1) We have audited the attached Balance Sheet of COMPUTERSKILL LIMITED
as at 31st March, 2008 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 the date. 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.
2) 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
3) As required by the Companies (Auditors Report) Order 2003 issued by
the Central Government of India in terms of Section (4A) of Section 227
of the Companies Act, 1956, we annex here to a statement on the matters
specified in paragraphs 4 and 5 of the said order to the extent
4) Further to our comments in the annexure referred to in paragraph 3
above, we state 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, proper books of accounts as required by law have
been kept by the Company so far as appears from our examination of
c) The Balance Sheet, the Profit and Loss Account and the Cash Flow
Statement dealt with by this report are in agreement with the books of
d) In our opinion, subject to Note 1(xb) of Schedule 23 regarding Non
Provision of Leave Encashment & Gratuity in respect of Employee
Benefit the Balance Sheet and the Profit and Loss Account comply with
Accounting Standards referred to in Section 211 3(C) of the Companies
e) On the basis of the written representations received from the
directors, as on March 31, 2008 and taken on record by the Board of
Directors, we report that none of the directors of the Company are
disqualified as on March 31, 2008 from being appointed as a director,
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, subject of Note 1(xi) of Schedule 23
regarding Non Provision of Leave Encashment & Gratuity in respect of
Employee benefit as required by AS 15 issued by Institute of
Chartered Accountants of India & the subsequential understatement of
losses of the company (amount not quantifiable) & Note No. 8 of
Schedule-23 regarding Balance Confirmation from Debtors, Creditors,
Banks & Financial Institution & note No. 9 of Schedule-23 regarding non
moving/slow moving items, & Note No. 10 of Schedule-23 regarding
classification of accounts as non performing assets (NPA) by IDBI &
Note No. 11 of Schedule-23 regarding classification of accounts as non
performing assets (NPA) by Union Bank of India and non-charging of
interest on there loan, Subject to Note No. 24 of Schedule 23 regarding
Going Concern Assumption the said accounts read together with the
notes 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, 2008 and
ii) in the case of the Profit and Loss Account of the Loss of the
Company for the year ended on that date.
iii) in the case of Cash Flow Statement, of the Cash Flows for the year
ended on that date.
ANNEXURE TO THE AUDITORS REPORT
1) In respect of its Fixed Assets :
a) The Company is in the process of updating Fixed Assets register for
the year under review.
b) As explained to us, a major portion of the fixed assets have been
physically verified by the Management at the year end. In our opinion,
the frequency of verification is reasonable having regard to the size
of the company and nature of its assets. As informed to us, no material
discrepancies were noticed on such physical verification.
c) As explained to us, the company has not made any disposal of Fixed
Assets during the year.
2) In respect of Inventories :
a) As explained to us, inventories were physically verified by the
Management at reasonable intervals during the year.
b) In our opinion and according to the explanation given to us, the
procedures for physical verification of inventories followed by the
Management were 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 explanations
given to us, the company is maintaining proper records of Inventory.
The discrepancies noticed on verification between the Physical stocks
and the book records were not material.
3) In respect of loans, secured or unsecured, granted or taken by the
company to / from companies, firms or other parties covered in the
register maintained under Section 301 of the Companies Act, 1956.
a) The Company has not taken any loans from any parties covered under
the register maintained under Section 301 of the Companies Act, 1956.
b) The Company has granted interest free loans to one party covered
under the register maintained under Section 301 of the Companies Act,
1956, aggregating to Rs. 1,15,252/ - (Maximum balance during the year
c) In our opinion and according to the information and explanations
given to us, the terms and conditions of the interest free loan granted
by the Company are prima facie not prejudicial to the interest of the
d) In respect of loan granted by the Company, the principal amount is
repayable on demand.
4) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business for the
purpose of inventory, fixed assets and also for the sale of goods and
5) In respect of transactions covered under Section 301 of the
Companies Act, 1956.
a) In our opinion and according to the information and explanations
given to us, particulars of contract or arrangement referred to in
Section 301 of the act have been entered in register required to be
maintained u/s 301 of the Companies Act, 1956.
b) In our opinion and according to the information and explanations
given to us, the transactions of purchase of goods and material and
sale of goods, material made in pursuance of contracts or arrangement
entered in the register maintained u/s 301 of the Companies Act, 1956
and aggregating to Rs. 5/- lacs, or more in respect of each party have
been made at prices which are reasonable having regard to the
prevailing market price for such goods, material or the prices at which
the transaction for similar goods & material have been made with other
6) In our opinion and according to the explanations given to us, the
company has not complied with the provisions of section 58A and 58AA of
the Companies Act, 1956 and the rules framed there under with regard to
the deposits accepted from the public.
7) In our openion, the internal audit system is commensurate with its
size and nature of business. However in our opinion the same is
required to be strengthened.
8) According to the information and explanations given to us, the
Central Government has not prescribed maintenance of cost records under
Section 209 (1) (d) of the Companies Act, 1956 in respect of activities
carried out by the Company.
9) In respect of Statutory Dues :
a) According to the records of the company undisputed statutory dues
including Provident Fund, Employees State Insurance, Income-tax,
Sales-tax, Wealth-tax, Service Tax, Custom Duty, Excise Duty, Cess and
any other statutory dues have not been regularly deposited with the
The extent of the arrears of outstanding statutory dues as at the last
day of the financial year concerned for a period of more than six
months from the date they became payable are as follows :
Statutory Liability outstanding for more than six months Amount (Rs.)
Tax Deducted at Source 866,265
Central Sales Tax / Vat 8,376,431
Professional Tax 116,469
Provident Fund 760,491
Fringe Benefit Tax 647,710
b) According to the information and explanation given to us, the
Company has no disputed statutory dues that have not been deposited on
account of matters pending before appropriate authority.
10) The accumulated losses of the company at the year end are more than
fifty percent of its net worth and the company has incurred cash losses
during the financial year covered by our audit.The company has also
incurred cash loss during the immediately preceding financial year.
11) As informed to us, the company has defaulted in the repayment of
dues of financial institutions.
The overdue amount of principal & interest is as under:
More than One Year Within One year
PRINCIPAL 96,148,636 81,714,146
INTEREST 50,369,720 45,414,423
12) According to the information and explanation given to us, the
Company has not granted any loan and advances on the basis of security
by way of pledge of share, debenture and other security.
13) In our Opinion, the company is not a chit fund or a nidhi/mutual
14) According to the information & explanation given to us, the company
is not dealing or trading in shares, securities, debentures and other
15) According to the information & explanation given to us, the company
has not obtained any term loan during the year.
16) According to the information & explanation given to us and on an
overall examination of the balance sheet and cash flow statement of the
Company and after placing reliance on the reasonable assumption made by
the Company for classification of long term and short term usage of
funds, we are of the opinion that Rs. 98.38 lacs raised for short term
basis have been used during the year for long term purpose.
17) The Company has not given guarantees for loans taken by others from
Banks or Financial Institutions.
18) The Company has not made any preferential allotment of Shares
during the year.
19) The Company has not issued any debentures during the year
20) The Company has not raised any money by way of Public Issue during
21) 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 Parikh & Majmudar
Place : Ahmedabad Hiten Parikh
Date : 28th June, 2008 Partner
Membership No. : 40230