kaprinas pharmaceuticals chemicals ltd Auditors report

KPRINAS PHARMACEUTICALS & CHEMICALS LIMITED AUDITORS REPORT To The Shareholders We have audited the attached Balance Sheet of M/S KAPRINAS PHARMACEUTICALS & CHEMICALS LIMITED, KHANNA as at 31 st March, 1998 and also the annexed Profit and Loss account of the Company for the year ended on that date and report that: 1. We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit: 2. In our opinion proper books of account as required by the law have been kept by the company as it appears from our examination of the books. 3. The Balance Sheet and Profit and Loss Account dealt with by this report are in agreement with the books of account. 4. As required by the manufacturing and other Companies (Auditors Report) Order,1988 issued in terms of Section 227 (4A) of the Companies Act, 1956 and on the basis of such checks as we considered appropriate, we further report that: (i) The Company maintained records showing particulars including quantitative details and situation of the fixed assets which were destroyed during accidental fire which broke out on 15.12.96 resulting in complete burning of entire record, thereafter no record has been maintained. The Management has stated that assets covering significant values have been physically verified during the year. (ii) None of the fixed assets have been revalued during the year. (iii) The stocks of finished goods, spare parts, raw materials and major items of stores have been physically verified during the year by the management. (iv) The Procedures of physical verification of stocks has been followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business. (v) In our opinion the valuation of stocks is fair and proper in accordance with the normally accepted accounting principles and is on the same basis as in the preceding year. (vi) The company has not taken any loans, secured or unsecured from Companies, Firms or other Parties listed in the register maintained under section 301 /Bodies corporate under the same management as defined under section 370 (IB) of the Companies Act, 1956. (vii) The Company has not granted any loans, secured or unsecured to Companies, Firms or other parties listed in the register maintained under section 301 /bodies corporate under the same management as defined under section 370 (IB) of the Companies Act, 1956. (viii) In our opinion and according to the information and explanations given to us the loans and advances in the nature of loan made by the company are being repaid as stipulated including interest wherever applicable. (ix) 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 company and nature of its business for purchase of stores, raw materials including components, plant and machinery, equipments and other assets and for sale of goods. (x) In our opinion and according to the information and explanations given to us there were no transaction for the purchase of goods materials and services made in pursuance of contracts or arrangements, entered in the register maintained under section 301 of the Companies Act, 1956 and aggregating during the year to Rs. 50000/- or more in respect of each party. (xi) As explained to us unserviceable or damaged stores, raw materials and finished goods are determined by the Company and adequate provision for the loss has been made in the accounts (xii) The Company has neither invited nor accepted any deposits from the public. (xiii) According to the information and explanations given to us internal audit has been conducted and the internal audit systems is commensurate with the size of the Company and nature of its business. (xiv) The maintenance of Cost Records has not been prescribed by the Central Government under Section 209 ( I ) (d) of the Companies Act, 1956 for the products manufactured by the Company. (xv) According to the records of the Company Provident Fund and Employees State Insurance dues have not been deposited regularly by the Company since March, 1997. (xvi) According to the information and explanations given to us there were no undisputed amounts payable in respect of Income Tax, Wealth Tax, Custom Duty and Excise Duty which were due for more than six months on the last day of the financial year. (xvii) On the basis of the examination of the books of account carried out by us in accordance with generally accepted auditing practices and according to the information and explanations given to us no personal expenses of employees or directors have been charged to the Profit and Loss Account other than those payable under contractual obligations or in accordance with generally accepted business practice. (xviii) The Company is a sick industrial company within the meaning of Section 3(1)(0) of Sick Industrial Companies (Special Provisions) Act, 1985. 5. In our opinion and to the best of our information and according to the explanations given to us, the accounts read together with the notes and significant accounting policies thereon, give the information required by the Companies Act,1956, in the manner so required and give a true and fair view subject to the notes attached with balance sheet (a) in the case of Balance Sheet of the state of affairs of the Company as at 31 st March, 1998 and (b) in the case of Profit and Loss account of the LOSS for the year ended on that date. FOR KHANNA ANIL ASSOCIATES CHARTERED ACCOUNTANTS DATED: 10.10.98 PLACE : LUDHIANA (ANIL KHANNA)