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Surana Industries Ltd.

BSE: 513597 | NSE: SURANAIND | Series: NA | ISIN: INE659D01019 | SECTOR: Steel - Rolling

BSE Live

Nov 09, 16:00
1.59 0.00 (0.00%)
Volume
No Data Available
201
  • Prev. Close

    1.59

  • Open Price

    1.59

  • Bid Price (Qty.)

    0.00 (0)

  • Offer Price (Qty.)

    1.59 (49799)

Surana Industries is not traded on BSE in the last 30 days

NSE Live

Nov 06, 15:31
1.30 0.00 (0.00%)
Volume
No Data Available
92
  • Prev. Close

    1.30

  • Open Price

    1.35

  • Bid Price (Qty.)

    0.00 (0)

  • Offer Price (Qty.)

    0.00 (0)

Surana Industries is not traded on NSE in the last 30 days

Annual Report

For Year :
2015 2014 2013 2012 2011 2010 2009 2008 2007

Auditor's Report

We have audited the accompanying standalone financial statements of Surana Industries Limited (the Company), which comprise the Balance Sheet as at March 31, 2015, 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 infor- mation. Management''s Responsibility for the Standalone 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 standalone 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 preparation 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 Our responsibility is to express an opinion on these standalone financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. 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. 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 overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified audit opinion on the standalone financial statements. Basis for Qualified Opinion 1. Capital work in progress relating to the Pelletisation and Beneficiation (P&B) Project, stated in note 12 includes: (a) Interest on borrowings aggregating to Rs. 407,645,055 (including Rs. 223,386,319 for the year) relating to the periods during which the project has been stalled, which is a departure from Accounting Standard 16 (AS-16) on Borrowing Costs. Had the interest capitalized during the period in which the project was stalled been charged to the Statement of Profit & Loss, the loss for the year and, the Deficit in the Statement of Profit and Loss, will be higher by Rs. 407,645,055 and Capital Work in Progress will be lower by Rs. 407,645,055. (b) Preoperative expenses incurred in relation to the project aggregating to Rs.6,835,660 (including Rs.1,982,051 for the year) relating to the periods during which the project has been stalled, which is a departure from Accounting Standard 10 (AS-10) on Fixed Assets. Had such expenditure capitalized during the period in which the project was stalled been charged to the Statement of Profit & Loss, the loss for the year and the Deficit in the Statement of Profit and Loss, will be higher by Rs.6,835,660and Capital Work in Progress will be lower by Rs. 6,835,660. 2. Current investments include investments made in : a. Surana Power Limited (SPL), a subsidiary, amounting to Rs. 4,185,000,000 valued at cost, in respect of which no operations have been carried out since August 2013 and its ongoing 2 X 210 MW power project has been stalled for want of additional funds. b. Surana Mines and Minerals Limited (SMML), a wholly owned subsidiary based in Singapore, amounting to Rs. 584,826,430 valued at cost, in respect of which no financial statements or other information is available after March 31, 2014. c. Surana Green Power Limited (SGPL), a wholly owned subsidiary amounting to Rs. 561,536,000 valued at cost. As stated in note No. 13, the Company is planning to dispose these investments, which are stated at cost without assessment of their net realizable value. As per Accounting Standard 13 - Accounting for Investments, these investments should be valued at the lower of cost and net realizable value. In the absence of the net realizable value, we are unable to comment on the adjustments, if any, that may be required to the carrying value of the investments as at March 31,2015. 3. Attention is invited to note 16 relating to inventory aggregating to Rs. 2,586,942,410, the quantity, quality and realizable value of which were not assessed and determined. As per Accounting Standard 2- Inventories, these inventories should be valued at the lower of cost and net realizable value. In the absence of the net realizable value, we are unable to comment on the adjustments that may be required to the carrying values of these inventories as at March 31,2015. Qualified Opinion In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matters described in paragraphs1 (a) and 1 (b), and the possible effects of the matters described paragraphs 2 and 3 in the Basis for Qualified Opinion paragraph above, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31,2015, and its loss 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 in terms of Section 143(11) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order. 