Mar 31, 2019
Report on the Audit of the Financial Statements Opinion
We have audited the accompanying financial statements of THE ANDHRA PETROCHEMICALS LIMITED (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2019, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date, and a summary of the significant accounting policies and other explanatory information (hereinafter referred to as âthe financial statementsâ).
In our opinion and to the best of our information and according to the explanations given to us, the accompanying financial statements give the information required by the Companies Act, 2013 (âthe Actâ) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (âInd ASâ) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2019, the profit and total comprehensive income, changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the financial statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditorâs 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 (ICAI) together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAIâs Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of 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. We have determined the matters described below to be the key audit matters to be communicated in our report.
Sl. No. |
Key Audit Matter |
How our audit addressed the Key Audit Matter |
1 |
Adoption of Ind AS 115 âRevenue from Contracts with Customersâ |
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Accuracy of recognition, measurement, presentation and disclosures of revenues and other related balances in view of adoption of Ind AS 115 âRevenue from Contracts with Customersâ (new revenue accounting standard) The application of the above new revenue accounting standard involves certain key judgements relating to identification of distinct performance obligations in the contract, determination of transaction price of the identified performance obligations, the appropriateness of the basis used to measure revenue recognized over a period. Additionally, new revenue accounting standard contains disclosures which involves collation of information in respect of disaggregated revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. |
We assessed the various Companyâs process, contracts entered with various customers to identify the impact of adoption of the new revenue accounting standard. Our audit approach consisted testing of the design and operating effectiveness of the internal controls and substantive testing as follows: Evaluated the design of internal controls relating to implementation of the new revenue accounting standard. Selected a sample of continuing and new contracts, and tested the operating effectiveness of the internal controls relating to identification of the distinct performance obligations and determination of transaction price. We carried out a combination of procedures involving enquiry and observation, re-performance and inspection of evidence in respect of operation of these controls. - Compared these performance obligations with that identified and recorded by the Company. |
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Refer Note 2.24 to the Financial Statements |
Considered the terms of the contracts to determine the transaction price including any variable consideration to verify the transaction price used to compute revenue and to test the basis of estimation of the variable consideration. - Performed analytical procedures for reasonableness of revenues disclosed by type and service offerings. We reviewed the collation of information and the logic of the report generated from the budgeting system used to prepare the disclosure relating to the periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. |
2. Valuation of Investments in Unquoted Equity Shares of Andhra Pradesh Gas Power Corporation Ltd., (APGPCL) |
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The valuation of the investments involves judgement and continues to be an area of inherent risk because quoted prices are not readily available. As per the MOU between the APGPCL and its shareholders, each shareholder is entitled to receive power generated in proportion to its shareholding at cost of generation plus 20% of its overheads which is substantially lower that the price charged by DISCOMs. In the absence of any transfer of shares of APGPCL during the year under audit the fair value of the shares has been determined by using âdiscounted cash flowâ method in respect of savings in cost of power in future years. Refer Note 3.2 to the Financial Statements |
We assessed the managementsâ approach to valuation for these investments by performing the following procedures: - We have verified data inputs used in the valuation models based on historical trends. We evaluated the methodology and assumptions used by management, including reasonableness of the discounted cash flows, growth rate and discount rate applied by comparing it with the Indian Government Bond rate for a similar period. - We tested the calculation of the fair value based on the assumptions applied. We found the disclosures in the financial statements to be appropriate. Conclusion: Based on the work performed and the evidence obtained, we consider the methodology and assumptions used by management to be appropriate. |
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3 Estimation of decommissioning and restoration provisions |
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The determination and valuation of provision is highly judgmental by its nature, as they are calculated based on assumptions that are impacted by future activities and the legislative environment in which the company operates. Refer Note 2.34 to the Financial Statements |
Our audit procedures to assess the decommissioning provision included the following: We assessed the valuation methodology. We evaluated the reasonableness of key assumptions applied by the management to calculate new and existing provisions. - We tested the calculation of the provisions. - We checked the accuracy and relevance of the input data used. We found the disclosures in the financial statements to be appropriate. Conclusion: Based on the work performed, we found managementâs assessment to be reasonable based on available evidence. |
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4 Uncertainty regarding the extension of land lease period. |
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The uncertainty of extension of lease period of the Land may have an effect on the going concern status of the Company. The company has initiated the process of renewal of the lease of the land on which the plant is located with Visakhapatnam Port Trust (VPT), which will expire on 26.06.2019. There is a possibility of existence of a competitor to the company as per the procedure to be adopted by VPT as per its âland lease extension policy.â As the company expects that the lease will be extended for at least 30 year in its favour, the unexpired period of lease for computing the provision for dismantling costs, resultant depreciation & amortization of various fixed assets has been considered as 30 years. |
Our audit procedures included the following: We have gone through the terms and conditions of the VPTâs Land renewal lease policy âe-Tender cum e-Auctionâ for the allotment of the Land on long term lease. We evaluated the reasonableness of the managementsâ judgment that the lease period will be extended for further period of 30 years based on the facts that the company has absolute right to take over the land provided they have to match the highest bid. Further, the chances of bidding by the competitor are very insignificant due to the fact that the successful bidder has to remit the value of the structures to the company in addition to the lease rentals and security deposit. Conclusion: We found managementâs judgment to be reasonable based on available evidence. |
Information Other than the Financial Statements and Auditorâs Report Thereon
The Companyâs Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and Analysis, Boardâs Report including Annexures to Boardâs Report, Business Responsibility Report, Corporate Governance and Shareholderâs Information, but does not include the financial statements and our auditorâs 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 during the course of our audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this âother informationâ, we are required to report that fact. We have nothing to report in this regard.
Managementâs Responsibility for the Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance, total comprehensive income, changes in equity and cash flows of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. 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 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 Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the 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.
The Board of Directors is responsible for overseeing the Companyâs financial reporting process.
Auditorâs 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 auditorâs 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 financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, 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 managementâs 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 Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs 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 auditorâs 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.
Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the financial statements.
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 deficiencies 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 auditorâs 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 (Auditorâs Report) Order, 2016 (âthe Orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in âAnnexure- Aâ a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, based on our audit 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, Statement of Changes in Equity and the Statement of Cash Flow dealt with by this Report are in agreement with the relevant books of account.
d) In our opinion, the aforesaid financial statements comply with the Ind AS specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
e) On the basis of the written representations received from the directors as on March 31, 2019 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2019 from being appointed as a director in terms 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 âAnnexure Bâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial reporting.
g) With respect to the other matters to be included in the Auditorâs Report in accordance with the requirements of section 197(16) of the Act, as amended:
The company has neither paid nor provided any remuneration to any of the Directors of the company. Accordingly the question of reporting under the provisions of section 197(16) of the Act does not arise.
h) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended 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.
ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts.
iii. The company has obtained a demand draft favoring âInvestor Education and Protection Fundâ for Rs.41.87 Lakhs on 20.11.2018 towards unpaid dividends for the year 2010-11, which were to be remitted to the fund on that date and remitted the same on 13th May 2019.
ANNEXURE-A TO THE INDEPENDENT AUDITORSâ REPORT
The Annexure A referred to in our Independent Auditorâs report of even date, to the members of THE ANDHRA PETROCHEMICALS LIMITED, TANUKU, for the year ended 31 March 2019. We report that:
i) a) The Company has maintained 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. According to the information furnished to us, no material discrepancies have been noticed on such verification.
c) The title deeds in respect of all immovable properties are held in the name of the company.
ii) Physical verification of inventory has been conducted during the year by the management at reasonable intervals. The discrepancies noticed on such verification between the physical stocks and the book records were not material.
iii) The Company has not granted any loans, secured or unsecured, to Companies, Firms, Limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Consequently, clauses 3 (iii) (a), (b) and (c) of the Order are not applicable.
iv) The company has neither given any loans to the directors or any other persons in whom the director(s) is interested nor given/provided any guarantee/security in connection with any loan taken by directors or such other persons as per the provisions of section 185 of the Companies Act, 2013. The investment made by the company in an earlier year does not exceed the limits prescribed under section 186 of the Companies Act, 2013.
v) The Company has not accepted any deposits from the public. Consequently, the clause 3(v) of the order is not applicable to the Company.
vi) We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under sub-section (1) of section 148 of the Companies Act, 2013 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.
vii) a) According to the information and explanations given to us and on the basis of examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including provident fund, employeesâ state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities.
