towels india exports ltd share price Auditors report

TOWELS INDIA EXPORTS LIMITED. ANNUAL REPORT 2001-2002 AUDITORSREPORT To The Members of M/S TOWELS INDIA EXPORTS LIMITED. We have audited the attached Balance Sheet of TOWELS INDIA EXPORTS LIMITED as at 31st March 2002 and also the Profit & Loss Account of the Company for the year ended on that date annexed thereto and report that: - 1. As required by the manufacturing and other Companies (Auditors Report) Order, 1988 issued by the Company Law Board under Section 227 (4A) of the Companies Act, 1956, we annex hereto a statement on the matters specified in paragraphs 4 & 5 of the said order. 2. Further to our comments in the annexure referred in Paragraph 1 above, we report that: i. We have obtained all the information and explanations except information relating to SSI. Units as stated in note no 10 of Schedule 16 forming part of the Accounts. ii. In our opinion, proper books of accounts as required by law have been kept by the Company so far as appears from our examination of the books. iii. The Balance Sheet and Profit & Loss Account are in agreement with the books of accounts. iv. In our opinion Balance Sheet and Profit & Loss Account complies with the requirement of Mandatory Accounting standards referred to in section 211 (3 c) of the Companies Act 1956, except as otherwise stated in notes forming part of accounts as per schedule " 16" v. In our opinion and to the best of our information and according to the explanation given to us the accounts subject to. Note No. 4 of Schedule No. 16 regarding non provision of doubtful debts of Rs. 6.62 lacs and interest of Rs. 477.01 lacs due to which the loss is understated to that extent and read together with other notes in schedule 16 thereon give the information required by the Companies Act, 1956, in the manners so required and give a true and fair view: (a) In the case of Balance Sheet of the state of affairs of the Company as at 31 11 March 2002. (b) In the case of Profit & Loss Accounts, of the Loss for the year ended on that date. For K.M.VASUDEVA & CO. CHARTERED ACCOUNTANTS MUMBAI (K.M.VASUDEVA) DATE: 28 1h June,2002 PROPRIETOR ANNEXURE TO THE AUDITORSREPORT TO THE MEMBERS OF MESSERS TOWELS INDIA EXPORTS LIMITED. (Referred to in Paragraph 1 of even date ) 1. The Company is maintaining proper, records showing full particulars including quantitative details and ,situation of fixed assets. These fixed assets have been physically verified by the Management during the period under reference and no material discrepancies were noticed. 2. None of the fixed assets have been revalued during the year. 3. The Stocks of finished goods, stores and spares, raw materials of the company have been physically verified by the management at reasonable intervals. 4. In our opinion and according to the information and explanation given to us, the procedure of physical verification of stocks followed by the Management were found to be reasonable and adequate relation to the size of the Company and the nature of its business. 5. The discrepancies noticed on physical verification of stocks as compared to book records have been dealt with in the books of accounts. 6. On the basis of our examination the valuation of the stock is fair and in proper accordance with the normally accepted accounting principles and is on the same basis as in the preceding year, 7. The Company has taken unsecured loans from Directors and their relatives listed in the register maintained under section 301 of the Companies Act, 1956. The terms and conditions of the loans are prima facie not prejudicial to the interest of the Company. 8. The Company has not granted any loans, secured or unsecured to Companies, firms or other parties listed in the Register maintained under section 301 of the Companies Act, 1956 under the same management within the meaning of sub-section (1 B) of section 370 of the Companies Act, 1956. 9. Loans and Advances in the nature of interest free loans have been given to employees of the Company and others. There is no stipulation of time for recovery. 10. 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 the nature of its business with regard to purchase of stores, raw materials including components, plants and machinery, equipment and other assets and with regard to sale of goods. 11. According to information and explanations given to us there were no transactions of purchase and sale of goods, material and services in pursuance of contract or arrangement, entered in the register maintained in terms of Sec.301 (21 of the Companies Act 1956, aggregating during the period to Rs.50000/- or more in respect of each party. 12. As explained to us, Company has a regular procedure for the determination of unserviceable or damaged stores, spare parts, raw materials and components. 13. According to the information and explanations given to us the Company has not accepted any deposits from the Public except as stated on the Balance Sheet. 14. According to information given to us the Company has no by-products. The reasonable records are maintained for sale and disposal of scrap. 15. As explained to us, the Company has got internal audit system. However, in our opinion it needs to be strengthened to make it commensurate with the size of the Company and the nature of its business. 16. Maintenance of cost records has been prescribed by the Central Government under section 209 (1) (d) of the Companies Act, 1956 in respect of the products of the Company. We have been informed that the said records are not prepared systematically and cannot be checked. 17. The Provident Fund dues of Rs. 34,45,862/- which had fallen due for deposit with the appropriate authorities had not been so deposited as at 31.3.2002. Out of these Rs. 2,06,818/- have been deposited subsequently. We have been informed that E.S.I.S. is not applicable. 18. According to the information and explanation given to us, there were no undisputed amounts payable in respect of Income-Tax and Sales-Tax except TD.S. of Rs. 18,60,138/- and Professional Tax Rs.1,96,990/ - for the period for more than six months from the date they become payable out of which T.D.S. Rs. 7,490/- has been deposited subsequently. 19. According to the information and explanation given to Lis and the records examined by us, no personal expenses other than those payable under contractual obligations and / or in accordance with the generally accepted business practices have been charged to revenue accounts. 20. In the case of Companys service activities we further Report as follows: (a) The Management directly supervises the receipts, issues and consumption of materials and stores. However, there is no system of allocation of materials and man-hours consumed to the relative job. (b) As explained to us, there is a reasonable system of authorisation by the Management, with necessary control in the issue of stores and allocation of labour jobs. In our opinion and according to information and explanations given to us there is a reasonable system of internal control commensurate with the size of the Company and the nature of its business. 21. The Company is a sick Industrial Company, within the meaning of clause (o) of sub-section (1) of Section 3 of the Sick Industrial Companies (Special Provisions) Act, 1985. For K.M.VA.SUDEXIA & CO. CHARTERED ACCOUNTANTS MUMBAI ( K.M.VASUDEVA) DATE : 28 th June ,2002 PROPRIETOR