We have audited the attached Balance Sheet of Twentyfirst Century
Management Services Limited for the year ended 31st March 2012 and also
the Profit & Loss Account for the year ended on that date, annexed
thereto. These financial statements are responsibility of the
Company''s management. Our responsibility is to express an opinion on
these financial statements based on our audit.
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.
As required by the Companies (Auditors Report) Order, 2003 issued by
the Central Government of India in terms of Sub section (4A) of Sec.
227 of the Companies Act 1956, we enclose in the annexure a statement
on the matters specified in paragraph 4 & 5 of the said Order to the
Further to our comments in the Annexure referred to above, we report
(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
(ii) In our opinion, the Company has kept proper books of account as
required by law so far as appears from our examination of the books.
(iii) In our opinion the Balance Sheet and Profit & Loss Account comply
with the accounting standards referred to in Sub section (3C) of
Section 211 of the Companies Act, 1956, subject to:
Note 2(h), in respect of no provision for gratuity has been made in
accounts, in the event of any employee leaving the services by reason
of death / incapability / retirement or resignation.
Note 13, in respect of non provision of sundry debtors amounting to Rs.
2307.13 lacs transferred from subsidiary company which are considered
good by the management.
Note 14(3), in respect of inoperative bank accounts amounting to Rs.
1.53 lacs, no confirmation is received and the accounts are neither
closed nor written off.
(iv) We further report that, had the observation made by us in Para
above, been considered, the loss for the year would have been Rs.
3072.25 lacs (as against reported loss of Rs.763.59 lacs) and
accumulated loss would have been Rs. 2442.23 lacs (as against reported
accumulated loss of Rs. 133.57 lacs) and sundry debtors would have been
Nil (as against reported sundry debtors of Rs. 2307.13 lacs) and Cash
and Bank balance would have been Rs. 14.83 lacs (as against reported
Cash and Bank balance of Rs. 16.36 lacs)
(v) The Balance Sheet and Profit & Loss A/c dealt with by this report
are in agreement with the books of account.
(vi) On the basis of written representations received from the
directors, as on 31s March 2012 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
31s 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.
(vii) In our opinion and to the best of our information and according
to the explanations given to us, the said financial statements, read
together with the notes thereon, give the information required by the
Companies Act, 1956, in the manner so required and present a true and
fair view, Subject to Para (iii) and (iv) above in conformity with the
accounting principles generally accepted in India:
a) in the case of Balance Sheet, of the state of affairs of the Company
as at 31st March 2012.
b) In the case of Profit & Loss Account, of the Loss of the company for
the year ended on that date.
c) In the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
ANNEXURE TO THE AUDITOR''S REPORT
1. The Company has maintained proper records showing full particulars,
including quantitative details and situations of fixed assets.
The fixed assets of the company have been physically verified by the
Management during the year and no material discrepancies were noticed
on such verification. In our opinion the verification is reasonable
having regard to the size of the Company and the nature of its assets.
As per the information and explanations given to us, during the year,
the company has not disposed off any substantial part of the fixed
assets that would affect the going concern.
2. The company is primarily engaged in investing activities.
Accordingly, it does not hold any physical inventories. Thus paragraph
4(ii) of the Order is not applicable to the company.
3. The company has not taken any loans from companies or firms listed
in the register maintained under section 301 of the company''s act
1956 and from company under the same management. The company has not
given any loan to companies or firms listed in the register maintained
under section 301 of the companies act, 1956 and from companies under
the same management.
4. The Company has adequate internal control procedures commensurate
with its size and nature of business with regard to purchase of shares,
fixed assets and for the sale of shares, assets or equipments. We have
not observed any continuing failure to correct such internal control
5. The transactions that are required to be entered into the register
in pursuance of Section 301 of the act have been so entered.
In our opinion and according the information and explanations given to
us the transactions made in pursuance of contracts or arrangements
entered in the register maintained u/s 301 of the companies act 1956
and exceeding the value of Rs.5 Lacs 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 where such market prices
6. During the year under review, the company has not accepted any
deposits from the public to which the provisions of Section 58A of the
Companies Act, 1956 apply.
7. Company does not have any internal audit department, commensurate
with the size of the company and nature of its business.
8. We have been informed that Central Government has not prescribed
the maintenance of cost records under Section 209(1 )(d) of the
Companies Act, 1956, in respect of any activities carried on by the
9. According to the information and explanations given to us, the
company has been regular in depositing Employees Provident Fund dues
and has also been regular in depositing undisputed income tax and other
applicable statutory dues with appropriate authorities.
According to the information and explanations given to us and the
records of the Company examined by us, the particulars of income tax as
at 31s March 2012 which have not been deposited on account of a dispute
pending are as under:
Name AY Nature Forum where Amount
of the of the disputes Disputed
Statute Dispute are pending
Income 1995- Demand raised ACII Company Rs.20.20
tax Act, 96 subject to recti- Circle III (2) lacs
1961 fication by ACIT
Income 2003- Diminution in the Madras High Rs.1289
tax Act, 04 value of stock Court lacs
Income 2006- Department has Commissioner Rs.562.33
tax Act, 07 disallowed the of Appeals-III, lacs
1961 Carrry forward Chennai-34.
Loss related to The Appeal has
AY 1998-99, been made
2003-04. The against 143(1)
company had of the Income
claimed the tax Act
loss related to
AY 2003-04, as
the matter is
Income 2007- Department has Commissioner Rs.598.14
tax Act, 08 raised demand of Appeals-III, lacs
1961 on Short Term Chennai-34.
Capital gains @ The Appeal is
30.99% instead made against
of 15% company the order u/s
had claimed the 154 of the
Carry forward Income tax Act
loss related to
AY 2003-04, as
the matter is
10. The company has no accumulated losses till the immediately
preceding financial year, but has incurred a losses of Rs. 763.59 Lacs
during the current financial year under this report.
11. On the basis of records examined by us and the information and
explanations given to us, the Company has not defaulted in repayment of
dues to financial institutions, banks or debenture holders.
12. 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. In our opinion the company is not a Chit Fund or a Nidhi/Mutual
Fund/Society. Therefore the provisions of clause 4 (xiii) of the
companies (Auditor''s Report) Order, 2003 are not applicable to the
14. The Company has maintained proper records of transactions and
contracts in respect of trading in shares, debentures and other
investments and timely entries have been made therein.
15. The company has given corporate guarantee of Rs. 287.50 lacs for
the credit facilities availed by its subsidiary. According to the
information and explanations given by the management, in our opinion
the terms and conditions of the guarantee given for loans are not
prejudicial to the interest of the Company.
16. According to the information and explanations given to us, the
company has not obtained any term loans during the year under review.
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, funds raised on short term basis, have not
been used for long term investments.
18. The company has not made any preferential allotment of shares
during the year.
19. There are no secured debentures issued during the year.
20. The company has not raised any money by public issue during the
21. To the best of our knowledge and belief and according to the
information and explanations given to us no material fraud on or by the
company has been noticed or reported during the course of our audit.
For M.B. Ladha & Company
Mukesh Ladha (M.No.35544)