| 1. We have audited the attached Balance Sheet of Edserv Soft systems
Limited as at March 31, 2012 and the Profit and Loss Account and the
Cash Flow Statement for the year ended on the 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 the 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 subsection (4A) of the
Companies Act, 1956, we enclose in the Annexure a statement on the
matters specified in paragraph 4 and 5 of the said Order.
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 law have
been kept by the company so far as appears from our examination of
those books,
iii. The Balance Sheet, Profit and 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 and Loss Account (read
in conjunction with the Notes and Schedule attached thereto) dealt with
by this report comply with the accounting standards referred to in
sub' section (3C) of Section 211 of the Companies Act, 1956 except the
following,
i. Note No. 23.m to Financial Statements regarding Confirmations of
Balance from Sundry Debtors, Deposit accounts, Loans and Advances,
Certain Creditors have not been obtained. Accounts of certain sundry
debtors, loans and advances, deposits and creditors are under review
and reconciliation. Adjustments, if any will be made on completion of
review/reconciliation / identification of doubtful debts/advances.
ii. The Company has initiated the process of review of impairment of
assets in the respect of the tangible, intangible and other current
assets their results in such impairment is awaited, The financial
implication if any on the above will be provide appropriately at later
stage.
iii. The Company has been subjected to survey by Income Tax Department
during the year. The amounts of demand from the Income Tax Department
for the preceding years are before appellate authority. Further notices
were issued by the assessing officer for reassessment of earlier years.
The assessment proceedings are in various stages and are yet to be
completed. The company is confident the matter shall be decided later
and financial implications on above cannot be ascertained as on date,
Hence no provision is made for such matters in the books.
In all the cases referred to above, effect on financial statements is
not ascertainable. we do not express independent opinion on these
matters.
v. On the basis of written representations received from the
directors, as on 31st March, 2012, and taken on record by the board of
Directors, we report that none of the directors is disqualified as on
31st March , 2012 from being appointed as a director in terms of
clause (g) of sub' section (1) of Section 274 of the Companies Act,
1956,
vi. Subject to our comments vide para 4.iv.i, 4.iv.ii, and 4.iv.iii
above, in our opinion and to the best of our information and according
to the explanations given to us, they said accounts give the information
required by the Companies Act, 1956, i n 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 31st March,2012,
b. in , the case of the Profit and Loss Account, of the Loss for the
year ended on that date,
c. In the case of the Cash Flow Statement of the Cash Flows for the
year ended on that date.
Annexure referred to in paragraph 3 of the Auditors Report to the
members of on the accounts for the year ended 31st March, 2012.
1. a) The company has maintained proper records showing full
particulars including quantitative details and situation of the fixed
assets.
b) As explained to us, all the fixed assets have been physically
verified by the management at reasonable intervals during the year.
According to the information and explanations given to us and the
records produced to us for our verification, discrepancies noticed on
such physical verification were not, in our opinion, material and the
some have been properly dealt with in the Books of Account.
c) During the year the Company has not disposed off any substantial of
major part of the Fixed Assets.
2. The company did not hold any stock of inventory. In view of the
foregoing, the provisions of clause 4(ii) of the Companies (Auditor s
Report) Order, 2003 (as a mended) are not applicable
3. As informed, the company has not granted any loans, secured or
unsecured, to/from companies, firms or other parties listed in the
register maintained under Section 301 of the Companies Act, 1956.
4. As informed, the company has taken loans, from Subsidiary listed in
the register maintained under Section 301 of the Companies Act, 1956.
The Loan is repayable on demand and there are no overdue amounts.
5. In our opinion and according to the information and explanation
given to us, having regard to the explanation that some items are of
special nature for which alternate quotations cannot be obtained, there
is an internal control system commensurate with the size of the company
and nature of its business for purchase of fixed assets and for the
sale of software products and services. During the course of audit, no
major weakness has been noticed in the internal control system in
respect of these areas. During the year, there are no transactions of
purchase of inventory.
6. a) Based on the audit procedures performed by us and according to
the information and explanations provided by the management, we are of
the opinion that the transactions that need to be entered in the
register maintained under Section 301 of the Companies Act, 1956 ha ve
been so entered.
b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the register maintained under sec 301 and
exceeding the value of Five Lakh rupees in respect of any party during
the year have been made at prices which are reasonable having regard to
prevailing market prices at the relevant time.
7. In our opinion and according to the information and explanations
given to us, as the company has not accepted deposits from the public
within the meaning of the provisions of Section 58A and 58AA of the
Companies Act, 1956 paragraph 4(vii) of th e Order is not applicable.
8. In our opinion the company has an internal audit system
commensurate with size and nature of its business.
9. To the best of our knowledge and as explained, the Central
Government has not prescribed maintenance of cost records under Section
209 (1)(d) of the Companies Act, 1956.
10. a) According to information and explanations given to us and as
per records produced before us for verification, the company is regular
in depositing with appropriate authorities undisputed statutory dues
including P.F. E.S.I, Sales Tax, Income tax, Custom duty and any other
undisputed statutory dues.
b) As per information and explanations furnished to us and on
verification of records produced, no undisputed arrears of amounts
payable in respect of sales tax / income tax / custom / wealth tax /
excise / service tax were outstanding as at 31st March 2012, for a
period of more than six months from the date they became payable.
c) According to the records of the Company, there are no disputed dues
in respect of sales tax / income tax / custom / wealth tax / excise /
service tax as on 31st March 2012.
11. The Company has no accumulated losses as at 31st March, 2012 and
has not incurred any cash losses during the financial year ended on
that date or in the immediately preceding financial year.
12. In our opinion and on verification of records, the company has not
defaulted in repayment of dues to financial institution, bank or
debenture holders.
13. The company has not granted any loans or advances on the basis of
security by way of pledge of shares, debentures and other securities
and therefore paragraph 4(xii) of the Order is not applicable.
14. The provisions of any special statute applicable to Chit Fund and
Nidhi / mutual benefit fund/society are not applicable to the company
and therefore paragraph 4 (xiv) of the Order is not applicable.
15. The company is not dealing or trading in shares, securities,
debentures and other investments and therefore paragraph 4 (xiv) of the
Order is not applicable.
16. According to the information and explanation given to us, the
Company has not given any guarantee for loans taken by others from
banks or financial institutions and therefore paragraph 4 (xvi) of the
Order is not applicable.
17. The company has not availed term loans during the year.
18. According to the information and explanations given to us and on
an overall examination of the balance sheet of the company, in our
opinion, no short term funds has been used for fixed assets (long term
investments) no long term funds were raised for short term investments.
19. The company has not made any preferential allotment of shares to
parties covered in the Register maintained under Section 301 of the
Companies Act, 1956.
20. The Company has not issued any Debentures during the year under
21. During the course of our examination of the books and records of
the Company carried out in accordance with the generally accepted
auditing practices in India and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company noticed or reported during the year, nor
have been informed of such case by the management.
For RAJ AND RAVI
Chartered Accountants
V. RAJ
(Membership No. 23211)
Place. Chennai
Partner
Date. 30.05.2012
Firm Registration No 010935S
| 