According to the information and explanations given to us, no undisputed amounts are payable in respect of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax or cess and other material statutory dues which were in arrears as at 31st March 2019 for a period of more than six months from the date they became payable.
b) As at 31st March 2019, there have been no disputed dues, which have not been deposited with the respective authorities in respect of Income tax, Service tax, duty of customs, duty of excise, value added tax and Cess, except the following:
Sr. No. |
Name of the Statute |
Nature of the Dues |
Amount * (Rs. in lakhs) |
Period to which the amount relates |
Forum where dispute is pending |
1. |
The Income Tax Act, 1961 |
Income Tax |
3.80 |
Assessment Year 2008-09 |
Commissioner of Income Tax (Appeals), Rajahmundry. |
2. |
The Income Tax Act, 1961 |
Income Tax |
2.21 |
Assessment Year 2009-10 |
Commissioner of Income Tax (Appeals), Rajahmundry. |
*Net of Pre deposits made.
viii) The Company has not defaulted in repayment of any loan installments in respect of term loans from financial institutions and banks.
ix) In our opinion, the Term Loans obtained in earlier years have been applied for the purposes for which they were raised.
x) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.
xi) The company has neither paid nor provided for any managerial remuneration during the financial year under report. Consequently the clause 3(xi) of the order is not applicable.
xii) In our opinion, the company is not a Nidhi Company. Consequently the clause 3(xii) of the order is not applicable.
xiii) According to the information and explanations given to us and on overall examination of the records of the Company, we report that all transactions with related parties are in compliance with the provisions of sections 177 and 188 of the Companies Act, 2013 and the related party disclosures as required by relevant Indian Accounting Standards are disclosed in the financial statements.
xiv) The Company has not made any preferential allotment or private placement of shares or fully/partly convertible debentures during the year under review. Consequently the clause 3(xiv) of the order is not applicable.
xv) The Company has not entered into any non cash transactions with the directors or persons connected with them during the year under report. Consequently the clause 3(xv) of the order is not applicable.
xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Consequently the clause 3(xvi) of the order is not applicable.
Annexure âBâ to the Independent Auditorsâ Report
Report on the Internal Financial Controls over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of THE ANDHRA PETROCHEMICALS LIMITED (âthe Companyâ) as of 31st March 2019 in conjunction with our audit of the financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Board of directors of the company 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 (âICAIâ). 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 companyâs 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.
Auditorâs Responsibility
Our responsibility is to express an opinion on the internal financial controls over financial reporting of the company based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the âGuidance Noteâ) issued by ICAI and the Standards on Auditing 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.
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 auditorâs judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companyâs internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A companyâs internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Ind AS financial statements for external purposes in accordance with generally accepted accounting principles. A companyâs internal financial control over financial reporting includes those policies and procedures that:
(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of Ind AS 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
(3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companyâs 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 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
In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2019, 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.
For C V RAMANA RAO & CO
Chartered Accountants
Place : Visakhapatnam Firm Registration Number: 002917S
Date : 25.05.2019 (KATYAYANI K)
Partner
Membership Number: 225030
Mar 31, 2018
INDEPENDENT AUDITORS'' REPORT
To
The Members of
The Andhra Petrochemicals Limited,
Tanuku.
Report on the Ind AS Financial Statements:
We have audited the accompanying Ind AS financial statements of The Andhra Petrochemicals Limited, Tanuku, which comprise the Balance Sheet as at March 31, 2018 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 then ended, and a summary of the significant accounting policies and other explanatory information.
Management''s Responsibility for the Ind AS Financial Statements:
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 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 (Ind AS) prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. 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 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:
1. Our responsibility is to express an opinion on these Ind AS financial statements based on our audit.
2. 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 thereunder.
3. We conducted our audit 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 Ind AS financial statements are free from material misstatement.
4. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the 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 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 Ind AS financial statements.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Ind AS financial statement.
Opinion:
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid 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 including the Ind AS, of the financial position of the Company as at 31st March, 2018, and its financial performance including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
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 subsection (11) of section 143 of the Act, we give in the Annexure A, a statement on the matters specified 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 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, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid Ind AS financial statements comply with the Indian Accounting Standards prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
e) On the basis of the written representations received from the directors as on 31st March, 2018 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2018 from being appointed as a director in terms 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".
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 explanations given to us:
i. The Company does not have any pending litigations that would impact its financial position.
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
The Annexure A referred to in our Independent Auditor''s report of even date, to the members of THE ANDHRA PETROCHEMICALS LIMITED, TANUKU, for the year ended 31 March 2018. We report that:
i) a) The Company has maintained 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. According to the information furnished to us, no material discrepancies have been noticed on such verification.
c) The title deeds in respect of all immovable properties are held in the name of the company.
ii) Physical verification of inventory has been conducted during the year by the management at reasonable intervals. The discrepancies noticed on such verification between the physical stocks and the book records were not material.
iii) The Company has not granted any loans, secured or unsecured, to Companies, Firms, Limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Consequently, clauses 3 (iii) (a), (b) and (c) of the Order are not applicable.
iv) The company has neither given any loans to the directors or any other persons in whom the director(s) is interested nor given/provided any guarantee/security in connection with any loan taken by directors or such other persons as per the provisions of section 185 of the Companies Act, 2013. The investment made by the company in an earlier year does not exceed the limits prescribed under section 186 of the Companies Act, 2013.
v) The Company has not accepted any deposits from the public. Consequently, the clause 3(v) of the order is not applicable to the Company.
vi) We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under sub-section (1) of section 148 of the Companies Act, 2013 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.
vii) a) According to the information and explanations given to us and on the basis of examination of the records of the Company, amounts
deducted/ accrued in the books of account in respect of undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities.
According to the information and explanations given to us, no undisputed amounts are payable in respect of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax or cess and other material statutory dues which were in arrears as at 31st March 2018 for a period of more than six months from the date they became payable.
b) As at 31st March 2018, there have been no disputed dues, which have not been deposited with the respective authorities in respect of Income tax, Service tax, duty of customs, duty of excise, value added tax and Cess, except the following:
Sr. No. |
Name of the Statute |
Nature of the Dues |
Amount * (Rs. in lakhs) |
Period to which the amount relates |
Forum where dispute is pending |
1. |
The Income Tax Act, 1961. |
Tax Deduction at Source |
1.72 |
Assessment Year 2006-07 |
Income Tax Appellate Tribunal, Visakhapatnam. |
2. |
The Income Tax Act, 1961. |
Income Tax |
23.67 |
Assessment Year 2012-13 |
Commissioner of Income Tax (Appeals), Rajahmundry. |
3. |
The Income Tax Act, 1961 |
Income Tax |
54.92 |
Assessment Year 2015-16 |
Commissioner of Income Tax (Appeals), Rajahmundry. |
4. |
The Income Tax Act, 1961 |
Tax Deduction at Source |
19.44 |
Assessment Years 2006-07 & 2008-09 |
Commissioner of Income Tax (Appeals), Visakhapatnam. |
*Net of Pre deposits made.
viii) The Company has not defaulted in repayment of any loan installments in respect of term loans from financial institutions and banks.
ix) In our opinion, the Term Loans obtained in earlier years have been applied for the purposes for which they were raised.
x) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.
xi) The company has neither paid nor provided for any managerial remuneration during the financial year under report. Consequently the clause 3(xi) of the order is not applicable.
xii) In our opinion, the company is not a Nidhi Company. Consequently the clause 3(xii) of the order is not applicable.
xiii) According to the information and explanations given to us and on overall examination of the records of the Company, we report that all transactions with related parties are in compliance with the provisions of sections 177 and 188 of the Companies Act, 2013 and the related party disclosures as required by relevant Indian Accounting Standards are disclosed in the financial statements.
xiv) The Company has not made any preferential allotment or private placement of shares or fully/partly convertible debentures during the year under review. Consequently the clause 3(xiv) of the order is not applicable.
xv) The Company has not entered into any non cash transactions with the directors or persons connected with them during the year under report. Consequently the clause 3(xv) of the order is not applicable.
xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Consequently the clause 3(xvi) of the order is not applicable.
