We have audited the attached Balance Sheet of Mangalore Refinery and
Petrochemicals Limited as at 31st March, 2011 the Profit and Loss
Account and the Cash Flow Statement for the year ended on that date
together with the schedules annexed thereto which are in agreement with
the books of account maintained. 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.
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 the management as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis
for our opinion.
1. As required by the Companies (Auditor''s Report) Order, 2003 as
amended by the Companies (Auditor''s Report) Amendment Order, 2004
issued by the Government of India in terms of section 227 (4A) of the
Companies Act, 1956, we enclose in the Annexure a statement on the
matters specifed in Paragraphs 4 and 5 of the said Order.
2. Further to our comments in the Annexure referred to above, we
report that:
i) 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.
ii) In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books.
iii) The Balance Sheet, Profit & Loss Account and Cash Flow Statement
dealt with this report are in agreement with books of account
maintained.
iv) In our opinion, the Balance Sheet and Profit and Loss Account and
Cash Flow Statement dealt with by this report read with the notes
thereon are in Compliance with the Accounting Standards referred to in
sub-section (3C) of section 211 of the Companies Act, 1956 to the
extent applicable.
v) Being a Government Company provision of clause (g) of Sub-section
(1) of Section 274 of the Companies Act, 1956, is not applicable as per
Notification no GSR 829(E) dated October 21, 2003 issued by the
Department of Company Affairs.
vi) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read together with the
significant accounting policies and other notes on accounts attached
thereto, 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.
a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2011.
b) in the case of the Profit and Loss Account, of the Profit for the year
ended on that date; and
c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR AUDIT REPORT OF EVEN DATE ON
THE ACCOUNTS OF MANGALORE REFINERY AND PETROCHEMICALS LIMITED FOR THE
YEAR ENDED 31st MARCH, 2011
1. (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 have been
noticed on such verification.
(c) The Company has not disposed off substantial part of fixed assets
during the year.
2 (a) We are informed that the inventories of stores and spares are
physically verified by the management on a continuing basis as per a
programme of perpetual inventory. Inventories of other items have been
physically verified at the year end, the frequency of which, in our
opinion is reasonable, having regard to the size of the Company and
nature of its business.
(b) In our opinion and according to the explanation given to us, the
procedures of physical verification of inventory 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 and as informed to us, discrepancies
noticed on physical verification by the management, which are reported
to be not material, same have been properly dealt with in the books of
account of the Company.
3. (a) The Company has not granted any loans, secured or unsecured to
companies, firms or other parties covered in the register maintained
under section 301 of the Companies Act, 1956.
(b) The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under section 301 of the Companies Act, 1956.
4. In our opinion and according to the information and explanations
given to us, internal control procedures are fairly adequate,
commensurate with the size of the Company and nature of its business
for the purchase of inventory and fixed assets and with regard to the
sale of goods. During the course of our audit no major weakness has
been noticed in the internal control systems.
5. According to the information and explanations given to us, Company
has not entered into any transactions that need to be entered in a
register maintained pursuant to section 301 of the Companies Act, 1956.
6. The Company has not accepted any deposits from the public during
the year and hence the directives issued by the Reserve Bank of India
and the provisions of sections 58A, 58AA or any other relevant
provisions of the Companies Act, 1956 and the rules framed thereunder
are not applicable.
7. The Company has an internal audit system which is commensurate with
its size and nature of its business.
8. We have broadly reviewed the records maintained by the Company
pursuant to the order by the Central Government under Section 209 (1)
(d) of the Companies Act, 1956 for maintenance of Cost records in
respect of the products of the Company and are of the opinion that
prima facie, the prescribed accounts and records have been made and
maintained.
However, we are not required to and have not carried out any detailed
examination of such records.
