1. We have audited the attached Balance Sheet of Morganite Crucible
(India) Limited (the Company) (Formerly Greaves Morganite Crucible
Limited) as at March 31, 2007 and the related Profit and Loss Account
and Cash Flow Statement for the year ended on that date, annexed
thereto, which we have signed under reference to this report. These
financial statements are the responsibility of the Management of the
Company. Our responsibility is to express an opinion on these financial
statements based on our audit.
2. We conducted our audit in accordance with 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.
3. As required by the Companies (Auditors Report) Order, 2003, as
amended by Companies (Auditors Report) (Amendment) Order, 2004, issued
by the Central Government of India in terms of sub-section (4A) of
Section 227 of The Companies Act, 1956 of India (theAct) and on the
basis of such checks of the books and records of the Company as we
considered appropriate and according to the information and
explanations given to us, we give in the Annexure a statement on the
matters specified in paragraphs 4 and 5 of the said Order, to the
extent applicable to the Company.
4. Further to our comments in Annexure referred to in paragraph 3
above, we report that:
(a) We have obtained alj the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
(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;
(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report have been prepared In compliance with the
applicable accounting standards referred to in Section 211 (3C) of the
Act;
(e) On the basis of written representations received from the Directors
of the Company as on March 31,2007, and taken on record by the Board of
Directors of the Company, none of the directors of the Company is
disqualified as on March 31,2007 from being appointed as aDirector in
terms of clause (g) of sub-section (1) of Section 274 of the Act;
(f) In our opinion, and to the best of our information and according to
the explanations given to us, the said financial statements together
with the Notes thereon and attached thereto, give in the prescribed
manner the information required by the Act and also 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 March 31,2007;
(ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(iii) inthe case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
ANNEXURE TO AUDITORS REPORT
REFERRED TO IN PARAGRAPH 3 OF AUDITORS REPORT OF EVEN DATE TO THE
MEMBERS OF MORGANITE CRUCIBLE (INDIA) LIMITED (FORMERLY GREAVES
MORGANITE CRUCIBLE LIMITED) ON THE FINANCIAL STATEMENTS FOR THE YEAR
ENDED MARCH 31, 2007
1. (a) The Company has maintained proper records to show full
particulars including quantitative details and situation of its fixed
assets.
(b) The fixed assets of the Company have been physically verified by
the Management during the year and no material discrepancies between
the book records and the physical inventory have been noticed. In our
opinion, the frequency of verification is reasonable.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
of by the Company during the year.
2. (a) The inventory has been physically verified by the Management
during the year. 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 inventory
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 inventory records, in our
opinion, the Company has maintained proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
3. (a) The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under Section 301 of the Act.
(b) The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act.
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventories, fixed assets and for sale of goods. Further,
on the basis of our examination of the books of account and records of
the Company, and according to the information and explanations given to
us, we have neither come across nor have we been informed of any
continuing failure to correct major weaknesses in the aforesaid
internal control system.
5. (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts and arrangements
that need to be entered in the register in pursuance of Section 301 of
the Act, 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
arrangements and exceeding the value of Rs. Five Lakhs in respect of
any party during the year are of specialised nature for which alternate
quotations are not available and therefore comparison with prevalent
market prices is not possible.
6. The Company has not accepted any deposits from the public within
the meaning of Sections 58 A and 58AA of the Act and the rules framed
there under,
7. In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
8. The Central Government of India has not prescribed the maintenance
of cost records under Section 209( 1 )(d) of the Act for any of the
products of the Company.
ANNEXURE TO AUDITORS REPORT
REFERRED TO IN PARAGRAPH 3 OF AUDITORS REPORT OF EVEN DATE TO THE
MEMBERS OF MORGANITE CRUCIBLE (INDIA) LIMITED (FORMERLY GREAVES
MORGANITE CRUCIBLE LIMITED) ON THE FINANCIAL STATEMENTS FOR THE YEAR
ENDED MARCH 31, 2007
9. (a) According to the books of account and the records as produced
and examined by us in accordance with the generally accepted auditing
procedures in India and also the management representation, in our
opinion, the Company is generally regular in depositing the undisputed
statutory dues in respect of provident fund, investor education and
protection fund, employees state insurance, income tax, sales tax,
wealth tax, service tax, customs duty, excise duty, cess and other
material statutory dues as applicable with the appropriate authorities
in India.
(b) According to the information and explanations given to us and the
records of the Company examined by us as at March 3 1, 2007, there are
no dues of income tax, sales tax, wealth tax, service tax, customs
duty, excise duty and cess which have not been deposited on account of
any dispute.
10. The Company has no accumulated losses as at March 31,2007 and it
has not incurred any cash losses in the financial year ended on that
date or in the immediately preceding financial year.
11. According to the books of account and records of the Company
examined by us and the information and explanations given to us, the
Company has not defaulted in repayment of dues to any financial
institution or bank or debenture holders as at the Balance Sheet date.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit fund /
nidhi / mutual benefit fund / societies are not applicable to the
Company.
14. In our opinion, the Company is not a dealer or trader in shares,
securities, debentures and other investments.
15. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions during the year.
16. In our opinion and according to the information and explanations
given to us, the term loan has been applied for the purpose for which
it was obtained.
17. Based on the information and explanations given to us and on an
overall examination of the Balance Sheet of the Company, in our
opinion, there are no funds raised on a short term basis which have
been used for long term investment.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under Section
301 of the Act during the year.
19. The Company has not issued debentures during the year.
20. The Company has not raised any money by public issues during the
year.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
year, nor have we been informed of such case by the Management.
Uday Shah
Partner
Membership No: F-46061
For and on behalf of
Price Waterhouse & Co.
Chartered Accountants
Place: Mumbai
Date : June 27.2007
