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Govind Rubber Ltd.

BSE: 509148 Sector: Auto
NSE: GOVINRUBER ISIN Code: INE011C01015
BSE 00:00 | 24 Apr 2020 Govind Rubber Ltd
NSE 05:30 | 01 Jan 1970 Govind Rubber Ltd

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OPEN 1.20
PREVIOUS CLOSE 1.20
VOLUME 750
52-Week high 3.99
52-Week low 0.83
P/E
Mkt Cap.(Rs cr) 3
Buy Price 1.26
Buy Qty 3904.00
Sell Price 1.26
Sell Qty 450.00
OPEN 1.20
CLOSE 1.20
VOLUME 750
52-Week high 3.99
52-Week low 0.83
P/E
Mkt Cap.(Rs cr) 3
Buy Price 1.26
Buy Qty 3904.00
Sell Price 1.26
Sell Qty 450.00

Govind Rubber Ltd. (GOVINRUBER) - Auditors Report


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Company auditors report

TO THE MEMBERS OF

GOVIND RUBBER LIMITED

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of Govind RubberLimited ('the Company') which comprise the Balance Sheet as at 31 March 2018the Statement of Profit and Loss (including Other Comprehensive Income) the Statement ofCash Flows and the Statement of Changes in Equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information (hereinafterreferred to as "Standalone Financial Statement").

Management's Responsibility for the Standalone 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 standalone financial statements that give a true and fair view of the financialposition financial performance including other comprehensive income cash flows and thestatement of changes in equity of the Company in accordance with the Indian AccountingStandards (Ind AS) prescribed under Section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 as amended and other accounting principles generallyaccepted in India.

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 standalonefinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone financial statementsbased on our audit.In conducting our audit we have taken into account the provisions ofthe Act the accounting and auditing standards and matters which are required to beincluded in the audit report under the provisions of the Act and the Rules made thereunderand the Order issued under section 143(11) of the Act.

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing specified under Section 143(10) of the Act. Those Standards requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone financial statements are free frommaterial misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone financial statements. The procedures selected depend onthe auditor's judgment including the assessment of the risks of material misstatement ofthe standalone financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to the Company'spreparation of the standalone financial statements that give a true and fair view in orderto design audit procedures that are appropriate in the circumstances. An audit alsoincludes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the standalone financial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our qualified audit opinion on the standalone financial statements.

Basis for Qualified Opinion

The Company's non current investments as at 31st March 2018 includes non currentinvestment of Rs 312.30 lakhs in a Joint Venture being considered good and recoverable bythe management of the Company. In the absence of sufficient appropriate evidence we areunable to comment upon the carrying value of the investment in joint venture and theconsequential impact if any on the accompanying Statement.

Qualified Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements except for the effects ofthe matter described in the Basis for Qualified Opinion paragraph above 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 and its loss total comprehensive income thechanges in equity and its cash flows for the year ended on that date.

Emphasis of Matters

The Company has outstanding loan & advances including amounting Rs 921.78 Lakhsoutstanding for more than three years and subject to confirmation/reconciliation. Noprovision against these amounts has been made as the management is of view that theCompany is taking all steps for recovery of these loan and advances amounts.

During the current year the company has changed accounting policy in respect ofPPE(Property Plant & Equipment) measurement in respect of Land from cost model torevaluation model and revalued freehold land based on the valuation report of the GovtRegistered Independent Valuer accordingly amount of freehold land value is increased byRs 3538.01 Lakhs and corresponding amount has been transferred to Revaluation SurplusAccount under Other Equity through Other Comprehensive Income (OCI).

Our opinion is not modified in respect of these matters.

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 section 143(11) of the Act we givein the Annexure A a statement on the matters specified in the paragraph 3 and 4 of theorder 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 purposes of our audit.

(b) In our opinion proper books of account as required by law have been kept by theCompany 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 statement of cash flows and the statement of changes in equity dealt with bythis Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone financial statements comply with theIndian Accounting Standards specified under Section 133 of the Act read withCompanies(Indian accounting standards) Rules2015 as amended;

(e) On the basis of the written representations received from the directors as on 31March 2018 and taken on record by the Board of Directors none of the directors aredisqualified as on 31 March 2018 from being appointed as a director in terms of Section164 (2) of the Act;

(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"; and

(g) 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 has disclosed the impact if any of pending litigations on itsfinancial position in its standalone financial statements;

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses; and

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

For and on behalf of
SONGIRA & ASSOCIATES
Chartered Accountants
(Firm Reg. No. 128085W)
(DHARMENDRA S. SONGIRA)
Place : MUMBAI Partner
Date : 30 MAY 2018 Membership No: 113275

ANNEXURE - A TO INDEPENDENT AUDITORS' REPORT

The Annexure referred to in Independent Auditors' Report to the members of the Companyon the standalone financial statements for the year ended 31 March 2018 we report that:

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

b) As explained to us the company has a regular programme for physical verification ina phased periodic manner which in our opinion is reasonable having regards to the sizeof the Company and nature of its assets. According to the information and explanationsgiven to us no material discrepancies were 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 the title deeds/lease deeds of immovableproperties (which are included under the Note 2 of the financial statements 'Propertyplant and equipments') are held in the name of the Company.

(ii) As explained to us physical verification of inventory has been conducted atreasonable intervals by the management and discrepancies noticed on such physicalverification between physical stocks and book records were not material considering theoperations of the Company and the same have been properly dealt with in the books ofaccount.