9. (a) The Company has been generally regular in depositing undisputed
statutory dues including Provident Fund, Employee''s State Insurance,
Income Tax, Sales Tax, Wealth Tax, Custom Duty, Excise Duty, Cess,
Investor Education and Protection Fund, Service Tax and other statutory
dues with the appropriate authorities during the year. There are no
arrears of undisputed statutory dues of material nature outstanding for
a period of more than 6 months from the date on which they became
payable.
(b) According to the information and explanations given to us and as
per our verification of records of the Company, the following disputed
amounts of tax not provided for in the accounts of the Company and not
deposited with appropriate authorities as at 31st March, 2011.
Name of the
Statue Nature of
the dues Total
Amount Paid and
or Balance
Amt Period to
which Forum where
dispute is
pending
(Rs.
Millions) Provided Outstan
-ding the
amount
relates
(Rs.
Millions) (Rs.
Millions)(financial
year)
The
Karnataka
Sales Sales Tax
/Entry
Tax/ 1,972.95 1,132.31 840.64 1993-94
to
2007-08 Commercial
Tax
Appellate
Tax Act,
1957/Central Interest
and
Penalty Authorities/
Sales Tax
Act, 1956/
The Hon''ble High
Court of
Karnataka.
Karnataka
Tax on
Entry of
Goods Act
1979 Entry tax –
Before Govt
of Karnataka
for
conciliation
and
settlement.
Income Tax
Act, 1961 Income Tax
/Interest/ 373.90 251.41 122.49 2002-03
to
2006-07 Income Tax
Appellate
Authorities
Penalty
Central
Excise Act,
1944 Central
Excise Duty/ 360.26 36.08 324.18 1996-97
to
2010-11 Central
Excise
Appellate
Service Tax
/Interest/ Authorities
/Ministry
of Finance,
Penalty Government
of India.
The Customs
Act, 1962 Customs
Duty 130.19 Nil 130.19 2004-05
to
2009-10 Customs
Appellate
Authorities.
10. There are no accumulated losses at the end of the financial year.
The Company has not incurred cash losses during the year and in the
immediately preceding financial year.
11. According to information and explanations given to us and as per
our verification of the records of the Company, the Company has not
defaulted in repayment of dues to the financial institutions and banks.
12. The Company has not granted any loans or advances on the basis of
security by way of pledge of share, debenture and other securities.
13. Since the Company is not a Chit Fund/Nidhi/Mutual Beneft
Fund/Society, the relative reporting requirements are not applicable.
14. The Company was dealing in Mutual Fund investments during the
year. Proper records of the transactions and contracts have been
maintained and timely entries have been made. The said investments have
been held by the Company in its own name.
15. According to the information and explanations given to us and as
per the verification of the records of the Company, the terms and
conditions of the guarantee given by the Company, for the loans taken
by New Mangalore Port Trust from banks and financial institutions, are
not prejudicial to the interest of the Company. Except for the above,
Company has not given any guarantee for loans taken by others from
banks or financial institutions.
16. According to the information and explanations given to us, the
Company has not availed any fresh term loans during the year.
17. According to the information and explanations given to us and as
per the verification of the records of the Company, on an overall basis,
the Company has not utilized short-term funds for long term purposes.
18. The Company has not made any preferential allotment of share to
the parties and companies covered in the register maintained under
section 301 of the Act.
19. The Company has not issued any debentures during the year.
20. The Company has not raised any money by public issues during the
year.
21. According to the information and explanations given to us and as
per the verification of the records of the Company, no fraud either on
or by the Company, having a material financial impact, has been noticed
or reported during the year.
For S. R. R. K. SHARMA ASSOCIATES For MAHARAJ N.R.SURESH & CO
Chartered Accountants Chartered Accountants
(ICAI Registration No. 003790S) (ICAI Registration No. 001931S)
C.A.S.R.R.K.Sharma C.A. JAYADEVAN N R
Partner Partner
Membership No. 18088 Membership No. 23838
Place: New Delhi
Date: 20th May, 2011.
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