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Atul Ltd | Annual Report 2017-18
Annexure A
to the Independent Auditor’s Report
Referred to in paragraph 10(f) under ‘Report on other
legal and regulatory requirements’ section of our report of
even date.
Report on the Internal Financial Controls over
financial reporting under Clause (i) of Sub-section 3 of
Section 143 of the Companies Act, 2013 (the Act)
01. We have audited the Internal Financial Controls over
financial reporting of Atul Ltd (the Company) as of
March 31, 2018 in conjunction with our audit of the
Standalone Ind AS Financial Statements of the Company
for the year ended on that date.
Management’s responsibility for Internal Financial
Controls
02. The Management of the Company is responsible for
establishing and maintaining Internal Financial Controls
based on the internal controls over financial reporting
criteria established by the Company considering the
essential components of internal controls stated in the
Guidance Note on Audit of Internal Financial Controls
over financial reporting (the Guidance Note) 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 the policies of the Company, the safeguarding of
its assets, the prevention and detection of frauds and
errors, the accuracy and completeness of the accounting
records, and the timely preparation of reliable financial
information, as required under the Companies Act, 2013.
Auditor’s responsibility
03. Our responsibility is to express an opinion on the
Internal Financial Controls of the Company over financial
reporting based on our audit. We conducted our audit
in accordance with the Guidance Note issued by the
Institute of Chartered Accountants of India 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. These 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 were
established and maintained and if such controls operated
effectively in all material respects.
04. 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 judgement, including the assessment of the
risks of material misstatement of the Financial Statements,
whether due to fraud or error.
05. We believe that the audit evidence obtained by us
sufficient and appropriate to provide a basis for our audit
opinion on the Internal Financial Controls system over
financial reporting of the Company.
Meaning of Internal Financial Controls over financial
reporting
06. The Internal Financial Controls over financial reporting of
a company is a process designed to provide reasonable
assurance regarding the reliability of financial reporting
and the preparation of the Financial Statements for
external purposes in accordance with Generally Accepted
Accounting Principles. Internal Financial Controls over
financial reporting of a Company include those policies
and procedures that a) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of the assets
of the Company, b) provide reasonable assurance
that transactions are recorded as necessary to permit
preparation of the 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 c) provide reasonable
assurance regarding prevention or timely detection of
unauthorised acquisition, use, or disposition of the assets
of the Company that could have a material effect on the
Financial Statements.
Inherent limitations of Internal Financial Controls over
financial reporting
07. 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