SAGAR CEMENTS LIMITED
ANNUAL REPORT 2011-2012
AUDITORS` REPORT
To
The Members
Sagar Cements Limited
Hyderabad.
We have audited the accompanying financial statements of Sagar Cements
Limited ("the company`), which comprise the Balance Sheet as at 31st March,
2012, the Statement of Profit and Loss of the company and the Cash Flow
Statement of the company for the year then ended and a summary of
significant accounting policies and other explanatory information.
Management`s Responsibility for the Financial Statements:
The management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flow 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:
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. 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. We believe
that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion.
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 case of the Balance Sheet, of the state of affairs of the Company as
at 31st March, 2012;
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 the Cash Flow Statement, of the cash flows for the year
ended on that date.
Report on other Legal and Regulatory Requirements:
As required by the Companies (Auditor`s Report) Order, 2003, as amended
("the Order`) issued by the Central Government of India in terms of Sub-
Section (4A) of Section 227 of the Companies Act, 1956 ("the Act`), we
enclose in the Annexure a statement on the matters specified in Paragraphs
4 and 5 of the said Order.
As required by Section227 (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 purposes of our audit;
b. In our opinion, proper books of accounts as required by law have been
kept by the company so far as appears from our examination of those books;
c. The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement
dealt with by this report are in agreement with the books of accounts;
d. In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash
Flow Statement 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. 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 Companies Act, 1956;
For P. Srinivasan & Co.,
Chartered Accountants
Place: Hyderabad K. Ranganathan
Date : 15th May 2012 Partner
Membership No. 10842
Annexure to the Independent Auditors` Report:
The Annexure referred to in the Independent Auditors` Report to the members
of Sagar Cements Limited ("the Company`) on the financial statements for
the year ended March 31, 2012, we report that:
1. The company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
2. Some of the fixed assets were physically verified during the year by the
management in accordance with a program of verification, which in our
opinion provides for physical verification of all the fixed assets at
reasonable intervals. According to the information and explanations given
to us, no material discrepancies were noticed on such physical
verification.
3. As per information and explanation given by the management during the
year, the company has not disposed off a substantial part of its fixed
assets and going concern assumption of the company is not affected.
4. As explained to us, inventories were physically verified during the year
by the management at reasonable intervals.
5. In our opinion and according to the information and explanations given
to us, the procedures of physical verification of inventories followed by
the management were reasonable and adequate in relation to the size of the
company and the nature of its business.
6. In our opinion and according to the information and explanations given
to us, the company has maintained proper records of its inventories and no
material discrepancies were noticed on physical verification.
7. According to the information and explanations given to us, the company
has not granted or taken any loans, secured or unsecured to/from companies,
firms or other parties covered in the Register maintained under Section 301
of the Companies Act, 1956.
8. As the company has not granted or taken loans to/from companies, firms
or other parties listed in the register maintained under Section 301 of the
Companies Act, 1956, the clause relating to rate of interest and other
terms and conditions of loans given or taken by the company, secured or
unsecured, which are prima facie prejudicial to the interest of the company
is not applicable to the company.
9. As the company has not taken loans from/granted to companies, firms or
other parties listed in the register maintained under Section 301 of the
Companies Act, 1956, the clause relating to the regular payment of
principal amount and interest is not applicable to the company.
10. As the company has not taken loans from or granted to companies, firms
or other parties listed in the register maintained under Section 301 of the
Companies Act, 1956, the clause relating to steps taken for
recovery/payment of the principal and interest on overdue amount of more
than one lakh, is not applicable to the company.
11. In our opinion and according to the information and explanations given
to us, there are adequate internal control procedures commensurate with the
size of the company and the nature of its business with regard to purchases
of inventory, fixed assets and with regard to the sale of goods. During the
course of our audit, no major weakness has been noticed in the internal
control.