The Annexure B referred to in our Independent Auditor''s report of even date on the financial statements of THE ANDHRA PETROCHEMICALS LIMITED, TANUKU.
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")
We have audited the internal financial controls over financial reporting of The Andhra Petrochemicals Limited, Tanuku ("the Company") as of March 31, 2018 in conjunction with our audit of the Ind AS 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 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.
Auditors'' Responsibility
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") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. 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.
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 Ind AS financial statements, whether due to fraud or error.
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
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 Ind AS financial statements for external purposes in accordance with generally accepted accounting principles including Indian Accounting Standards prescribed under section 133 of the Act. A company''s internal financial control over financial reporting includes those policies and procedures that:
(1) pertains to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
(2) provides reasonable assurance that transactions are recorded as necessary to permit preparation of Ind AS financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and
(3) provides 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 Ind AS financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
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
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March, 2018, 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".
For C V RAMANA RAO & CO
Chartered Accountants
Firmâs Registration Number: 002917S
(KATYAYANI K)
Camp : Hyderabad Partner
Date : 24.°5.2°18 Membership Number: 225030
Mar 31, 2016
To
The Members of
The Andhra Petrochemicals Limited,
Tanuku.
Report on the Financial Statements:
We have audited the accompanying financial statements of The Andhra Petrochemicals Limited, Tanuku, which comprise the Balance Sheet as at March 31, 2016 and the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements:
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 financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. 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 financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor''s Responsibility:
1. Our responsibility is to express an opinion on these financial statements based on our audit.
2. 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.
3. We conducted our audit 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 financial statements are free from material misstatement.
4. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. 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. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the 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 financial statements.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statement.
Opinion:
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid 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 of the Company as at 31st March, 2016, and its losses and its cash flows for the year ended on that date.
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 of the Act, we give in the Annexure A, a statement on the matters specified 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 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, and Cash Flow statement dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
e) On the basis of the written representations received from the directors as on 31st March, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed as a director in terms 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".
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 explanations given to us:
i. The Company does not have any pending litigations that would impact its financial position.
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
Annexure A to the Independent Auditor''s Report:
The Annexure A referred to in our Independent Auditor''s report of even date, to the members of THE ANDHRA PETROCHEMICALS LIMITED, TANUKU, for the year ended 31 March 2016. We report that:
i) a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
b) The fixed assels have been physically verified by the management during the year. According to the information furnished to us, no material discrepancies have been noticed on such verification.
c) The title deeds in respect of all immovable properties are held in the name of the company.
ii) Physical verification of inventory has been conducted during the year by the management at reasonable intervals. The discrepancies noticed on such verification between the physical stocks and the book records were not material.
iii) The Company has not granted any loans, secured or unsecured, to Companies, Firms, Limited liability partnerships or Other parties covered in the register maintained under section 189 of the Companies Act, 2013. Consequently, clauses 3 (iii) (a), (b) and (c) of the Order are not applicable.
iv) The company has neither given any loans to the directors or any other persons in whom the director is interested nor given/ provided any guarantee/security in connection with any loan taken by directors or such other persons as per the provisions of section 185 of the Companies Act, 2013. The investment made by the company in an earlier year does not exceed the limits prescribed under section 186 of the Companies Act, 2013.
v) The Company has not accepted any deposits from the public. Consequently, the clause 3(v) of the order is not applicable to the Company.
vi) We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under sub-section (1) of section 148 of the Companies Act, 2013 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.
vii) a) According to the information and explanations given to
us and on the basis of examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities.
According to the information and explanations given to us, no undisputed amounts are payable in respect of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax or cess and other material statutory dues which were in arrears as at 31st March 2016 for a period of more than six months from the date they became payable.
b) As at 31st March 2016, there have been no disputed dues, which have not been deposited with the respective authorities in respect of Income tax, Service tax, duty of customs, duty of excise, value added tax and Cess, except the following:
Sr. No. |
Name of the Statute |
Nature of the Dues |
Amount * (Rs. in lakhs) |
Period to which the amount relates |
Forum where dispute is pending |
1. |
The Income Tax Act, 1961 |
Tax Deduction at Source |
1.72 |
Assessment Year 2006-07 |
Income Tax Appellate Tribunal, Visakhapatnam. |
2. |
The Income Tax Act, 1961 |
Income Tax |
4.39 |
Assessment Year 2008-09 |
Deputy Commissioner of Income Tax, Circle - 1, Visakhapatnam. |
3. |
The Income Tax Act, 1961 |
Fringe Benefit Tax |
2.28 |
Assessment Year 2008-09 |
Commissioner of Income Tax (Appeals), Visakhapatnam. |
4. |
The Income Tax Act, 1961 |
Tax Deduction at Source |
15.68 |
Assessment Years 2008-09 & 2009-10 |
Commissioner of Income Tax (Appeals), Visakhapatnam. |
5. |
Value Added Tax |
Disallowance of Input tax credit |
10.45 |
Assessment Year 2009-10 |
Appellate Deputy Commissioner (CT), Vijayawada |
6. |
Central Excise Act, 1944 |
Ineligible cenvat credit on Service tax paid on certain services |
9.60 |
Period from Dec., 2011 to Sep., 2015 |
Commissioner of Central Excise (Appeals), Visakhapatnam |
* Net of Pre deposits made.
viii) The Company has not defaulted in repayment of any loan installments in respect of term loans from financial institutions and banks consequent to the reschedulement of term loan installments by IDBI Bank.
ix) In our opinion, the Term Loans obtained during the financial year under report and in earlier years have been applied for the purposes for which they were raised.
x) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.
xi) The company has neither paid nor provided for any managerial remuneration during the financial year under report. Consequently the clause 3(xi) of the order is not applicable.
xii) In our opinion, the company is not a Nidhi Company. Consequently the clause 3(xii) of the order is not applicable.
xiii) According to the information and explanations given to us and on overall examination of the records of the Company, we report that all transactions with related parties are in compliance with the provisions of sections 177 and 188 of the Companies Act, 2013 and the related party disclosures as required by relevant Accounting Standards are disclosed in the financial statements.
xiv) The Company has not made any preferential allotment or private placement of shares or fully/partly convertible debentures during the year under review. Consequently the clause 3(xiv) of the order is not applicable.
xv) The Company has not entered into any non cash transactions with the directors or persons connected with them during the year under report. Consequently the clause 3(xv) of the order is not applicable.
xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Consequently the clause 3(xvi) of the order is not applicable.
for BRAHMAYYA & CO.,
Chartered Accountants
Camp : Hyderabad
Firm R,e9n. N°. °0°513S
Date : 20.5.2016 C V Ramana Rao
Partner
Membership No.018545
Accounting Policies
Mar 31, 2015
We have audited the accompanying financial statements of The Andhra
Petrochemicals Limited, Tanuku, which comprise the Balance Sheet as at
March 31, 2015 and the Statement of Profit and Loss, the Cash Flow
Statement for the year then ended, and a summary of the significant
accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements:
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 financial statements that give a true and
fair view of the financial position, financial performance and cash
flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. 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 financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility:
1. Our responsibility is to express an opinion on these financial
statements based on our audit.
