1. We have audited the attached Balance Sheet of SHRI KESHAV CEMENTS
AND INFRA.LIMITED [formerly known as Katwa Udyog Limited] as at 31
stMarch 2009, the Profit and Loss Account and also the Cash Flow
Statement for the year ended on that date annexed thereto, [together
referred to as Financial Statements]. These Financial Statements are
the responsibility of the Companys Management. Our responsibility is
to express an opinion on these Financial Statements based on our audit.
The Company
has changed the name from Katwa Udyog Limited to Shri Keshav Cements
and Infra Limited vide approval from Registrar of Companies Bangalore
Certificate dated : 07-11 -2007. The change in name is intimated to all
the State & Central Government Departments and the change of name is
confirmed. The change of name is also intimated to BSE Mumbai the
approval is still under their consideration.
2. We have 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 from 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 our opinion.
3. As required by the Companies [Auditors Report] Order, 2003 as
amended by the Companies [Auditors Report][Amendment] Order, 2004[the
Order], issued by Central Government of India in terms of sub-
section [4A] of section 227 of the Companies Act 956, and on the basis
of such checks of the books and records as we considered necessary and
appropriate and according to the information and explanation given to
us during the course of the audit, we enclose in the annexure, a
statement on the matters specified in paragraphs 4 and 5 of the said
Order to the extent applicable
4. Further, to our comments in the Annexure referred to in paragraph
[3] above, we report that:
i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
ii) In our opinion, the Company has kept propel books of account as
required by law, so far as appears from our examination of the books.
It is reported by the management that the Central Excise Department has
seized the books of accounts and relevant documents for the period from
01-04- 2008 to 23-10-2008. In view of this we are unable to verify and
Confirm the correctness of the transactions for the aforesaid period.
We are therefore unable to make any comment on this point.
iii) The Balance sheet, Profit and Loss Account and cash flow
statements dealt with by this report are in agreement with the books of
account;
iv) In our opinion, the Balance sheet, Profit and Loss Account 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; save the compliance with accounting standards
28 on impairment of assets.
v) On the basis of the written representation received from the
directors, as on 31st March 2009 and taken on record by the Board of
Directors, we report that hone of the directors of the company are
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;.
vi) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read with significant
accounting policies and other notes thereon subject to notes No v on
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 Balance Sheet of the state of affairs of the Company
as at 31st March 2009,
b) in the case of the Profit and Loss Account, of the Profit for the
year ended on that date; and c) in the case of cash flow statement, of
cash flows for the year ended on that date.
ANNEXURE TO THE AUDITORS REPORT
[Referred to in paragraph 3 of our report of even date]
In respect of Fixed Assets:
i. a The company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
b. The fixed assets are physically verified by the Management at
reasonable intervals having regard to size of the company and nature of
its assets. We have been informed that no material discrepancies were
noticed during such physical verification.
c. in our opinion and according to the information and explanations
given to us, the Company has not made any substantial disposal of
assets during the year and therefore the going concern concept is not
affected.
d. In our opinion and according to the information and explanation
given to as, the company has undertaken expansion of Plant I and
purchased additional machinery & spares for an amount of Rs.
1,38,51,632 and deducted modvat credit of Rs. 12,53,355. Net amount of
Rs. 1, 25, 98,277 is shown as Capital Work in Progress under schedule
Fixed Assets. Similarly, in the earlier year Company has undertaken
expansion of Plant II and purchased additional Plan & Machinery and
spares for Plant-ll amounting to Rs. 3,63,17,534and deducted Modvat
credit of Rs. 21,14,764and net amount of Rs. 3,42,02,770 along with op.
balance of Rs. 6,29,50,377. Total amounting to Rs. 9,71,53,147 has been
transferred to Plant and Machinery Plant II Since the expansion work is
completed.
