Balaji Galvanising Industries Ltd.की ऑडीटर रिपोर्ट

Mar 31, 2014

Report on the financial statements

We have audited the accompanying financial statements of Balaji Galvanising Industries Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2014 and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s responsibility for the financial statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the company''s preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the company as at March 31,2014;

b) in the case of the statement of Profit and Loss, of the loss for the year ended on that date; and

c) in the case of Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central

Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure

a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, 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, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956 read with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013;and

e) on the basis of written representations received from the directors as on March 31,2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO AUDITOR''S REPORT

Annexure referred to in paragraph 1 of Our Report of even date to the members of Balaji Galvanising Industries Limited on the accounts of the company for the year ended 31 st March, 2014.

On the basis of such checks as we considered appropriate and according to the information and explanation given to us during the course of our audit, we report that:

1. (a) The company has maintained proper records showing full particulars including quantitative details and situation of its fixed assets.

(b) As explained to us, fixed assets have been physically verified by the management at reasonable intervals; no material discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanations given to us, no fixed asset has been disposed off during the year. As such going concern status of the company has not been affected.

2. (a) As explained to us, inventories have been physically verified during the year by the management

at reasonable intervals.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business.

(c) In our opinion and on the basis of our examination of the records, the company is generally maintaining proper records of its inventories. No material discrepancy was noticed on physical verification of stocks by the management as compared to book records.

3. (a) According to the information and explanations given to us and on the basis of our examination of

the books of account, the company has not granted any loan, secured or unsecured to Companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956, but has taken loan from three parties, listed in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs. 1,17,81,433/ - and the year end balance of loan taken from such parties was Rs. 1,17,81,433/-.

(b) In our opinion and according to the information and explanations given to us, the rate of interest, wherever applicable and other terms and conditions on which such loans have been taken are not prima facie prejudicial to the interest of the company.

(c) In respect of loans taken by the company, the interest payments are regular and the principal amounts are repayable on demand.

(d) There is no overdue amount of loans taken from such parties listed in the register maintained under section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the company and the nature of its business with regard to purchase of inventories, fixed assets & for sale of goods and services. During the course of our audit, no major instance of continuing failure to correct any major weaknesses in the internal controls has been noticed.

5. a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entere in the register maintained under that section.

b) As per the information & explanations given to us and in our opinion, the transactions entered into by the company with parties covered u/s 301 of the Act have been made at prices which appear reasonable having regard to the prevailing market prices at the relevant time.

6. According to the information and explanation given to us, the company has not accepted any deposits from the public within the meaning of the provisions of Section 58A and 58AA of the Companies Act, 1956 and Companies (Acceptance of Deposits) Rules 1975.

7. As per the information & explanations given by the management, the company has an internal audit system commensurate with its size and nature of its business.

8. As per information & explanation given by the management, maintenance of cost records has been prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Act and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

9. (a) According to the records of the company, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, cess to the extent applicable and any other statutory dues have generally been regularly deposited with the appropriate authorities. According to the information and explanations given to us there were no outstanding statutory dues as on 31st of March, 2014 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, customs duty, excise duty and cess are in arrears as at 31 st March 2014 for a period of more than six months from the date they became payable.

(c) According to the information and explanation given to us, there are no dues of sales tax, income tax, customs duty, wealth tax, excise duty and cess which have been deposited on account of any dispute, except under mentioned dues.

Name of the Statute Central Excise Act, 1944 Nature of Dues Excise Duty Period to which the dispute related 2012-13 Forum where dispute is pending Commissioner of Central Excise (Appeals) Amount (Rs.) 17,95,647

10. In our opinion, the accumulated losses of the Company at the end of the year under report are more than 50% of the company''s net worth. The company has incurred cash loss during the finacial year covered by our audit and also in the immediately preceding financial year.

11. According to the records of the company examined by us and as per the information and explanations given to us, the company has not taken any loans and borrowings from any financial institution or bank nor issued any debentures.

12. According to the information and explanations given to us, the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a chit fund or a nidhi /mutual benefit fund/society. Accordingly, paragraph 4(xiii) of the order is not applicable.

14. According to information and explanations given to us, the company is not dealing in or trading in Shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor''s Report) order, 2003 are not applicable to the company.

15. According to the information and explanations given to us, the company has not given any guarantee for loan taken by others from a bank or financial institution.

16. Based on our audit procedures and as per the information given by the management, we report that the company has not raised any term loan during the year.

17. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the company as at 31st March, 2014, we report that no funds raised on short-term basis have been used for long-term investment by the company,

18. Based on the audit procedures performed and the information and explanations given to us by the management, we report that the company has not made any preferential allotment of shares during the year.

19. According to the information and explanation given to us, the company has not issued any secured debentures during the year.

20. The company has not raised any money by public issue during the year under audit.

21. Based on the audit procedures performed and the information and explanations given to us, we report that no fraud on or by the company has been noticed or reported during the year, nor have we been informed of such case by the management.

