1. I have audited the attached Balance Sheet of INFO-DRIVE SOFTWARE
LIMITED, as at March 31, 2012 and the related Statement of Profit and
Loss and the Cash Flow Statement for the year ended on that date
annexed thereto. I have not audited the Balance Sheet and related
statement of Profit and Loss of the Branch office situated in Singapore
and the same has been included in the above financial statements as
certified by the management. These financial statements are the
responsibility of the company''s management. My responsibility is to
express an opinion on these financial statements based on my audit.
2. I conducted the audit in accordance with auditing standards
generally accepted in India. Those standards require that I plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement(s). 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. I believe that my audit provides a reasonable basis for
3. As required by the Companies (Auditor''s Report) Order 2003, as
amended by the Companies (Auditor''s Report) Amendment) Order 2004
issued by the Central Government of India in terms of subsection (4A)
of Section 227 of the Companies Act, 1956, I enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
4. Without qualifying my opinion, I draw attention to Note e of Notes
forming part of financial statements for the year ended March 31, 2012
in connection with the value of investments:
i) in Info-Drive Software Inc, USA (wholly owned subsidiary) though
diminished as on the date of balance sheet, management is confident of
augmenting resources against firm orders to mitigate any further
erosion and hence carried at cost.
Further to my comments in the Annexure referred to above, I report
a) I have obtained all the information and explanations, which to the
best of my knowledge and belief were necessary for the purposes of my
b) In my opinion, proper books of account as required by law have been
kept by the company so far as appears from my examination of those
books and I have not visited the Singapore Branch but the financial
statements certified by the management have been considered.
c) The Balance Sheet, the Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
d) In my opinion, the Balance Sheet, the Statement of Profit and Loss
and Cash Flow Statement dealt with this report comply with the
accounting standards referred to in sub-section (3C) of Section 211 of
the Companies Act, 1956 to the extent applicable.
e) On the basis of written representations received from the directors
and taken on record by the Board of Directors, I report that none of
the directors is disqualified as on March 31, 2012 from being appointed
as director in terms of clause (g) of sub-section (1) of Section 274 of
the Companies Act, 1956;
f) In my opinion and to the best of my information and according to the
explanations given to me, the said accounts 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 the Balance Sheet, of the state of affairs of the
Company as at March 31, 2012;
ii) In the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
iii) In the case of the Cash flow statement, of the cash flows for the
year ended on that date.
ANNEXURE TO THE AUDITOR''S REPORT OF EVEN DATE TO THE MEMBERS OF
INFO-DRIVE SOFTWARE LIMITED
i) a) The company has maintained proper records showing full
particulars, including quantitative details and the situation of its
b) As explained to me, during the year all the fixed assets have been
physically verified by the management at reasonable intervals.
According to the information and explanations given to me, no material
discrepancies were noticed on such verification.
c) The fixed assets disposed off during the year, in my opinion; do not
constitute a substantial part of fixed assets of the company
ii) a) As explained to me, the inventory have been physically verified
by the management at reasonable intervals .
b) In my opinion and according to the information and explanations
given to me, the procedure for physical verification of inventory
followed by the management were reasonable and adequate in relation to
the size of the company and the nature of its business.
c) In my opinion and according to the information and explanations
given to me, the company has maintained proper records of inventory and
the discrepancies between the physical stocks and the book stocks on
such verification has been properly dealt with in the books of account.
iii) The company has not granted/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. Therefore, the
sub-clauses (a) to (g) under this clause are not applicable to the
iv) In my opinion and according to the information and explanations
given to me there are adequate internal control systems commensurate
with the size of the company and the nature of its business with regard
to purchase of inventory, fixed assets and for sale of goods and
v) a) According to the information and explanations given to me, I am
of the opinion that the particulars of contracts or arrangements need
to be entered into the register maintained under section 301 of the Act
have been so entered.
b) In my opinion and according to the information and explanations
given to me, there are no transactions made in pursuance of such
contracts or arrangements 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 from the public as per
section 58A, 58AA or any other relevant provisions of the Act.
vii) The company has an internal audit system commensurate with the
size and nature of its business.
viii) The Central Government has not prescribed maintenance of cost
records under section 209 (1) (d) of the companies Act, 1956 for the
ix) a) According to the records, information and explanations provided
to me, the company is generally regular in depositing with appropriate
authorities undisputed amount of Provident Fund, Employees'' State
Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax and any other
statutory dues applicable to it and no undisputed amounts payable were
outstanding as at March 31, 2012 for a period of more than six months
from the date they become payable.
b) According to the information and explanations given to me, there are
no dues of sales-tax, income-tax, customs duty, wealth tax, service
tax, excise duty and cess which have not been deposited on account of
any dispute except the following.
Name of Nature of Amount Period
to which Forum where
Statute the Dues (Rs.) the amount
Income-tax Income-tax 0/- AY 2004-05 Commissioner
Income-tax TDS 33,44,226/- AY 2010-11 Commissioner of
Income-tax TDS 1,65,15,087/- AY 2011-12 Commissioner of
x) In my opinion and according to the information and explanations
given to me, the accumulated losses of the company are not more than
fifty percent of its net worth. The company has not incurred cash
losses in the immediately preceding financial year.
xi) Based on my audit procedures and on the information and
explanations given by the management, the company has not defaulted in
repayment of dues to any financial institution or bank.
xii) Based on my examination and according to the information and
explanations given to me, 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/mutual benefit fund/society and
clause xiii of the Order is not applicable.
xiv) The company is not dealing or trading in shares, securities,
debentures and other investments.
xv) The company has given corporate guarantees for loans taken from
banks by the wholly owned subsidiary company in Singapore. The terms
and conditions whereof are not prejudicial to the interests of the
xvi) In my opinion, the term loans have been applied for the purpose
for which they were raised.
xvii) According to the information and explanations given to me and on
an overall examination of the balance sheet of the company, I report
that no funds raised on short term have been used for long term
investment. No long term funds have been used to finance short term
xviii) During the year, the company has not made any preferential
allotment of shares to parties and companies covered in the register
maintained under section 301 of the act.
xix) The company did not have any outstanding debentures during the
xx) The company has not raised any money by public issue during the
xxi) Based on the audit procedures performed and information and
explanations given to me by the management, I report that no fraud on
or by the company has been noticed or reported during the course of my
for K. S. REDDY ASSOCIATES
Chennai K. SUBBA REDDY (Proprietor)