jem industries ltd Auditors report

JEM INDUSTRIES LIMITED ANNUAL REPORT 2004-2005 AUDITORS REPORT To, The Members, JEM INDUSTRIES LIMITED. REPORT ON THE ACCOUNTS FOR THE YEAR ENDED ON 31ST MARCH, 2005 IN COMPLIANCE WITH SECTION 227(2) OF THE COMPANIES ACT, 1956: We have examined the attached Balance sheet and Profit & Loss Account annexed thereto which are in agreement with Companys books of account. 1. We carried out audit in accordance with Auditing Standard 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 misstatements. 2. As required by the Companies (Auditors Report) Order 2003 issued by the Central Government of India in terms of Provisions of section 227(4A) of the Companies Act, 1956, in our opinion, and on the basis of such checks of the books and records as we considered appropriate, and according to the information and explanations given to us during the normal course of the audit, which were necessary to the best of our knowledge and belief, we report that: 1. FIXED ASSETS: a) The Company has maintained proper records to show full particulars, including quantitative details and situation of Fixed Assets on the basis of available information. b) As explained to us, the fixed assets have been physically verified by the management during the year in a periodical manner, which in our opinion is reasonable having regard to the size of company and nature of its assets. c) No material discrepancies were noticed on such physical verification. d) In our opinion, the company has not disposed off substantial part of Fixed assets during the year & the going concern status of the company is not affected. 2. INVENTORY: a) As explained to us, Inventory have been physically verified by the management at regular intervals during the year. b) In our opinion & according to the information & explanation given to us, the procedures of physical verification of inventories followed by management are reasonable & adequate in relation to the size of the company & nature of its business. c) The company has maintained proper records of Inventory. As explained to us, there were no material discrepancies noticed on physical verification of inventories as compared to the book record. 3. In respect of Loans, secured or unsecured, granted or taken by the company to/from Companies firms or other parties covered in register maintained pursuant to section 301 of the Companies Act, 1956. a) The company has taken loan from Shri Rahul N. Amin aggregating to Rs.1000000/-. b) In our opinion & according to information & explanation given to us, the rate of interest and other terms & conditions are not prima facie prejudicial to the interest of the company. c) In our opinion, payment of principal amount & interest are regular. d) There is no overdue amount in respect of loan taken by the company. 4. In our opinion & according to information & explanation given to us, there are adequate internal control procedures commensurate with the size of the company and nature of its business for purchase of inventory, fixed assets and with regard to sale of goods. During the course of audit, we have not observed any major weaknesses in internal control. 5. a) In our opinion & according to information & explanation given to us, the transactions that needed to be entered in to the register maintained under section 301 have been so entered. b) In our opinion & according to information & explanation given to us, there were no such transactions exceeding Rs. 5 lakhs each which are not reasonable. 6. The Company has not accepted any Deposits from the public. 7. In our opinion, the company has an Internal audit system commensurate with the size of the company and nature of its business. 8. The Central Government has prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956. 9. a) According to the records of the company, the company is regular in depositing with appropriate authorities undisputed statutory dues including Provident fund, E.S.I. Income tax, Sales tax, Wealth tax, Custom duty Excise duty, Cess and other statutory dues applicable to it. b) As at 31-3-2005, according to the records of the company, following are the particulars of Disputed Dues. Sr. No. Name of the Statute Amount (Rs.) Forum where dispute is pending 1. Income Tax 129965/- Appellate Tribunal 10. The company has no accumulated losses and has not incurred any cash losses during the financial year covered by our audit or in the immediately preceding financial year. 11. Based on our audit procedures and according to the information and explanation given to us, we are of the opinion that the company has not defaulted in repayment of dues to the financial institution, banks or debenture holders. 12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. 13. The Company has not a Chit Fund or a Nidhi/Mutual Benefit Funds/Society. 14. The Company is not a dealer or trader in securities. 15. The Company has not given any guarantee for loans taken by others from Bank or financial Institution. 16. The Term loans obtained by the company have been applied for the purpose for which they were raised. 17. According to the information and explanation 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 by the company. 18. The Company has not made any preferential allotment of shares to the parties and companies covered in the register maintained under section 301 of the Companies Act, 1956 during the year. 19. The Company has not issued any Debentures. 20. The Company has not raised any money by Public Issue during the year. 21. In our opinion and according to the information and explanation given to us, no fraud on or by the Company has been noticed or reported during the year. Further to the above: a) We have obtained all the information and explanations which to the best of our knowledge and belief of were necessary for the purpose 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 those books; c) In our opinion, the Balance Sheet and the Profit & Loss Account comply with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956. d) On the basis of written representations received from the directors of the company as at 31st March, 2005 and taken on record by the Board of Director of the company, we report that none of the Director is disqualified as at 31st March, 2005 from being appointed as a director in terms of clause (g) of sub section 274 of the companies Act, 1956; e) 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: 1. in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2005 and 2. in the case of the Profit & Loss Account, of the profit of the Company for the year ended on that date. For AMIN PARIKH & COMPANY Chartered Accountants Vadodara. (SAMIR R. PARIKH) Date: 29 June, 2005 Partner