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Modi Cement | Auditor's Report > Cement - Mini > Auditor's Report from Modi Cement - BSE: 518014, NSE: MODICEMENT
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Modi Cement

BSE: 518014|NSE: MODICEMENT|SECTOR: Cement - Mini
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Modi Cement is not traded in the last 30 days
Modi Cement is not traded in the last 30 days
Auditor's Report (Modi Cement) Year End : Dec '05
We have audited the attached Balance Sheet of Ambuja Cement Eastern
 Limited as at 31st December 2005, Profit and Loss Account and the Cash
 Flow Statement for the eighteen months period 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.
 
 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
 assessing the accounting principles used and significant estimates made
 by the management, as well as evaluating the overall financial
 statement presentation. We believe that our audit provides a reasonable
 basis for our opinion.
 
 As required by the Companies (Auditor's Report) (Amendment) Order,
 2004, (the Order) issued by the Central Government of India in terms
 of Section 227(4A) of the Companies Act, 1956 (hereinafter referred to
 as `the Act') and according to the information and explanations given
 to us and on the basis of such checks as we consider appropriate, 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
 audit;
 
 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
 those books;
 
 c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
 referred to in this report are in agreement with the books of accounts;
 
 d) 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 Section 211(3C) of the Companies Act, 1956;
 
 e) On the basis of 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 December 2005 from being
 appointed as a director in terms of Section 274(1)(g) 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 accounts read together with
 notes given in Schedule N, 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 case of the Balance Sheet, of the state of affairs of the company
 as at 31st December, 2005;
 
 ii) in case of the Profit and Loss Account, of the profit of the
 company for the eighteen months period ended on that date; and
 
 iii) in case of the Cash Flow Statement, of the cash flows for the
 eighteen months period ended on that date.
 
 For Lodha & Co.                      S R Batliboi & Associates
 Chartered Accountants                Chartered Accountants
 
 R P Singh                            Per Sudhir Soni
 Partner                              a Partner
 Membership No. 52438                 Membership No. 41870
 
 Place: Mumbai
 Date : 23rd January, 2006
 
 ANNEXURE TO THE AUDITORS' REPORT TO THE MEMBERS OF AMBUJA CEMENT
 EASTERN LIMITED
 
 i. a. The Company has maintained proper records showing full
 particulars, including quantitative details and situation of fixed
 assets.
 
 b. As informed, the fixed assets are physically verified by the
 management in a phased manner, which in our opinion is reasonable
 having regard to the size of the Company and the nature of its fixed
 assets. As informed, no material discrepancies were noticed on such
 verification.
 
 c. During the period, the Company has not disposed off substantial part
 of its fixed assets.
 
 ii. a. As informed, the inventory has been physically verified
 during the period by the management. In our opinion,
 the frequency of such 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 Company 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 according
 to the information and explanations given to us, the discrepancies
 noticed on physical verification were not material and the same have
 been properly dealt with in the books of account.
 
 iii. a. The Company had taken a secured loan, from the erstwhile
 ultimate holding company listed in the register maintained under
 Section 301 of the Companies Act, 1956. The maximum amount outstanding
 against the above loan during the period was Rs. 1344.82 lacs and the
 period-end balance was Rs. 918.41 lacs. The Company has not granted any
 loan secured or unsecured to companies, firms or other parties listed
 in the register maintained under Section 301 of the Companies Act,
 1956.
 
 b. In our opinion and according to the information and explanations
 given to us, the terms and conditions of aforesaid loan, which is
 interest free, are not prima facie prejudicial to the interest of the
 Company.
 
 c. In respect of the above loan, the Company is regular in repaying the
 principal amounts as stipulated.
 
 d. In respect of the aforesaid loan, there is no over due amounts
 outstanding at the Balance Sheet date.
 
 iv. In our opinion and according to the information and explanations
 given to us and on the basis of reasonable tests as considered
 necessary, we are of the opinion that 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, fixed
 assets and for the sale of goods.  During the course of our audit, we
 have not observed any continuing failure to correct major weaknesses in
 internal controls.
 
 v. a. According to the information and explanations given to us and on
 the basis of reasonable test, we are of the opinion that the
 transactions that need to be entered into the register maintained under
 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 contracts or
 arrangements entered in the register maintained under Section 301 of
 the Companies Act, 1956 and exceeding the value of Rupees Five Lakhs in
 respect of any party during the period have been made at prices which
 are reasonable having regard to prevailing market prices at the
 relevant time.
 
 vi. The Company has not accepted any deposits during the period from
 public within the meaning of Sections 58A, 58AA or any other relevant
 provisions of the Companies Act, 1956.
 
 vii. In our opinion, the Company has an internal audit system, which is
 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 order 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 information and explanations given to us, the
 Company has been regular in depositing the undisputed statutory dues
 including Provident Fund, Employees State Insurance, Income Tax, Sales
 Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any
 other statutory dues with the appropriate authorities. As far as
 available from the records verified by us and according to the
 information and explanations given to us, there were no arrears of dues
 outstanding for a period of more than six months as at 31st December
 2005 from the date they became payable.
 
 b. According to the information and explanation given to us, the
 details of disputed dues of Income Tax, Sales Tax, Wealth Tax, Service
 Tax, Excise Duty, Custom Duty and Cess, as applicable, are as follows:
 
 Name       Nature of      Amount    Period to           Forum where
 of the     Dues           (Rs. in   which amount        the dispute
 Statute                   lacs)     relates             is pending
 
 Central    Sales Tax       6.96     1999-00             Appellate
 Sales Tax
 Act, 1956                            
 
 Sales Tax  Sales Tax      101.46    1995-96, 99-00,     Appellate
 Act of                              01-02, 02-03
 relevant                     
 states                     23.97    1988-89,90-91,      Assessing
                                     97-98,2000-01       Authority
                             9.86    1991-92             High Court
                           123.89    1991-92, 92-93,     Tribunal
                                     93-94, 96-97, 98-99      
 Total                     266.14                     
 
 Out of the sum of Rs.266.14 lacs, stay received for Rs.183.96 lacs.
 
 x. The Company does not have any accumulated losses as at the end of
 the period and the Company has not incurred cash losses during the
 financial period covered by our audit and in the immediately preceding
 financial year.
 
 xi. As per books and records maintained by the Company, and according
 to the information and explanations made available to us, the Company
 has not defaulted in repayment of any dues to financial institutions or
 banks or debenture holders during the period.
 
 xii. According to the information and explanations given to us and
 based on the documents and records produced, the Company has not
 granted any loans and advances on the basis of security by way of
 pledge of shares, debentures and other securities.
 
 xiii.  According to the information and explanations given to us, 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.
 
 xiv. According to the information and explanations given to us, the
 Company is not engaged in 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 not given any guarantee for loans taken by its associates
 or subsidiaries or others from bank or financial institutions.
 
 xvi. In our opinion, on the basis of information and explanations given
 to us, the term loans were applied for the purposes for which the loans
 were obtained.
 
 xvii. According to the information and explanations given to us and on
 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
 investments.
 
 xviii. According to the information and explanations given to us, the
 Company has not made any preferential allotment of shares during the
 period to any parties or companies covered in the register maintained
 under Section 301 of the Companies Act, 1956.
 
 xix. According to the information and explanations given to us, the
 Company did not have any outstanding debentures during the period.
 
 xx. According to the information and explanations given to us, the
 Company has not raised any money through a public issue during the
 period.
 
 xxi. During the course of our examination of the books of accounts and
 records of the Company carried out in accordance with the generally
 accepted auditing practices and according to the information and
 explanations given to us, we have neither come across any incidence of
 fraud on or by the Company nor have we been informed of any such case
 by the management.
 
 For Lodha & Co.                S R Batliboi & Associates
 Chartered Accountants          Chartered Accountants
 
 R P Singh                      Per Sudhir Soni
 Partner                        a Partner
 Membership No. 52438           Membership No. 41870
 
 Place :  Mumbai
 Date  :  23rd January, 2006
Source : Dion Global Solutions Limited
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