krishna ferro products ltd Auditors report
KRISHNA FERRO PRODUCTS LIMITED
ANNUAL REPORT 2011-2012
AUDITORS REPORT
The Members
Krishna Ferro Products Limited
1. We have audited the attached Balance Sheet of M/S KRISHNA FERRO PRODUCTS
LIMITED, MANDIAKUDAR, CHUNGIMATI-770034, as at 31st March 2012, the Profit
& Loss Account and Cash Flow Statement of the Company for the year ended on
that date annexed thereto. 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.
2. We conducted the audit in accordance with auditing standards 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 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 the management, as well as evaluating the
overall financial statement presentation. We believe that our audit
provides a reasonable basis of our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 issued by the
Central Government of India in terms of sub-section (4A) of section 227 of
the Companies Act, 1956, we enclose in the Annexure a statement on the
matters specified in the paragraphs 4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to in paragraph (3)
above, we report that:
(a) We have obtained all the information and explanations, which to the
best of our knowledge and belief, 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) The Balance Sheet, the Profit and Loss Account and the Cash Flow
Statement dealt with by this report are in agreement with the books of
Account;
(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in section 211(3C) of the Companies Act, 1956 to the
extent applicable.
(e) On the basis of the written representation, received from the directors
taken on record by the board of directors as on 31st March 12. We report
that none ofthe Directors is disqualified as on 31st March 12 from being
appointed as a Director in terms of Section-274(1)(g) of the Companies Act
1956.
(f) 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 31st March, 2012
ii. In the case of the Profit and Loss Account, of the profits for the year
ended on that date.
iii. In the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
For K. D. LATH & COMPANY
Chartered Accountants
sd/-
Place: Rourkela SUDHIR LATH, Partner
Dated: 22nd June, 2012 Membership No. 59396
FRN. 306011 E
ANNEXURE TO THE AUDITORS REPORT:
Referred to in Paragraph (3) of our report of even date on the accounts for
the year ended 31st March, 2012 of Krishna Ferro Products Limited.
i. a) The Company is maintaining proper records showing full particulars,
including quantitative details and situation of fixed assets.
b) Fixed Assets of the company were physically verified by the management
during the year at reasonable intervals and no material discrepancies were
noticed on verification.
c) There is no disposal of a substantial part of fixed assets during the
year; therefore, the effect, if any, as going concern does not arise.
ii. a) The stock of finished goods, stores, spare parts and raw materials
have been physically verified by the management at reasonable intervals.
b) In our opinion and according to the information and explanation given to
us, the procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
c) No discrepancies were noticed on verification of physical stock as
compared to book records.
iii. a) The Company has not granted unsecured loans to Companies/Firms or
Other parties covered in the register maintained under section 301 of the
Companies Act, 1956. Therefore, the provisions of clause 4(iii) (a) to (d)
of the Companies (Auditors Report) Order, 2003 are not applicable to the
Company.
b) The company has taken unsecured loans from Companies/Firms or Other
parties covered in the register maintained under section 301 of the
Companies Act, 1956.
No. of Opening balance of Maximum amount involved Year end balance
Parties Loan (Rs. In Lacs) in the transaction of loan
5 653.34 670.63 30.62
c) The rate of interest and other terms and conditions on which unsecured
Loans have been obtained from Companies and other parties are not, prima-
facie, prejudicial to the interest of the Company.
d) Payment of the Principal amount and interest wherever is applicable, are
regular.
iv. In our opinion and according to the information and explanations given
to us there is an adequate internal control procedure commensurate with the
size of the Company and the nature of its business, for the purchase of raw
materials including components, stores, plant and machinery, equipments and
other similar assets and with regard to sale of goods & services. To the
best of our knowledge, we noticed no major weaknesses in internal control
during the course of our audit.
v. a) In our opinion and according to the information given to us, the
transactions that need to be entered into the register in pursuance of
section 301 of the Companies Act, 1956, have been entered.
b) In our opinion and according to the information and explanation given to
us, the transactions made in pursuance of such contracts or arrangements
exceeding value of Rupees Five Lakhs have been entered into during the
financial year at price which are reasonable having regard to the
prevailing market price at the relevant time.
vi. In our opinion and according to information and explanations given to
us, the Company has not accepted any deposits from public as per the
provisions of section 58A, 58AA or any other relevant provisions of the Act
and the Companies (Acceptance of Deposits) Rules, 1975, where applicable,
with regard to deposits accepted from the public.
vii. In our opinion the company has an internal audit system commensurate
with its size and nature of its business.
viii. We have broadly reviewed the cost records maintained by the Company
pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed
by the Central Government under Section 209(1)(d) of the Companies Act,
1956 and are of the opinion that prima facie the prescribed cost records
have been maintained. We have, however, not made a detailed examination of
the cost records with a view to determine whether they are accurate or
complete.
ix. a) According to the records of the Company, the Company has been
generally regular in depositing undisputed statutory dues including
Provident Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth
Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other statutory
dues with the appropriate authorities. According to the information &
explanation given to us, no undisputed statutory dues were in arrear as at
31st March, 2012, for a period of more than six months from the date they
became payable.
b) The disputed statutory dues aggregating Rs 15.05 Lacs that have not been
deposited on account of disputed matters pending before appropriate
authorities are as under:
Name of Nature of Year Amount Forum where
the Status Dues (in Rs.) pending
ESI Act ESI Mar 01 to 1,54,728/- Regional Director
Mar 03 ESI Corporation BBSR
Entry Tax Entry Tax 2002-03 1,94,874/- Asst. Commissioner
Act 2001-02 1,25,484/- of Sales Tax
Sundergarh Range,
Rourkela
2003-04 3,04,676/- Addl/Commissioner
S.T Cuttack
Sales Tax & CST 2005-06 5,17,365/- Joint Commissioner
VAT Law of Sales Tax
Sundergarh Range,
Rourkela
Sales Tax & VAT 2005-07 2,07,654/- Deputy Commissioner
VAT Law of Sales Tax
Sundergarh Range,
Rourkela
x. The Company has no accumulated losses and has not incurred cash losses
in the financial year covered by our audit and immediately preceding
financial year.
xi. On the basis of the verification of records and information and
explanations given to us, the Company has not defaulted in repayment of
dues to financial institutions, banks and debenture holders.
xii. The Company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
xiii. The Company does not carry on the business of a chit fund.
xiv. The Company does not deal or trade in shares, securities, debentures
and other investments.
xv. According to information and explanations given to us, the Company has
not given any guarantee for loans taken by others from banks or financial
institutions.
xvi. According to the records of the company, term loans have been applied
for the purpose for which they were obtained.
xvii. According to the information and explanations given to us, the cash
flow statement examined by us and on an overall examination of the balance
sheet of the company, we report that funds raised on short-term basis have
not been used for long term investment.
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. The Company has issued 0% unsecured Non Convertible Debenture to M/S
Krishna Re-Rollers Pvt. Ltd. during the year. The said debentures are
unsecured and no charge or security is required to be created in respect of
debenture issued.
xx. During the year, the Company has not raised any money by public issues.
xxi. Based on the audit procedure performed and the representation obtained
from the management, we report that no case of fraud on or by the Company
has been noticed or reported during the year under audit.
For K. D. LATH & COMPANY
Chartered Accountants
sd/-
Place: Rourkela SUDHIR LATH, Partner
Dated: 22nd June, 2012 Membership No. 59396
FRN. 306011E