We have audited the attached Balance Sheet of ANU''S LABORATORIES
LIMITED as at March 31, 2011, the Profit and Loss Account and also the
Cash Flow Statement 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.
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 responsible 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
1. 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, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order to the extent applicable.
2. Further to our comments in the Annexure referred to above, we
a. We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
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
c. The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account.
d. In our opinion, the Balance Sheet and Profit and Loss Account dealt
with by this report comply with the accounting standards referred to in
sub-section (3C) of Section 211 of the Companies Act, 1956 to the
e. On the basis of written representations received from the
directors/companies, as on March 31, 2011, and taken on record by the
Board of Directors, we report that none of the Directors is
disqualified as on March 31, 2011 from being appointed as a director in
terms of clause (g) of sub-section (1) of Section 274 of the Companies
f. Attention is invited to Note 7 of Schedule N of accounts relating
to the liability of interest and required disclosures under the Micro,
small and Medium Enterprises Development Act, 2006. The Company is in
the process of compiling information regarding measurement and
disclosures prescribed under the Act. In view of the above, we are
unable to comment on the impact of the same on the accounts.
g. In our opinion and to the best of our information and according to
the explanation given to us, the said accounts 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.
i. In the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2011;
ii. In the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
iii. In the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
Annexure to Auditors’ Report
(Referred to in paragraph 1 of our Report of even date)
i. a. The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
b. The fixed assets have been physically verified by the management in
accordance with regular programme of verification which, in our
opinion, is reasonable having regard to the size of the Company and
nature of its assets. The discrepancies noticed on such verification
were not material and have been properly dealt with in the books of
c. Fixed assets disposed off during the year were not substantial.
According to the information and explanations given to us, we are of
the opinion that the disposal of fixed assets has not affected the
going concern status of the company.
ii. a. The inventories have been physically verified during the year by
the management. In our opinion, the frequency of verification is
b. The procedure 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 according to the information and explanation
given to us, the Company is maintaining proper records of inventory.
The discrepancies noticed on verification between physical stocks and
the book records were not material and have been properly dealt with in
the books of account.
iii. The Company has not granted or taken loans, secured or unsecured
to/from companies, firms or other parties covered in the register
maintained under Section 301 of the Companies Act, 1956. Accordingly,
sub-clause (b), (c), (d), (f) & (g) are not applicable.
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 for the
purchases 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 control system in respect of
v. a. As per information and explanation and on basis of records
maintained by the Company we are of the opinion that particulars of
contracts or arrangements referred to in Section 301 of the Act have
been entered in the register required to be maintained under that
b. In our opinion and according to the information and explanation
given to us, the transactions made in pursuance of contracts or
arrangements entered in the registers maintained under Section 301 of
the Companies Act, 1956 have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
vi. In our opinion and according to the information and explanations
given to us, the Company has not accepted deposits from the public
during the year. Therefore, the provisions of Clause 4(vii) of the
Order are not applicable to the Company.
vii. In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
viii. We have broadly reviewed the books of account relating to
materials, labour and other items of cost maintained by the Company
pursuant to the Rules made by the Central Government for the
maintenance of cost records under Section 209 (1)(d) of the Companies
Act, 1956 and we are of the opinion that prima facie the prescribed
accounts and records have been made and maintained.
ix. a. According to the records of the Company, provident fund,
employees'' state insurance, income tax, sales tax, wealth tax, service
tax, customs duty, excise duty, cess and other material statutory dues
applicable to it have generally been regularly deposited during the
year with the appropriate authorities though there has been a small
delay in a few cases. According to the information and explanation
given to us, the undisputed amount payable in respect of Income Tax for
the financial year 2009-10 of Rs.400.83 lakhs were in arrears as at
March 31, 2011 for a period of more than six months from the date on
which they became payable.
b. According to the information and explanations given to us, the
details of dues of sales tax, income tax which have not been deposited
on account of any dispute are given below:
Nature of Name of Amount Period to Forum where
due the statute Rs. Million which amount dispute
relates is pending
Sales Tax Sales Tax Act 10.00 A.Y. 2001-02 ADC (CT)
Sales Tax Sales Tax Act 6.77 A.Y. 2003-04 ADC (CT)
Sales Tax Sales Tax Act 18.27 A.Y. 2004-05 ADC (CT)
Sales Tax Sales Tax Act 22.10 A.Y. 2005-06 ADC (CT)
x. The Company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses during the financial
year covered by our audit and the immediately preceding financial year.
xi. In our opinion and according to the information and explanation
given to us, the Company has not defaulted in repayment of dues to a
financial institution or bank.
xii. Based on our examination of the records and 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.
xiii. In our opinion the Company is not a chit fund or a nidhi/ mutual
benefit fund/society. Therefore the provisions of clause 4(xiii) of the
Companies (Auditor''s Report) Order, 2003 are not applicable to the
xiv. In our opinion 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.
xv. According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
xvi. In our opinion and according to the information and explanations
given to us, the term loans have been applied for the purpose for which
they were raised.
xvii. According to the information and explanations given to us and on
an overall examination of the Balance Sheet of the Company, we report
that no funds raised on short term basis have been used for long term
xviii.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.
xix. In respect of the end-use of money raised by public issue as
disclosed in the schedules to the financial statements, in our opinion
and based on the explanations given to us and certified by the
management, the Company has utilized an amount of Rs.7,264.01 lakhs for
purposes as stated/specified in the offer document for the issue. The
unutilized money of Rs.757.99 lakhs have been in usage for working
xx. 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
For Karumanchi & Associates
Hyderabad, May 28, 2011