AUDITORSTo,
The Members,
SAGAR SYSTECH LIMITED
Mumbai
We have audited the attached Balance Sheet of SAGAR SYSTECH LIMITED as at 31stMarch, 2010 and Profit and Loss Account and Cash Flow as on that date for the period endedon that date, annexed thereto. These financial statements are the responsibility of theCompany's management. Our responsibility is to express an opinion on these financialstatements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted inIndia. These Standards require that we plan and perform the audit to obtain reasonable assuranceabout whether the financial statements are free from material misstatement(s). An auditincludes examining on a test basis, evidence supporting the amount and disclosure in thefinancial statement. An audit also includes assessing the accounting principles used andsignificant estimates made by management, as well as evaluating the overall financialstatement presentation. We believe that our audit provides a reasonable basis for ouropinion.
And we report that:
As required by the Companies (Auditor's Report) Order, 2003 issued by the CentralGovernment of India in terms of sub-section (4 A) of section 227 of the Companies Act,1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and5 of the said Order, to the extent applicable to the company.
Further to our comments in the Annexure referred to above, we report that:
a. We have obtained all the information and explanation, which to the best of ourknowledge 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 thecompany so far as appears from our examination of those 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 the Balance Sheet and 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.
e. On the basis of written representation received from the directors, and taken onrecord by the Board of Directors, none of the directors is disqualified as on 31st March2009 from being appointed as director in terms of clause (g) of sub section (1) of section274 of the Companies Act, 1956.
f. In our opinion and to the best of our information and according to the explanationsgiven to us, the said accounts subject to the notes thereon give the information requiredby the Companies Act, 1956, in the manner so required and in conformity with theaccounting principles generally accepted in India and give a true and fair view :
(a) In the case of the Balance Sheet, of the state of affairs of the Company as at 31stMarch, 2010,
(b) In the case of the Profit and Loss Account, of the loss for the year ended on thatdate and
(c) In the case of cash flow statement, of the cash flows for the year ended on thatdate.
For Chaitanya C. Dalai & Co.
Chartered Accountants
Chaitanya C. Dalai
Partner
Membership No. 35809
Firm's Registration No.: 101632W
Place: Mumbai
Date:
Annexure to the Auditors' Report
Re: Sagar Systech Limited
As required by the Companies (Auditor's Report) Order 2003 including the Companies(Auditor's Report) (Amendment) 2004 issued by the Central Government of India in term ofSection 227(4A) of the Companies Act 1956 and on the basis of such checks as we consideredappropriate we report that: -
(i)
a. The company is maintaining proper records showing full particulars, includingquantitative details and situation of fixed assets.
b. These fixed assets have been physically verified by the management at reasonableintervals; and no material discrepancies were noticed on such verification.
c. As per the information and explanations given to us, during the year, the Companyhas not disposed off any substantial part of fixed assets that would affect the goingconcern.
(ii) The Company did not carry any inventory during the year. Accordingly, the clausesas to physical verification of inventory at reasonable intervals, the procedures ofphysical verification of inventory followed by the management, and maintenance of properrecords of inventory are not applicable.
(iii) The Company has neither taken nor granted any unsecured loans to any partycovered in the register maintained under section 301 of the Act. Since unsecured loansneither taken nor granted to any party covered in the register maintained under section301 of the Act reporting under Clause (b), (c), and (d) are not required.
(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 for the purchase of fixed assets and revenue recognition.Further, on the basis of our examination of the books and records of the Company, andaccording to the information and explanations given to us, we have neither come across norhave been informed of any continuing failure to correct major weaknesses in the aforesaidinternal procedures.
(v)
a. In our opinion and according to the information and explanations given to us. Thetransactions that need to be entered into the register in pursuance of Section 301 of Acthave been so entered.
b. In our opinion and according to the information and explanations given to us, thetransactions made in pursuance of contracts or arrangements entered into the register inpursuance of Sections 301 of the Act and exceeding the value of Rupees Five Lakh inrespect of any party during the year, have been made at prices which are reasonable havingregard to the prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from public; hence question of complyingwith the directives issued by Reserve Bank of India and the provisions of Sections 58A and58AA of the Act and the Companies (Acceptance of Deposits) Rules, 1975 with regard to thedeposits accepted from the public are not applicable.
(vii) In our opinion, the Company has an internal audit system commensurate with itssize and nature of its business.
(viii)
a. The Act relating to ESIC, and PF are not applicable to the company and According tothe information and explanations given to us and the records of the company examined byus, in our opinion, the Company is regular in depositing the undisputed statutory duesincluding investor education and protection fund, income tax, sales-tax, wealth tax,customs duty, excise duty, Cess and other material statutory dues as applicable with theappropriate authorities. According to the information and explanations given to usno undisputed amounts payable in respect of such statutory dues were outstanding asat 31st March 2010, for a period of more then six months from the date theybecame payable.
b. According to the information and explanations given to us there is no disputed duesof sales tax/income tax/custom tax/wealth tax/excise duty/Cess have been deposited onaccount of any dispute.
(ix) The Company has no accumulated losses as at March 31, 2010 but it has incurredcash losses of Rs. 75,256/- in the financial year ended on that date and in theimmediately preceding financial year.
(x) Company has not granted loans against pledge of shares, debentures and othersecurities; hence question of Maintenance of adequate documents and records of pledge ofshares, debentures and other securities, does not arise.
(xi) According to the information and explanations given to us, the Company has notgiven any guarantee during the year for loans taken by others from banks or financialinstitutions.
(xii) The Company has not availed any term loans facility during the year, hence,question of using of it for the purposes for which they were obtained does not arise.
(xiii) The company has maintained proper records of transactions and contracts inrespect of trading in shares, debentures, and other securities and timely entries havebeen made therein. The investments are held by the company in its own names except thoseallowable under section 49 of the Companies Act, 1956.
(xiv) On the basis of an overall examination of the balance sheet of the Company, inour opinion and according to the information and explanations given to us, there are nofunds raised as working capital loans (short term loans) that have been used for long-terminvestment and vice versa.
(xv) The Company has not made any preferential allotments of shares to parties andcompanies covered in the register maintained under Section 301 of the Act during the year.
(xvi) During the course of our examination of the books and records of the Company,carried out in accordance with the generally accepted auditing practices in India, andaccording to the information and explanations given to us, we have neither come across anyinstance of fraud on or by the company, noticed or reported during the year, nor have webeen informed of such case by the management.
(xvii) The other clauses, namely (viii), (xiii), (xix) and (xx) of paragraph 4 of theCompanies (Auditor's Report) Order 2003 are not applicable in the current year. Since inour opinion there is no matter which arises to be reported in the aforesaid order.
For Chaitanya C. Dalai & Co.
Chartered Accountants
Chaitanya C. Dalai
Partner
Membership No. 35809
Firm's Registration No.: 101632W
Place: Mumbai
Date: