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Garg Furnace
BSE: 530615|ISIN: INE194E01015|SECTOR: Steel - Medium / Small
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« Mar 12
Auditor's Report (Garg Furnace) Year End : Mar '13
Report on the Financial Statements
 
 We have audited the accompanying Financial Statements of Garg Furnace
 Limited (the Company), Kanganwal Road, V.PO Jugiana, G. T Road,
 Ludhiana, which comprise the Balance Sheet as at March 31, 2013, the
 Statement of Profit and Loss and Cash Flow Statement for the year then
 ended, and a summary of significant accounting policies and other
 explanatory information.
 
 Management''s Responsibility for the Financial Statement
 
 Management is responsible for the preparation of these financial
 statements that give a true and fair view of the financial position,
 financial performance and Cash flows of the Company in accordance with
 accounting principles generally accepted in India including Accounting
 Standards referred to in Section 211 (3C) of the Companies Act 1956
 (the Act).This Responsibility includes the design, implementation and
 maintenance of Internal Control relevant to the preparation and
 presentation of the financial statements that give true and fair view
 and are free from material misstatement, whether due to fraud or error.
 Auditors'' Responsibility
 
 Our Responsibility is to express an opinion on these financial
 statements based on our audit. We conducted our audit in accordance
 with the Standards on Auditing issued by the Institute of Chartered
 Accountants of India. Those Standards require that we comply with
 ethical requirements and plan and perform the audit to obtain
 reasonable assurance about whether the financial statements are free
 from material misstatements.
 
 An audit involves performing procedures to obtain audit evidence about
 the amounts and disclosures in the financial statements. The procedures
 selected depend on auditor''s judgment, including assessment of the
 risks of material misstatement of the financial statements, whether due
 to fraud or error In making those risk assessments; the auditor
 considers internal control relevant to the Company''s preparation and
 fair presentation of the financial statements in order to design audit
 procedures that are appropriate in the circumstances. An auditor also
 includes evaluating the appropriateness of accounting policies used and
 the reasonableness of the accounting estimates made by management, as
 well as evaluating the overall presentation of the financial
 statements. We believe that audit evidence we have obtained is
 sufficient and appropriate to provide a basis for our audit opinion.
 Opinion
 
 In our opinion and to the best of our information and according to the
 explanations given to us, the financial statements give the information
 required by the Act in the manner so required and give a true and fair
 view in conformity with the accounting principles generally accepted in
 India.  a In the case of the Balance Sheet, of the state of affairs of
 the company as at March 31, 2013.  b). In the case of the tatement of
 Profit and Loss, of the profit for the year ended on that date and c).
 In the case of the Cash Flow Statement, of the cash flows for the year
 ended on that date.
 
 Report on Other Legal and Regulatory
 
 Requirements
 
 1 As required by the Companies (Auditor''s Report) Order 2003 (the
 Order) issued by the Central Government of India in terms of section
 227(4A) of the Act, we give in the Annexure a statement on the matters
 specified in paragraph 4 and 5 of the Order.
 
 2 As required by section 227(3) of the Act, 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
 audit.
 
 b) In our opinion, proper books of account as required by law have been
 kept by the Company so far as appears from ourexammation of those
 books.
 
 c) The Balance Sheet, the Statement of Profit and Loss, and the Cash
 Flow Statement dealt with by this Report are in agreement with the
 books of account
 
 d) In our opinion, the Balance Sheet, the statement of Profit and Loss,
 and the Cash Flow Statement comply with the Accounting Standards
 referred to in Section 211 (3C)oftheAct
 
 e) On the basis of the written representations received from the
 directors as on March 31, 2013, taken on record by the Board of
 Directors, none of the directors is disqualified as on March 31, 2013,
 from being appointed as a director in terms of Section 274( 1) (g) of
 the Act.
 
 ANNEXURE TO THE AUDITOR REPORT
 
 (REFERRED TO IN PARAGRAPH 1 UNDER THE HEADING OF
 
 REPORT ON OTHER LEGAL AND REGULATORY
 
 REQUIREMENTS''^OUR REPORTOF EVEN DATE.)
 
 (I) a). The company has maintained proper records showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 b). All the assets have not been physically verified by the management
 during the year but there is a regular programme of verification which,
 in our opinion, is reasonable having regard to the size of the company
 and the nature of its assets. No material discrepancies were noticed on
 such verification.
 
 c). During the year, the company has not disposed off substantial part
 of its plant & machinery and hence the going concern status of the
 company has not been affected.
 
