We have audited the attached Balance sheet of AUTOMOBILE PRODUCTS OF
INDIA LTD as at 31st March, 2012, the Profit and Loss Statement and the
Cash Flow Statement for the year ended on that date, both 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 reasonable assurance about whether the financial
statements are free of material misstatements. An audit includes,
examining on a test basis, evidence supporting the amounts and
disclosure in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates .
made by the management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
1. 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 enclose in the Annexure a statement on the matters
specified in paragraphs 4 and 5 of the said order.
2. Further to our comments in the Annexure referred in paragraph 1
above, we state that:
a) We have obtained all the information and explanation, which to the
best of our knowledge and belief were necessary for the purpose of our
b) In our opinion, the Company has kept proper books of account, as
required by law, so far as appears from our examination of such books.
c) The Balance Sheet, Profit and Loss Statement and the Cash Flow
Statement referred to in this report are in agreement with the books of
d) In our opinion, the Profit and Loss Statement, the Balance Sheet and
the Cash Flow Statement comply with the Accounting Standards referred
to in Section 211 (3 C) of the Companies Act, 1956.
e) On the basis of written representation received from Directors, and
taken on record by the Board of Directors, we report that none of the
Directors are disqualified as on 31st March, 2012 from being appointed
as a Director in terms of Section 274 (1) (g) of the Companies Act,
f) In our opinion and to the best of our information and according to
the explanations given to us, the said Balance Sheet, the Profit and
Loss Statement and the Cash Flow Statement, read together with other
notes and accounting policies, give the information required by the
Companies Act, 1956, in the manner so required and gives a true and
fair view in conformity with the accounting principles accepted in
(i) In so far as it relates to the Balance Sheet, of the state of
affairs of the Company as at 31st March, 2012
(ii) In so far as it relates to the Profit and Loss Statement of the
LOSS of the Company for the year ended on that date, and
(iii) In so far as it relates to the Cash Flow Statement, of the Cash
Flow of the Company for the year ended on that date.
ANNEXURE TO THE AUDTORS'' REPORT (Referred to in paragraph 1 of our
report of even date)
In terms of the information and explanation given to us and the books
and records examined by us in the normal
course of audit and to the best of our knowledge and belief, we state
1. a) The Company has maintained proper records showing full
particulars including quantitative details and
situation of Fixed Assets.
b) There were no Fixed Assets, except land, belonging to the Company.
c) No substantial part of fixed assets have been disposed off during
2. a) The stock of finished goods stores and spare parts have been
physically verified at reasonable intervals by
b) The procedure of physical verification of inventories followed by
the management is reasonable and adequate in relation to the size of
the company and the nature of its business.
c) The Company is maintaining proper records of inventory and no
material discrepancies are noticed on such physical verification.
3. The Company has taken loans from companies covered in the register
maintained under Section 301 of the Companies Act, 1956.
4. In our opinion and according to the information and explanation
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 stores, spare parts, components and
other assets and with regard to the sale of goods. No instances of
continuing failure to correct major weaknesses in Internal Control were
5. According to the information and explanation given to us, there
were no transactions of purchase of goods and materials with companies
covered under Section 301 of the Companies Act, 1956.
6. The Company has not accepted any deposit from the public. The
provisions of sections 58A & 58AA of the Companies Act, 1956, and the
Rules framed there under are not applicable.
7. In our opinion, the Company has no separate internal audit system.
However, there are adequate internal control procedures commensurate
with its size and nature of its business.
8. The Central Government has not prescribed for the Company the
maintenance of cost records under Section 209 (1) (d) of the Companies
9. According to the records of the Company, the Company is generally
regular in depositing undisputed statutory dues including Tax Deducted
at Source with the appropriate authorities. According to the
information and explanation given to us, there were no undisputed
amount payable in respect of tax deducted at source and outstanding as
at 31st March, 2012, for a period of more than six months from the date
they became payable. The Income Tax demand for Assessment Years 2003-04
and 2008-09, disputed and under appeal are as follows:
A.Y. 2003-04 Rs 29,64,061
A.Y. 2008-09 Rs 9,71,20,638
10. The Company''s accumulated losses at the end of the financial year
are more than fifty percent of its net worth and it has incurred cash
losses during this year and in the financial year immediately
preceding this financial year.
11. The Company has not defaulted in repayment of dues to Financial
Institutions or Banks or Debenture Holders, during the year.
12. The Company has not granted any loans and advances during the
year, on the basis of security by way of pledge of shares .debentures
and other securities.
13. The Company has not given guarantee for loans taken by others from
Banks or Financial Institutions.
14. The Company has not obtained term loans during the year.
15. As per the records of the Company, no funds were raised on short
term basis and used for long term investment and vice versa.
16. 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.
17. The Company has not issued any debentures and hence creation of
securities in respect of debentures does not arise.
18. The Company has not raised money by way of public issues.
19. According to the information and explanation furnished to us, no
fraud on or by the Company has been noticed or reported during the
For VENKATESH & CO.,
PLACE : Chennai V. DASARATY
DATE : 29th August, 2012 PARTNER
Regn. No. 004636S