| We have audited the attached Balance Sheet of SBEC Systems (India)
Limited as at 31s1 March, 2012 and also the Profit & Loss Account and
the Cash Flow Statement 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.
1. We conducted our audit in accordance with the 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.
2. As required by the Companies Auditor's Report Order, 2003, issued
by the Company Law Board in terms of Section 227(4A) of the Companies
Act, 1956, we annex hereto a statement on the matters specified in
paragraphs 4 & 5 of the said Orders.
3. Further to our comments in the Annexure, referred to 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 purposes
of our audit;
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 of the Company.
iii The Balance Sheet, Profit & Loss Account and Cash Flow Statement,
dealt with by this Report, are in agreement with the books of account
of the Company.
iv In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement dealt with by this report comply with the applicable
Accounting Standards, referred to in Sub-section (3C) of Section 211 of
the Companies Act, 1956 and Companies (Accounting Standard) Rule 206,
issued by the central government in exercise of the power conferred
under sub section (1) (a) of section 642 of the Companies Act, 1956 to
the extent applicable except:
A.) Accounting Standard - 13 " Accounting for Investments" referred
Note No. - 32.
B.) Accounting Standard - 11 "The Effect of change in foreign
exchange rate" referred Note No.- 33.
v Based on the declaration made by the directors of the company and the
information and explanations given to us, none of the Directors is, as
at 31.03.2012, prima-facie disqualified from being appointed as a
director in terms of clause (g) of Sub-section (1) of Section 274 of
the Companies Act, 1956..
vi In our opinion and to the best of our information and according to
the explanations given to us the said Balance Sheet, Profit and Loss
Account and Cash Flow Statement read with the Schedules and Notes
thereon specifically Note No. 30 regarding Going concern basis and
subject to the consequential impact on the result for the period of
Note No 29 regarding non-provision of expenses related to deputation
charges of foreign technicians , Note No 31 regarding Non provision of
interest on foreign
currency loan, Note No.32 regarding non reversal of diminution of
current investments, Note No. 33 regarding non provision of exchange
rate fluctuation of foreign liabilities, Note No. 34 regarding
unaccounted of consequential effect of supplier settlement order(s)
passed by the Hon'ble Delhi High Court and Note no. 35 regarding
non-provision of interest on overdue payment of foreign suppliers give
the information required by the Companies Act, 1956, in the manners so
required and a true and fair view:-
(a) In the case of the Balance Sheet of the state of affairs of the
Company as at 315 March, 2012 and
(b) In the case of the Profit & 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 2 of our Report of even date to the
Member of SBEC SYSTEMS (INDIA) LIMITED on the accounts as at and for
the year ended 31st March, 2012
1. (a) 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 in a phased periodical manner, which
in our opinion is reasonable having regard to the size of the company
and nature of its assets. No material discrepancies between the book
records and the physical inventory were noticed in respect of the
assets physically verified.
(c) In our opinion, the company has not disposed of substantial part of
fixed assets during the year and the going concern status of the
company is not affected.
2. (a) Inventories have been physically verified by the management at
reasonable intervals during the year.
(b) In our opinion, the procedure of physical verification of inventory
followed by the management is reasonable and adequate in relation to
the size of the company and the nature of its business.
(c) On the basis of our examination of records of inventory produced to
us, in our opinion, the company has maintained proper records of
inventories. There were no material discrepancies noticed on physical
verification of inventory as compared to the book record.
3. The company has not taken/granted any loan, secured or unsecured,
from companies, firms or other 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 procedures
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. During the course of our audit, no major weakness
has been noticed in the internal control in respect of these areas.
5 (a) According to the information and explanations given to us, we are
of the opinion that the transactions that need to be entered into the
register maintained under section 301 have 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 section 301 of
the Companies Act, 1956 and exceeding the value of Rupees five Lakhs in
respect of any party during the year 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 has an internal audit system
commensurate with the size and nature of its business..
8. We are informed that the provisions of Section 209(1 )(d) of the
Companies Act, 1956 relating to the maintenance of cost records are not
applicable to the Company.
9. (i) Undisputed statutory dues including Provident Fund, Investor
Education & Protection fund, Employees State Insurance, Income Tax,
Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess have
generally been regularly deposited with the appropriate authorities.
(ii) According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, Investor
Education and Protection Fund, Employee State Insurance, Income-Tax,
Sales-Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess
were outstanding at the year end for a period of more than six months
from the date they became payable.
(iii) According to the information and explanation given to us, there
are no dues of Income Tax, Custom Duty, Wealth Tax, service Tax, Excise
Duty, Sales Tax and Cess which have not been deposited on account of
any dispute except the Trade Tax dues of Rs. 2.55 lakh under U P Trade
Tax Act for which an appeal is pending before the Assistant
Commissioner
- Trade Tax.
10. The Company's accumulated losses at the end of the financial
year are more than fifty percent of its net worth. The Company has
incurred cash loss during the year but has not incurred cash losses
during the immediately preceding financial year.
11. Based on our audit procedures and as per the information and
explanation given by the management we are of the opinion that the
company has not taken any loans from any financial institutions, banks
or debenture holders and hence no default on repayment of the same.
12. According to the information and explanations given to us and
based on the documents and records produced 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 clause 4 (xiii) of the Companies (Auditors
Report) Order, 2003 are not applicable to the company.
14. The company is not dealing or trading in shares, securities,
debentures and other investments.
15. According to the information and explanations given to us, the
Company has not given any guarantee for loan taken by others from banks
or financial institutions.
16. The company has not obtained any term loan during the year ended
31st March, 2012.
17. According to the information and explanations given to us and on
an overall examination of the Balance Sheet and Cash Flow Statement of
the company, we report that no funds raised on short- term basis have
been used for long-term investments.
18. The company has not made any preferential allotment of shares to
parties or companies covered in the register maintained under section
301 of the Companies Act, 1956, during the year.
19. No debenture were issued by the company. Therefore, no securities
have been created.
20. The company has not raised any money by a public issue during the
year.
21. Based upon the audit procedures performed for the purpose of
reporting true and fair view of the financial statements and as per the
information and explanations given by the management, we report that no
fraud on or by the company has been noticed or reported during the
course of our audit.
For K. K. JAIN & COMPANY,
Chartered Accountants,
Firm Reg. NO.02465N
(K.K. JAIN)
Place : New Delhi (PARTNER)
Date : 28th August, 2012 Membership No. 005436 |