1. We have audited the attached Balance Sheet of M/s. CONSOLIDATED
SECURITIES LIMITD as at 31 st March 2009 and also the Profit & Loss
Account and Cash Flow Statement of the company for the period on that
date. The financial statement is the responsibility of the Companys
management. Our responsibility is to express an opinion on the
financial statement 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 a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
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 (Auditors 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 in paragraph 3
-a. We have obtained all the information and explanations, which to
the best of our knowledge and belief were necessary for the purpose of
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 the
books of accounts.
c. The Balance Sheet, Profit & Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of accounts.
d. In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement complied with the requirements of the accounting
standards referred to in sub- section (3C) of Section 211 of the
Companies Act, 1956.
e. On the basis of the 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 2009 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 accounts read with notes thereon, give
the information as required by the Companies Act, 1956 in the manner so
required and also give a true and fair view:-
(i) In the case of Balance Sheet of the State of affairs of the company
as at 31st March 2009
(ii) In the case of Profit & Loss Account of the Profit for the year
ended on that date.
(iii) In the case of Cash Flow Statement, of the cash flows for the
year ended on that date.
ANNEXURE TO THE AUDITORS REPORT
(Annexure Referred to in paragraph (3) of our Audit Report of even date
on the Accounts of Consolidated Securities Ltd. for the year ended 31
st March 2009)
1. a. The company has maintained proper records showing full
particulars including quantitative details and situation of its fixed
b. As explained to us, the fixed assets have been physically verified
by the management during the year in a phased periodical manner, which
in our 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. During the year, the company has not disposed off substantial part
of fixed assets.
2. a. The management has conducted physical verification of inventory
of shares held as stock-in-trade at reasonable intervals.
b. 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. The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification.
3. a. The Company has granted unsecured loan to one company covered
in the register maintained under section 301 of the companies Act,1956.
and the amount involved is Rs.4087 Lacs and the year end balance of
such loan was Rs. Nil.
b. In our opinion the rate of interest and other conditions of loans
given by the company are prima facie not prejudicial to the interest of
c. The receipt of principal amount and interest was regular.
d. There is no overdue amount of the loan given to the companies.
e. The Company had taken unsecured loan
from one company covered in the register maintained under section 301
of the companies Act, 1956. The amount involved during the year was Rs.
20 Lacs and the year end balance of loan taken from such parties was
f. In our opinion the rate of interest and other conditions of loans
given by the company are prima facie not prejudicial to the interest of
g. Payment of the principal & interest is also regular.
4. 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, fixed assets and also for the
sale of goods & services. During the course of our audit, we have not
observed any major weaknesses in internal controls.
5. Based on the audit procedures applied by us and according to the
information and explanations provided by the management, we are of the
opinion that there is no transaction that needs to be entered into the
register maintained under section 301. Accordingly, the provision of
Clause v (b) of the paragraph 4 of the Order is not applicable to the
6. The company has not accepted any deposits during the year from the
public within the meaning of the provisions of Section 58 A, 58 AA or
any other relevant provision of the Companies Act, 1956 and rules made
there under. Hence, the clause (vi) of the order is not applicable.
7. The Company has an internal audit system commensurate with its
sizes and nature of its business.
8. We have been informed that the Central government has not
prescribed maintenance of cost records under section 209(1 )(d) of the
Companies Act, 1956.
9. a. According to the records of the company,
undisputed statutory dues including Provident Fund, Investor Education
and Protection Fund, Employees State Insurance, Income Tax, Sales Tax,
Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and any other
statutory dues to the extent applicable have been regularly deposited
with the appropriate authorities. According to the information and
explanations given to us, no undisputed amounts payable in respect of
the aforesaid dues were outstanding as at 31st March, 2009 for a period
of more than six months from the date of becoming payable.
b. According to the information and explanation given to us, there are
no dues of Sales Tax, Custom Duty, Wealth Tax, cess which have not been
deposited on account of any dispute.
10. The Company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses during the financial
year and in the immediately preceding financial year.
11. Based on our audit procedures and on the information and
explanations given to us, we are of the opinion that the Company has
not defaulted in repayment of dues to banks. Company has not taken any
loans from financial institutions and also not issued any debenture.
Hence question of default does not arise.
12. According to the information and explanations given to us, the
company has not given any loans and advances on the basis of security
by way of pledge of shares, debentures and other securities and
accordingly paragraph 4 (xii) of the order is not applicable
13. In our opinion, considering the nature of activities carried on by
the company during the year, the provisions of any special statute
applicable to chit fund/ Nidhi/mutual benefit fund/societies are not
applicable to the company.
14. According to the information and explanations given to us, proper
records have been maintained in respect of transaction and contracts in
respect of shares, securities, debentures and other investments and
timely entries have been made therein. The shares and other investment
have been held by the company in its own name.
15. As explained by the management, company has not given guarantee
for loans taken by other from banks or financial Institutions.
16. Based on information and explanations given to us by the
management, the company has not obtained any term loans.
17. According to the information and explanations given to us and on
an overall examination of the Balance Sheet of the company, we report
that no funds raised on short-term basis have been used for long-term
18. 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 Companies Act, 1956.
19. According to the information and explanations given to us and the
records examined by us, the company has not issued any debentures.
Accordingly, the provisions of clause 4 (xix) issued are not applicable
to the company.
20. The company has not raised any money by public issues during the
21. According to the information and explanations given to us, we
report that no fraud on or by the company has been noticed or reported
during the course of our audit.
For R.Mahajan & Associates
Place : New Delhi Ratnesh Mahajan
Date : 30th June 2009 Partner