(iii) In our opinion and according to the information and explanation given to us theCompany has not granted any loans secured or unsecured to Companies firms or otherparties as covered in the register maintained under section 189 of the Companies Act2013. Accordingly the provisions of clause 3(iii) (a) (b) and (c) of the Order are notapplicable.

iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Act with respectto loans and advances given investments made guarantees and securities made.

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposit within the meaning of Section 73 to 76 of the Actand the rules framed thereunder.

(vi) We have broadly reviewed the books of account maintained by the Company in respectof products where pursuant to the Rules made by the Central Government the maintenanceof cost records have been prescribed under Section 148 (1) of the Act and are of theopinion that prima facie the prescribed accounts and records have been made andmaintained. We have not however made a detailed examination of the records with a viewto determining whether they are accurate or complete.

(vii) (a) According to the records of the Company and the information and explanationsgiven to us the Company has been generally depositing with the appropriate authoritiesundisputed statutory dues with some delays in payment including Provident Fund Employees'State Insurance Income tax Sales-Tax Value added Tax and any other statutory duesapplicable to it except Rs. 40.30 Lakhs.

According to the information and explanations given to us arrears of undisputedstatutory dues outstanding for a period of more than six months as on the date of balancesheet i.e. March 31 2018 was Rs. 40.30 Lacs as mentioned below:

SN. Name of the Statute Nature of the dues

Amount (in Lakhs)

Period to which the amount relates

Due Date

Date of Payment

Remarks if any

1 ESIC Contribution 40.30 May-17 Overdue Not Yet Paid

(b) According to the information and explanations given to us the dues in respect ofIncome Tax Sales Tax Service Tax Duty of Customs and Excise Duty and that have not beendeposited with the appropriate authorities on account of dispute and the forum where thedisputes are pending are given below :-

Sr. No. Name of the Statute Nature of dues Financial Year to which the matter pertains Forum where dispute is pending Amount (Rs. in lacs)
1 Central and State Sales Tax Acts Sales Tax 2001-2002 AETC (Appeal) Ludhiana 0.98
2 Central and State Sales Tax Acts Sales Tax 2006-2007 AETC (Appeal) Ludhiana 14.38
3 Central and State Sales Tax Acts Sales Tax 2007-2008 AETC (Appeal) Ludhiana 0.95
4 Central and State Sales Tax Acts Sales Tax 2009-2010 AETC (Appeal) Ludhiana 0.45

(viii) Based on our audit procedures and according to the information and explanationsgiven by the management the Company has defaulted in repayment of loans(in respect ofTerm Loans) from bank/financial institutions as per following details:

S.N. Name of lenders

Amount of Default as at 31.03.2018

Nature of Bank Loan Period of Default Remarks if Any
1 ICICI

60.99 Lakhs

ZCTL (Term Loan) Jan-16 Bank Classified Account as NPA
2 SBI

169.41 Lakhs

TL/ZCTL (Term Loan) Mar-15 Bank Classified Account as NPA

Further as per the records of the Company during the year there were no loans orborrowings from any debenture holders.

(ix) In our opinion and according to the information and the explanations given to usthe term loans outstanding at the beginning of the year have been applied for the purposesfor which they were raised. Further as per the records the Company did not raise anymoney by way of initial public offer or further public offer (including debt instruments).

(x) Based upon the audit procedures performed and to the best of our knowledge andbelief and according to the information and explanations given to us no fraud by thecompany or any fraud on the Company by its officers or employees has been noticed orreported during the year.

(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) 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) 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 the financial statements as required by the applicableIndian Accounting 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.

For and on behalf of
SONGIRA & ASSOCIATES
Chartered Accountants
(Firm Reg. No. 128085W)
(DHARMENDRA S. SONGIRA)
Place : MUMBAI Partner
Date : 30TH MAY 2018 Membership No: 113275

Annexure - B to the Auditors' Report

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 over financial reporting of GovindRubber Limited ('the Company') as of 31 March 2018 in conjunction with our audit ofthe standalone financial 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 control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India ('ICAI'). These responsibilitiesinclude the design implementation and maintenance of internal financial controls withreference to financial statements were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to company's policies thesafeguarding 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.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate 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 internalfinancial controls with reference to financial statements over financial reporting andtheir operating effectiveness. Our audit of internal financial controls over financialreporting included obtaining an understanding of internal financial controls overfinancial reporting assessing the risk that a material weakness exists and testing andevaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgment including theassessment of the risks of material misstatement of the standalone financial statementswhether 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 ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures 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 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.

Qualified Opinion

According to the information and explanations given to us and based on our audit thefollowing material weaknesses have been identified as at March 31 2018:

1. The policies procedures and overall internal controls needs to bestrengthened in order to provide proper evidences regarding recoverability of receivablesvaluation of inventories provision of payables /liabilities and statutory compliances. Weare unable to ascertain its impact if any on the statements in respect of the abovematters.

A 'material weakness' is a deficiency or a combination of deficiencies in internalfinancial control over financial reporting such that there is a reasonable possibilitythat a material misstatement of the company's annual or interim financial statements willnot be prevented or detected on a timely basis.

In our opinion except for the effects/possible effects of the material weaknessesdescribed above on the achievement of the objectives of the control criteria theCompany has in all material respects an adequate internal financial controls system overfinancial reporting and such internal financial controls over financial reporting wereoperating effectively as at 31 March 2018 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 and on behalf of
SONGIRA & ASSOCIATES
Chartered Accountants
(Firm Reg. No. 128085W)
(DHARMENDRA S. SONGIRA)
Place : MUMBAI Partner
Date : 30TH MAY 2018 Membership No: 113275


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