2. As required by Section 143 (3) of the Act, we report that: (a) We have sought and except for the matters described in the Basis for Qualified Opinion paragraph, obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit. (b) Except for the effects of the matters described in paragraphs1 (a) and 1 (b), and the possible effects of the matters described in paragraphs 2 and 3 in the Basis for Qualified Opinion paragraph above, 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 the Cash Flow Statement dealt with by this Report are in agreement with the books of account. (d) Except for the effects of the matters described in paragraphs1 (a) and 1 (b), and the possible effects of the matters described in paragraphs 2 and 3 in the Basis for Qualified Opinion paragraph above, in our opinion, the aforesaid standalone 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) The matters described in the Basis for Qualified Opinion paragraph above read with the matters stated in clauses (i), (ii), (iv) and (ix)of the Annexure to the Auditor''s Report referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report, in our opinion, may have an adverse effect on the functioning of the Company. (f) On the basis of the written representations received from the directors as on March 31,2015 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015 from being appointed as a director in terms of Section 164 (2) of the Act. (g) The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the Basis for Qualified Opinion paragraph above. (h) 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 has disclosed the impact of pending litigations on its fi- nancial position in its financial statements(Refer to Note 27B to the financial statements); 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 (Referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date) (i) In respect of its fixed assets: a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets. b) During the year, the Company has not carried out a physical verification of its fixed assets. The Company does not have a regular programme for verification of its fixed assets. (ii) In respect of its inventories: a) As explained to us and read with our observations in paragraph 3 of the Basis for Qualified Opinion paragraph, the inventories were not physically verified / weighed during the year by the Management. b) In our opinion and according to the information and explanations given to us and read with our observations in paragraph 3 of the Basis for Qualified Opinion paragraph, the procedures of physical verification of inventories followed by the Management were not reasonable and adequate and needs to be improved further taking into account the size of the Company and the nature of its business. c) In our opinion and according to the information and explanations given to us, the Company has maintained records of its inventories. For the reasons stated in paragraphs (ii) (a) and (ii) (b)above and read with our observation in paragraph 3 of the Basis for Qualified Opinion paragraph we are unable to comment on the discrepancies noticed on physical verification of inventories and updation of inventory records. (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. (iv) In our opinion and according to the information and explanations given to us, the internal control systems need to be strengthened to make it commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services and during the course of the audit, we have not observed any continuing failure to correct majorweaknesses in such internal control system. (v) In our opinion and according to the information and explanations given to us, the Company has not accepted deposits from public during the year. (vi) We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended and prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013 and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete. (vii) According to the information and explanations given to us in respect of statutory dues: (a) The Company has not been generally regular in depositing undisputed dues, including Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Service Tax, Customs Duty, Value Added Tax, Excise Duty, Cess and other material statutory dues applicable to it with the appropriate authorities and there were inordinate delays in a number of cases in respect of Provident Fund, Tax Deducted at Source, Service Tax and Value Added Tax. (b) There were no undisputed amounts payable in respect of Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Service Tax, Customs Duty, Value Added Tax, Excise Duty, Cess and other material statutory dues in arrears as at March 31, 2015 for a period of more than six months from the date they became payable, other than those disclosed below: Name of Statute Nature of Dues Amount Involved (Rs.) Provident Fund Provident Fund 1,445,879 Income Tax Act, 1961 Tax deducted at Source 1,276,094 Income Tax Act, 1961 Tax deducted at Source 54,499 Income Tax Act, 1961 