1. We have audited the attached Balance Sheet of M/s Rajshree Sugars &
Chemicals Limited as at 31st March 2012, the Statement of Profit and
Loss and 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 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 misstatements. 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.
3. As required by the Companies (Auditor''s Report) Order, 2003 as
amended, issued by the 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 paragraphs 4 and 5 of the said
Order to the extent applicable.
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 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 appears from our examination of those
c) The Balance Sheet, the Statement of Profit and Loss and the Cash
Flow Statement dealt with by this report are in agreement with the
books of account;
d) In our opinion the Balance Sheet, the Statement of Profit and Loss
and the Cash Flow Statement dealt with by this report are in compliance
with the Accounting Standards referred to in sub-section (3C) of
section 211 of the Companies Act, 1956;
e) On the basis of written representation received from the Directors
as on 31st March 2012, and taken on record by the Board of Directors,
in our opinion none of the Directors is disqualified as on that date,
from being appointed as a Director in terms of clause (g) of
sub-section (1) of section 274 of the Companies Act, 1956, and
f) In our opinion and to the best of our information and according to
the explanations given to us, 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 31st March 2012
ii. in the case of the Statement of Profit and Loss, of the Loss 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 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 its fixed
b. As explained to us, all the fixed assets have been physically
verified in a phased periodical manner, by the management, which in our
opinion is reasonable having regard to the size of the company and
nature of its assets. No material discrepancies have been noticed on
such physical verification.
c. The company has not disposed off substantial part of its fixed
assets during the year.
ii) a. The physical verification of inventory has been conducted by the
management at reasonable intervals.
b. The procedures of physical verification of inventories followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
c. On the basis of our examination of records of inventory, in our
opinion, the Company has maintained proper record of inventory and no
material discrepancies were noticed on the physical verification of
inventories as compared to the book records.
iii) a. 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 Act.
b. The Company has granted unsecured loan to its wholly owned
subsidiary company. The maximum amount involved in the above
transaction net of periodical repayments is Rs 3,076.13 lakhs and the
year end balance is Rs 1,505.61 lakhs. In our opinion and according to
the information and explanations given to us, the rate of interest and
other terms & conditions of the loan are not prima facie prejudicial to
the interests of the company.
c. In respect of said loan, the said principal and interest are
payable on demand and therefore the question of overdue amounts does
iv) In our opinion and according to the information and explanations
given to us 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 and fixed assets and for the sale of
goods and services. During the course of our audit, no major weaknesses
have been noticed in the internal control systems.
v) a. To the best of our knowledge and belief, and according to the
information and explanations given to us, we are of the opinion that
the transactions that need to be entered into the register in pursuance
of section 301 of the Companies Act, 1956 have been so entered.
b. In our opinion and according to the information and explanations,
such transactions have been made at prices, which are reasonable having
regard to the prevailing market prices at the relevant time.
vi) In our opinion, the Company has complied with the provisions of
Section 58A of the Companies Act, 1956 and the Companies (Acceptance of
Deposits) Rules, 1975 with regard to the deposits accepted from the
vii) In our opinion, the Company has an adequate internal audit system
commensurate with the size and the nature of its business;
viii) The Central Government has prescribed maintenance of cost records
under section 209 (1) (d) of the Companies Act, 1956 in respect of
certain products manufactured by the company. We have broadly reviewed
the accounts and records of the Company in this connection and are of
the opinion that prima facie, the prescribed accounts and records have
been made and maintained. We have not, however carried out a detailed
examination of the same.
ix) a. The Company is regular in depositing undisputed statutory dues
including Provident Fund, Investor Education and Protection Fund,
Employees'' State Insurance, Income tax, Sales tax, Wealth tax, Customs
duty, Excise duty, Service tax, Cess and any other statutory dues with
the appropriate authorities. According to the information and
explanation given to us no undisputed arrears of statutory dues were
outstanding as at 31.03.2012 for a period of more than six months from
the date they became payable.
b. According to the information and explanations given to us, the
details of disputed statutory dues which have not been deposited is as
Name of the
statute Period to
which Nature of
disputed Forum where
amount relates (Rs in
lakhs) is pending
TNGST 1995-96 to
1997-98 Interest on
sales tax 42.50 High Court,
Service Tax 2006 -2007 Penalty 21.00 Commissioner
TNGST 2000-01 to
2004-05 Sales tax 256.82 1st
x) There are no accumulated losses at the end of the financial year
31.03.2012.The Company has not incurred cash loss during the financial
year covered by our audit and has incurred cash loss in the immediately
preceding financial year.
xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to
financial institutions or banks. The company has not issued any
debentures till date.
xii) During the year, the Company has not granted any loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities.
xiii) The provisions of special statute applicable to Chit fund,
nidhi/mutual benefit fund / societies are not applicable to the
xiv) The Company is not dealing or trading in shares, securities,
debentures and other investments.
xv) The Company has given corporate guarantee for loans taken from bank
by its wholly owned subsidiary Company. According to the information
and explanations given to us, the terms & conditions of the guarantee
given are not prejudicial to the interests of the company.
xvi) The Company has applied term loans for the purpose for which the
loans were obtained during the year.
xvii) According to the information and explanations given to us and on
an overall examination of the source and application of funds of the
Company, we report that out of the funds raised on short term basis
during the year, an amount of Rs 1871.84 lakhs has been used for long
term investments by way of part financing the acquisition of fixed
xviii) The Company has not made any preferential allotment of shares to
parties and Companies covered in the Register maintained under section
301 of the Companies Act, 1956 .
xix) The Company has not issued any secured debentures during the year.
xx) The Company has not raised any money by way of public issues during
xxi) To the best of our knowledge and belief and according to the
information and explanations given to us, no frauds on or by the
Company has been noticed or reported during the year.
For SRIKISHEN & CO.
Reg No. 004009 S
Place: Coimbatore Membership No.14328
Date: 19th May 2012 Auditors, Proprietor