We have audited the attached Balance Sheet of M/s TVS Autolec Limited
(Formerly Autolec Industries Limited), Chennai 600 077 as at 31 March
2003 and also the Profit & Loss Account for the year ended on that date
annexed thereto and the Cash Flow Statement for the year ended on that
date. 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 management, as well as evaluating the overall financial statements
presentation. We believe that our audit provides a reasonable basis for
As required by the Manufacturing and Other Companies (Auditor's Report)
Order, 1988 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 Order.
Further to our comments in the Annexure referred to above, we report
i) we have obtained all the information and explanations, which to the
best of our knowledge and belief, were necessary for the purposes of
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 such
iii) the Balance Sheet and Profit & Loss Account dealt with by this
report are in agreement with the books of account;
iv) in our opinion, the Balance Sheet and Profit & Loss Account dealt
with by this report comply with the accounting standards referred to in
sub-section (3C) or Section 211 of the Companies Act, 1956;
v) on the basis of written representations received from the Directors,
as on 31 st March, 2003 and taken on record by the Board of Directors,
we report that none of the Directors is disqualified as on 31 st March,
2003 from being appointed as a Director in terms of Clause (g) of
sub-section (1) of Section 274 of the Companies Act, 1956;
vi) 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:
a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March 2003;
b) in the case of the Profit & Loss Account, of the profit for the year
ended on that date; and
c) in the case of Cash Flow Statement, of the Cash Flow for the year
ended on that date.
ANNEXURE referred to in our report of even date
1. The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets. 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 were noticed on
2. None of the fixed assets has been revalued during the year.
3. a. The stocks of raw materials, stores, spare parts and finished
goods have been physically verified during the year by the management.
In our opinion, the frequency of verification is reasonable.
b. The procedure for physical verification of stocks followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
c. The discrepancies noticed on verification between the physical
stocks and book records were not material and these have been properly
dealt with in the books of accounts.
d. On the basis of our examination of stock records, we are of the
opinion that the valuation of stocks is fair and proper in accordance
with the normally accepted accounting principles and is on the same
basis as in the preceding year.
4. The Company has taken loans from the holding company listed in the
Register maintained under Section 301 of the Companies Act, 1956. The
terms and conditions of such loans are prima facie not prejudicial to
the interests of the Company.
5. According to the information and explanations given to us, the
Company has not granted any loans to companies or firms listed in the
Register maintained under Section 301 of the Companies Act, 1956 and
there are no companies under the same management.
6. In respect of loans and advances in the nature of staff advances
given by the Company, parties have repaid the principal amounts as
stipulated and have also been regular in the payment of interest
7. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business with regard to purchase of stores, raw materials including
components, plant and machinery, equipment and other assets and also
with regard to the sale of goods.
8. In our opinion and according to the information and explanations
given to us, the transactions of purchase of goods and materials and
sale of goods, materials and services, made in pursuance of contracts
or arrangements entered in the Register maintained under Section 301
and aggregating during the year to Rs.50,000/- or more in respect of
each party have been made at prices which are reasonable having regard
to prevailing market prices for such goods, materials or services or
the prices at which transactions for similar goods, materials or
services have been made with other parties.
9. The Company has a regular procedure for determination of
unserviceable or damaged stores, raw materials, finished goods and
trading goods. Adequate provision has been made in the accounts for the
loss arising on the items so determined.
10. In our opinion and according to the information and explanations
given to us, the Company has complied, with the provisions of Section
58A of the Companies Act, 195.6 and the Companies (Acceptance of
Deposits) Rules, 1975 with regard to the deposits accepted from the
11. In our opinion, reasonable records have been maintained by the
Company for the sale and disposal of scrap. The Company has no
12. In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
13. In our opinion, the Company has maintained adequate cost records as
required under Section 209(1 )(d) of the Companies Act, 1956.
14. According to the records of the Company, Provident Fund and
Employees' State Insurance dues have been regularly deposited during
the year with the appropriate authorities.
15. According to the information and explanations given to us, no
undisputed amounts payable in respect of Income-tax, Wealth-tax,
Sales-tax, Customs duty and Excise duty, were outstanding as on 31 st
March 2003, for more than six months from the date they became payable.
16. According to the information and explanations given to us, no
personal expenses of employees or Directors have been charged to
revenue account, other than those payable under contractual obligations
or in accordance with generally accepted business practice.
17. The Company is not a sick industrial company within the meaning of
clause (o) ofsub-section(l) of Section 3 of the Sick Industrial
Companies (Special Provisions) Act, 1985.
For SUNDARAM & SRINIVASAN
Chennai M BALASUBRAMAMNIYAM
June 25,2003 Partner