AUDITOR
To,
The Members of
Prabhav Industries Ltd.
1. We have audited the attached Balance Sheet of Prabhav Industries Ltd. as at
31st March, 2011, the Profit and Loss Account and also the Cash Flow Statement of the
Company 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.
2. 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.
3. As required by the Companies (Auditor’s Report) Order, 2003 and the Companies
(Auditor’s Report) (Amendment) Order, 2004 issued by the Central Government of India
in terms of subsection (4A) of Section 227 of the Companies Act, 1956, we enclose in the
Annexure, a statement on matters specified in paragraphs 4 and 5 of the said Order,
subject to notes on accounts.
4. Further to our comments in the Annexure referred to in paragraph 3 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 purposes of our audit;
(b) 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 the books;
(c) The Balance Sheet, the Profit and Loss Account and Cash Flow Statement dealt with
by this report are in agreement with the books of account;
(d) In our opinion, the Balance Sheet, the Profit and Loss and Cash Flow Statement
Account dealt with by this report comply with the accounting standards referred to in
sub-section (3C) of Section 211 of the Companies Act, 1956, subject to notes on accounts.
(e) On the basis of written representations received from the directors as on March 31,
2011 and taken on record by the Board of Directors, we report that none of the directors
is disqualified as on 31st March 2011 from being appointed as a director in terms of
clause (g) of sub-section (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 with the notes 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 on 31st
March 2011;
ii. in the case of the Profit and Loss Account, of the profit of the company for the
year ended on that date; and
iii. in the case of the Cash Flow Statement, of the Cash Flow of the company for the
year ended on that date.
|
For N. R. PARIKH & CO. |
|
Chartered Accountants |
|
FRN No. 107563W |
|
Sd/- |
|
C.A. N. R. Parikh |
| Date: 1st September, 2011 |
(Partner) |
| Place: Vadodara |
Membership No.007854 |
ANNEXURE TO AUDITOR’S REPORT
Referred to in paragraph 3 of our report of even date on the accounts for the year
ended 31st March 2011 of Prabhav Industries Ltd.
(i) (a) As informed to us, The Company is still in the process of compiling records to
showing full particulars including quantitative details and situation of fixed assets.
(b) As explained to us, fixed assets, according to the practice of the Company are
physically verified by the management at reasonable intervals, in a phased
verification-programme, which, in our opinion, is reasonable, looking to the size of the
Company and the nature of its business. As informed to us, no material discrepancies have
been noticed on verification;
(c) No disposal of a substantial part of fixed assets of the company has taken place
during the year.
(ii) (a) As informed to us, The Inventory were physical verified by the management at
reasonable intervals during the year.
(b) In our opinion and according to the information and explanations given to us,
company has reasonable and adequate procedure for physical verification of inventories in
relation to 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 proper records of inventory, and no major discrepancy reported by
the management.
(iii) The Company has granted unsecured loans to 7 companies, and 4 Interested Party
listed in the register maintained under Section 301 of the Companies Act, 1956. The year
balance of loans granted to these was Rs. 484.43 Lacs.
In our opinion and according to the information and explanations given to us, the terms
and condition of interest free loan given to the parties covered under in the register
maintained under section 301of the Companies Act, 1956 are not prima facie prejudicial to
the interest of the company.
According to the information and explanations given to us, no repayment schedule has
been specified and accordingly the question of regularity in payment of principal amount
and interest wherever applicable does not arise.
The Company has taken unsecured loans from 1 company, 2 Directors and 18 Interested
Party listed in the register maintained under Section 301 of the Companies Act, 1956. The
year balance of loans taken from these was Rs. 2608.13 Lacs.
In respect of above Loans taken, no repayment schedule has been specified with regard
to
the Interest / Repayment or any other terms and conditions.
(iv) 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.
(v) According to the information and explanations given to us, the details of
transaction that needed to be entered in the register in pursuance of section 301 of the
Company Act. 1956, have been so entered.
According to information and explanations given to us, the transactions of purchase and
sale of goods/services made in pursuance of such contracts or arrangements have been made
at prices which are reasonable having regard to prevailing market prices at the relevant
time.
(vi) The company has not accepted deposits from other corporate which attracting the
provisions of section 58A and 58AA of the Companies Act, 1956, and the rules framed there
under.
(vii) The system of internal audit of the company needs to be strengthened and
commensurate with the size and nature of its business.
(viii) According to the information and explanations given to us, the Central
Government has not prescribed maintenance of cost records under Section 209(1)(d) of the
Companies Act, 1956.
(ix) In respect of statutory dues:
(a) Account to the records of the Company examined by us, Company is not liable to Pay
Provident Fund, Investor Education and Protection fund, Employees State Insurance, Sales
Tax, Wealth Tax, Service Tax, Custom duty, Excise Duty, Cess no undisputed amounts payable
in respect of such statutory dues which have remained outstanding as on 31st march 2011
for a period of more than Six Month from the day they become payable except Income tax for
the year 97-98 Rs.54156/-
(b) According to the Information and explanation given to us there are no dues of Sales
Tax, Provident Fund, Investor Education & protection Fund, Employee State Insurance,
Custom Duty, Wealth Tax, Services Tax, Excise Duty and Cess Which have not been deposited
on account of any dispute except Income tax for the year 97-98 Rs.54156/-.
(x) Accumulated losses at the end of financial year ended on 31st March,2011
is Rs. 57,75,305/ - which does not exceed 50% of its net worth and it has not incurred
cash losses in the financial year ended on the date and in the immediately preceding
financial Year.
(xi) According to the information and explanations given to us and records of the
company examined by us, the Company has not defaulted during the year in repayment of dues
to its bankers or to any financial institution. The company did not have any outstanding
debenture during the year.
(xii) According to the information and explanations given to us, the Company has not
granted any loans or advances on the basis of security by way of pledge of shares,
debentures and other securities.
(xii) As the Company is not a chit fund or a nidhi / mutual benefit fund / society to
which the provisions of special statute relating to chit fund are applicable, the
provisions of clause 4(xiii) of the Order are not applicable.
(xiv) The company is dealing in or trading in share, securities, Debenture or other
investment. The Company has maintained proper records of the transactions and contracts in
respect of dealing or trading in shares, securities, debentures and other investments and
timely entries have been made therein. Further such securities have been held by the
company in its own name or are in the process of transfer in its on company name.
(xv) According to the information and explanations given to us, the Company has not
given any guarantee for loans taken by others from banks or financial institutions.
(xvi) According to the information and explanations given to us and as per records made
available for our verification, the Company has not taken any term loan during the year
(xvii) According to the information and explanations given to us and 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-term investment, this clause is not applicable.
(xviii)As the Company has not made any preferential allotment of shares during the year
to parties and companies covered in the Register maintained under Section 301 of the Act,
the provisions of clause 4(xviii) of the Order are not applicable to the Company.
(xix) As the Company has not issued any debentures, the provisions of clause 4(xix) of
the Order are not applicable to the Company.
(xx) The Company has not raised any money by public issue during the year.
(xxi) According to the information and explanations given to us, no fraud on or by the
Company was noticed or reported during year.
|
For N. R. PARIKH & CO. |
|
Chartered Accountants |
|
FRN No. 107563W |
|
Sd/- |
|
C.A. N. R. Parikh |
| Date: 1st September, 2011 |
(Partner) |
| Place: Vadodara |
Membership No.007854 |
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