12. a) Based on the audit procedure applied by us and according to the
information and explanations provided by the management, we are of the
opinion that the transactions 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 transactions made in pursuance of such contracts or arrangements
and exceeding Rupees five lakhs in respect of any party during the year,
have been made at prices which are reasonable having regard to the
prevailing market prices at the relevant time.
13. The company has not accepted deposits from the public during the year.
14. In our opinion, the internal audit functions carried out during the
year by a firm of Chartered Accountants appointed by the management have
been commensurate with the size of the Company and the nature of its
business.
15. In our opinion and according to the information and explanations given
to us, the company has made and maintained accounts and records prescribed
by the Central Government under Section 209 (1) (d) of the Companies Act,
1956. However, we have not carried out any detailed examination of such
records.
16. 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, Customs Duty, Excise Duty,
Cess and other statutory dues applicable to it.
17. According to the information and explanations given to us, the details
of dues on sales tax, excise duty and others which have not been deposited
as on 31st March, 2012 on account of disputes are given below:
Name of the Amount Amount Period to Nature of Dues Forum where
Statute Rs. Deposited which the the dispute
under amount is pending
protest relates
Rs.
1. A.P. 17350747 10802441 1999-2000 Voltage Filed an
TRANSCO Surcharge & grid appeal with
supporting Division
charges Bench, High
Court of
A.P
2. Sales 10940297 2735074 2009-2010 Tax on sale of Contested
Tax Fixed Assets before the
Authorities State
Appellate
Tribunal
1960832 490208 1999-2000 Interest on Filed an
delayed payment Appeal
before the
Appellate
Tribunal
3. Income 7498000 - 2006-2007 Disallowances Contested
Tax of certain before the
Authorities expenditure Commissioner
4. Central 22495200 19500000 2008-2009 Denying the Filed an
Excise benefit of Appeal with
Authorities Cenvat credit goods
on capital CESTAT,
Bangalore
65080000 - - Denying the Filed an
benefit of Appeal with
Cenvat credit CESTAT,
on capital goods Bangalore
5. Road 2850000 320000 2006-2007 Life Tax on Filed an
Transport dumpers used in Appeal in
Authority captive mines High Court
of A.P.
18. The company has no accumulated losses and it has not incurred any cash
losses during the financial year covered by our audit and the immediately
preceding financial year.
19. In our opinion and according to the information and explanations given
to us, the company has not defaulted in repayment of dues to financial
institutions, banks or debenture holders.
20. The company has not granted loans and advances on the basis of security
by way of pledge of shares, debentures and other securities.
21. The company is not a chit fund or nidhi or mutual fund/society and
hence the provisions of Clause 4 (xiii) of the Companies (Auditor`s Report)
Order, 2003 are not applicable to the company.
22. The company is not dealing in or trading in shares, securities,
debentures and other investments and hence the provisions of Clause 4 (xiv)
of the Companies (Auditor`s Report) Order, 2003 are not applicable to the
company.
23. As the company has not given any guarantee for loans taken by others
from banks or financial institutions, hence the provisions of Clause 4 (xv)
of the Companies (Auditor`s Report) Order, 2003 are not applicable to the
company.
24. In our opinion, the term loans taken by the company have been applied
for the purpose for which they were raised.
25. According to the information and explanations given to us and on an
over all 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.
No long term funds have been used for short term assets.
26. According to the information and explanations given to us, the company
has not made preferential allotment of shares to parties and companies
covered in the register maintained under Section 301 of the Companies Act,
1956.
27. According to the information and explanations given to us, during the
period covered by our audit report, the company has not issued any
debentures.
28. During the year, the company has not raised monies by public issue.
29. According to the information and explanations given to us and the books
and records examined by us, no fraud on or by the company has been noticed
or reported during the year.
For P. Srinivasan & Co.,
Chartered Accountants
Place: Hyderabad K. Ranganathan
Date : 15th May 2012 Partner
Membership No. 10842 |