1. We have audited the attached Balance Sheet of MPS LIMITED (the
Company'') as at 31st March, 2012, the Profit and Loss Account and the
Cash Flow Statement of the Company for the period 1st January, 2011 to
31st March, 2012, both annexed thereto. 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.
2. We conducted our audit in accordance with the 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 the disclosures in the financial statements. An audit also includes
assessing the accounting principles used and the significant estimates
made by the Management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
3. Without qualifying our opinion, we draw attention to Note No. 5b of
Schedule 19 regarding the disallowance of input credit of service tax
claims against which the Company has filed/ is in the process of filing
appeals with the respective authorities and service tax demand on
overseas commission, against which the Company has filed an appeal with
the concerned authority.
4. As required by the Companies (Auditor''s Report) Order, 2003 (CARO)
issued by the Central Government in terms of Section 227(4A) of the
Companies Act, 1956, we enclose in the Annexure a statement on the
matters specified in paragraphs 4 and 5 of the said Order.
5. Further to our comments in the paragraph 3 above and Annexure
referred to in paragraph 4 above, we report as follows:
(a) we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purposes of our
(b) 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
(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, the Balance Sheet, the Profit and Loss Account and
the Cash Flow Statement dealt with by this report are in compliance
with the Accounting Standards referred to in Section 211(3C) of the
Companies Act, 1956;
(e) in our opinion and to the best of our information and according to
the explanations given to us, they 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 31st March, 2012;
(ii) in the case of the Profit and Loss Account, of the profit of the
Company for the period 1st January, 2011 to 31st March, 2012 and
(iii) in the case of the Cash Flow Statement, of the cash flows of the
Company for the period 1st January, 2011 to 31st March, 2012.
6. On the basis of the written representations received from the
Directors as on 31st March, 2012 taken on record by the Board of
Directors, none of the Directors is disqualified as on 31st March, 2012
from being appointed as a director in terms of Sec- tion 274(1) (g) of
the Companies Act, 1956.
ANNEXURE TO THE AUDITORS'' REPORT
(Referred to in paragraph 4 of our report of even date)
(i) Having regard to the nature of the Company''s
business/activities/result, clauses ii, iii (b) to (d), iii (f) and
(g), v, vi, viii, xii, xiii, xiv, xix, xx of CARO are not applicable.
(ii) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of the fixed assets.
(b) The fixed assets were physically verified during the period by the
Management in accordance with a regular programme of verification
which, in our opinion, provides for physical verification of all the
fixed assets at reasonable intervals. According to the information
and explanation given to us, no material discrepancies were noticed on
(c) The fixed assets disposed off during the period, in our opinion, do
not constitute a substantial part of the fixed assets of the Company
and such disposal has, in our opinion, not affected the going concern
status of the Company.
(iii) The Company has neither granted nor taken any loans to/from
companies, firms or other parties listed 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, having regard to the explanations that some of the items
purchased are of special nature and suitable alternative sources are
not readily available for obtaining comparable quotations, there is
an adequate internal control system commensurate with the size of the
Company and the nature of its business with regard to purchases of
fixed assets and the rendering of services. During the course of our
audit, we have not observed any major weakness in such internal control
system. The activities of the Company do not involve purchase of
inventory and sale of goods.
(v) In our opinion, the Company has an adequate internal audit system
commensurate with the size and the nature of its business.
(vi) According to the information and explanations given to us in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
dues, including Provident Fund, Investor Education and Protection
Fund, Employees'' State Insurance, Income-tax, Sales Tax, Wealth Tax,
Service Tax, Custom Duty, Cess and other material statutory dues
applicable to it with the appropriate authorities, except for delays in
remittances of service tax and professional tax.
(b) There were no undisputed amounts payable in respect of Provident
Fund, Investor Education and Protection Fund, Employees'' State
Insurance, Income-tax, Sales tax, Wealth Tax, Service Tax, Custom Duty,
Cess and other material statutory dues in arrears as at 31st March,
2012 for a period of more than six months from the date they became
payable, except for ''23,072 relating to service tax which could not be
deposited pending registration of services in the nature of com-
mercial training / coaching.
(c) Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax,
Custom duty, Excise Duty and Cess which have not been deposited as on
31st March, 2012 on account of disputes are given below:
Statite Nature of Forum where Period to which Amount
Dispute the amount relates involved
is pending (Rs.in lacs
Act, 1961 Income Tax Income Tax
Tribunal 2004-05 and 2006-07 149.16
Tax (Appeals) 2006-07 and 2007-08 450.44
Act Service Tax Customs and
Tax Appellate April 06 to September,
(vii) The Company does not have accumulated losses at the end of the
financial year and has not incurred cash losses in the cur- rent
financial year but has incurred cash losses in the immediately
preceding financial year
(viii) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
banks. There are no borrowings from financial institutions and the
Company has not issued any debentures.
(ix) The Company has not given any guarantee for loans taken by others
from banks or financial institutions.
(x) In our opinion and according to the information and explanations
given to us, the term loans have been applied for the pur- poses for
which they were obtained.
(xi) In our opinion and according to the information and explanations
given to us and on an overall examination of the Balance Sheet, we
report that funds raised on short-term basis have not been used during
the period for long- term investment.
(xii) 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.
(xiii) To the best of our knowledge and according to the information
and explanations given to us, no fraud on or by the Company has been
noticed or reported during the period.
For DELOITTE HASKINS & SELLS
(Registration No. 008072S]
MUMBAI, 28th May, 2012 (Membership No.47840)