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समबंदम स्पिनिंग मिल्स

बीएसई: 521240  |  NSE: SAMBANDAM  |  ISIN: INE304D01012  |  Textiles - Spinning - Cotton Blended

खोजें समबंदम स्पिनिंग मिल्स कनेक्शन Mar 17
लेखा परीक्षकों की रिपोर्ट वर्षांत : Mar '18

Report on the standalone Ind AS Financial Statements

1. We have audited the accompanying standalone Ind AS financial statements of Sambandam Spinning Mills Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Statement of Standalone Ind AS Financial Statements

2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these Standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Standalone Ind AS) prescribed under Section 133 of the Act.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

3. Our responsibility is to express an opinion on these Standalone Ind AS financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

4. We conducted our audit of the Standalone Ind AS financial statements in accordance 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 the audit to obtain reasonable assurance about whether the Standalone Ind AS financial statements are free from material misstatement.

5. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the Standalone Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the Standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the Standalone Ind AS financial statements that give a true and fair 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 and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the Standalone Ind AS financial statements.

6. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Ind AS financial statements.

Opinion

7. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs (financial position) of the Company as at March 31, 2018, its profit (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.

Emphasis of Matter

8. We draw attention to note. 45 of the notes forming part of the standalone Ind AS financial statements regarding the Company''s identification of instances of embezzlement of its funds by an employee of the Company. Our opinion is not modified in respect of this matter.

Other Matters

9. The comparative financial information of the Company for the year ended March 31, 2017 and the transition opening balance sheet as at April 1,2016 included in these standalone Ind AS financial statements, are based on the previously issued statutory financial statements prepared in accordance with the Companies ( Accounting Standards) Rules,2006 audited by the predecessor auditor whose reports for the year ended March 31, 2017 and March 31,2016 dated May 6,2017 and May 21,2016 respectively expressed an unmodified opinion on those standalone financial statements. The comparative financial information for the year ended March 31, 2017 and the opening balance sheet as at April 1, 2016 has been adjusted for the differences in the accounting principles/ policies adopted by the Company on transition to the Ind AS, which have been audited by us.

Report on Other Legal and Regulatory Requirements

10. As required by Section143 (3) of the Companies Act, 2013, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by 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 Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report is in agreement with the books of account.

(d) In our opinion, the aforesaid Standalone Ind AS financial statements comply with the Indian Accounting Standards prescribed under Section 133 of the Act.

(e) On the basis of the written representations received from the directors as on March 31, 2018 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164 (2) of the Companies Act, 2013.

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in Annexure “A”.

(g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanation given to us:

i. The Company has disclosed the impact of pending litigations on its financial position vide note 42.

ii. The company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

11. As required by the Companies (Auditor''s Report) Order,2016 (“the Order”) issued by the Central Government in terms of Section 143(11) of the Act we give in “Annexure B” a statement on the matters specified in paragraphs 3 and 4 of the Order.

ANNEXURE “A” TO THE INDEPENDENT AUDITOR''S REPORT

(Referred to in paragraph 11(f) under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

1. We have audited the internal financial controls over financial reporting of Sambandam Spinning Mills Limited (“the Company”) as of March 31, 2018 in conjunction with our audit of the Standalone Ind AS financial statements of the 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 internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditor''s Responsibility

3. Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the Institute of Chartered Accountants of India and the Standards on Auditing deemed to be prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material 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 to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

6. A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and disposition of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material 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 financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

8. According to the information and explanations given to us and based on our audit the Company''s internal control system, periodic review of treasury related reports was inadequate in respect of a part of the year.

A ‘material weakness'' is a deficiency, or a combination of deficiencies, in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company''s annual or interim financial statements will not be prevented or detected on a timely basis.

The material weakness noted above resulted in a fraud (detailed in note 45) being committed by an employee. Subsequent to unearthing of the fraud, the company has initiated remediation measures before the end of the year towards correcting the material weakness noticed in the internal controls.

In our opinion, except for the effects (detailed in note 45) of the material weakness as described above on the achievement of the objectives of the control criteria, the Company has maintained, in all material respects adequate internal financial controls over financial reporting and such internal financial controls over financial reporting were operating effectively as of March 31, 2018 based on the Guidance note on Audit of Internal Financial Control over financial reporting issued by the Institute of Chartered Accountants of India.

We have considered the material weakness identified and reported as above and the remediation measures initiated by the Company, in determining the nature, timing and extent of audit tests applied in our audit of March 31, 2018 standalone financial statements of the Company, and these material weakness does not affect our opinion on the standalone financial statements of the Company.

“ANNEXURE B” TO THE INDEPENDENT AUDITORS'' REPORT

(Referred to in paragraph 12 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date on the Standalone Ind AS financial statements of Sambandam Spinning Mills Limited (“the Company”) for the year ended March 31, 2018).

