Report on the Financial Statements
We have audited the attached Balance Sheet of S R K Industries Limited
as at 31st March, 2013 and also the Profit and Loss Account and Cash
Flow Statement of the Company for the year ended on that date annexed
thereto and a summary of significant accounting policies and other
Managements Responsibility for the Financial Statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance of the Company in accordance with the accounting
principles generally accepted in India including Accounting Standards
referred to in Section 211 (3C) of the Companies Act, 1956 (the
Act). This responsibility includes the design, implementation and
maintenance of internal control relevant to the preparation and
presentation of the financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with auditing standards issued by the Institute of Chartered
Accountants of 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 involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedure
selected depends on the auditor''s judgment, including the assessment
of the risk of material misstatement of the financial statement,
whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the company''s
preparation and fair presentation of the financial statements in order
to design audit procedures that are appropriate in the circumstances.
An audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of the accounting estimates made
by management, as well as evaluating the overall presentation of the
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basic for our audit opinion.
In our opinion and to the best of our information and according to the
explanations given to us the said accounts together with 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.
i. in the case of Balance Sheet, of the state of affairs of the
Company as at 31st March, 2013;
ii. in the case of Profit and Loss Account, of the Profit of the
Company for the year ended on that date; and
iii. in so far as it relates to the Cash Flow Statement, of the cash
flows of the Company for the year ended on that date.
Report on Other Legal and Regulatory Requirements
(1) As required by the Companies (Auditor''s Report) Order, 2003
issued by the Central 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
(2) As required by section 227(3) of the companies Acr, 1956, we report
(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 account 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 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, Statement of Profit and Loss
Account and Cash Flow Statement comply with the Accounting Standards
referred to in Sub-section (3C) of Section 211 of the Companies Act,
(e) On the basis of written representations received from the Directors
as on 31st March, 2013, and taken on record by the Board of Directors,
none ofthe Directors are disqualified as on 31st March, 2013, from
being appointed as a Director in terms of clause (g) of sub-section (1)
of section 274 of the Companies Act, 1956;
Referred to in Paragraph 2 of my report of even date 1 In respect of
its fixed assets:
a. The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets on the
basis of available information.
b. As explained to me, the fixed assets have been physically verified
by the management during the year in a phased periodical manner, which
in my opinion is reasonable, having regard to the size of the Company
and nature of its assets. No material discrepancies were noticed on
such physical verification.
c. In my opinion, the Company has not disposed of its fixed assets
during the year, The Company''s going concern concept was not affected
after such disposal.
2 In respect of its inventories :
a. As explained to us, inventories have been physically verified by
the management at regular intervals during the year.
b. In my opinion and according to the information and explanations
given to me, the procedures of physical verification of inventories
followed by the management at 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 inventories. As
explained to me, there was no material discrepancies noticed on
physical verification of inventory as compared to the book records.
3 In respect of loans, secured or unsecured, taken by the Company to /
from Companies, or other parties covered in the register maintained
under Section 301 of the Companies Act, 1956
a. The Company has not granted any loans to other companies during the
b. Since the Company has not granted loans to other Companies, the
question of Prima facie prejudicial rate of interest, repayment of
Principal and interest, and overdue of loan does not arise.
c. The Company has not taken any loans from other Companies during the
4 In my opinion and according to the information and explanations given
to me, there are adequate internal control procedures commensurate with
the size of the Company and the nature of its business for the purchase
of inventory, fixed assets and also for the sale of goods. During the
course of my audit, I have not observed any major weaknesses in
5 In respect of transactions covered under section 301 of the Companies
a. In my opinion and according to the information and explanations
given to me, there are no transactions made in pursuance of contracts
or arrangements that needed to be entered into in the register
maintained under section 301 of the Companies Act, 1956.
b. In my opinion and according to the information and explanations
given to me, there are no transactions in pursuance of contracts or
arrangements entered in the register maintained under section 301 of
the Companies Act, 1956 aggregating during the year to Rs 5,00,000
(Rupees Five lakhs Only) or more.
6 The Company has not accepted any deposits from the public.
7 The Company does not have a separate internal audit system. However,
in my opinion, the existing internal Control procedures are adequate
having regard to the size and nature of the business of the Company.
8 The Central Government has not prescribed maintenance of cost records
under section 209(1 )(d) of the Companies Act, 1956.
9 In respect of statutory dues, undisputed statutory dues with regard
to Employees'' State Insurance, the Company has not deposited
regularly with the appropriate authorities due to the severe financial
crisis faced by the Company.
10 The Company has accumulated losses and has not incurred cash loss
during the financial year covered by my audit and has not incurred cash
loss in the immediately preceding financial year.
11 Since the Company has not availed any loans during the year, the
question of repayment does not arise.
12 In my opinion and according to the information and explanation given
to me, no loans and advances have been granted by the company on the
basis of security by way of pledge of Shares and Securities.
13 In my opinion, the Company is not a chit fund or a nidhi /mutual
benefit fund / society. Therefore, clause 4(xiii) ofthe Companies
(Auditor''s Report) Order 2003 is not applicable to the Company.
14 In my opinion and according to the information and explanation given
to me, the Company is not dealing or trading in shares, securities,
debentures and other investments.
15 In my opinion and according to the information and explanation given
to me, the Company has not given any guarantees for loans taken by
others from banks or financial institutions.
16 The Company has not raised any new term loans during the year.
17 The Company has not used the short term loans for long term
investments and vice versa.
18 During the year, the company has not made any preferential allotment
of shares to parties and Companies.
19 The Company has not issued debentures; therefore the question of
creation of securities does not arise.
20 The Company has not raised any money by way of public issue during
21 In my opinion and according to the information and explanations
given to me, no fraud on or by the Company has been noticed or reported
during the year, that causes the financial statements to be materially
B.COM, GRAD.C.W.A. F.C.A
Place: Coimbatore M. No. 210367