We have audited the attached Balance Sheet of BGIL FILMS & TECHNOLOGIES
LIMITED as at 31st March, 2011 and the Profit and Loss Account for the
year ended on that date annexed thereto and the Cash Flow Statement for
the year ended on that date. 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.
1. 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 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 and report thereto:
2. As required by the Companies (Auditor''s Report) Order, 2003 issued
by the Central Government in terms of section 227 (4A) of the Companies
Act, 1956 and on the basis of such checks of the books and records of
the company, as we considered appropriate, and in terms of the
information and explanations given to us, we enclose in the annexure a
statement on the matters specified in paragraph 4 and 5 of the said
order to the extent applicable to the company.
3. Further to our comments in annexure referred to in paragraph (3)
above, we report that:
(a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
(b) In our opinion, the company as required by law, has kept proper
books of account so far as appears from our examination of such books.
(c) The Balance Sheet and Profit & Loss Account dealt with by this
report are in agreement with the books of account.
(d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement dealt with by this report, comply with the Accounting
Standards referred in sub – section 3(C) of section 211 of the
companies Act, 1956.
(e) On the basis of written representations received from the directors
as on 31.03.2011 and taken on record by the Board of Directors, we
report that none of the directors is disqualified as on 31.03.2011 from
being appointed as directors in terms of clause (g) of sub-section (1)
of section 274 of the Companies Act, 1956.
(f) In our opinion and to the best of our information and according to
the explanations given to us, the said statements of accounts together
with the notes appearing in Schedule of Notes subject to Non-provision
of retirement benefits as detailed in Note no. 15 of Notes on accounts
(Schedule No. 14), 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 Balance Sheet, of the state of affairs of the company
as at 31st March,2011;
ii) In the case of 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 THE AUDITORS'' REPORT
Referred to in paragraph 3 of our report of even date,
(i) (a) The company has generally maintained proper records showing
particulars including quantitative details and situation of fixed
(b) As explained to us, the Fixed Assets are physically verified by the
management at reasonable intervals in a phased verification programme,
which in our opinion, is reasonable having regard to the size of the
company and the nature of its business. No material discrepancies were
noticed on such verification.
(c) During the year, the company has not disposed off any part of its
Fixed Assets so as to affect its going concern.
(ii) (a) The inventory has been physically verified during the year by
the management. In our opinion, the frequency of verification is
(b) In our opinion, the procedures 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) On the basis of our examination of the inventory records, in our
opinion, the company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
(iii) (a) According to the information and explanations given to us,
the company has neither granted nor taken any loans, secured or
unsecured to/from companies, firms or other parties, covered in the
register maintained under section 301 of the Companies Act, 1956.
(iv) 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 purchases of inventory, fixed assets and with
regard to the sale of goods. During the course of our audit, no major
weakness has been noticed in internal controls.
(v) (a) On the basis of the audit procedures performed by us and
according to the information, explanations and representations given to
us, we are of the opinion that, the transactions in which directors
were interested as contemplated under section 297 and sub-section (6)
of section 299 of the Companies Act, 1956, and which were required to
be entered in the register maintained under section 301 of the
Companies Act, 1956, have so entered.
(b) According to the information and explanations given to us,
transactions exceeding the value of Rs. 5,00,000/- have been made at
prices which are reasonable having regard to the prevailing market
prices at the relevant time.
(vi) The company has not accepted any deposits as defined under
sections 58A of the Companies Act, 1956 and the Companies (Acceptance
of Deposits) Rules, 1975.
(vii) In our opinion, the company has an internal audit system
commensurate with the size and nature of its business.
(viii) According to the information and explanations given to us,
maintenance of cost records have not been prescribed by the Central
Govt. under section 209 (1) (d) of the Companies Act, 1956.
(ix) (a) According to the records of the company, in our opinion the
company is generally regular in depositing with appropriate authorities
undisputed statutory dues including provident fund, investor education
and protection fund, employee''s state insurance, income tax, sales tax,
wealth tax, custom duty, excise duty, cess and any other statutory dues
applicable to it.
(b) According to the information and explanations given to us, there
are no undisputed amount payable in respect of income tax, sales tax,
customs duty, wealth tax and excise duty were outstanding as on 31st
March, 2011 for a period of more than six months from the date becoming
payable except the following:
Name of Nature of Dues Amount Period
the the amount in Lacs to which
Service Service Tax 30.34 01.10.2008 to
Tax Act 31.03.2010
Income Income Tax 18.15 01.04.2008 to
Tax Act 31.03.2010
(x) The company has no accumulated losses as at 31st March, 2011 and it
has not incurred any cash losses during the financial year ended on
that date or in the immediately preceding financial year.
(xi) According to the records of the company examined by us and the
information and explanations given to us, the company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
(xii) The company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
(xiii) In our opinion, the company is not a chit fund or a nidhi/mutual
(xiv) In respect of shares, securities, debentures and other
investments, dealt in or traded by the company, proper records have
been maintained in respect of transactions and contracts, and timely
entries have been made therein.
(xv) According to the information and explanations given to us, the
company has not given any guarantee for loans taken by others, from
banks or financial institutions during the year.
(xvi) The Company has not obtained any term loans during the current
(xvii) Based on the information and explanations given to us and on an
overall examination of the balance sheet of the company, in our
opinion, there are no funds raised on a short term basis which have
been used for long term investment and vice-versa.
(xviii) According to the information and explanations given to us, the
company has not made preferential allotment of shares to parties and
companies covered in the register maintained under section 301 of the
Act during the year.
(xix) According to the information and explanations given to us, during
the period covered by our audit report, the company has not issued any
(xx) The company has not raised money by way of public issues during
(xxi) Based on the audit procedures performed and information and
explanations given to us, we report that no fraud on or by the company
has been noticed or reported during the course of our audit.
For SNMG & CO.
(Firm No. 004921N)
Membership No. 87004
Dated : 01-09-2011
Place : New Delhi