VAKRANGEE SOFTWARES LIMITED
ANNUAL REPORT 2011-2012
The Members of
Vakrangee Softwares Limited,
We have audited the attached Balance Sheet of Vakrangee Softwares Limited
as at March 31, 2012, the Profit and Loss Account and the Cash Flow
Statement for the year ended on that date, annexed thereto. 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.
1. We conducted our audit in accordance with auditing standards generally
accepted in India. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements
are prepared, in all material respects, in accordance with an identified
financial reporting framework and 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
2. As required by the Companies (Auditor`s Report) Order, 2003 and
amendments thereto issued by the Central Government of India in terms of
Section 227(4A) of the Companies Act, 1956, we annex hereto a statement on
the matters specified in the paragraphs 4 and 5 of the said Order.
3. Further to our comments in the Annexure referred to in paragraph 2
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 accounts as required by law have been
kept by the Company as it appears from our examination of those books.
c) The said Balance Sheet, the Profit & Loss Account and the Cash Flow
statement dealt with by this report are in agreement with the books of
d) In our opinion and to the best of our information and according to the
explanations given to us, the said Balance Sheet and Profit and Loss
Account comply with the Accounting Standards referred to in Section 211(3C)
of the Companies Act, 1956.
e) On the basis of written representations received from the directors as
on March 31, 2012 and taken on record by the Board, we report that none of
the directors is disqualified as on March 31, 2012 from being appointed as
a director in terms of clause (g) of subsection (1) of section 274 of the
Companies Act, 1956.
f) In our opinion and to the best of our information and according to the
explanations given to us, the said accounts, read together with notes
appearing thereon, 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 March 31, 2012,
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 Cash Flow Statement, of the Cash Flows of the company
for the year ended on that date.
For S. K. Patodia & Associates
Mem. No.: 045489
Date : April 26, 2012
ANNEXURE TO AUDITOR`S REPORT:
Annexure referred to in Paragraph 2 of the Auditor`s Report to the members
of Vakrangee Softwares Limited for the year ended March 31, 2012.
As required by the Companies (Auditor`s Report) Order, 2003 and amendments
thereto and according to the information and explanations given to us
during the course of the audit and on the basis of such checks of the books
and records as were considered appropriate we report that:
(i) a) The Company has maintained proper records showing full particulars,
including quantitative details and situations of fixed assets.
b) All the assets have been physically verified by the management in
accordance with a phased program of verification, which in our opinion is
reasonable, considering the size of the company and the nature of business.
The frequency of verification is reasonable and no material discrepancies
have been noticed on such physical verification.
c) During the year, there is no substantial disposal of Fixed Assets.
(ii) a) The inventories have been physically verified by the management
during the year at reasonable intervals.
b) The procedures of physical verification of the inventories followed by
the management are reasonable and adequate in relation to the size of the
company and the nature of its business.
c) The Company has maintained proper records of inventories. The
discrepancies noticed on physical verification of inventories as compared
to book records were not material.
(iii) a) The Company has granted unsecured loans to nine parties including
four subsidiary companies covered in the register maintained under Section
301 of the Companies Act, 1956 on call basis. The maximum amount
outstanding during the year was Rs. 2,400.09 lacs and the year-end balance
was Rs. 1,420.77 lacs.
b) Interest is charged on all the said loans except in case of Vakrangee
Lactus & Hortus Pvt. Ltd. Other terms and conditions on which the loans
have been granted are prima facie, not prejudicial to the interest of the
c) According to information provided to us, the repayment of said loans is
d) The Company has taken unsecured loans from Vakrangee Capital Pvt. Ltd.
and Vakrangee Holdings Pvt. Ltd. covered in the register maintained under
Section 301 of the Companies Act, 1956 on call basis. The maximum amount
outstanding during the year was Rs. 1,443.25 lacs and the year-end balance
was Rs. 943.25 lacs.
e) The said loans are interest-free loans. Other terms and conditions on
which the loans have been taken are prima facie, not prejudicial to the
interest of the Company.
f) According to information provided to us, there is no default in
repayment of said loans.
(iv) In our opinion and according to the information and explanation 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 for the sale of goods and services. During the
course of our audit, we have not observed any continuing failure to correct
major weaknesses in internal control systems.
(v) a) Based on the audit procedures performed by us, we are of the opinion
that particulars of contracts or arrangements referred to in Section 301 of
the Act have been entered in the register required to be maintained in that
b) The transactions made in pursuance of such contracts or arrangements
have been made at prices which are reasonable having regard to the
prevailing market prices at the relevant time.
(vi) The Company has not accepted any public deposit.
(vii) The Company has an adequate internal audit system commensurate with
the size and nature of its business.
(viii) The Central Government has not prescribed for maintenance of cost
records under Section 209 (1) (d) of the Companies Act, 1956 for the
(ix) a) According to the records of the Company, the undisputed statutory
dues including Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty
and Excise Duty, Cess have regularly been deposited with the appropriate
authorities. There are no significant undisputed amount payable in respect
of such statutory dues which have remained outstanding as at March 31, 2012
for a period more than six months from the date they became payable.
b) According to the records of the company and information and explanations
given to us, there are no dues of income tax, sales tax, wealth tax,
service tax, custom duty, excise duty and cess which have not been
deposited on account of any dispute.
(x) The Company has no accumulated losses at the end of the financial year
and it has not incurred cash losses during the financial year and in the
immediately preceding financial year.
(xi) The Company has not defaulted in repayment of its dues to banks and
(xii) The Company has not granted any loans or advances on the basis of
security by way of pledge of shares, debentures or other securities.
(xiii) The provisions of any Special Statute applicable to Chit Fund, Nidhi
or Mutual Benefit Fund/Societies are not applicable to the company.
(xiv) In respect of dealing in shares, securities and other investments, in
our opinion and according to the information and explanations given to us,
proper records have been maintained of the transactions and contracts and
timely entries have been made therein. The shares, securities and other
investments have been held by the company in its own name.
(xv) The Company has not given any guarantee for loans taken by others from
banks and financial institutions except guarantee given in respect of loan
granted to Vakrangee e-Solutions Inc., a subsidiary company, by Barclays
Bank Plc. The outstanding amount of loan as on March 31, 2012 is Nil.
(xvi) The Company has taken Term Loans during the year and has applied the
loans for the purposes for which they were obtained.
(xvii) On an overall examination of the balance sheet of the Company, we
report that no funds raised on short-term basis have been used for long
(xviii) The Company has made preferential allotment of equity shares
against share warrants issued in the previous year(s) to the parties
covered in the register maintained under section 301 of the Companies Act,
1956. The same has been made in conformity with the guidelines issued by
the Securities and Exchange Board of India relating to such preferential
allotment and the basis of said allotment is not prejudicial to the
interest of the company.
(xix) The Company has not issued any debentures during the year.
(xx) The Company has not raised any money by way of public issue during the
(xxi) During the course of our examination of the books and records of the
Company, carried out in accordance with the generally accepted auditing
practices in India, we have not come across any instance of material fraud
on or by the Company, noticed or reported during the year.
For S. K. Patodia & Associates
Mem. No.: 045489
Date : April 26, 2012.