TO THE MEMBERS OF
GIRDHARILAL SUGARS AND ALLIED INDUSTRIES LIMITED
REPORT ON THE STANDALONE FINANCIAL STATEMENTS
We have audited the accompanying standalone financial statements of GIRDHARILAL
SUGARS AND ALLIED INDUSTRIES LIMITED (The Company), and the statement of Profit and
Loss (including Other Comprehensive Income), the Cash Flow statement and the Statement of
Changes in Equity for the year ended 31st March 2019, and notes to the financial
statements including a summary of significant accounting policies and other explanatory
information.
OPINION
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 a
airs of the Company as at March 31, 2019, and its total comprehensive income (comprising
of profit and other comprehensive income), its cash flows and the changes in equity for
the year ended on that date.
BASIS FOR OPINION
We concluded our audit in accordance with the Standards on Auditing
(SAs) specified under section 143(10) of the Act. Our responsibilities for the Audit of
the Financial Statements section of our report. We are independent of the Company in
accordance with the Code of Ethics issued by the Institute of Chartered Accountants of
India together with the ethical requirements that are relevant to our audit of the
financial statements under the provisions of the Act and the Rules thereunder, and we have
fulfilled our other ethical responsibilities in accordance with these requirements and the
Code of Ethics. We believe that the audit evidence we have obtained as sufficient and
appropriate to provide a basis for our opinion subject to Basis of Qualified Opinion given
hereunder :-
BASIS OF QUALIFIED OPINION
The Company has not provided Rs. 74.94 Lacs for the quarter ended
31.3.2019 towards interest on loans from Banks.
Had the above liability been considered there would have been a loss of
Rs.186.93 Lacs as against the reported loss of Rs. 111.99 Lacs and other equity as at the
balance sheet date would have been Rs. (-) 348.42 Lacs as against reported gure of Rs.(-)
273.48 Lacs.
QUALIFIED OPINION
In our opinion and to the best of our information and according to the
explanations given to us, except for the the ects of the matter described in the Basis for
Qualified Opinion paragraph above, the aforesaid standalone 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 a
airs of the Company as at 31st March 2019, and its pro t/loss and its cash flows for the
year ended on that date.
EMPHASIS ON MATTERS
We draw attention to the following matters in the Notes to the
financial Statement:
a) Note No. 37 in respect of interest liability on unpaid undisputed
statutory dues if any.
Our opinion is not modified in respect of this matter
b) Note No. 22c in respect of non-deposition of unclaimed debentures
amount to Investors Education and Protection Fund Account.
c) Note No. 36 in respect of non-provision of MAT Liability under
section 115JB of the Income Tax Act of 1961 of Rs.24473898/- for the F.Y. 14-15 to 17-18.
KEY AUDIT MATTERS
Key audit matters are those matters that in our professional judgment
were of the most significance in our audit of the financial statements of the current
period. These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon and we do not provide a separate
opinion on these matters except para (2) hereunder:-
| Key Audit Matter Description |
How our Audit addressed the key audit matter |
| 1) Considering the companys business as a going concern
and the accounts prepared in accordance, with. |
We understood and tested the controls established by the
management and evaluated that the companys soya division business has temporarily
been discontinued due to disparity of margin. However, the company has continued in doing
its dairy business which gives good cash margin. Based on these factors we relied that the
companys business is still to be continued as a going concern company. |
| 2) Non-provision of interest of Rs.74.94 Lacs on loan taken
from banks for the quarter ended 31.3.2019. |
We understood and tested the controls established by the
management and evaluated that as the company has not made the provision of interest
liability of Rs. 74.94 Lacs for the quarter ended 31.3.2019 on the ground that the
companys Account has been treated by the bank as a Non-Performing Asset account and
also a symbolic possession of the asset taken over by the bank. We do not agree with the
reasoning given by the Company and are of the view that the company should have made a
provision of interest liability, even the bankers have declared the account as a
Non-Performing Asset account. We have taken up this matter in our report as our qualified
opinion. |
| 3) Non-Provision of the MAT liability for the F.Y. 14-15 TO
17-18 of Rs. 2,44,73,898 (Refer Note No. 36) |
We understood and tested the controls established by the
management and evaluated that the non-provision of MAT Liability for the A.Y. 14-15 to
17-18 of Rs. 2,44,73,898 is not in the nature of contingent liability but still has to be
provided in the books. The total liability which was not provided by the company has been
explained fully in Note No. 36 as referred and we are of the view that the company should
have provided this liability. We have referred this matter in Emphasis of Matter for the
knowledge of the stakeholders. |
OTHER INFORMATION
The Companys Board of Directors is responsible for the other
information. The other information comprises the information included in the annual
report, but does not include the financial statements and our auditors report
thereon.