2. 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.
3. We conducted our audit 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 financial statements
are free from material misstatement.
4. An audit involves performing procedures to obtain audit evidence
about the amounts and the disclosures in the financial statements. 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. In making those risk
assessments, the auditor considers internal financial control relevant
to the Company's preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on whether the Company has in place an adequate internal
financial control system over financial reporting and the operating
effectiveness of such controls. 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 over- all presentation of the financial statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion on the
financial statement.
Opinion:
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid 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 of the Company as
at 31st March, 2015, and its losses and its cash flows for the year
ended on that date.
Report on Other Legal and Regulatory Requirements:
1. As required by the Companies (Auditor's Report) Order, 2015 ("the
Order") issued by the Central Government of India in terms of
sub-section (11) of section 143 of the Act, we give in the Annexure a
statement on the matters specified in the paragraphs 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 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, and Cash Flow
statement dealt with by this Report are in agreement with the books of
account.
d) In our opinion, the aforesaid financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014.
e) On the basis of the written representations received from the Di-
rectors as on 31st March, 2015 taken on record by the Board of
Directors, none of the Directors is disqualified as on 31st March, 2015
from being appointed as a Director in terms of Section 164 (2) of the
Act and
f) 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 explanations given to us.
i. The Company does not have any pending litigations that would impact
its financial position.
ii. The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable
losses.
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.
Annexure to the Independent Auditor's Report:
The Annexure referred to in our Independent Auditor's report of even
date, to the members of THE ANDHRA PETROCHEMICALS LIMITED, TANUKU, for
the year ended 31 March 2015. We report that:
i) a) The Company has maintained 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. According to the information furnished to
us, no material discrepancies have been noticed on such verification.
ii) a) Physical verification of inventory has been conducted during the
year by the management at reasonable intervals.
b) The procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
c) On the basis of our examination of the records of inventory, we are
of the opinion that the Company is maintaining proper records of
inventory. The discrepancies noticed on such verification between the
physical stocks and the book records were not material.
iii) The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under section 189 of the Companies Act, 2013. Consequently, clauses 3
(iii) (a) and (b) of the Order are not applicable.
iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventories, fixed assets and sale of goods. We have not
observed any major weakness in the internal control system during the
course of the audit.
v) The Company has not accepted any deposits from the public.
Consequently, the clause 3(v) of the order is not applicable to the
Company.
vi) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the Rules made by the Central Government for the
maintenance of cost records under sub-section (1) of section 148 of the
Companies Act, 2013 and we are of the opinion that prima facie the
prescribed accounts and records have been made and maintained. However,
we have not made a detailed examination of the records. vii) a)
According to the information and explanations given to us and on the
basis of examination of the records of the Company, amounts deducted/
accrued in the books of account in respect of undisputed statutory dues
including provident fund, employees' state insurance, income-tax,
sales-tax, wealth- tax, service tax, duty of customs, duty of excise,
value added tax, cess and other material statutory dues have been
regularly deposited during the year by the Company with the appropriate
authorities.
According to the information and explanations given to us, no
undisputed amounts are payable in respect of income tax, sales tax,
wealth tax, service tax, duty of customs, duty of excise, value added
tax or cess and other material statutory dues which were in arrears as
at 31st March 2015 for a period of more than six months from the date
they became pay- able.
b) As at 31st March 2015, there have been no disputed dues, which have
not been deposited with the respective authorities in respect of Income
tax, Wealth-tax, Service tax, duty of customs, duty of excise, value
added tax and Cess, except the following:
Period to Forum
Name Amount * which the where
Sr. of the Nature of (Rs. in amount dispute is
No. the Dues
Statute lakhs) relates pending
1. The Tax 1.72 Assess- Income Tax
Income Deduction ment Appellate
Tax Act, at Source Year Tribunal,
1961 2006-07 Visakhapatnam
2. The Income 2.82 Assess- Commissioner
Income Tax ment of Income Tax
Tax Act, Year (Appeals),
1961 2008-09 Visakhapatnam
3. The Fringe 2.28 Assess- Commissioner
Income Benefit ment of Income Tax
Tax Act, Tax Year (Appeals),
1961 2008-09 Visakhapatnam
4. The Tax 15.68 Assessment Commissioner
Income Deduction Years ofIncome Tax
Tax Act, at 2008-09 & (Appeals),
1961 Source 2009-10 Visakhapatnam
5. Value Dis- 10.45 Assess- Appellate
added allowance ment Deputy
of Input
Tax tax Year Commissioner
credit 2009-10 (CT)
* Net of Pre deposits made.
c) According to the information and explanations given to us the
amounts which were required to be transferred to the Investor education
and protection fund in accordance with the relevant provisions of the
Companies Act, 1956 (1 of 1956) and rules there under has been
transferred to such fund within time.
viii) The Company has no accumulated losses. It has incurred cash
losses during the financial year covered by our audit and also the
immediately preceding financial year.
ix) The Company has not defaulted in payment of any loan installment or
interest in respect of term loans from financial institutions and banks
consequent to the reschedulement of term loan installments by IDBI
Bank.
x) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks or financial institutions. Consequently the clause 3 (x) of the
order is not applicable to the Company.
xi) In our opinion, the Term Loans obtained during the financial year
under report and in earlier years have been applied for the purposes
for which they were raised.
xii) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
for BRAHMAYYA & CO.,
Chartered Accountants
Firm Regn. No. 000513S
Place : Visakhapatnam
C V Ramana Rao
Date : 22.5.2015
Partner
Membership No.018545
Mar 31, 2014
1. We have audited the accompanying Financial Statements of The Andhra
Petrochemicals Limited, Tanuku ("the Company"), which comprise the
Balance Sheet as at March 31, 2014, the Statement of Profit and Loss
and Cash Flow Statement for the year then ended, and a summary of
significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements:
2. Management is responsible for the preparation of these Financial
Statements that give a true and fair view of the financial position and
financial performance of the Company in accordance with the Accounting
Standards referred to in sub-section (3C) of section 211 of the
Companies Act, 1956 ("the Act"). This responsibility includes the
design, implementation and maintenance of internal control relevant to
the preparation and presentation of the 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 Financial
Statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement. An audit involves performing procedures to
obtain audit evidence about the amounts and disclosures in the
financial statements. 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.
4. In making those risk assessments, the auditor considers internal
control relevant to the Company''s preparation and fair presentation of
the financial statements in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the entity''s internal control. An
audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of the accounting estimates made
by management, as well as evaluating the overall presentation of the
financial statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion:
6. In our opinion and to the best of our information and according to
the explanations given to us, the 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:
a) In the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2014;
b) In the case of the Statement of Profit and Loss, of the Loss for the
year ended on that date; and
c) In the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
Report on Other Legal and Regulatory Requirements:
7. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of sub-
section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
8. As required by section 227(3) of the Act, we report that:
a) we have 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;
c) the Balance Sheet, the Statement of Profit and Loss and the Cash
Flow Statement, dealt with by this Report are in agreement with the
books of account;
d) in our opinion, the Balance Sheet, the Statement of Profit and Loss
and the Cash Flow Statement, comply with the Accounting Standards
referred to in sub-section (3C) of section 211 of the Companies Act,
1956;
e) on the basis of the written representations received from the
Directors as on 31st March, 2014, taken on record by the Board of
Directors, none of the Directors is disqualified as on 31st March,
2014, from being appointed as a Director in terms of section
274(1)(g) of the Act.
ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT REFERRED TO IN PARAGRAPH 7
UNDER THE HEADING OF "REPORT ON OTHER LEGAL AND REGULATORY
REQUIREMENTS'''' OF OUR REPORT OF EVEN DATE:
i) a) The Company has maintained 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. According to the information furnished to us, no
material discrepancies have been noticed on such verification.
c) The Fixed Assets disposed off by the Company during the year do not
form a substantial part thereof. Accordingly the "going concern" status
of the Company is not affected.
ii) a) Physical verification of inventory has been conducted during the
year by the management at reasonable intervals.
b) The procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
c) On the basis of our examination of the records of inventory, we are
of the opinion that the Company is maintaining proper records of
inventory. The discrepancies noticed on such verification between the
physical stocks and the book records were not material.
iii) a) The Company has not granted any loans, secured or unsecured to
companies, firms or other parities covered in the register maintained
under section 301 of the Companies Act, 1956. Consequently, clauses
4(iii)(b) to (d) of the Order are not applicable.
b) The Company during the year has taken and repaid an unsecured loan
amounting to Rs. 10 Crores from a company, to whom the provisions of
section 301 of the Companies Act, 1956 apply.
c) We are of the opinion based on the information provided to us that
the rate of interest and other terms and conditions on which the above
loan taken by the company are not prima facie prejudicial to the
interest of the company.
d) The company has repaid the loan amount along with the interest
accrued thereon during the year.
iv) In our opinion and according to the information and
explanations given to us, there is adequate internal control system
commensurate with the size of the Company and the nature of its
business with regard to purchase of inventory, fixed assets and sale of
goods and services. We have not observed any major weakness in the
internal control system during the course of the audit.
v) a) According to the information and explanations given to us, we are
of the opinion that the particulars of contracts and arrangements that
need to be entered into the register maintained under section 301 of
the Companies Act, 1956 have been so entered. b) In our opinion and
according to the information and explanations given to us, the
contracts and arrangements made in pursuance of contracts or
arrangements entered in the register maintained under section 301 of
the Companies Act, 1956 have been made at prices which are reasonable
having regard to prevailing market prices at the relevant time.
vi) The Company has not accepted any deposits from public.
Consequently the clause 4(vi) of the order is not applicable.
vii) In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
viii) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the Rules made by the Central Government for the
maintenance of cost records under section 209(1)(d) of the Companies
Act, 1956 and we are of the opinion that prima facie the prescribed
accounts and records have been made and maintained. However, we have
not made a detailed exmination of the records.
ix) a) According to the information and explanations given to us and on
the basis of examination of the records of the Company, amounts
deducted / accrued in the books of account in respect of undisputed
statutory dues including provident fund, income-tax, sales-tax,
wealth-tax, custom duty, excise duty, service-tax, cess and other
material statutory dues have been regularly deposited during the year
by the Company with the appropirate authorities.
b) According to the information and explanations given to us, no
undisputed amounts payable in respect of income tax, sales tax, wealth
tax, service tax, customs duty, excise duty, cess and other material
statutory dues which were in arrears as at 31st March, 2014 for a
period of more than six months from the date they became payable.
c) As at 31st March, 2014, there have been no disputed dues, which have
not been deposited with the respective authorities in respect of Income
Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and
Cess, except the following:
Name Amount *
Sr. Nature of
of the (Rs. in
No. the Dues
Statute lakhs)
1. The Income Tax 1.72
Ta x Act, Deduction
1961 at Source
2. The Income Income Tax 2.82
Ta x Act,
1961
3. The Income Fringe 2.28
Ta x Act, Benefit
1961 Tax
4. The Income Tax 15.68
Ta x Act, Deduction
1961 at Source
5. Value Disallowance 10.45
Added of Input tax
Tax credit
Period to Forum
Name of the which the where
Statute amount dispute is
relates pending
The Income Assessment Income Tax
Tax Act,1961 Year 2006-07 Appellate
Tribunal,
Visakhapatnam.
The Income Tax Act,1961 Assessment Commissioner
Year 2008-09 of Income Ta x
(Appeals),
Visakhapatnam.
The Income Tax Act,1961 Assessment Commissioner
Year 2008-09 of Income Ta x
(Appeals),
Visakhapatnam.
The Income Tax Act,1961 Assessment Commissioner
Years of Income Tax
2008-09 & (Appeals),
2009-10 Visakhapatnam.
Value Added Tax Assessment Appellate Year 2009-10 Deputy Commissioner
(CT)
* Net of Pre deposits made.
x) The Company has no accumulated losses. It has incurred cash
loss during the financial year covered by our audit. However,
it has not incurred any cash loss in the immediately preceding
financial year.
xi) The Company has not defaulted in payment of any loan installment
or interest in respect of term loans from financial institutions and
banks consequent to the reschedulement of term loan installments
by IDBI Bank vide its modified sanction letters dated 17th May,
2014.
xii) The Company has not granted any loans or advances on the
basis of security by way of pledge of shares, debentures and other
securities. Consequently, the clause 4(xii) of the order is not
applicable.
xiii) In our opinion, the Company is not a chit fund or a nidhi/
mutual benefit fund/society. Consequently the clause 4(xiii) of the
order is not applicable.
xiv) In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other instruments. Consequently
the clause 4(xiv) of the order is not applicable.
xv) The Company has not given any guarantee for loans taken by
others from banks or financial institutions. Consequently the
clause 4(xv) of the order is not applicable.
xvi) In our opinion, the Term Loans obtained in earlier years have
been applied for the purposes for which they were raised.
xvii) According to the information and explanations given to us and
on overall examination of the Balance Sheet of the Company, we
report that no funds raised on short-term basis have been used
for long-term investment.
xviii) During the year, the Company has not made any preferential
allotment of shares. Consequently the clause 4(xviii) of the order
is not applicable.
xix) The Company has not issued any debentures so far. Consequently
clause 4(xix) of the order is not applicable.
xx) During the year, the Company has not raised money by Public
issue. Consequently the clause 4(xx) of the order is not applicable.
xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
for BRAHMAYYA & CO.,
Chartered Accountants
Firm Regn. No. 000513S
C V Ramana Rao
Camp : Hyderabad Partner
Date : 24th May, 2014 Membership No.018545
Mar 31, 2013
Report on the Financial Statements :
1. We have audited the accompanying Financial Statements of the Andhra
Petrochemicals Limited, Tanuku ("the Company"), which comprise the
Balance Sheet as at 31st March, 2013, the Statement of Profit and Loss
and Cash Flow Statement for the year then ended, and a summary of
significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements :
2. Management is responsible for the preparation of these Financial
Statements that give a true and fair view of the financial position and
financial performance of the Company in accordance with the Accounting
Standards referred to in sub-section (3C) of section 211 of the
Companies Act, 1956 ("the Act"). This responsibility includes the
design, implementation and maintenance of internal control relevant to
the preparation and presentation of the 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 Financial
Statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the Financial Statements are free
from material misstatement. An audit involves performing procedures to
obtain audit evidence about the amounts and disclosures in the
financial statements. 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.
4. In making those risk assessments, the auditor considers internal
control relevant to the Company''s preparation and fair presentation of
the Financial Statements in order to design audit procedures that are
appropriate in the circumstances. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of
the accounting estimates made by management, as well as evaluating the
overall presentation of the Financial Statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion :
6. In our opinion and to the best of our information and according to
the explanations given to us, the 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:
a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2013;
b) in the case of the Statement of Profit and Loss, of the Profit for
the year ended on that date; and
c) in the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
Report on Other Legal and Regulatory Requirements:
7. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
8. As required by section 227 (3) of the Act, we report that:
a) we have 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;
c) the Balance Sheet, the Statement of Profit and Loss and the Cash
Flow Statement, dealt with by this Report are in agreement with the
books of account;
d) in our opinion, the Balance Sheet, the Statement of Profit and Loss
and the Cash Flow Statement, comply with the Accounting Standards
referred to in sub-section (3C) of section 211 of the Companies Act,
1956;
e) on the basis of the written representations received from the
Directors as on 31st March, 2013, taken on record by the Board of
Directors, none of the Directors is disqualified as on 31st March,
2013, from being appointed as a Director in terms of section
274(1) (g) of the Act.
ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT REFERRED TO IN PARAGRAPH 7
UNDER THE HEADING OF "REPORT ON OTHER LEGAL AND REGULATORY
REQUIREMENTS'''' OF OUR REPORT OF EVEN DATE:
i) a) The Company has maintained 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. According to the information furnished to us, no
material discrepancies have been noticed on such verification.
c) The Fixed Assets disposed off by the Company during the year do not
form a substantial part thereof. Accordingly the "going concern"
status of the Company is not affected.
ii) a) Physical verification of inventory has been conducted during the
year by the management at reasonable intervals.
b) The procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
c) On the basis of our examination of the records of inventory, we are
of the opinion that the Company is maintaining proper records of
inventory. The discrepancies noticed on such verification between the
physical stocks and the book records were not material.
iii) a) The Company has not granted any loans, secured or unsecured to
companies, firms or other parities covered in the register maintained
under section 301 of the Companies Act, 1956. Consequently, clauses
4(iii) (b) to (d) of the order are not applicable. b) The Company has
not taken any loans, secured or unsecured from companies, firms, or
other parties covered in the register maintained under section 301 of
the Companies Act, 1956. Consequently, clauses 4(iii)(f) & (g) of the
Order are not applicable.
iv) In our opinion and according to the information and explanations
given to us, there is adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and sale of goods and services.
We have not observed any major weakness in the internal control system
during the course of the audit.
v) a) According to the information and explanations given to us, we are
of the opinion that the particulars of contracts and arrangements that
need to be entered into the register maintained under section 301 of
the Companies Act, 1956 have been so entered. b) In our opinion and
according to the information and explanations given to us, the
contracts and arrangements made in pursuance of contracts or
arrangements entered in the register maintained under section 301 of
the Companies Act, 1956 have been made at prices which are reasonable
having regard to prevailing market prices at the relevant time.
vi) The Company has not accepted any deposits from Public. Consequently
the clause 4(vi) of the order is not applicable.
vii) In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
viii) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the Rules made by the Central Government for the
maintenance of cost records under section 209(1)(d) of the Companies
Act, 1956 and we are of the opinion that prima facie the prescribed
accounts and records have been made and maintained. However, we have
not made a detailed exmination of the records.
ix) a) According to the information and explanations given to us and on
the basis of examination of the records of the Company, amounts
deducted / accrued in the books of account in respect of undisputed
statutory dues including provident fund, income-tax, sales-tax,
wealth-tax, custom duty, excise duty, service-tax, cess and other
material statutory dues have been regularly deposited during the year
by the Company with the appropirate authorities.
b) According to the information and explanations given to us, no
undisputed amounts payable in respect of income tax, sales tax, wealth
tax, service tax, customs duty, excise duty, cess and other material
statutory dues which were in arrears as at 31st March, 2013 for a
period of more than six months from the date they became payable.
c) As at 31st March, 2013, there have been no disputed dues, which have
not been deposited with the respective authorities in respect of Income
Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and
Cess, except the following :
Period to Forum
Name Amount which the where
Sr. Name of
of the (Rs. in amount dispute is
No. the Dues
Statute lakhs) relates pending
1. The Income Income 24.71 Assessment Commissioner
Tax Act, Tax Year 2010-11 of Income
1961 Tax (Appeals),
Visakhapatnam.
x) The Company has no accumulated losses and has not incurred cash
losses in the financial year covered by our audit and the immediately
preceding financial year.
xi) The Company has not defaulted in payment of any loan installment or
interest in respect of term loans from financial institutions and
banks.
xii) The Company has not granted any loans or advances on the basis of
security by way of pledge of shares, debentures and other securities.
Consequently, the clause 4(xii) of the order is not applicable.
xiii) In our opinion, the Company is not a chit fund or a nidhi/mutual
benefit fund/society. Consequently the clause 4(xiii) of the order is
not applicable.
xiv) In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other instruments. Consequently the
clause 4(xiv) of the order is not applicable.
xv) The Company has not given any guarantee for loans taken by others
from banks or financial institutions. Consequently the clause 4(xv) of
the order is not applicable.
xvi) In our opinion, the Term Loans have been applied for the purposes
for which they were raised.
xvii) According to the information and explanations given to us and on
overall examination of the Balance Sheet of the Company, we report that
no funds raised on short term basis have been used for long term
investment.
xviii) During the year, the Company has not made any preferential
allotment of shares. Consequently the clause 4(xviii) of the order is
not applicable.
xix) The Company has not issued any debentures so far. Consequently
clause 4(xix) of the order is not applicable.
xx) During the year, the Company has not raised money by Public issue.
Consequently the clause 4(xx) of the order is not applicable.
xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
for BRAHMAYYA & CO.,
Chartered Accountants
Firm Regn. No. 000513S
C V Ramana Rao
Camp : Hyderabad Partner
Date : 25-5-2013 Membership No.018545
Mar 31, 2012
1. We have audited the attached Balance Sheet of The Andhra
Petrochemicals Limited, Tanuku as at 31st March, 2012, the statement of
Profit and Loss for the year ended on that date annexed thereto and
cash flow statement for the year ended on that date. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements
based on our audit.
2. We have conducted our audit in accordance with auditing standards
generally accepted in India. These Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors' Report) Order, 2003 issued
by the Central Government of India in terms of sub-section (4A) of
Section 227 of 'The Companies Act, 1956' of India (the 'Act') and on
the basis of such checks as we considered appropriate and according to
the information and explanations given to us, we set out in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of
the said Order.
4. Further to our comments in the Annexure referred to above, we
report that:
a) We have 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 such
books.
c) The Balance Sheet and statement of Profit and Loss dealt with by
this report are in agreement with the books of account.
d) In our opinion the Balance Sheet and statement of Profit and Loss
dealt with by this report comply with the accounting standards referred
to in Sub Section (3c) of Section 211 of the Companies Act, 1956.
e) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view, in conformity with the accounting principles
generally accepted in India:
i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2012.
ii) in the case of the statement of Profit and Loss, of the profit for
the year ended on that date.
iii) in the case of the cash flow statement, of the cash flows for the
year ended on that date.
f) On the basis of written representations received from the Directors
as on 31st March, 2012 and taken on record by the Board of Directors,
we report that none of the Directors is disqualified as on 31st March,
2012 from being appointed as a Director in terms of clause (g) of
sub-section (1) of section 274 of the Act.
ANNEXURE TO THE AUDITORS' REPORT REFERRED TO
IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE:
i) a) The Company has maintained 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. According to the information furnished to us, no
material discrepancies have been noticed on such verification.
c) The Fixed Assets disposed off by the Company during the year do not
form a substantial part thereof.
ii) a) Physical verification of inventory has been conducted during the
year by the management at reasonable intervals.
b) The procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
c) On the basis of our examination of the records of inventory, we are
of the opinion that the Company is maintaining proper records of
inventory. The discrepancies noticed on such verification between the
physical stocks and the book records were not material.
iii) a) The Company has not granted any loans, secured or unsecured to
companies, firms or other parities covered in the register maintained
under section 301 of the Companies Act, 1956. Consequently, clauses
4(iii) (b) to (d) of the order are not applicable.
b) The Company has not taken any loans, secured or unsecured from
companies, firms, other parties covered in the register maintained
under section 301 of the Companies Act, 1956. Consequently, clauses
4(iii)(f) & (g) of the order are not applicable.
iv) In our opinion and according to the information and explanations
given to us, there is adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and sale of goods and services.