In respect of Inventories:
ii. a. As explained to us the management during the year physically
verified the inventories. In our opinion, the frequency of verification
is reasonable.
b. In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were reasonable and adequate in relation to
the size of the company and in t;he nature of its business.
c. In our opinion and according to the Information and explanations
given to us, the company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verification.
d. During the year the inventory of Rs. 15,00,000 which is shown as
current asset Plant-ll has been transfered to inventory account.
iii a. As informed, the company has not granted loans, secured and
unsecured to Companies, Firms or Other parties, covered in the register
maintained under section 301 of the Companies Act, 1956. Accordingly,
sub-clause [b][c] and [d] are not applicable.
b. The Company has taken unsecured loans from directors covered in the
register maintained under section 301 of the Companies Act, 1956. The
maximum amount involved during the year was Rs. 6,13,18,144 the number
of parties are five, and year-end balance of such loan taken was Rs.
5,59,59,445.
xii. In our opinion and according to the information and explanations
given to us, the company has not defaulted in repayment of dues to a
financial institution, bank or debenture holders.
xiii. Based on our examination of the records and the information and
explanation given to us, the Company . has not granted any loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities. .
xiv. In our opinion, the company is not a chit fund or a nidhi / mutual
benefit fund / society Therefore, the provisions of clause 4 [xiii] of
the order are not applicable to the Company.
xv. in our opinion, as per the information and explanations given to us
the company has not given any guarantee for the loans taken by others.
xvi. In our opinion, the term loans have been applied for the purpose
which they were raised.
xvii. According to the cash flow statement arid other records examined
by us and the information and explanations given to us, on an over all
basis, funds raised on short term basis have prima facie, not been used
during the year for a long term investment [ fixed assets etc] other
than temporary deployment pending application.
xviii. According to the information and explanations given to us, the
company has not made any preferential allotments of shares to parties
and companies covered in the register maintained under section 301 of
the Act.
xix. According.to the information and explanations given to us, during
the period covered by our audit report the company has not issued any
debentures. .
xx. The Company has not raised any money by public issue during the
year.
xxi. According to the information and explanation given to us, no fraud
on or by the company has been noticed during the course of our audit
c. In our opinion, the rate of interest and other terms and conditions
under section 301 of the Companies Act, 1956 are prima facie, not
prejudicial to the interest of the Company.
d. The Company is regular in repaying the principal amount as
stipulated and has been regular in the payment of interest.
e. The Company has not given loans and advances in the nature of loans
to employees.
iv. In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the company and the nature of its business with
regards to purchase of inventory, fixed assets and with regard to 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.
v. a) According to the information and explanations given to us, we are
of the opinion that the transactions that need to be entered into a
register in pursuance of section 301 of the Companies Act, 1956 have
been so entered.
b) In our opinion and according to the information and explanations given
to us, the transactions made in pursuance of such contracts or arrangement
have been made at prices which are reasonable having regard to the
prevailing market prices at the relevant time.
vi. In our opinion and according to information and explanations given
to us, the company has accepted
public deposits, and it has complied with the provisions of section
58A, 58AAof the Companies Act,
1956 and the Companies [Acceptance of the Deposit ] Rules, 1975 with
regard to the deposit accepted
from public. 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. It is reported by the management that the Company has appointed
qualified Cost Auditor and has
maintained cost records as required U.S. 209[1][d] of the Companies Act
1956. The Cost Auditor has issued a certificate statins that the
Company has complied with the requirements as required U.S. 209[1][d]
of the Companies Act 1956.
ix According to the records of the company, Provident Fund, Investors
Education and Protection Fund, Employees State Insurance, Income Tax,
Sales Tax, Wealth Tax, Service Tax, Custom duty, Excise duty, Cess,
Fringe Benefit Tax and other material statutory dues applicable to it
have been generally regularly deposited during the year, with the
appropriate authorities. According to the information and explanations
given to us, no undisputed Amounts payable in respect of above were in
arrears, as at March 31,2009 for a period of more than six months form
the date on which they became payable.
x. According to the information and explanations given to us, there
are no dues of Income tax, Service Tax, Wealth Tax, Sales Tax, Custom
Duty, Excise Tax, and Cess fringe Benefit Tax, which have not been -.,
deposited on account of any dispute!
xi. The company does not have accumulated losses at the end of the
financial year and has not incurred cash losses during the financial
year covered by our audit and the immediately preceding financial year.
C.A. Prabhakar K. Latkan
Belgaum-590005. Chartered Accountant
Dated : June 27, 2009 M No. 200/21730