Tax collected at Source 211,466 Finance Act, 1994 Service Tax 1,787,824 Finance Act, 1994 Service Tax 1,792,951 Total 6,568,713 Name of Statute Period to which the Due Date Amount Relates Provident Fund Before March 31, 2014 Before March 31, 2014 Income Tax Act, 1961 Before March 31, 2014 Before March 31, 2014 Income Tax Act, 1961 April 2014 to August 2014 May 2014 to September 2014 Income Tax Act, 1961 Before March 31, 2014 Before March 31, 2014 Finance Act, 1994 Before March 31,2014 Before March 31, 2014 Finance Act, 1994 April 2014 to August May 2014 to September 2014 2014 (c) Details of dues of Employees'' State Insurance, Excise Duty, Customs Duty, Value Added Tax and Central Sales Tax which have not been deposited as on March 31, 2015 on account of disputes are given below: Period to Nature of Forum where which the Amount Name of Statute Dues Dispute is amount Involved Pending relates (Rs.) to Employees'' State Employee Insurance State Honourable Act, 1948 High 2010-11 6,111,988 Insurance Court of Chennai Central Excise Central Commissioner 2006 13,832,710 Act, 1944 Excise of Central Excise, Com- missioner II, Chennai Central Central Honourable 1999-2000 2,868,511 Excise Excise High Act, 1944 Court of Chennai Central Central Appeal will 2013 2,800,000 Excise Excise be filed Act, 1944 before CESTAT, Bangalore Central Central Honourable 1997-2000 9,388,727 Excise Excise High Act, 1944 Court of Chennai Central Central Commissioner 2010 50,359,737 Excise Excise of Act, 1944 Central Excise, Com- missioner II, Chennai Central Central Commissioner 2010 15,000,000 Excise Excise of Act, 1944 Central Excise, Com- missioner I, Chennai Central Central CESTAT, 2011 235,265,808 Excise Excise Bangalore Act, 1944 Central Central Commissioner 2012-13 56,756,116 Excise Excise (Appeals) Act, 1944 Customs Act, Customs Honourable 1999-2000 2,086,066 1962 Duty High Court of Chennai Customs Customs Honourable 1998-1999 782,445 Act, 1962 Duty High Court of Chennai Customs Customs Honourable 2000-03 10,000,000 Act, 1962 Duty High Court of Chennai Customs Customs Honourable 2005-06 13,829,000 Act, 1962 Duty Supreme Court Various Value Honourab|e 2008-09 192,742 states High Court (Sales Tax Added Tax of Chennai Acts) Various Value Honourable 2009-10 234,547 states High Court (Sales Tax Acts) Added of Chennai Tax Various Value Writ filed 2006-07 to 181,785,401 states before (Sales Tax Acts) Added Tax Honourable 2010-11 and High Court Central Sales Tax, 1956 of Chennai Various Value Pending 2007-08 & 10,867,454 states before Sales (Sales Tax Acts) Added Tax Tribunal 2008-09 Tax Gulbarga Various Value Pending before 2010-11 858,052 states Added Tax Sales Tax (Sales Tax Tribunal Acts) Gulbarga Various Value Honourable 2010-11 28,454,281 states Added High Court (Sales Tax Tax of Chennai Acts) Various Value Honourable 2011-12 5,950,109 states Added High Court (Sales Tax Tax of Chennai Acts) Various Value Honourable 2012-13 7,535,500 states Added High Court (Sales Tax Tax of Chennai Acts) Various Value Honourable 2013-14 4,597,143 states Added High Court (Sales Tax Tax of Chennai Acts) Total 659,556,337 (d) The Company has been regular in transferring amounts to the Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act 1956 (1 of 1956) and Rules made thereunder within time. (viii) After considering the effect of our audit qualifications reported in paragraphs (1)(a) and (1)(b) of the Basis for Qualified Opinion of our Audit Report and without considering the possible effects of our audit qualifications reported in paragraphs (2) and (3) of the Basis for Qualified Opinion of our Audit Report which is not quantifiable, the accumulated losses of the Company at the end of the financial year are less than fifty per cent of its net worth and the Company has incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year. (ix) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks and financial institutions, as stipulated in the Master Re- structuring Agreement (MRA) (refer to note 5(i) of the financial statements) except that there has been a default in repayment of interest amounting to Rs.48,700,000 outstanding as at March 31, 2015 payable to a financial institution (refer to note 5 (iv) of the financial statements). The Company has not issued any debentures. (x) In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from banks and finan- cial institutions are not, prima facie, prejudicial to the interest of the Company. (xi) In our opinion and according to the information and explanations given to us, the term loans have been applied by the Company during the year for the purposes for which they were obtained, other than temporary deployment pending application. (xii) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year. For DELOITTE HASKINS & SELLS LLP Chartered Accountants (Firm''s Registration No. 117366W/W-100018) Sd/- Geetha Suryanarayanan Partner Date : May 30, 2015 (Membership No. 29519) Place : Chennai