1. We have audited the attached Balance Sheet of REI SIX TEN RETAIL
LIMITED as at 31st March 2012 and Statement of Profit & Loss and also
the Cash Flow Statement for the year ended on that date 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 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. We believe that our audit provides a reasonable basis for
3. As required by 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, and on the basis of such check as we considered appropriate and
according to the information and explanation given to us we enclose in
the Annexure, a statement on the matters specified in paragraphs 4 and
5 of the said Order, to the extent applicable to the Company.
4. Further to our comments in the Annexure referred to in paragraph
(3) above, we report that:
a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
b) In our opinion, proper books of accounts as required by law have
been kept by the Company so far as appears from our examination of
c) The Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
d) In our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement dealt with by this report comply with the
Accounting Standards referred to in Section 211 (3C) of the Companies
e) On the basis of written representations received from the directors,
and taken on record by the Board of Directors, we report that none of
the directors is disqualified as on 31st March, 2012 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
the explanations given to us, the said accounts read together with the
Significant Accounting Policies and Notes thereon 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;
1) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2012;
2) in the case of Statement of Profit and Loss, of the Profit for the
year ended on that date, and
3) 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) In respect of its Fixed Assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
(b) The fixed assets are being physically verified in the phased manner
by the management in accordance with a program of verification covering
all the fixed assets, which in our opinion provides for physical
verification of all the fixed assets. The discrepancies noticed on such
verification were not material and have been properly dealt with the
books of accounts.
(c) The Company has not disposed off substantial part of its fixed
assets during the year and therefore do not affect the going concern
status of the Company.
ii) In respect of its Inventories:
(a) As explained to us the Inventories have been physically verified by
the management at reasonable intervals. In our opinion the frequency of
verification is reasonable.
(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) The Company has maintained proper records of its inventories and no
material discrepancies were noticed on physical verification of
Inventories as compared to the book records.
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, accordingly
the provisions of other sub - clauses are not applicable.
iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory, fixed assets and for the sale of goods. During
the course of our audit no major weakness has been noticed in the
internal control system in respect of these areas.
v) (a) According to the information and explanations given to us, we
are of the opinion that the particulars of contracts or arrangements
referred to in section 301 of the Companies Act, 1956 that need to be
entered into the register have been so entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements exceeding the value of Rupees Five Lacs have been entered
during the year 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 within
the meaning of Section 58A, 58AA or any other provisions of the Company
Act 1956 and the Companies (Acceptance of Deposits) Rules 1975 framed
vii) In our opinion, the company has an internal audit system
commensurate with the size of the company and nature of its business.
viii) The provisions of Clause (viii) of Paragraph 4 of the order
regarding maintenance of Cost Records prescribed U/s 209(1)(d) of the
Act are not applicable to the company.
ix) (a) According to the records of the Company, undisputed statutory
dues including Provident fund, Employee,s State Insurance, Investor
Education and Protection Fund, Income Tax, Wealth Tax, Service Tax,
Sales tax, and any other material statutory dues have been generally
regularly deposited with the appropriate authorities during the year.
As explained to us no undisputed amounts payable in respect of
aforesaid duties were outstanding at the year end, for a period of more
than six months from the date they became payable.
(b) The disputed Statutory dues aggregating to Rs. 61,82,291/- that has
not been deposited on account of disputed matters in respect of Income
Tax for Assessment year 2009-2010 which is pending before C.I.T.(A)-II,
x) The Company has no accumulated losses as at the end of the year and
it has not incurred cash losses during the current financial year.
xi) Based on our audit procedures and on the basis of information and
explanations given to us, we are of the opinion that the company has
not defaulted in the repayment of dues to any financial institution, or
Bank, or debenture holders.
xii) According to the information and explanations given to us, the
company has not granted loans or advances on the basis of security by
way of pledge of shares, debentures and other securities.
xiii) The company is not a Chit Fund/Nidhi/Mutual Benefit Fund/Society,
therefore the provisions of Clause (xiii) of Paragraph 4 of the order
are not applicable to the company.
xiv) As the Company is not dealing or trading in shares, securities,
debentures and other investments, paragraph 4 (xiv) of the Order is not
xv) According to the information and explanations given to us there is
no guarantee given by the company for loans taken by others from banks
or financial institutions.
xvi) The company has raised new Term (Vehicle) Loan during the year.
The term loan outstanding at the beginning of the year and those raised
during the year have been applied for the purposes for which they were
xvii) According to the information and explanation given to us and on
an overall examination of the Balance Sheet of the Company, we report
that, during the year, short term funds have not been used for Long
xviii) The Company has not made any preferential allotment of shares
during the year.
xix) The company has not issued any secured debentures during the year;
hence the question of charge does not arise.
xx) The Company has not raised any money by way of public issue during
xxi) Based upon the audit procedures performed and information and
explanations given by the management, we report that no material fraud
on or by the Company has been noticed or reported during the year.
For P. K. LILHA & Co.
Firm No. 307008E
(CA P.K. LILHA)
M. No. 11092
Place : Camp at Delhi
Date : 30th May, 2012