 (ii) a) The inventory has been physically verified during the year by
 the management. In our opinion, the frequency of verification is
 reasonable.
 
 b). 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). The company is maintaining proper records of inventory. The
 discrepancies noticed on verification between physical stocks and the
 book records were not material.
 
 (iii) a). The company has not granted secured or unsecured loan to the
 companies, firms or other parties covered in the register maintained
 under section 301 of the companies Act 1956.  Therefore the provisions
 of Paragraph 4 (iii) (b) (c) and (d) of the above said order are not
 applicable to the company.
 
 b). The company has taken interest free unsecured loans from three
 parties covered in the register maintained under section 301 of the
 Companies Act, 1956. The amount involved in the transaction is Rs 1.93
 Crores and balance outstanding at the end of the year is Rs 1.12 crores
 
 c).  In our opinion, the terms and conditions on which loan has been
 taken are not prima facie prejudicial to the interest of the company.
 
 d). In our opinion and according to the information and explanation
 given to us, the payment of principal amount as agreed are regular.
 
 (iv) In our opinion and according to the information and explanations
 given to us, there is adequate internal control system commensurate
 with the size of the company and the nature of its business for
 purchases of inventory, fixed assets and for sale of goods and
 services. During the course of our audit, we have not observed any
 continuing failure to correct major weaknesses in internal control
 system.
 
 (v) a), in our opinion and according to the information and
 explanations given to us, the particulars of contracts or arrangements
 referred to in section 301 of the Companies Act, 1956, have been
 entered in the register maintained underthat section.
 
 b). In our opinion and according to the information and explanations
 given to us, the transactions made in pursuance of contracts or
 arrangements entered in the register maintained under section 301 of
 the Companies Act, 1956 and exceeding Rs. five lacs or more in respect
 of each party during the year, have been made at prices which are
 reasonable having regard to the prevalent market prices at the relevant
 time.
 
 (vi) In our opinion and according to the information and explanations
 given to us, the provisions of sections 58A and 58AA or any other
 relevant provisions of the Companies Act, 1956 and the companies
 (Acceptance of Deposits) Rules, 1975 are not applicable to Company. No
 order has been passed by the Company Law Board or National Company Law
 Tribunal or Reserve Bank of India or any other court or any other
 Tribunal.
 
 (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. We have however not
 made a detailed examination of the record with a view to determine
 whether they are accurate or complete.
 
 (ix) The Company is regular in depositing with appropriate
 authorities undisputed statutory dues including provident fund,
 employees'' state insurance, income tax, sales tax, custom duty, excise
 duty, cess, service tax and other material statutory dues applicable to
 it.
 
 (x) The Company does not have any accumulated losses, further it has
 not incurred cash losses during the financial year covered by our audit
 and in the immediately preceding financial year.
 
 (xi) In our opinion and according to the information and explanations
 given to us, the company has not defaulted in repayment of dues to
 bank.
 
 (xii) The company has not granted loans or 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.
 
 (xiv) In our opinion, the company has not dealt or traded in shares,
 securities, debentures and other investments
 
 (xv) The Company has not given guarantees for loan taken by others from
 banks. Therefore provisions of 4(XV) of above said order are not
 applicable to Company.
 
 (xvi) In our opinion and according to the information and explanation
 given to us, the term loans have been applied for the purpose for which
 they were obtained.
 
 (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 the no funds raised on short-term basis have been used for
 long-term investment.
 
 (xviii) According to the information and explanations given to us, the
 company has not made any preferential allotment of shares during the
 year to parties and companies covered in the register maintained under
 section 301 of the Act.
 
 (xix) According to the information and explanations given to us, during
 the period covered by our audit report, the company has not issued any
 debentures.
 
 (xx) The company has not raised money through Public Issue during the
 period covered by our audit.
 
 (xxi) According to the information and explanations given to us, no
 fraud on or by the Company has been noticed or reported during the year
 
                                   For Dass Khanna & Co.
 
                                   Chartered Accountants
 
                                  (Registration No. 000402 N)
 
                                   SD/- 
 
                                  (RAKESH SONI) 
 
 Place: LUDHIANA.                  PARTNER
 
 Date : 30-05-2013                 M. No. 83142
Source : Dion Global Solutions Limited
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