Report on the Financial Statements
We have audited the accompanying fnancial statements of Eimco Elecon
(I) Limited (the Company), which comprise the Balance Sheet as at
March 31, 2013, and the Statement of Proft and Loss and Cash Flow
Statement for the year then ended, and a summary of signifcant
accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation of these fnancial
statements that give a true and fair view of the fnancial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards referred to in sub- section (3C) of section
211 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 fnancial 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 fnancial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the fnancial statements are free
from material misstatement. An audit involves performing procedures to
obtain audit evidence about the amounts and disclosures in the fnancial
statements. The procedures selected depend on the auditor's judgment,
including the assessment of the risks of material misstatement of the
fnancial statements, whether due to fraud or error. In making those
risk assessments, the auditor considers internal controls relevant to
the Company's preparation and fair presentation of the fnancial
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 fnancial statements. We believe that the
audit evidence we have obtained is suffcient and appropriate to provide
a basis for our audit opinion.
In our opinion and to the best of our information and according to the
explanations given to us, the fnancial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
(a) In the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2013;
(b) In the case of statement of Proft and Loss, of the proft for the
year ended on that date; and
(c) In the case of the Cash Flow Statement, of the cash fows 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 (the
Order) issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure, a
statement on the matters specifed in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, 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 account as required by law have been
kept by the Company so far as appears from our examination of those
books and proper returns adequate for the purposes of our audit have
been received from branches not visited by us;
c. The Balance Sheet, Statement of Proft and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account and with the returns received from branches not visited by us,
d. In our opinion, the Balance Sheet, Statement of Proft and Loss, and
Cash Flow Statement comply with the Accounting Standards referred to in
subsection (3C) of section 211 of the Companies Act, 1956;
e. On the basis of written representations received from the directors
as on March 31, 2013, and taken on record by the Board of Directors,
none of the directors is disqualifed as on March 31, 2013, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956:
f. Since the Central Government has not issued any notifcation as to
the rate at which the cess is to be paid under section 441A of the
Companies Act, 1956 nor has it issued any Rules under the said section,
prescribing the manner in which such cess is to be paid, no cess is due
and payable by the Company.
ANNEXURE TO THE AUDITOR'S REPORT
RE: Eimco Elecon (India) Ltd.
(Referred to in paragraph 1 under Report on Other Legal and Regulatory
Requirements of our report of even date.)
(i) (a) The company has maintained proper records showing full
particulars including quantitative details and situation of fxed
(b) All the assets have not been physically verifed by the management
during the year but there is a regular programme of verifcation 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 such verifcation.
(c) During the year, the company has not disposed off any major part of
the Fixed Assets.
(ii) (a) The inventory has been physically verifed during the year by
the management. In our opinion, the frequency of verifcation is
(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) On the basis of our examination of the records of the company, we
are of the opinion that the company is maintaining proper records of
inventory. The discrepancies noticed on verifcation between the
physical stocks and the book records were not material.
(iii) (a) During the year the company has not given any loans secured
or unsecured to the companies, frms or other parties covered in the
register maintained under section 301 of the Companies Act,1956. Hence
Clause (iii) (b),(c),(d) are not applicable to the company.
(e) The Company has not taken any loans, secured or unsecured from
companies, frms or other parties covered in the register maintained
under section 301 of the Companies Act,1956.
(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 with regard to purchase of inventory, fxed assets and with
regard to the sale of goods. During the course of our audit, no
continuing failure to correct major weaknesses has been noticed in the
(v) (a) 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 the transactions that need to be entered into the
register maintained under Section 301 have been so entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of
contracts/arrangements entered in the Register maintained under section
301 of the Companies Act, 1956 and exceeding the value of Rs. 5,00,000 in
respect of each party during the year have been made at prices which
appear reasonable as per information available with the company.
(vi) During the year, the Company has not accepted any deposits under
the provisions of sections 58A and 58AA or any other relevant
provisions of the Act and the Companies (Acceptance of Deposits) Rules,
1975 framed there under. No order has been passed by the Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
Court or any other Tribunal.
(vii) In our opinion, the company has an internal audit system
commensurate with the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
company pursuant to the Rules made by the Central Government for the
maintenance of cost records under section 209(1) (d) of the Companies
Act, 1956 and are of the opinion that prima facie the prescribed
accounts and records have been made and maintained.
(ix) (a) According to the records of the company, the company is
regular in depositing with appropriate authorities undisputed statutory
dues including provident fund, investor education protection fund,
income-tax, sales-tax wealth-tax, service tax, custom duty, excise duty
cess and other material statutory dues applicable to it. According to
the information and explanations given to us, no undisputed arrears of
statutory dues were outstanding as at 31st March,2013 for a period of
more than six months from the date they became payable.
(x) The company does not have any accumulated losses. The company has
not incurred cash losses during the fnancial year covered by our audit
and in the immediately preceding fnancial year.
(xi) Based on our audit procedures and on the information and
explanations given by the management, we are of the opinion that the
company has not defaulted in repayment of dues to the banks.
(xii) The company has not granted any loans against security by way of
pledge of shares, debentures and other securities.
(xiii) The company is not a chit fund or a nidhi mutual beneft
fund/society. Therefore, the provisions of this clause of the Companies
(Auditor's Report) Order, 2003 are not applicable to the company.
(xiv) The company is not dealing in or trading in shares, securities,
debentures and other investments. Accordingly, the provisions of this
clause of the Companies (Auditor's Report) Order, 2003 are not
applicable to the Company.
(xv) In our opinion and according to the explanations given to us the
company has not given any guarantee during the year for loans taken by
others from fnancial institutions or banks.
(xvi) There were no term loans obtained by the company during the year.
(xvii) Based on 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
investment by the company.
(xviii) The company has not made any preferential allotment of shares
to any parties and companies covered under the register maintained
u/s.301 of the Act.
(xix) During the period covered by our audit report, the company has
not issued any debentures.
(xx) The company has not raised any money out of public issue.
Moreover, the company has not received any fresh public deposit during
(xxi) We report that no fraud on or by the company has been noticed or
reported during the course of our audit.
For TALATI & TALATI
(Firm Reg. No. 110758W)
(UMESH H. TALATI)
Place : Ahmedabad Partner
Date : 30th April, 2013 Mem. No. 34834