THE MEMBERS OF AVON MERCANTILE LIMITED
1. We have audited the attached Balance Sheet of Avon Mercantile Limited, as at 31stMarch 2012, Profit & Loss Account and Cash Flow Statement for the year ended on thatdate annexed thereto. These financial statements are the responsibility of the company'smanagement. Our responsibility is to express an opinion on these financial statementsbased on our audit.
2. We conducted our audit in accordance with auditing standards generally accepted inIndia. These standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of material misstatement. Anaudit includes examining on a test basis, evidence supporting the amounts and disclosuresin the financial statements. An audit also includes assessing the accounting principlesused and significant estimates made by the management, as well as evaluating the overallfinancial presentation. We believe that our audit provides a reasonable basis for ouropinion.
3. As required by the Companies (Auditor's report) Order, 2003 (as amended) issued bythe Central Govt, of India in terms of section 227 (4A) of the Companies Act 1956, Weenclose in the annexure a statement on the matters specified in the paragraph 4 & 5 ofthe said order.
4. 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 curknowledge and belief were necessary for the purpose of our audit;
II. In cur opinion, the Company has kept proper books of account as required by law sofar as appears from our examination of those books.
III. The attached Balance Sheet, Profit & Loss Accounts and Cash Flow Statement arein agreement with the books of account.
IV. In our opinion, the Balance Sheet, Profit & Loss account and Cash FlowStatement dealt with by this report comply with the mandatory Accounting Standardsreferred to in Sub-section (3C) of Section 211 of the Companies Act, 1956.
V. On the basis of written representations received from the directors, as on 31StMarch 2012 and taken on record by the board of directors, we report that none of thedirectors of the company is disqualified as on 31st March 2012 from being appointed as adirector in terms of section 27A (l)(g) of the Companies Act, 1956.
VI. In our opinion and to the best of our information and according to the explanationsgiven to us, the said accounts read with notes thereon, give the information required bythe Companies Act, 1956 (as amended) in the manner so required and give a true and fairview in conformity with the accounting principle generally accepted in India:
i. In the case of the Balance Sheet, of the state of affairs of the company as at 31stMarch, 2012; and
ii. In the case of the Profit & Loss account, of the profit for the year ended onthat date.
iii. In the case of Cash Flow Statement, of the cash flows of the company for the yearended on that date.
5. In terms of RBI Notification No. DFC 117/DG(SOT)-98 Dt. 02.01.1998, we give ourreport on the matters specified in the said notification as under :
(i) APPLICATION FOR REGISTRATION UNDER SECTION 45 IA OH RBI ACT
The company has been duly allotted fresh certificate of registration no. 13.12.00443dated 11.09.2007 in lieu of registration No. 05.00319 dated 21.02.1998.
(ii) NBFC ACCEPTING PUBLIC DEPOSITS
The company has not accepted any deposit from the public; hence this clause is notapplicable.
(iii) NBFC NOT ACCEPTING PUBLIC DEPOSITS
The company has not accepted any deposit from public since beginning. It has passed afresh Board Resolution dated 26th September 2008 for not to accept any publicdeposit. The company has complied with the prudential norms as prescribed by the RBI.
(iv) NBFC AS INVESTMENT CO. INVESTING 90% OF ITS ASSETS IN OTHER GROUP COMPANIES
The company has not invested 90% of its assets in-group companies; hence this clause isnot applicable.
For GUPTA GARG & AGRAWAL CHARTERED ACCOUNTANTS
PARTNER M.No. 012399
Place: New Delhi
ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE
The comments are in serial in of theorder.
i. As the company does not have fixedassets and as such the sub clauses a),b), and c) are not applicable.
ii. The company does not have any inventory;as such there are no comments on subclause a), b) and c).
iii. (a) The Company has not granted anyloans, secured or un-secured to companies, firmsor other parties covered in the register maintained u/s 301 of the Companies Act,1956, as such there are no comments on sub clauses , b), c) and d),
(e) The Company has not taken any loans, secured or un-secured from companies, firms orother parties covered in the register maintained u/s 301 of the Companies Act,1956, and as such there are no comments on subclauses , f) and g).
iv There exist adequate internal control procedures in the company in commensurationwith its size and nature of business for purchase and sale of shares and securities.
v (a) According to the information and explanations given to us, we are of the opinionthat there are no transactions that need to be entered in the register maintained inpursuance of section 301 of the Act, and as such the sub clause
b) is not applicable.
vi The company has not accepted deposits from the public.
vii. The company has internal audit system in commensuration with its size and nature ofits business.
viii. The maintenance of cost records has not been prescribed by the central governmentu/s 209 of the Act.
ix. (a) The company has been regular in depositing un-distributed statutory duesincluding Provident fund, Income Tax, Wealth Tax, Custom Duty, Service Tax. if any, withappropriate authorities.
(b) There are no disputed statutory dues in the company on the date of balance sheet.
x. The company has been in existence for a period more than five years and hasaccumulated losses of Rs. 2,75,79,795/- as on the date of the Balance Sheet. Thelosses are less than 50% of its net worth.The company has earned cash profit of Rs53,83,611/- during the current financial year as against cash profit of Rs. 2,17,659/- inthe immediately preceding financial year (without considering reversal of provision madefor doubtful debts and write off advances no longer recoverable and write back of sundrycreditors no longer payable).
xi. The company does not have loan from Banks. Institutions or Debenture holders; assuch default in repayment thereof does not arise.
xii. The company has not granted any loan or advance on the basis of security byway of pledge of shares, debentures and other securities, hence clause is not applicable.
xiii. The company is not a Nidhi / Mutual Benefit Fund / Society therefore thesubclauses (a) to (d) are not applicable.
xiv. The company is dealing/ trading in shares and/or securities for which properrecords are maintained and timely entries have been made therein. The investments held arein the name of the company.
xv. The company has not given any guarantee and as such the clause is not applicable
xvi. The company has not raised any term loan and as such there arc no comments.
xvii. The company has neither raised nor utilized any short term or long-term loansduring the year under audit.
xviii. The company has not made any preferential allotment of its shares during theyear under audit.
xix. The company has not issued any debentures; hence the clause is not applicable.
xx. During the year, the company has not raised any money through public issue; henceno disclosure is required
xxi. According to the information and explanations given to us, no fraud on or by thecompany has been noticed or reported during the course of our audit.
For GUPTA GARG & AGRAWAL CHARTERED ACCOUNTANTS FRN 505762C
PARTNER M.No. 012399
Place: New Delhi