For DAGLIYA & CO. Chartered Accountants ICAI Firm Regn. No. 00671S

Date : 30-05-2014 (Jitendra Kumar Jain) Place : Secunderabad Partner M. No.18398

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Mar 31, 2011

1. We have audited the attached balance sheet of BALAJI GALVANISING INDUSTRIES LIMITED as at 31st March, 2011, the profit & loss account and also the cash flow statement of the company for the year ended on that date annexed thereto. These financial statements are the responsibility of the company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our 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 management as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of sub-section (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 to the extent applicable.

4. Further to our comments in the Annexure referred to in paragraph 3 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 purpose of our audit;

ii. In our opinion, proper books of account as required by iaw have been kept by the company, so far as appears from our examination of those books;

iii. The balance sheet, profit & loss account and the cash flow statement dealt with by this report are in agreement with the books of account;

iv. In our opinion, the balance sheet, profit & loss account and the 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;

v On the basis of written representations received from the directors, as on 31st March, 2011, and taken on record by the Board of Directors, we report that none of the directors of the company is disqualified as on 31st March, 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

vi. Advances, creditors and other liabilities include certain old balances which require review, re- calculation and adjustments. In the absence of the same, consequential adjustments are not carried out in the books of accounts. The relevant impact on the accounts is not ascertainable.

vii. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the significant accounting policies and other notes thereon, 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, subject to note no.4(vi)

a) in the case of the balance sheet, of the state of affairs of the company as at 31st March, 2011;

b) in the case of the profit & loss account, of the profit for the year ended on that date; and

c) in the case of the cash flow statement, of the cash flows for the year ended on that date.

ANNEXURE TO AUDITOR'S REPORT

(Referred to in paragraph 3 of our Report of Even date)

1a. The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

b. As explained to us, the fixed assets have been physically verified by the management during the year and no material discrepancies were noticed on such physical verification.

c. During the year the company has not disposed off any substantial/major part of fixed assets.

2a. As explained to us, the inventory has been physically verified by the management at regular intervals during the year. In our opinion, the frequency of verification is reasonable.

b. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to size of the company and the nature of its business.

c. The company has maintained proper records of inventory and discrepancies between the physical inventory and the book records, which have been properly dealt with in the books of account, were not material.

3. In respect of loans, secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956:

a. The company has not granted any loan but has accepted loan from a company covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs 39.93 lacs and the year end balance of loan taken from such party was Rs. Nil.

b. In our opinion and according to the information and explanations given to us, the rate of interest, wherever applicable and other terms and conditions on which such loan has been taken are not prima facie prejudicial to the interest of the company.

c. In respect of loans taken by the company, the interest payments are regular and the principal amount has been repaid.

d. There is no overdue amount in respect of loan taken by the company as this loan has been repaid on demand.

4. 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 for the purchase of inventory, fixed assets and also for the sale of goods. During the course of our audit, we have not observed any major weaknesses in internal controls.

5a. In our opinion and according to the information and explanations given to us, the particulars of contracts and arrangements that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 have been so entered

b. According to the information and explanations given to us, the transactions made in pursuance of such contracts have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. The company has not accepted any deposits from the public.

7. In our opinion, the company's present internal audit system is commensurate with its size and nature of its business.

8. According to the information given to us, the company, being a small scale industrial undertaking, it is exempt from maintaining cost records under Section 209(1 )(d) of the Companies Act, 1956 for its

9 In respect of statutory dues:

a. According to the records of the company and as per the information and explanations given to us, the company has generally been regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income tax, sales tax, service tax, wealth tax, customs duty, excise duty, cess and other material statutory dues as are applicable to the company, with the appropriate authorities during the year.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, wealth tax, sales tax, service tax, customs duty and cess were in arrears as at 31.03.11 for a period of more than six months from the date they became payable.

c. According to the information and explanations given to us, there are no dues of sale tax, income tax, customs duty, wealth tax, service tax, excise duty and cess which have not been deposited on account of any dispute.

10. In our opinion, the accumulated losses as at 31st March, 2011 are less than fifty percent of its net worth. The company has not incurred any cash loss during the financial year covered by our audit and also in the immediately preceding financial year.

11. According to the records of the company examined by us and explanations given to us, the company has not defaulted in repayment of dues to financial institutions, banks or debenture holders during the year.

12. In our opinion and according to the information and explanations given to us, 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 provisions of any special statute applicable to a chit fund/nidhi/mutual benefit fund/society are not applicable to the company.

14. In our opinion, the company is not a dealer or trader in shares, securities, debentures or other investments.

15. In our opinion and according to the information and explanations given to us, the company has not given any guarantee for loans taken by others from banks or financial Institutions during the year.

16. The company has not raised any term loan during the year.

17. On the basis of an overall examination of the balance sheet of the company, in our opinion and according to the information and explanations given to us, there are no funds raised on short term basis which have been used for long term investment, and vice versa.

18. 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 Companies Act, 1956.

19. The company has not issued any debentures so far.

20. The company has not raised any money by way of public issue during the year.

21 During the course of our examination of the books of account carried out in accordance with the generally accepted auditing practices in India, we have not come across any instance of fraud on or by the company nor have we been informed by the management of any such instance being noticed or reported during the year.

Place : Secunderabad For Dagliya & Co.,

Chartered Accountants,

Date : 31.05.2011 (F.R.N 671S)

(JITENDRA KUMAR JAIN)

Partner

M.No:18398