1) We have audited the attached Balance Sheet of IEC Education Ltd
(Formerly IEC Softwares Ltd.) as at 31st March, 2009, the Profit & Loss
Account and also the Cash Flow Statement for the year ended on that
date both annexed thereto. These financial statements are the
responsibility of the Companys management. Our responsibility is to
express an opinion on these financial statements based onouraudit.
2) We conducted our audit in accordance with the auditing standards
generally accepted in India. These 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 presentation of
financial statements. We believe that our audit provides a reasonable
basis for our opinion.
3) As required by the Companies (Auditors Report) Order, 2003, (CARO)
issued by the Central Government 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 paragraph 4 and 5 of the said
4) Further to our comments in the Annexure referred to in paragraph 3
above, 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
(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 such
(c) The Balance Sheet, Profit & 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, Profit & Loss Accounts and Cash
Flow statement dealt with by this report are in compliance with the
Accounting Standards referred to in sub-section (3c) of Section 211 of
the Companies Act, 1956.
(e) On the basis of written representations received from the Directors
of the Company as on 31st March, 2009 and taken on record by the Board
of Directors, we report that the none of the Directors is disqualified
as on 31st March, 2009.
from being appointed as a director of the Company in terms of clause
(g) of sub-section (I) 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 said account subject to:
(i) Note No: 4 of Schedule 20 regarding non registration of title deeds
in respect of one premise;
(ii) Note No: 5 of Schedule 20 regarding adjustments of entries arising
out of confirmation / reconciliation of the accounts of parties and
(Hi) Note No: 9 of Schedule 20 regarding non provision of debts and
advances considered doubtful amounting to Rs. 1,28,84,944.94 and
and read together with the notes and the significant accounting
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 the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2009.
II. ln the case of the Profit & LossAccount, of the Profit of the
Company for theye arended on that date and
III. ln the case of Cash Flow Statement, of the cash flows of the
Company for the year ende don that date.
(Referred to in paragraph 3 of our report of even date on the accounts
of I EC Education Ltd (Formerly IEC Softwares Ltd) for the year ended
31st March, 2009)
I. In respect of its fixed assets:
a) The Company has maintained fixed asset register. However in some
cases item wise depreciation, location or quantity were not maintained
in the fixed asset register.
b) The management has not carried out a physical verification of all
the fixed assets but there is a regular programme of verification which
in our opinion is reasonable having regard to the size of the company
and nature of its assets. To the best of our knowledge, no material
discrepancies have been noticed on such verification.
c) In our opinion and according to the information and explanation
given to us, the fixed assets have not been disposed off by the company
during the year.
U. The nature of the companys business/activities during the year have
been such that clause (ii) of paragraph 4 is not Applicable to the
company for the year.
III. a) During the year, the Company has not granted any loan, Secured
or Unsecured to Companies, firms or other parties covered in the
register maintained under Section 301 of the Companies Act,1956.
b) The Company has taken unsecured interest free loans, repayable on
demand, from five parties covered in the register maintained under
section 301 of the Companies Act,1956. The maximum amounts outstanding
during the year were Rs.86,87,635.94 and the year end balance was Rs.
c) According to the information and explanation given to us, we are of
the opinion that the rate of interest and other terms and conditions on
which the interest free loans have been taken by the Company from the
parties covered in the .register maintained under section 301 of the
Companies Act,1956 are not prima facie prejudicial to the interest of
d) As maintained in para (iii)(b) above, the loan taken by the
companies covered in the register maintained under section 301 of the
Companies Act,1956, are repayable on demand. In view of this, we are
unable to comment on the regularity of payment of principal and the
overdue amount, if any, due to the 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 generally adequate internal control procedures
commensurate with the size of the Company and nature of its business
with regards to purchase of components, plant and machinery, equipments
and similar assets and also for training and education Services
V. a) In our opinion and according to the information and explanations
given to us, the particulars of contracts or arrangements referred to
in Section 301 of the Act have been entered in the register required to
be maintained under that Section.
b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of rupees fivelakhs in respect of
any party during the year, have been made at prices which are
reasonable having regard to the prevalent market prices at the relevant
time other than transactions of special nature for which competitive
quotations are not available.
VI. The Company has not accepted any deposits from the public and
hence the directives issued by the Reserve Bank of India and the
provision ofsection58A and 58 AAofthe Companies Act, 1956 and the
rules framed hereunder, are not applicableto the Company.
VII. In our opinion, the Companys present internal audit system is
commensurate with the size and nature of its business.
VIII. Since the Company is not a manufacturing, mining or processing
industry, the Central Government has not prescribed the maintenance of
cost records under Section 209 (1) (d) of the Companies Act, 1956.
I A-r I
IX. According to the information and explanation given to us and the
records of the Company examined by us, in our opinion the Company has
been generally regular in depositing undisputed statutory dues
including Provident Fund, Investor education and protection Fund,
Employees state insurance, income tax (other than TDS of Rs. 88124
outstanding for a period of more than Six month as on 31st March 2009),
Sales Tax, Service tax,wealth Tax, custom duty, excise duty and cess
and any other statutory dues applicable to it, with the appropriate
X. The Company has no accumulated losses at the end of the financial
year and it has not incurred cash losses in the current and immediately
preceding financial year.
XI. In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to any
financial institutions or bank during the year.
XII. According to the information and explanation given to us and
based on the documents and records produced to us, the company has not
granted loans and the advances on the basis of security by way of
pledge of shares, debentures and other securities.
XIII.- In our opinion, the company is not a Chit Fund or Nidhi/ Mutual
benefit fund/ society. Therefore the provision of clauses 4 (xiii) are
not applicable to the Company.
XIV. In our opinion, the Company is not dealing in or trading in
share, securities, debentures and other Investments. Accordingly, the
provisions of clause 4 (xiv) are not applicable to the Company.
XV. According to the information and explanation given to us, the
company has not given any guarantee for loans taken by others from
bankorfinancial institutions duringtheyear.
XVI. According to the information and explanation given to us, no term
loan has been raised duringtheyear.
XVII. According to information and explanation given to us and on an
overall examination of Balance Sheet of the Company, we report that no
funds raised on short term basis have been used for long-term
investment and no long term funds have been prime facie used to finance
short term assets.
XVIII. During the year Company has allotted 3000000 Equity Shares upon
conversion of Share Warrants and 3260000 Equity Shares pursuant to the
scheme of amalgamation approved by Honble High Court of Delhi. In our
opinion, the price at which shares have been issued upon Conversion of
share warrant is not prejudicial to the interest of the Company.
XIX. The Company has not raised any loan during the year through issue
of debentures; hence the provisions of clause 4 (xix) are not
applicable to the Company.
XX. The Company has not raised any money through a public issue during
the year, hence the provisions of clause 4 (xx) are not applicable to
XXI. Based upon the audit procedures performed and the information and
explanation given to us by the management, we reportthat no fraud on or
by the Company has been noticed or reported during the course of our
Place :- Delhi
Date :-28th August, 2009 Kailash Hari
(Partner) M.No.- 82285