AXTEL INDUSTRIES LIMITED
We have audited the attached Balance Sheet of AXTEL INDUSTRIES LIMITED for theyear ended on 31 st March, 2012 and the Profit and Loss Account of the Company for theyear ended on that date, annexed thereto. These financial statements are theresponsibility of the Company's Management. Our responsibility is to express an opinion onthese financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted inIndia. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free from material misstatement. Anaudit also includes examining, on a test basis, evidence supporting the amounts anddisclosures in the financial statements. An audit also includes assessing the accountingprinciples used and significant estimates made by management as well as evaluating theoverall financial statement presentation. We believe that our audit provides a reasonablebasis for our opinion and we report that:
I. a. We have obtained all the information and explanations which to the best of ourknowledge 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 theCompany, so far as it appears from our examination of the books.
c. The Balance Sheet and Profit and Loss Account and Cash Flow Statement dealt with bythis Report are in agreement with the books of account.
d. In our opinion and subject to the accounting treatment in respect of transactionsdiscussed in Significant Accounting Policies, Notes on Accounts, the Balance Sheet, Profitand Loss Account and Cash Flow Statement dealt with by this Report, comply with theaccounting standards referred to in Section 211 (3C) of the Companies Act, 1956.
e. On the basis of written representation received from the directors, as on 31stMarch, 2012 and taken on record by the Board of Directors, we report that none of thedirectors is disqualified as on 31st March, 2012 from being appointed as a director interms 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 explanationsto us the said accounts, read together with the significant accounting policies and notesthereon, give the information as required by the Companies Act, 1956, in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India :-
(1) In the case of Balance Sheet, of the state of affairs of the Company, for the yearended on 31st March, 2012.
(2) In the case of Profit and Loss Account, of the "PROFIT" of the Companyfor the year ended on that date. And
(3) In the case of the Cash Flow Statement, of the cash flows of the Company for theyear ended on that date.
II. As required by the Companies (Audit Report) Order, 2003 issued by CentralGovernment of India in terms Section 227(4A) of the Companies Act, 1956 and on the basisof such checks of the books and records of the company as were considered appropriate, andas per the information and explanation given to us during the course of our Audit, wefurther report on the matters specified in para 4 & 5 of the said order to the extentapplicable to the company, as under:
1. (i) The Company has maintained proper records to show full particulars includingquantitative details and situation of fixed assets.
(ii) The Fixed Assets have been physically verified by the Management at the year end.In our opinion the frequency of verification is reasonable. No material discrepancies havebeen noticed on such verification.
(iii) In our opinion and according to the information and explanations given to us, thecompany has not disposed off substantial part of fixed assets during the year and thegoing concern status of the company is not affected.
2. (i) As informed to us, the inventories have been physically verified by themanagement at the year end. In our opinion, the frequency of verification is reasonable.
(ii) In our opinion and according to the information and explanations given to us, theprocedures of physical verification of inventories followed by the management arereasonable and adequate in relation to the size of the Company and nature of its business.
(iii) In our opinion and according to the information and explanations given to us, theCompany has maintained proper records of its inventories and no material discrepancieswere noticed on physical verification of inventories as compared to the book records.
3. The company has not granted nor taken any loans, secured or unsecured to/fromcompanies, firm or other parties covered in the register maintained under section 301 ofthe companies act, 1956. Under the above circumstances the requirements of clause (iii)(c) and (iii) (d) of paragraph 4 of the order are not applicable to the company.
4. In our opinion, and according to the information and explanations given to us, thereare adequate internal control procedures commensurate with the size of the company and thenature of its business with regard to purchase of inventory and fixed assets and for saleof goods. During the course of audit, we have not observed any continuing failure tocorrect major weaknesses in internal control.
5. According to the information and explanations given to us, there were transactionsthat have been done during the year that needed to be entered into the register maintainedunder section 301 of the Companies Act, 1956 and for which required approval has beenobtained for relevant authorities. These transactions have been entered at prices whichare reasonable having regard to the prevailing market prices at relevant time.
6. During the year, the company has not accepted any deposits from the public withinthe meaning of sections 58A and 58AAof the Act and the rules framed there under.
7. The internal audit of the Company has been conducted by company's own staff. In ouropinion, the internal audit system is commensurate with the size and nature of itsbusiness. However, the consistency of staff and it's reporting needs to be strengthened.
8. The Central Government has not prescribed maintenance of cost records under section209(1 )(d) of the Companies Act, 1956 in respect of the industry to which company belong.Hence, the Company has not maintained such records.
9. (i) The Company is regular in depositing undisputed statutory dues, includingprovident fund, Employees State Insurance
Fund, investor education protection fund, income tax sales tax, wealth tax, customduty, excise duty, cess and other material statutory dues, with appropriate authorities,as applicable to it.
(ii) According to information and explanations given to us, no undisputed amountsPayable in respect of income tax, wealth tax, sales tax, excise, and cess which were inarrears as at 31st March, 2012 for a period of more than six month from the date theybecame payable.
(iii) According to information and explanations given to us, there are no disputedamounts payable in respect of income tax, wealth tax, sales tax, excise, and cess as on31st March, 2012, since there are no disputes on which any tax/ cess is due.
(iv) The Disputed statutory dues aggregating Rs. 1,93,150that have not been depositedon account of disputed matters pending before appropriate authority is as under:
|Name of the Statute ||Name of Dues ||Amount (Rs.) ||Period to which amount relates ||Forum where dispute is pending |
|Income Tax Act, 1961 ||FBT ||1,93,150 ||P.Y. 05-06 A.Y 06-07 ||Commissioner of Income Tax (Appeals)-IV |
10. The company does not have any accumulated losses at the end of the financial year,nor has the company incurred any cash losses in the current year and immediately precedingfinancial year.
11. In our opinion and according to the information and explanations given to us thecompany has not defaulted in repayment of dues to a bank or financial institutions. Thecompany has not issued any debentures.
12. In our opinion and according to the information given to us the company has notgranted loans or advances on the basis of security byway of pledge of shares, debentureand other securities.
13. The nature of the company activities during the year is such that, clauses(xiii) and (xiv) of paragraph 4 of the companies (Auditor Report) order 2003 are notapplicable to the company for the year.
14. According to the information and explanation given to us, the company has not givenany guarantee for loans taken by others from banks or financial institutions.
15. To the best of our knowledge and belief and according to explanation given to us,term loans availed by the company were, prima facie applied by the company during the yearfor the purpose for which loans were obtained
16. According to the information and explanations given to us and on an overallexamination of balance sheet of the company we report that no funds raised on short - termbasis have been used for long-term investment.
17. During the year, the company has not issued any debentures and hence the questionof creating securities in respect thereof does not arise.
18. During the year, the company has not raised money by way of public issue.
19. In our opinion and according to the information and explanations given to us nofraud on or by the company has been noticed or reported during the year that causes thefinancial statements to be materially misstated.
|PLACE: BARODA ||For V. K. SHASTRI & CO. |
|DATE: 25/05/2012 ||CHARTERED ACCOUNTANTS |
| ||(V. K. SHASTRI) |
| ||Sole Proprietor |