Our opinion on the financial statements does not cover the other
information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our
responsibility is to read the other information and, in doing so, consider whether the
other information is materially inconsistent with the financial statements or our
knowledge obtained in the audit6 or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is
material misstatement of this information, we are required to report the fact.
We have nothing to report in this regard.
RESPONSIBILITIES OF MANAGEMENT AND THOSE CHARGED WITH GOVERNANCE FOR
THE STANDALONE FINANCIAL STATEMENTS
The Companys 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 to 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
specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) 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 of 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.
In preparing the financial statements, management is responsible for
assessing the Companys ability to continue as a going concern, disclosing, as
applicable, matters related to going concern basis of accounting unless management either
intends to liquidate the Company or to cease operations, or has no realistic alternative
but to do so. Those Board of Directors are also responsible for overseeing the
Companys financial reporting process.
AUDITORS RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL
STATEMENTS
Our objectives are to obtain reasonable assurance about whether the
financial statements as a whole are free from material misstatement, whether due to fraud
or error, and to issue an auditors report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with SAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually
or in the aggregate, they could reasonably be expected to influence the economic decisions
of users taken on the basis of these financial statements.
As part of an audit in accordance with SAs, we exercise professional
judgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial
statements, whether due to fraud or error, design and perform audit procedures responsive
to those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in
order to design audit procedures that are appropriate in the circumstances. Under section
143(3)(I) of the Companies Act, 2013, we are also responsible for expressing our opinion
on whether the company has adequate internal financial controls system in place and the
operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of managements use of the going
concern basis of accounting and, based on the audit evidence obtained, whether a material
uncertainty exists related to events or conditions that may cast significant doubt on the
Companys ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditors report to the
related disclosures in the 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. However, future events or conditions may cause the
Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the
financial statements, including the disclosures, and whether the financial statements
represent the underlying transactions and events in a manner that achieves fair
presentation.
We communicate with those charged with governance regarding, among
other matters, the planned scope and timing of the audit and significant audit findings,
including any significant de ciencies in internal control that we identify during our
audit.
We also provide those charged with governance with a statement that we
have complied with relevant ethical requirements regarding independence, and to
communicate with them all relationships and other matters that may reasonably be thought
to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we
determine those matters that were of most significance in the audit of the financial
statements of the current period and are therefore the key audit matters. We describe
these matters in our auditors report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a
matter should not be communicated in our report because the adverse consequences of doing
so would reasonably be expected to outweigh the public interest benefits of such
communication.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the Companies (Auditors Report) order, 2015
("the order"), issued by the Central Government of India in terms of sub-section
(11) of section 143 of the Companies Act, 2013 we give in the annexure a statement on the
matters specified in paragraphs 3 and 4 and 5 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 best of 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 the company so far as appears from our examination of those books of the Company.
c. The Balance Sheet, the Statement of Pro t and Loss (including other
comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity
dealt with by this Report are in agreement with the books of account.
d. In our opinion, the aforesaid Standalone Ind AS financial Statements
dealt with by this repot comply with the account standards specified under section 133 of
the Act, read with rule 7 of Companies (Accounts) Rules, 2014.
e. On the basis of written information received from the directors of
the Company and taken on record by the Board of Directors as on 31st March 2019, and the
information and explanations given to us, we report that none of the directors is
disqualified as on 31st March 2019, from being appointed as a director in terms of
subsection (2) of section 164(2) of the Act.
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 B", and
g. With respect to the other matters to be included in the
Auditors 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
explanations given to us:-
(i) The Company has disclosed the impact of pending litigations on its
financial position in its financial statements as referred to in note no.40 to the
financial statements.
(ii) The Company has made provision, as required under the applicable
law or accounting standards, for material foreseeable losses, if any, and as required on
long-term contracts including derivative contracts.
(iii) According to the information and explanations given to us, the
company has not transferred a sum of Rs.80.41 lacs to on account of unclaimed debenture
account. However as per BIFR order dated 15.01.2014, the company was exempted from the
provisions of Sec 125 of the Companies Act 2013 (erstwhile section 205C of the Companies
Act 1956) and deferred the same payment till2016-17.
| Place: Dewas |
For, SUNIL BANDI & CO. |
| Date : 28th May, 2019 |
Chartered Accountants |
|
F. R. No. 007419C |
|
CA Sunil Bandi |
|
(Partner) |
|
M. No. 077705 |
+91-9892691696