We have not observed any major weakness in the internal control system
during the course of the audit.
v) a) According to the information and explanations given to us, we are
of the opinion that the particulars of contracts and arrangements that
need to be entered into the register maintained under section 301 of
the Companies Act, 1956 have been so entered.
b) In our opinion and according to the information and explanations
given to us, the contracts and arrangements made in pursuance of
contracts or arrangements entered in the register maintained under
section 301 of the Companies Act, 1956 have been made at prices which
are reasonable having regard to prevailing market prices at the
relevant time.
vi) The Company has not accepted any deposits from public.
Consequently, the clause 4(vi) of the order is not applicable.
vii) In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
viii) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the Rules made by the Central Government for the
maintenance of cost records under section 209(1)(d) of the Companies
Act, 1956 and we are of the opinion that prima facie the prescribed
accounts and records have been made and maintained. However, we have
not made a detailed exmination of the records.
ix) a) According to the information and explanations given to us and on
the basis of examination of the records of the Company, amounts
deducted / accrued in the books of account in respect of undisputed
statutory dues including provident fund, income-tax, sales-tax,
wealth-tax, custom duty, excise duty, service-tax, cess and other
material statutory dues have been regularly deposited during the year
by the Company with the appropirate authorities.
b) According to the information and explanations given to us, no
undisputed amounts payable in respect of income tax, sales tax, wealth
tax, service tax, customs duty, excise duty, cess and other material
statutory dues which were in arrears as at 31st March, 2012 for a
period of more than six months from the date they became payable.
c) As at 31st March, 2012, there have been no disputed dues, which have
not been deposited with the respective authorities in respect of Income
Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and
Cess.
x) The Company has no accumulated losses and has not incurred cash
losses in the financial year covered by our audit and the immediately
preceding financial year.
xi) The Company has not defaulted in payment of any loan installment or
interest in respect of term loans from financial institutions and
banks.
xii) The Company has not granted any loans or advances on the basis of
security by way of pledge of shares, debentures and other securities.
Consequently, the clause 4(xii) of the order is not applicable.
xiii) In our opinion, the Company is not a chit fund or a nidhi/mutual
benefit fund/society. Consequently, the clause 4(xiii) of the order is
not applicable.
xiv) In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other instruments. Consequently, the
clause 4(xiv) of the order is not applicable.
xv) The Company has not given any guarantee for loans taken by others
from banks or financial institutions. Consequently, the clause 4(xv) of
the order is not applicable.
xvi) In our opinion, the Term Loans have been applied for the purposes
for which they were raised.
xvii) According to the information and explanations given to us and on
overall examination of the Balance Sheet of the Company, we report that
no funds raised on short term basis have been used for long term
investment.
xviii) During the year, the Company has not made any preferential
allotment of shares. Consequently, the clause 4(xviii) of the order is
not applicable.
xix) The Company has not issued any debentures so far. Consequently,
clause 4(xix) of the order is not applicable.
xx) During the year, the Company has not raised money by Public issue.
Consequently, the clause 4(xx) of the order is not applicable.
xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
for BRAHMAYYA & CO.,
Chartered Accountants
Firm Regn. No. 000513S
C V Ramana Rao
Camp : Hyderabad Partner
Date : 19-5-2012 Membership No.018545
Mar 31, 2011
1. We have audited the attached Balance Sheet of The Andhra
Petrochemicals Limited, Tanuku as at 31st March, 2011, together with
the Profit and Loss Account for the year ended on that date annexed
thereto and cash flow statement for the year ended on that date. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We have conducted our audit in accordance with auditing standards
generally accepted in India. These Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors' Report) Order, 2003 issued
by the Central Government of India in terms of sub-section (4A) of
Section 227 of 'The Companies Act, 1956' of India (the `Act') and on
the basis of such checks as we considered appropriate and according to
the information and explanations given to us, we set out in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of
the said Order.
4. Further to our comments in the Annexure referred to above, we
report that:
a) We have 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 appears from our examination of such
books.
c) The Balance Sheet and Profit and Loss Account dealt with by this
report are in agreement with the books of account.
d) In our opinion the Balance Sheet and Profit and Loss Account dealt
with by this report comply with the accounting standards referred to in
Sub Section (3c) of Section 211 of the Companies Act, 1956.
e) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view, in conformity with the accounting principles
generally accepted in India:
i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2011.
ii) in the case of the Profit and Loss account, of the profit for the
year ended on that date.
iii) in the case of the cash flow statement, of the cash flows for the
year ended on that date.
f) On the basis of written representations received from the Directors
as on 31st March,2011 and taken on record by the Board of Directors, we
report that none of the Directors is disqualified as on 31st March,
2011 from being appointed as a Director in terms of clause (g) of
sub-section (1) of section 274 of the Act.
ANNEXURETO THE AUDITORS' REPORT REFERRED TO IN PARAGRAPH 3 OF OUR
REPORT OF EVEN DATE:
i) a) The Company has maintained 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. According to the information furnished to us, no
material discrepancies have been noticed on such verification.
c) The Fixed Assets disposed off by the Company during the year do not
form a substantial part thereof.
ii) a) Physical verification of inventory has been conducted during the
year by the management at reasonable intervals.
b) The procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
c) On the basis of our examination of the records of inventory, we are
of the opinion that the Company is maintaining proper records of
inventory. The discrepancies noticed on such verification between the
physical stocks and the book records were not material.
iii) a) The Company has not granted any loans, secured, unsecured to
companies, firms or other parities to whom the provisions of section
301 of the Companies Act, 1956 apply. Accordingly clauses 4(iii) b, c
and d of the order are not applicable.
b) The Company has not taken any loans, secured or unsecured from
companies, firms, other parties covered in the register maintained
under section 301 of the Companies Act, 1956. Accordingly clauses
4(iii)(f) & (g) of the order are not applicable.
iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and sale of goods and services.
During the course of our audit, no major weakness has been noticed in
the internal control systems.
v) a) According to the information and explanations given to us, we are
of the opinion that the particulars of contracts and arrangements that
need to be entered into the register maintained under section 301 of
the Companies Act, 1956 have been so entered.
b) In our opinion and according to the information and explanations
given to us, the contracts and arrangements made in pursuance of
contracts or arrangements entered in the register maintained under
section 301 of the Companies Act, 1956 have been made at prices which
are reasonable having regard to prevailing market prices at the
relevant time.
vi) The Company has not accepted any deposits from public. Accordingly
the clause 4(vi) of the order is not applicable.
vii) In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
viii) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the Rules made by the Central Government for the
maintenance of cost records under section 209(1)(d) of the Companies
Act, 1956 and we are of the opinion that prima facie the prescribed
accounts and records have been made and maintained.
ix) a) According to the records of the Company, the Company is regular
in depositing with appropriate authorities undisputed statutory dues
including provident fund, investor education and protection fund,
employees state insurance, income-tax, sales-tax, wealth-tax,
service-tax, custom duty, excise duty, cess and other material
statutory dues applicable to it.
b) According to the information and explanations given to us, no
undisputed amounts payable in respect of income tax, sales tax, wealth
tax, service tax, customs duty, excise duty, cess and other material
statutory dues applicable to it were in arrears as at 31st March, 2011
for a period of more than six months from the date they became payable.
c) As at 31st March, 2011, there have been no disputed dues, which have
not been deposited with the respective authorities in respect of Income
Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and
Cess.
x) The Company has no accumulated losses and has not incurred cash
losses in the financial year covered by our audit and the immediately
preceding financial year.
xi) The Company has not defaulted in payment of any loan installment or
interest in respect of term loans from financial institutions and
banks.
xii) The Company has not granted any loans or advances on the basis of
security by way of pledge of shares, debentures and other securities.
