India Securities Ltd Merged Auditor Reports

INDIA SECURITIES LIMITED ANNUAL REPORT 2010-2011 AUDITORS REPORT TO THE MEMBERS OF INDIA SECURITIES LIMITED We have audited the attached Balance Sheet of India Securities Limited, as at March 31, 2011 and also the Profit and Loss Account for the year ended on that date annexed thereto and the Cash Flow Statement for the year ended on that date. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in India. These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As required by the Companies (Auditors Report) Order, 2003 (as amended) issued by the Central Government of India in terms of subsection (4A) of section 227 of the Companies Act, 1956, and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order. 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 our knowledge and belief were necessary for the purposes of our audit; (ii) In our opinion, proper books of account as required by law have been kept by the company so far as it appears from our examination of those books. (iii) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account; (iv) On the basis of written representations received from the directors as on March 31, 2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on March 31, 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956; (v) In our opinion, the Balance Sheet, the Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956; (vi) In our opinion and to the best of our information and according to the explanations given 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 accounting principles generally accepted in India:- i. in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2011; ii. in the case of the Profit and Loss Account, of the loss of the Company for the year ended on that date; and iii. in the case of cash flow statement, of the cash flows of the Company for the year ended on that date. For NISAR & KUMAR Chartered Accountants Firm Regn. No.127820 W K.M. Mahadik Partner M. No. 48453 Place: Mumbai Date : December 1, 2011 ANNEXURE REFERRED TO THE REPORT OF EVEN DATE FOR THE YEAR ENDED MARCH 31, 2011 OF INDIA SECURITIES LIMITED (i) (a) The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. (b) All the assets other than leased assets have been physically verified by the management during the year as per programme of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. As informed to us, no discrepancies were noticed on such verification. (c) During the year, the company has disposed off substantial part of the fixed asset; however it has not affected going concern status of the company. (ii) Since the company do not have inventory, the clause (ii) is not applicable to the company for the year. (iii) (a) The company has not granted any loans to companies, firms and other parties covered in the Register maintained under Section 301 of the Companies Act, 1956: (b) In view of clause (iii) (a) above, clause (iii) (b) is not applicable. (c) In view of clause (iii) (a) above, clause (iii) (c) is not applicable. (d) In view of clause (iii) (a) above, clause (iii) (d) is not applicable. (e) The company has not taken any loans from companies, firms and other parties covered in the Register maintained under Section 301 of the Companies Act, 1956. (f) In view of clause (iii) (e) above, clause (iii) (f) is not applicable. (g) In view of clause (iii) (e) above, clause (iii) (g) is not applicable. (iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchases of assets and rendering of services. During the course of our audit, no major weakness has been noticed in the internal controls system. (v) (a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that there are no transactions during the year that need to be entered into the register maintained under section 301. (b) In view of clause (v) (a) above, clause (v) (b) is not applicable. (vi) During the year the company has not accepted or renewed any public deposits. As informed to us no order has been passed by the National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal. (vii) In our opinion, the company has an internal audit system commensurate with the size and nature of its business. (viii) As informed to us, the maintenance of cost records have not been prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Companies Act, 1956. (ix) (a) According to the records of the company, the company is generally regular in depositing undisputed statutory dues including provident fund, service tax in deposit of taxes with appropriate authorities, however there were delays in deposit of income tax. As per the books of account and according to information and explanations given to us there are no undisputed dues of Investor Education and Protection Fund, Employees State Insurance, Sales Tax, wealth tax, Custom Duty, Excise Duty and Cess. The arrears of income tax dues of Rs.1,990,766 were outstanding as at March 31, 2011 for a period of more than six months from the date they became payable. (b) According to the records of the company, there are no dues of Wealth Tax, Service Tax, Custom duty, excise duty/cess which have not been deposited on account of dispute. The details of Income Tax and Sales Tax, which have not been deposited on account of dispute are as under: Nature of Statute Amount Period Authorities before Liability (Rs. Lakhs) which pending dispute Sales tax Rajasthan 4.31 F.Y 1995-96 Sales Tax (lease tax) Sales Tax Authorities, Jaipur Act 15.99 F.Y 1996-97 Income Tax Income Tax 13.21 A.Y 2000-01 DCIT Appeal - Mumbai Act, 1961 54.78 A.Y 2007-08 ACIT Appeal - Mumbai (x) The accumulated losses of the company at the end of the financial year are not more than fifty percent of its networth and the company has not incurred any cash losses during the financial year covered by our audit and in the immediately preceding financial year. (xi) Based on our audit procedures and according to the books of account and information and explanations given by the management, we state that there are no dues to banks or financial institutions. (xii) Based on our examination of documents and records, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. (xiii) Provisions of Chit Fund Nidhi/ Mutual Benefit Fund/Societies are not applicable. (xiv) In respect of dealing or trading in shares, securities, debentures and other investments by the company, proper records have been maintained of the transactions and contracts and timely entries have been made therein. Investments held by the company are since in its own name. (xv) The company has not given any guarantee for loans taken by others from bank or financial institutions. (xvi) During the year the company has not borrowed any term loan. (xvii) During the year the funds raised on short term basis have not been used for long term investments. (xviii) During the year the company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act. (xix) During the year, the company has not issued secured debentures. (xx) During the year, the company has not raised money by public issues. (xxi) Based upon the audit procedures performed and information and explanations given by the management, we report that no fraud on or by the company has been noticed or reported during the course of our audit. For NISAR & KUMAR Chartered Accountants Firm Regn. No.127820 W K.M. Mahadik Partner M. No. 48453 Place: Mumbai Date : December 1, 2011