KSE LIMITED
ANNUAL REPORT 2011-2012
AUDITORS` REPORT
To
The Members of
KSE Limited Irinjalakuda
We have audited the attached Balance Sheet of KSE LIMITED as at 31st March
2012, Statement of Profit and Loss and 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.
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 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.
I. As required by the Companies (Auditor`s Report) Order, 2003 issued by
the Central Government of India in terms of Section 227 (4A) of the
Companies Act, 1956, we enclose in the Annexure a statement on the matters
specified in Para 4 and 5 of the said Order.
II. Further to our comments in the Annexure referred to above, we report
that:
(i) 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.
(ii) 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.
(iii) The Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
account.
(iv) 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.
(v) On the basis of written representations received from directors and
taken on record by the Board of Directors, we report that none of the
directors of the Company 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.
(vi) In our opinion and to the best of our information and according to the
explanations given to us, the said accounts, read together with the
accounting policies and other notes attached thereto, 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:
(a) In the 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.
For VARMA & VARMA
(Firm No. 004532 S)
Sd/-
Place: Thrissur (C. Pankajakshan, M. No. 12948)
Date : May 30, 2012 Chartered Accountants
ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR AUDIT REPORT OF EVEN DATE:
1. In respect of fixed assets:-
(a) The Company is maintaining proper records showing full particulars,
including quantitative details and situation of fixed assets.
(b) We are informed that most of the fixed assets of the Company have been
physically verified by the management during the year, which, in our
opinion, is reasonable having regard to the size of the company and the
nature of its assets and that no material discrepancy has been noticed on
such verification.
(c) The Company has not disposed off substantial part of fixed assets
during the year.
2. In respect of inventories:-
(a) We are informed that the inventory has been physically verified by the
management at the year end, which, in our opinion, is reasonable having
regard to the size of the company and the nature of its business.
(b) In our opinion and according to the explanations given to us, the
procedures for 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) The Company is maintaining proper records of inventory, and as informed
to us, discrepancies of material nature were not noticed on physical
verification by the management.
3. (a) The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained under
Section 301 of the Companies Act, 1956.
(b) The Company has accepted deposits under the provisions of Section 58 A
of the Companies Act, 1956 from 28 parties covered in the Register
maintained under Section 301 of the Companies Act, 1956 and the aggregate
amount outstanding as on 31.03.2012 is Rs. 1,07,47,000 (Maximum amount
outstanding during the year Rs. 1,07,47,000). The Company has not taken any
other loan, secured or unsecured, from Companies, firms or other parties
covered in the register maintained under Section 301 of the Companies Act,
1956.
(c) In our opinion, the rate of interest and other terms and conditions of
the deposits accepted by the Company from the Parties listed in the
Register maintained under Section 301 of the Companies Act, 1956, are as
applicable to other depositors and are in accordance with the Companies
(Acceptance of Deposits) Rules, 1975 and are prima facie not prejudicial to
the interest of the Company.
(d) In respect of the above deposits, the payments of principal amounts and
interest there on are regular.
4. 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 nature of its business for the purchase of
inventory and fixed assets and for the sale of goods. The Company, being
primarily a manufacturing Company, is not rendering any services. During
the course of our audit, we have not observed any continuing failure to
correct major weakness in the internal controls.
5. In respect of transactions covered under Section 301 of the Companies
Act, 1956:-
(a) According to the information and explanations given to us, we are of
the opinion that the particulars of contracts or arrangements referred to
in Section 301 of the Companies Act, 1956 have been entered in the register
required to be maintained under that Section.
(b) In our opinion and according to the information and explanations given
to us, the transactions made in pursuance of such 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 the
quality and prevailing market prices at the relevant time.
6. In respect of deposits accepted by the Company from the public, the
directives issued by the Reserve Bank of India and the provisions of
Section 58A and 58AA or any other relevant provisions of the Companies Act,
1956 and the Rules framed there under, wherever applicable, have been
complied with.
7. In our opinion, the Company has an internal audit system, the scope and
coverage of which is commensurate with the size of the Company and nature
of its business.
8. We have broadly reviewed the cost records maintained by the Company
pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed
by the Central Government under Section 209 (1) (d) of the Companies Act,
1956 and are of the opinion that prima facie the prescribed cost records
have been maintained. We have, however, not made a detailed examination of
the cost records with a view to determine whether they are accurate or
complete.
9. In respect of statutory dues:-
(a) As per the information and explanations furnished to us and according
to our examination of the records of the Company, except for certain minor
delays in remittance of undisputed Income tax deducted at source, the
Company has been generally regular in depositing undisputed provident fund
and employees` state insurance dues, investor education and protection
fund, sales tax, wealth tax, service tax, income tax, customs duty, excise
duty, cess and other statutory dues during the year. There are no arrears
of undisputed statutory dues of material nature outstanding for a period of
more than six months from the date on which they became payable.
(b) According to the information and explanations given to us and as per
the records of the Company examined by us, the following disputed amount of
statutory dues have not been deposited with the relevant authorities as at
31st March 2012:
Name of the Nature of the Amount Period to which Forum where
statute dues Rs. in the amount dispute is
lakhs relates pending
KGST Act, Amount disputed 25.40 F.Y. 2000-01 Asst.
1963 on allowability Commissioner
of ST Exemption (Assessment)
for refining
plant
Customs Act, Dispute on 45.07 F.Y. 2008-09 CESTAT,
1962 applicable Bangalore
Tariff head
Customs Act, Dispute on 1.98 F.Y. 2009-10 CESTAT,
1962 applicable Bangalore
Tariff head
10. There are no accumulated losses at the end of the financial year and
the company has not incurred cash losses during the financial year and in
the immediately preceding financial year.
11. According to the information and explanations given to us and as per
the records of the Company verified by us, the Company has not defaulted in
repayment of dues to banks.
12. The Company has not given any loans or advances in the nature of loans
on the basis of security by way of pledge of shares, debentures and other
securities.
13. Since the Company is not a chit fund/nidhi/mutual benefit fund/society,
the relative reporting requirements in this regard are not applicable.
14. Since the Company is not dealing or trading in shares, securities,
debentures and other investments, the relative reporting requirements in
this regard are not applicable.
15. According to the information and explanations given to us and as per
the records of the company verified by us, the Company has not given any
guarantee for loans taken by others from banks or financial institutions.
16. According to the information and explanations given to us and the
records of the Company examined by us, the term loans availed by the
Company were applied for the purpose for which the loans were obtained.
17. According to the information and explanations given to us and on an
overall examination of the balance sheet of the Company, we report that
funds raised by the Company on short-term basis have not been used for
long-term investment.
18. The Company has not made any preferential allotment of shares to
parties and Companies covered in the Register maintained under Section 301
of the Companies Act, 1956.
19. The Company has not issued any debentures during the year.
20. The Company has not raised any money by public issues during the year.
21. According to the information and explanations given to us and as per
the verification of the records of the Company, no fraud, either on or by
the Company has been noticed or reported during the year.
For VARMA & VARMA
(Firm No. 004532 S)
Sd/-
Place: Thrissur (C. Pankajakshan, M. No. 12948)
Date : May 30, 2012 Chartered Accountants |