Accordingly the clause 4(xii) of the order is not applicable.
xiii) In our opinion, the Company is not a chit fund or a nidhi/mutual
benefit fund/society. Accordingly the clause 4(xiii) of the order is
not applicable.
xiv) In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other instruments. Accordingly the
clause 4(xiv) of the order is not applicable.
xv) The Company has not given any guarantee for loans taken by others
from banks or financial institutions. Accordingly the clause 4(xv) of
the order is not applicable.
xvi) In our opinion, the Term Loans have been applied for the purposes
for which they were raised.
xvii) According to the information and explanations given to us and on
overall examination of the Balance Sheet of the Company, we report that
no funds raised on short term basis have been used for long term
investment.
xviii) During the year, the Company has not made any preferential
allotment of shares. Accordingly the clause 4(xviii) of the order is
not applicable.
xix) The Company has not issued any debentures so far. Accordingly
clause 4(xix) of the order is not applicable.
xx) During the year, the Company has not raised money by Public issue.
Accordingly the clause 4(xx) of the order is not applicable.
xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
for BRAHMAYYA & CO.,
Chartered Accountants
Firm Regn. No. 000513S
C V Ramana Rao
Partner
Membership No.018545
Place : Visakhapatnam
Date : 23-5-2011
Mar 31, 2010
1. We have audited the attached Balance Sheet of The Andhra
Petrochemicals Limited, Tanuku as at 31st March, 2010, the Profit and
Loss Account for the year ended on that date annexed thereto and cash
flow statement for the year ended on that date. These financial
statements are the responsibility of the Companys management. Our
responsibility is to express an opinion on these financial statements
based on our audit.
2. We have conducted our audit in accordance with auditing standards
generally accepted in India. These Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 issued
by the Central Government of India in terms of sub-section (4A) of
Section 227 of ÃThe Companies Act, 1956 of India (the `Act) and on
the basis of such checks as we considered appropriate and according to
the information and explanations given to us, we set out in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of
the said Order.
4. Further to our comments in the Annexure referred to above, we
report that: a) We have 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 appears from our examination of such
books.
c) The Balance Sheet and Profit and Loss Account dealt with by this
report are in agreement with the books of account.
d) In our opinion the Balance Sheet and Profit and Loss Account dealt
with by this report comply with the accounting standards referred to in
Sub Section (3c) of Section 211 of the Companies Act, 1956.
e) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view, in conformity with the accounting principles
generally accepted in India:
i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2010.
ii) in the case of the Profit and Loss account, of the loss for the year
ended on that date.
iii) in the case of the cash flow statement, of the cash flows for the
year ended on that date.
f) On the basis of written representations received from the Directors
as on 31st March, 2010 and taken on record by the Board of Directors,
we report that none of the Directors is disqualified as on 31st March,
2010 from being appointed as a Director in terms of clause (g) of
sub-section (1) of section 274 of the Act.
ANNEXURE TO THE AUDITORS REPORT REFERRED TO IN PARAGRAPH 3 OF OUR
REPORT OF EVEN DATE:
i) a) The Company has maintained 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. According to the information furnished to us, no
material discrepancies have been noticed on such verification.
c) The Fixed Assets disposed off by the Company during the year do not
form a substantial part thereof.
ii) a) Physical verification of inventory has been conducted during the
year by the management at reasonable intervals.
b) The procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
c) On the basis of our examination of the records of inventory, we are
of the opinion that the Company is maintaining proper records of
inventory. The discrepancies noticed on such verification between the
physical stocks and the book records were not material.
iii) a) The Company has during the year granted an unsecured
inter-corporate loan of Rs. 9 crores to one company, which is covered
in the register maintained under section 301 of the Companies Act,
1956.
b) In our opinion, the rate of interest and other terms and conditions
on which the said loan has been granted by the Company is not, prima
facie, prejudicial to the interest of the Company.
c) The Company has received repayment of the full principle amount of
the inter-corporate loan together with the interest accrued thereon.
Accordingly, clause 4(iii)(d) of the Order is not applicable.
d) The Company has not taken any loans, secured or unsecured from
companies, firms, or other parties covered in the register maintained
under section 301 of the Companies Act, 1956. Accordingly, clauses
4(iii) (f) & (g) of the Order are not applicable.
iv) In our opinion and according to the
information and explanations given to us, there are adequate internal
control systems commensurate with the size of the Company
and the nature of its business with regard to purchase of inventory,
fixed assets and sale of goods and services. During the course of our
audit, no major weakness has been noticed in the internal control
systems.
v) a) According to the information and explanations given to us, we are
of the opinion that the particulars of contracts and arrangements that
need to be entered into the register maintained under section 301 of
the Companies Act, 1956 have been so entered. b) In our opinion and
according to the information and explanations given to us, the
contracts and arrangements made in pursuance of contracts or
arrangements entered in the register maintained under section 301 of
the Companies Act, 1956 have been made at prices which are reasonable
having regard to prevailing market prices at the relevant time.
vi) The Company has not accepted any deposits from public. Accordingly
the clause 4(vi) of the order is not applicable.
vii) In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
viii) We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the Rules made by the Central Government for the
maintenance of cost records under section 209(1)(d) of the Companies
Act, 1956 and we are of the opinion that prima facie the prescribed
accounts and records have been made and maintained.
ix) a) According to the records of the Company, the Company is regular
in depositing with appropriate authorities undisputed statutory dues
including provident fund, investor education and protection fund,
employees state insurance, income-tax, sales-tax, wealth-tax,
service-tax, custom duty, excise duty, cess and other material
statutory dues applicable to it.
b) According to the information and explanations given to us, no
undisputed amounts payable in respect of income tax, sales tax, wealth
tax, service tax, customs duty, excise duty, cess and other material
statutory dues applicable to it were in arrears as at 31st March, 2010
for a period of more than six months from the date they became payable.
c) As at 31st March, 2010, there have been no disputed dues, which have
not been deposited with the respective authorities in respect of Income
Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and
Cess.
x) The Company has no accumulated losses and has not incurred cash
losses in the financial year covered by our audit and the immediately
preceding financial year.
xi) The Company has not defaulted in payment of any loan installment or
interest in respect of term loans from financial institutions and
banks.
xii) The Company has not granted any loans or advances on the basis of
security by way of pledge of shares, debentures and other securities.
Accordingly the clause 4(xii) of the order is not applicable.
xiii) In our opinion, the Company is not a chit fund or a nidhi/mutual
benefit fund/society. Accordingly the clause 4(xiii) of the order is
not applicable.
xiv) In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other instruments. Accordingly the
clause 4(xiv) of the order is not applicable.
xv) The Company has not given any guarantee for loans taken by others
from banks or financial institutions. Accordingly the clause 4(xv) of
the order is not applicable.
xvi) In our opinion, the Term Loans have been applied for the purposes
for which they were raised.
xvii) According to the information and explanations given to us and on
overall examination of the Balance Sheet of the Company, we report that
no funds raised on short term basis have been used for long term
investment.
xviii) During the year, the Company has not made any preferential
allotment of shares. Accordingly the clause 4(xviii) of the order is
not applicable.
xix) The Company has not issued any debentures so far. Accordingly
clause 4(xix) of the order is not applicable.
xx) During the year, the Company has not raised money by Public issue.
Accordingly the clause 4(xx) of the order is not applicable.
xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
for BRAHMAYYA & CO.,
Chartered Accountants
Firm Regn. No. 000513S
C V Ramana Rao
Place : Visakhapatnam Partner
Date : 5-8-2010 Membership No.018545
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