REPORT OF THE AUDITORS TO THE SHARE HOLDERS OF
TO THE SHARE HOLDERS OF
R.P.P INFRA PROJECTS LTD
1. We have audited the attached Balance Sheet of M/s. RPP INFRA PROJECTS LIMITED asat 31.03.2011, the Profit and Loss Account and also the Cash Flow Statement for the yearended on that date annexed thereto. These financial statements are the responsibility ofthe Companys management. Our responsibility is to express an opinion on thesefinancial statements based on our audit.
2. 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 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 management, as well as evaluating the overallfinancial statement presentation. We believe that our audit provides a reasonable basisfor our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 issued by theCentral Government of India in terms of sub-section (4A) of section 227 of the CompaniesAct, 1956, read with Companies (Auditors Report) (Amendment) Order 2004 dated25.11.2004, we enclose in the annexure a statement on the matters specified in paragraphs4 and 5 of the 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 ourknowledge 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 thecompany so far as appears from our examination of those books. The Srilankan BranchAuditors report has been forwarded to us and has been appropriately dealt with byus.
iii) The Balance Sheet, Profit and Loss Account and Cash Flow statement dealt with bythis report are in agreement with the books of account and with the audited returns fromthe branches.
iv) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow statementdealt 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 representation received from the Board of Directors andtaken on record by the Board of directors, we report that none of the directors aredisqualified at the year end as per the provisions of clause (g) of sub-section (1) ofSection 274 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 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 accountingprinciples generally accepted in India:
a) in the case of Balance Sheet, of the state of affairs of the Company as at March,31, 2011.
b) in the case of the Profit and Loss account, of the profit of the Company for theyear ended on that date; and
c) in the case of the Cash Flow statement, of the cash flows for the year ended on thatdate.
| ||For KARTHIKEYAN & JAYARAM |
| ||CHARTERED ACCOUNTANTS |
| ||(sd/-) |
| ||CA. G.N. JAYARAM, F.C.A. |
|Place : Erode ||Partner. |
| ||Membership No: 200-027291 |
|Date : 25.07.2011 || |
| ||Firm Regn No: 07570S |
Re : R.P.P INFRA PROJECTS LTD
(Referred to in paragraph 3 of our Report dated 25.07.2011)
(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of the fixed assets.
(b) All the assets have been physically verified by the management during the year andthat there is a regular programme of verification which in our opinion is reasonablehaving regard to the size of the company and the nature of its assets. As reported nomaterial discrepancies have been noticed on such verification.
(c) During the year the has disposed off only a negligible portion of its plant &Machinery and has made substantial additions. We are of the opinion that the sale of thesaid part of Plant & Machinery has not affected the going concern status of theCompany.
(ii) (a) The inventory has been physically verified during the year by the Management.In our opinion, the frequency of the verification is reasonable.
(b) The procedures of physical verification of stock followed by the management arereasonable and adequate in relation to the size of the company and the nature of itsbusiness.
(c) The company is maintaining proper records of inventory. The discrepancies noticedon verification between the physical stocks and the book records were not material.
iii. (a) The Company has granted loan to one company covered in the register maintainedunder section 301 of the Companies Act, 1956. The amount involved during the year wasRs.46 lakhs and the year-end balance of loan was also Rs.46 Lakhs.
(b) No interest is charged on the loan, and as the Company is paying interest on itsborrowings from the bank it is prima facie prejudicial to the interest of the Company.
(c) and (d) are not applicable as there are no stipulated terms for the repayment ofprincipal and the loan is interest-free.
(e) to (g) are not applicable as the company has not taken any loans secured orunsecured from companies, firms or other parties covered in the register maintained undersection 301 of the Companies Act, 1956.
(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 Companyand the nature of its business with regard to purchases of inventory, fixed assets andwith regard to the sale of goods. During the course of our audit we have not observed anycontinuing failure to correct major weaknesses in internal controls.
(v) (a) According to the information and explanations given to us, we are of theopinion that the particulars of contracts or arrangements referred to in section 301 ofthe Act have been entered in the register required to be maintained under that section;and
(b) In our opinion and according to the information and explanations given to us, thetransactions made in pursuance of such contracts or arrangements exceeding the value ofrupees five lakhs in respect of any party during the year have been made at prices whichare reasonable having regard to prevailing market prices at the relevant time.
(vi) In our opinion and according to the information and explanations given to us,provisions of section 58A & 58 AA or any other relevant provisions of the companiesAct, 1956 are not attracted as the Company has not accepted any deposits from the public.
(vii) In our opinion the Company has regular internal audit system commensurate withthe size and nature of its business.
(viii) In our opinion and according to information and explanations given to us, theprovisions of section 209(1)(d) of the Companies Act, 1956 are not attracted in the natureof the activities undertaken by the company.
(ix) (a)The Company is regular in depositing with appropriate authorities undisputedstatutory dues including provident fund, investor education protection fund,employees state insurance, income tax, sales tax, wealth tax, service tax, customduty, excise duty, cess and other material statutory dues applicable to it.
(b) According to the information and explanations given to us, there are no undisputedamounts payable in respect of income tax, wealth tax, service tax, sales tax, excise dutyand cess were in arrears as at 31st March, 2011, for a period of more than six months fromthe date they became payable.
(c) According to the information and explanation given to us, there are no dues ofsales tax, income tax, customs duty, wealth tax, excise duty and cess which have not beendeposited on account of any dispute, except in respect of the particulars given hereunder:
|S.No ||Tax Laws ||Forum where Dispute is pending ||Period ||Amount (In Rs.) |
|1. ||Service Tax ||Commissioner of Central Excise, Salem ||F.Yr 2008-09 ||2,52,28,175 |
|2. ||Income Tax || ||F.Yr 2006-07 ||24,14,650 |
|3. ||Income Tax || ||F.Yr 2009-10 ||51,87,870 |
(x) There are no accumulated losses of the company. The Company has not incurred cashlosses during the financial year covered by our audit and in the immediately precedingfinancial year.
(xi) In our opinion and according to the information and explanation given to us, theCompany has not defaulted in repayment of dues to a financial institution or bank. Thereare no debenture holders.
(xii) In our opinion, and according to the information and explanations given to us,the Company has not granted any loans and advances on the basis of security by way ofpledge of shares, debentures and other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi / mutual benefitfund/society. Therefore, the provisions of clause 4(xiii) of the Companies (AuditorsReport) Order, 2003 are not applicable to the Company.
(xiv) In our opinion and according to the information and explanations given to us, theCompany is not dealing or trading in shares, securities, debentures & otherinvestments. The trading in shares is only in the nature of investments.
(xv) As per written undertaking taken on record from the Management, the Company hasnot given any guarantee for loans taken by others from bank or financial institutions.
(xvi) In our opinion, the term loans have been applied for the purpose for which theywere raised.
(xvii) According to the information and explanations given to us and on an overallexamination of the balance sheet of the Company, we report that no funds aised onshort-term basis have been used for long-term investment.
(xviii) According to the information and explanations given to us, the Company has notmade preferential allotment of shares to parties and companies covered in the registermaintained under section 301 of the Act.
(xix) According to the information and explanations given to us, the Company has notissued any debentures.
(xx) We have verified the end use of money raised by public issue as disclosed by themanagement in the notes to the Financial Statements.
(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.
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For KARTHIKEYAN & JAYARAM
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| || |
| || |
CA. G.N. JAYARAM, F.C.A.
|Place : Erode || |
| || |
Membership No: 200-027291
|Date : 25.07.2011 || |
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Firm Regn No: 07570S