants |
| ||Firm Reg. No. 0003575S |
| ||Jayaprakesh M C F.C.A. |
|Place: Kannur ||(Partner) |
|Date: 29-06-2020 ||Mem. No. 215562 |
"ANNEXURE B" REFERRED TO IN PARAGRAPH 2(f) UNDER THE HEADING "REPORT ONOTHER LEGAL AND REGULATORY REQUIREMENTS" OF OUR INDEPENDENT AUDITORS REPORT OF EVENDATE ON THE STANDALONE FINANCIAL STATEMENTS OF THE WESTERN INDIA PLYWOODS LIMITED FOR THEYEAR ENDED 31ST MARCH 2020
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")
We have audited the internal financial controls system with reference to standalonefinancial statements reporting of THE WESTERN INDIA PLYWOODS LIMITED("theCompany") as of 31st March 2020 in conjunction with our audit of the Standalonefinancial statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal controls with reference to financial statementsreporting 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(ICAI'). These responsibilities include the design implementation and maintenanceof adequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company's policiesthe safeguarding 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.
Our responsibility is to express an opinion on the Company's internal financialcontrols system with reference to the standalone financial statements reporting based onour audit. We conducted our audit in accordance with the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting (the "Guidance Note") andthe Standards on Auditing issued by ICAI and deemed to be prescribed under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls both applicable to an audit of Internal Financial Controls and bothissued by the Institute of Chartered Accountants of India. 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 controlssystem with reference to financial statements reporting was established and maintained andif 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 with reference to financial statements reportingand their operating effectiveness. Our audit of internal financial controls system withreference to standalone financial statements reporting included obtaining an understandingof internal financial controls over financial reporting assessing the risk that amaterial weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement 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 systemwith reference to these standalone financial statements reporting.
Meaning of Internal Financial Controls with reference to these standalone Financialstatements Reporting
A company's internal financial control system with reference to these standalonefinancial statement reporting is a process designed to provide reasonable assuranceregarding the reliability of financial reporting and the preparation of financialstatements for external purposes in accordance with generally accepted accountingprinciples. A company's internal financial controls system with reference to financialstatement 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 reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls with reference to StandaloneFinancial Statements reporting
Because of the inherent limitations of internal financial controls system withreference to financial statements reporting including the possibility of collusion orimproper management override of controls material misstatements due to error or fraud mayoccur and not be detected. Also projections of any evaluation of the internal financialcontrols system with reference to standalone financial statements reporting to futureperiods are subject to the risk that the internal financial controls system with referenceto standalone financial statements reporting may become inadequate because of changes inconditions or that the degree of compliance with the policies or procedures maydeteriorate.
In our opinion the Company has in all material respects an adequate internalfinancial controls systems with reference to these standalone financial statementsreporting and such internal financial controls system with reference to these standalonefinancial statements reporting were operating effectively as at 31 March 2020 based onthe internal control with reference to these standalone financial statements 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.
| ||For Sankar & Moorthy |
| ||Chartered Accountants |
| ||Firm Reg. No. 0003575S |
| ||Jayaprakesh M C F.C.A. |
|Place: Kannur ||(Partner) |
|Date: 29-06-2020 ||Mem. No. 215562 |