1. In respect of its fixed assets :

(a) The company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets

(b) The fixed assets have been physically verified by the management during the year and no material discrepancies have been noticed on such verification.

(c) According to the information and explanations given to us and based on the examination of registered sale deeds/ transfer deeds/ conveyance deeds provided to us, we report that the title deeds, of all the immovable properties are held in the name of the Company.

2. As explained to us the inventories other than goods in transit have been physically verified at the year-end by the management and no material discrepancies were noticed on such physical verification.

3. According to the information and explanations given to us, the Company has granted loan to one Company covered in the register maintained under Section 189 of the Companies Act , 2013 in respect of which:

a. The terms and conditions of the grant of such loan are, in our opinion, prima facie, not prejudicial to the Company''s interest.

b. The schedule of repayment of principal and payment of interest has been stipulated and repayments or receipts of principal amounts and interest have been regular as per stipulations.

c. There is no overdue amount remaining outstanding as at the year end.

4. According to information and explanations given to us the Company has complied with the provisions of sections 185 and 186 of the Companies Act, 2013 in respect of grant of loans, making investments and providing guarantees and securities, as applicable.

5. According to information and explanations given to us, the Company has not accepted any deposits from public however in respect of the deposits accepted from shareholders, the Company has complied with the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

6. The maintenance of cost records has been specified by the Central Government under Section 148(1) of the Companies Act, 2013. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended and prescribed by the Central Government under Sub section (1) of Section 148 of the Companies Act, 2013 and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

7. According to the information and explanations given to us and the books of account examined by us, in respect of statutory dues:

(a) The company is regular in depositing material amount of undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, Customs duty, Excise duty, value added tax, cess and any other statutory dues as applicable to the appropriate authorities during the year. There were no undisputed amounts payable in respect of the aforesaid statutory dues outstanding as on March 31, 2018 for a period of more than six months from the date they became payable.

(b) There are no dues of Income tax, Sales tax, Service tax, Customs Duty, Excise duty or Value added tax that have not been deposited on account of any dispute. Details of dues of value added tax, and other statutory dues, which have not been deposited as at March 31,2018 on account of any dispute is as stated below:

(Rs. in Lakhs)

Nature of dues

Disputed dues (Net)

Period to which the amount relates

Forum where the dispute is pending

Sales tax

7.17

1991-92

Coimbatore Court

Corporation Tax

17.05

October 1998 - March 2013

Madras High Court

Infrastructure and development

66.75

July 2012

Madras High Court

amenities charges

Employee state Insurance

25.63

2003-04 to 2004-05

Salem Labour Court

8. The Company has not defaulted in repayment of dues to any financial institution, or from banks.

9. The Company has not raised any money by way of initial public offer or further public offers (including debt instruments) during the year. Hence reporting on utilization of such money does not arise.

10. To the best of our knowledge and belief, and according to the information and explanations given to us, and considering the size and nature of the Company''s operations no fraud by the company has been noticed or reported during the year. Embezzlement of funds by an employee aggregating Rs.1344.25 lakhs was reported during the year (Refer Note 45).

11. According to the information and explanations given to us, the company has paid/provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Companies Act, 2013.

12. The Company is not a Nidhi Company and accordingly the provisions of Clause (xii) of the Order are not applicable to the Company.

13. In our opinion and according to the information and explanations given to us all transactions with the related parties are in compliance with sections 177 and 188 of the Companies Act, 2013, where applicable. The details of the transactions during the year have been disclosed in the Standalone Ind AS financial statements as required by the applicable Accounting Standards. (Refer Note 39).

14. During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under Clause (xiv) of the Order is not applicable.

15. In our opinion and according to the information and explanations given to us, the Company has not entered into any non-cash transactions during the year with directors or persons connected with them. Hence reporting on whether there is compliance with provisions of section 192 of the Companies Act, 2013 does not arise.

16. The Company is not required to be registered under section 45- IA of the Reserve Bank of India Act, 1934.

For R.Sundararajan & Associates

Chartered Accountants

Registration No. 008282S

Date : May 27, 2018 S. Krishnan - Partner

Place : Salem Membership No. 26452

स्रोत: रेलीगरे टेचनोवा

न्यूज़ फ़्लैश

  • MARKET CUES : FIIs ने कैश में `1116.79 Cr की बिकवाली की
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  • MARKET CUES : इंडेक्स फ्यूचर्स में `1197.47 Cr की बिकवाली
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  • CS ON AUROBINDO PHARMA : रेटिंग Neutral से घटाकर Underperform
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  • HSBC ON BAJAJ FIN : BUY रेटिंग, लक्ष्य `4,860 से घटाकर `3,750/Sh

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