We have audited the attached Balance Sheet of Indo Aquatics Limited as
at 31st March 2009, and also the Profit and Loss Account and the Cash
Flow Statement for the Year ended on that date annexed thereto.These
financial statements are the responsibility of the companys
management. Our responsibility is to express an opinion on these
financial statements based on ouraudit.
We conducted our audit in accordance with Auditing Standards generally
accepted in India.Those standards require that we plan and perform
theaudit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. Our audit includes
examining, on a test basis, evidencesupportingtheamountsand disclosures
in thefinancialstatements. Our 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 forour opinion.
As required by the Companies (Auditors Report) Order, 2003, as amended
by the Companies ((Auditors Report)(Amendment) Order, 2004, 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 paragraphs4and 5 of thesaid order.
Furthertoourcomments in the annexure referred toabove.we report that;
I. We have obtained all the information and explanations, which to the
best of our knowledgeand belief were necessary forthe purpose of our
II. In our opinion, proper books of account as required by law have
been kept by the company so far as it appears from our examination of
III. The Balance Sheet, Profit and Loss Account and Cash Flow
Statement referred to in the report are in agreement with the books of
IV. In our opinion,the Balance Sheet, Profit and Loss Account and Cash
Flow Statement comply with the mandatory Accounting Standards referred
to in Sub-section (3C) of section 211 of the Companies Act, 1956.
V. On the basis of the written representations received from the
Directors and taken on record by the Board of Directors, we report that
none of the Directors is disqualified as on 31st March, 2009 from being
appointed as Director in terms of clause(g)of Sub-section(l) of section
274 of the Companies Act, 1956.
VI. Attention is invited to the following notes in the notes to
accounts in schedule - K.
a) Note No.1 (a) regarding preparation of accounts on principles
applicable to a going concern.
b) Note No.1 (C) regarding non-provision of interest on loans from
banks & financial institutions at the original contracted rates.
II. Subject to our remarks in paragraph VI above and possible
impact on the loss,assets and liabilities of the company, the accounts
g ive a true and fair view:
1) In case of Balance sheet, of the State of affairs of the company as
at31 st March,2009
2) In case of Profit and Loss Account, of the loss for the year ended
3) In case of the Cash flow statement, of the cash flows for the year
ended on that date.
INDO AQUATICS LIMITED
ANNEXURETO THE AUDITORS REPORT
(Referred to in Paragraph 3 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) 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
c) During the year the company has not disposed off any item of its
ii) As there are no stocks of finished goods, raw-material, stores and
spares, the matters specified in clauses (ii)(a), (ii)(b), and (ii)(c)
of paragraph-? of the said Orderarenotapplicable.
iii a) The Company has not granted any loans secured or unsecured, to
any party. However, the Company had taken interest free loans in
earlier years and also during the current year from the parties listed
in the register maintained under section 301 of the companies Act,
1956.The total outstanding amount of these loans taken from the
b) As perthe information and explanations given,there are no specific
terms and conditions attached to the above said loans regarding
c) The company has not repaid the said loans.
d) The entire amounts of the said loans other than the loans obtained
during the year are long overdue.
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 nature of its business
with regard to purchase of inventory; fixed assets and with regard to
sale of goods. However,there are no sales during the year.
v) During the year, there were no transactions exceeding the value of
five lakh rupees in respect of each party which need to beentered in
the register in pursuance of section 301 of the companies Act, 1956.
vi) The company has not accepted any deposits from the public.
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 the
Central Government has not prescribed the maintenance of cost records
under section 209(1)(d) of the companies Act, 1956 for any of the
products of the company.
ix) a) As per the information and explanations given to us,the
provisions of Employees Provident Fund Act and employees State
Insurance Act are not applicable fortheyear under audit.
b) According to the information and explanations given to us, no
undisputed amount payable in respect of Income Tax, Wealth Tax,
SalesTax,Customs duty, excise duty and cess which were in arrears, as
at 31.03.2009 for a period of more than six months from the date they
c) On the basis of the records made available to us and other
information and explanations given, we report that the following are
the disputed amounts of Excise Duty and IncomeTax.
Amount in Rs. Name of the forum where
the dispute is pending
ExciseDutyof Rs. 25,60,989/- The Customs.Exciseand Service Tax
(including penalty of Rs.12,19,081) AppellateTribunal, Bangalore
IncomeTax of Rs.6,70,813/- Income Tax Appellate tribunal,
x) The amount of accumulated losses at the end of the financial year is
far in excess of the net worth of the company. During the year the
Company has not incurred any cash loss. However it has incurred cash
loss in the immediately preceding year
xi) The company has defaulted in repayment of dues to the ICICI Bank
which has assigned the debt in favour of Standard Chartered Bank and
which in turn has again assigned the said debt in favour of Sri
Venkatasesha Reddy.K. The total amount of the said dues as on 31st
March 2009 as per the books of account of the Company excluding
interest for the period from 1 April 2002 to 31st March
xii) The company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
xiii) The company is not a chit/nidhi/benefit company
xiv) The company is not dealing/Trading in Shares, Securities,
Debentures and other investments.
xv) According to the information and explanations given to us, the
company has not given any guarantee for loans taken by others from
xvi) During the yearthecompany has not obtained any Term Loans.
xvii) Based on the examination of the books of account and related
records and according to the information and explanations provided to
us,the company has not utilized funds raised on short term basis for
long term investment and vice versa.
xviii) The company has not made any fresh allotment of equity shares
during the year.
xix) The company has not issued any debentures.
xx) During the year the company has not raised any money by public
issue of its shares.
xxi) According to the information and explanations given to us, no
fraud on or by the company has been noticed or reported during the
For Reddy & Balu
Place: Hyderabad M Raja Reddy
ICAI Membership No.23110