| Report on the Financial Statements
We have audited the accompanying financial statements of the Scope
Industries (India) Limited, which comprises the Balance Sheet as at
March 31, 2013, and the Statement of Profit and Loss and Cash flow
statement for the year ended, and summary of significant accounting
policies and other explanatory information.
Management 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
Accounting Standards referred to in sub-section (3C) of section 211 of
the Companies Act, 1956 ("the Act"). This responsibility includes the
design, implementation and maintenance of internal controls 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 judgement, 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 and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances. 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 Balance Sheet, of the state affairs of the Company
as at March 31, 2013
(b) In the case of the Statement of Profit and Loss, of the profit 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 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,
comply with the Accounting standards referred to in sub-section (3c) of
section 211 of the Companies Act, 1956;
e. On the basis of written representations received from the directors
as on March 31, 2013, and taken on record by the Board of Directors,
none of the Directors is disqualified as on March 31, 2013, 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 the Auditors' Report to the Members of SCOPE INDUSTRIES
(INDIA) LIMITED, for the year ended March 31, 2013
(Referred to in paragraph 3 of our Report of even date)
(i) (a) The company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The Fixed assets have been physically verified by the management
during the year in accordance with a phased program of verification
which, in our opinion is reasonable having regard to the size of the
company and the nature of its assets, According to the information
furnished to us , no material discrepancies have been noticed on such
verification.
(c) No substantial part of fixed assets have been disposed off by the
company during the year.
(ii) (a) The inventory has been physically verified by the Management
during the year. In our opinion, the frequency of such verification is
reasonable.
(a) The procedures for the 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
(b) The Company has maintained proper records of inventory and there
are no discrepancies noticed on verification between the physical
stocks and the book of records.
(iii) (a) The company has not granted any loans to covered in the
register maintained under section 301 of the companies Act, 1956. In
view of clause (iii) (a) above, the clauses (iii) (b), (iii) (c) (iii)
(d) are not applicable.
(b) According to the information and explanations given to us, the
company has taken loans from the two parties covered in the register
maintained under section 301 of the Companies Act 1956. The maximum
amount outstanding during the year was Rs 16,00,000 and the year end
balance of such loan was Rs 7,21,595.
(c) In our opinion, the rate of interest and other terms and conditions
on which the loan has been taken from parties covered in the register
maintained under Section 301 of the Companies Act, 1956 are not, prima
facie, prejudicial to the interest of the Company.
(d) Since, the periods of payment of interest and repayment of
principle have not been stipulated in the agreement, we are unable to
comment whether the payment of interest and repayment of principle are
regular or not.
(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 purchase of inventory and fixed assets and for the sale of
goods and services. During the course of our audit, no major weakness
has been noticed in the internal controls system.
(v) According to the information and explanations given to us, we are
of the opinion that there are no contracts or arrangements that need to
be entered into the register maintained under section 301 of the Act.
(vi) In our opinion and according to the information and explanations
given to us, the company has not accepted any deposits within the
meaning of Sections 58A and 58AA of the Companies Act, 1956 and the
Companies (Acceptance of Deposits) Rules, 1975 with regard to the
deposits accepted from the public.
(vii) In our opinion the company has an internal audit system
commensurate with its size and the nature of its business.
(viii) According to the information and explanations given to us,
maintenance of cost records has not been prescribed by the central
government under the clause (d) of sub-section (1) of section 209 of
the Act.
(ix) (a) According to the information and explanations given to us and
on the basis of our examination of the records of the Company, amounts
deducted/ accrued in the books of account in respect of undisputed
statutory dues including income-tax, and other material statutory dues
have generally been regularly deposited during the year by the Company
with the appropriate authorities, except for certain cases of tax
deducted at source(Amounting Rs.93,63,056) and Professional tax (
Amounting Rs 11,180 ) Provident fund (Amounting Rs 1,19,871) where
there have been delays for more than180 days.
(b) According to the information and explanation given to us, there are
no dues of income-tax, wealth- tax, sales-tax, and cess, which have not
been deposited on account of any dispute.
(x) The company has been registered for a period of not less than five
years and the accumulated losses of the company at the end of the
financial year is not more than fifty percent of its Net worth and the
Company has not incurred any cash losses during the year and
immediately preceding financial year.
(xi) Based on our audit procedures and on the information and
explanation given to us, we are of the opinion that the company has not
defaulted in the payment of any dues.
(xii) According to the information explanation given to us, the company
has not granted any loans and advances on the basis of security by way
pledge of shares, debentures and other securities.
(xiii) The company is not a chit fund or nidhi / mutual benefit fund /
society. Accordingly, the provisions of clause 4 (xiii) of the said
order are not applicable to the company.
(xiv) The Company does not deal or trade in shares, securities,
debentures and other investments.
(xv) According to the information and explanations given to us, the
company has not given guarantees for loans taken by others from banks
or financial institutions.
(xvi) The company has not raised any new term loans during the year
hence the question of reporting on these clause is not required.
(xvii) According to the information and explanations given to us, and
on overall examination of the Balance Sheet of the company, in our
opinion, the funds raised on short-term basis have not been used for
long-term investments.
(xviii) The company has made preferential allotment of shares to
parties and companies covered in the register maintained under section
301 of the Act. In our opinion, the price at which such shares have
been issued is not prejudicial to the interest of the company.
(xix) The company has not issued any debentures. Accordingly, the
question of creating security or charge for such debentures does not
arise.
(xx) The company has not raised any money by public issues during the
year. Accordingly, the question of disclosure of end use of such monies
does not arise.
(xxi) According to the information and explanations given to us, no
fraud on or by the company has been noticed or reported during the
course of our audit.
For Ramasamy Koteswara Rao & Co;
Chartered Accountants
Firm Registration No: 010396S
Sd/-
(C V Koteswara Rao)
Place : Hyderabad
Partner
Date : May 30, 2013
Membership No. 028353 | 