1. We have audited the attached Balance Sheet of Vindhya Telelinks
Limited (''the Company'') as at March 31, 2012 and also 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 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 statement
presentation. We believe that our audit provides a reasonable basis for
3. As required by the Companies (Auditor''s Report) Order, 2003 (as
amended) 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.
4. Further to our comments in the Annexure referred to above, we
(i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
(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
(iii) The balance sheet, statement of profit and loss and cash flow
statement dealt with by this report are in agreement with the books of
(iv) 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 sub-section (3C) of section 211 of
the Companies Act, 1956.
(v) On the basis of the written representations received from the
directors, as on March 31, 2012, and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
March 31, 2012 from being appointed as a director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act, 1956.
(vi) Without qualifying our report, we draw attention to Note No. 33 of
the attached financial statements regarding non-provision for the
shortfall in the market value of the quoted investments for the stated
(vii) 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 March 31, 2012;
(b) in the case of the statement of profit and loss, of the Loss for
the year ended on that date; and
(c) in the case of cash flow statement, of the cash flows for the year
ended on that date.
Annexure referred to in paragraph 3 of the Auditors'' report to the
shareholders of Vindhya Telelinks Limited for the year ended 31st March
i. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
(b) The management has physically verified the fixed assets at the year
end, the frequency of which, in our opinion is adequate. No material
discrepancies were noticed on such verification.
(c) Since there is no substantial disposal of fixed assets during the
year, the preparation of financial statements on a going concern basis
is not affected on this account.
ii. (a) As explained to us, the inventories comprising of raw
material, store & spares, traded goods, work in progress, finished
goods and scrap except stock in transit, have been physically verified
by the management at reasonable intervals.
(b) In our opinion, the procedures of physical verification of
inventory followed by the management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) In our opinion, the Company is maintaining proper records of
inventory and no material discrepancies were noticed on physical
iii. (a) The Company has not granted any loans, secured or unsecured to
companies, firms or other parties covered in the register required to
be maintained under Section 301 of the Companies Act,1956.Therefore,the
provisions of clause 4 (iii) (b), (c) and (d) of the Order are not
applicable to Company.
(b) The Company has not taken any loans, secured or unsecured from
companies, firms or other parties covered in the register required to
be maintained under Section 301 of the Companies Act, 1956. Therefore,
the provisions of clause 4 (iii) (f) and (g) of the Order are not
applicable to Company.
iv. 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, for the purchase of inventory and fixed assets and for the
sale of goods and services. During the course of our audit, we have not
observed any continuing failure to correct major weaknesses in internal
control system of the company.
v. According to the information given to us, there are no contracts or
arrangements during the year that need to be entered into a register in
pursuance of section 301 of the Companies Act, 1956. Therefore, the
provisions of clause 4 (v) of the Order are not applicable to the
vi. The Company has not accepted any deposits from the public in terms
of sections 58A and 58AA or any other relevant provisions of the Act
and the rules made there under.
vii. A firm of Chartered Accountants has carried out internal audit
during the year. In our opinion, the internal audit system of the
Company is commensurate with its size and nature of its business.
viii. We have broadly reviewed the books of accounts maintained by the
Company pursuant to the rules made by the Central Government for the
maintenance of cost records under clause (d) of sub-section (1) of
section 209 of the Companies Act, 1956 and are of opinion that prima
facie, the prescribed accounts and records have been maintained. We
have not, however, made a detailed examination of the records with a
view to determine whether they are accurate and complete.
ix. (a) The Company is regular in depositing the undisputed statutory
dues including employees'' state insurance, provident fund, investor
education and protection fund, income-tax, sales-tax, wealth-tax,
service-tax, customs duty, excise duty, cess and other material
statutory dues as applicable with the appropriate authorities, though
there has been slight delay in a few cases. No undisputed amounts
payable in respect thereof were outstanding at the year end for a
period of more than six months from the date they became payable.
(b) There are no amounts in respect of sales-tax, income-tax, customs
duty, wealth-tax, service-tax, excise duty and cess that have not been
deposited with the appropriate authorities on account of any dispute.
x. The Company has no accumulated losses at the end of the financial
year. Further, the Company has incurred cash losses during the
financial year covered under audit. However, the Company had not
incurred cash losses in the year immediately preceding the current
xi. On the basis of the verification of records and information and
explanations given to us, the Company has not defaulted in repayment of
dues to banks. The Company did not have any outstanding debentures and
loans from financial institutions during the year.
xii. The Company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
Accordingly, the provisions of clause 4(xii) of the Order are not
applicable to the Company.
xiii. The Company does not carry on the business of a chit
fund/Nidhi/Mutual Benefit Fund. Accordingly, the provisions of clause
4(xiii) of the Order are not applicable to the Company.
xiv. The Company is not dealing or trading in shares, securities,
debentures and other investments. Accordingly, the provisions of clause
4(xiv) of the Order are not applicable to the Company.
xv. According to the information and explanations given to us, the
Company has given Cross corporate guarantee to a bank for credit
facilities sanctioned to Birla Ericsson Optical Limited (a joint
venture) amounting to Rs.5,400 lakhs as stated in Note No. 30 (a) (v).
In our opinion, the terms and conditions of the guarantee given by the
Company, for credit facilities sanctioned to the joint venture by the
bank during the year, are not prejudicial to the interest of the
xvi. The Company did not have any term loan outstanding during the
xvii. According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that funds raised on short-term basis have not been used for long term
xviii. During the year, the Company has not made any preferential
allotment of shares to parties and companies covered in the Register
maintained under section 301 of the Act.
xix. The Company has neither issued nor had any outstanding debenture
during the year.
xx. Since there were no public issue of securities during the year,
verification of the end use of money does not arise.
xxi. Based on the audit procedure performed and the representation
obtained from the management, we report that no case of fraud on or by
the Company has been noticed or reported during the year under audit.
For V. Sankar Aiyar & Co.
Firm Registration No. 109208W
Membership No. 081350
Place : New Delhi
Date : May 16, 2012