1. We have audited the attached Balance Sheet of OMKAR SPECIALITY
CHEMICALS LIMITED as at 31st March 2011, and also the Profit and Loss
Account and also the Cash Flow Statement for the year ended on that
date 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. These standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free from any material misstatement. An audit
includes, examining on the 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 presentation of the
financial statements. We believe that our audit provides a reasonable
basis for our opinion.
3. As required by 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 sub-section (4A) of Section
277 of ''The Companies Act, 1956'' and on the basis of such checks of the
books and records of the Company as we considered appropriate and
according to the information and explanations given to us, we give in
the annexure, a statement on the matters specified in paragraphs 4 and
5 of the said order.
4. Further to our comments in the Annexure referred to above, we
a) We have obtained all the information and explanations, which to the
best of our knowledge & belief were necessary for the purpose of our
b) In our opinion, proper books of account as required by law have been
kept by the company so far as appears from examination of such books;
c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the applicable
Accounting Standards referred to in Section 211(3C) of Companies Act,
e) On the basis of the written representations received from the
Directors and taken on record by the Board of Directors of the Company,
we report that none of the Directors are disqualified as on 31st March
2011 from being appointed as a Director in terms of clause (g) of
sub-section (1) of Section 274 of the Companies Act, 1956;
f) In our opinion and to the best of our information and according to
explanations given to us, the said accounts read together with the
notes thereon give in the prescribed manner the information required by
the Act and give a true and fair view in conformity with the accounting
principles generally accepted in India.
i. in the case of Balance Sheet, of the state of affairs of the
company as on 31st March, 2011;
ii. in the case of the Profit and Loss Account, of the Profit of the
Company for the year ended on that date ; and
iii. in the case of Cash Flow Statement, of the Cash Flows for the
year ended on that date.
ANNEXURE TO THE AUDITOR''S REPORT
(Referred to in Paragraph 3 of our report of even date)
1. (a) The Company is maintaining proper records showing full
particulars including quantitative details & situation of fixed assets
except for certain items of Fixed Assets, the quantitative details of
which, we are informed, are in the process of being compiled.
(b) The fixed assets of the Company have been physically verified by
the management during the year at reasonable intervals and no material
discrepancies were found on such verification.
(c) The Company has not disposed off a substantial part of its fixed
assets during the year under review and the going concern status of the
company is not affected.
2. (a) As explained to us and on the basis of verification of the
relevant records, stocks of raw materi- als, work in process and
finished goods have been physically verified by the management at
regular intervals during the year.
(b) In our opinion, the procedure of physical verification of stocks
followed by the management is reasonable and adequate in relation to
the size of the company and nature of its business.
(c) In our opinion, and according to the information and explanation
given to us the Company has maintained proper records of its
inventories. And no material discrepancies were noticed on physical
(d) The valuation of Stock is fair and proper and is in accordance with
the generally accepted ac- counting principles.
3. (a) In our opinion and according to information and explanations
given to us, the company has taken unsecured loans from director to the
amount Rs. 181.02 lakhs from one party. However, company has not
granted any loans to companies, firms or other parties listed in the
register required to be maintained under Section 301 of the Companies
Act, 1956. of paragraph 3 of the order are not applicable.
(b) In our opinion and according to information and explanations given
to us, The rates of interest and other terms and conditions of loans
taken by the company, secured or unsecured, are not prima facie
prejudicial to the interest of the company.
(c) In our opinion and according to information and explanations given
to us, the company has not repaid principal or interest during the
(d) In our opinion and according to information and explanations given
to us, there is no amount overdue for more than one lakh.
4. In our opinion and according to information and explanations given
to us, there is adequate internal control through personal supervision
of the management in respect of the purchases of stores, raw materials
including components, plant & machinery, equipments & other assets, &
for the sale of the goods and services.
5. (a) According to the information and explanation given to us and to
the best of our knowledge the contracts or arrangements that need to be
entered into the register maintained in pursuance of Section 301 of the
Companies Act, 1956 have been so entered.
(b) In our opinion and according to information and explanation given
to us, transactions made in pursuance of such contracts or arrangements
and exceeding the value of Rupees Five Lakhs in respect of any party
during the year have been made at prices which are reasonable having
regard to the prevailing market prices at the relevant time.
6. The Company has not accepted any deposits from the public during
the year, to which the directives issued by the Reserve Bank of India &
the provisions of Section 58-A and 58-AA of the Companies Act 1956 and
the rules framed there under apply.
7. In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
8. As informed to us, the maintenance of the cost records has not been
prescribed by the Central Government under Section 209(l)(d) of the
Companies Act, 1956, in respect of the activities carried on by the
9. (a) The Company has been generally regular in depositing undisputed
statutory dues including Provident fund, Investor Education and
Protection Fund, Employee''s State Insurance, Income Tax, Sales Tax,
Wealth Tax, Custom Duty, Excise Duty, Cess and other statutory dues
with the appropriate authorities.
(b) According to the information and explanations given to us and the
books and records examined by us, there was no undisputed amount
outstanding as on 31st March 2011 in respect of Income Tax, Sales Tax,
Service Tax, Customs Duty, Excise Duty & Cess.
10. The Company has no accumulated losses as on 31st March 2011 and
not incurred cash losses during the financial year covered by our audit
as also in the immediately preceding financial year.
11. Based on our audit procedures, and as per the information and
explanations given to us by the management, we are of the opinion that
according to the information and explanation given to us, the company
has not defaulted in repayment of dues to financial institutions and
12. The company has not granted any loans or advances on the basis of
the security by way of pledge of shares, debentures and other
13. The provisions of any special statute applicable to chit fund,
nidhi or mutual benefit fund/ societies are not applicable to the
14. In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments.
15. According to the information and explanation given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
16. In our opinion and according to the information and explanations
given to us, the term loans have been applied for the purpose for which
they were obtained.
17. On the basis of an overall examination of the Balance Sheet of the
Company, in our opinion and according to the information and
explanations given to us, there are no funds raised on a short-term
basis, which have been used for long-term investment.
18. The Company has not made any preferential allotment of shares to
parties or companies covered in the register maintained under Section
301 of the Companies Act, 1956.
19. The Company did not issue any debentures during the year.
20. The company has raised money through the Public Issue during the
year. The company has issued 81,00,004 equity shares @ Rs. 98/- per
share. (Rs. 10/- face value and Rs. 88/- on account of Share Pre- mium)
The management has disclosed the end use of money raised by public
issue and we have verified the same.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the company, noticed or reported during the year, nor
have we been informed of such case by the management.
For Siddharth Sinkar & Associates
Firm Registration No. 124931W
S. S. Sinkar
Place : Mumbai Proprietor
Date : 16.05.2011 M. No. 109229