1) I have audited the attached Balance Sheet of RAYMED LABS LIMITED as
at 31st March 2010 and also the Profit & Loss Account and the Cash flow
Statement for the year ended on that date annexed thereto. These
financial statements are the responsibility of the Companys
management. My responsibility is to express an opinion on these
financial statements based on my audit.
2) I have conducted my audit in accordance with auditing standards
generally accepted in India. Those standards require that I 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 and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. I believe that my audit provides a reasonable basis for
3) As required by the Companies(Auditors Report) Order, 2003 and the
Companies (Auditors Report) (Amendment) order 2004 issued by the
Central Govt. of India in terms of sub-section (4A) of Section 227 of
the Companies Act, 1956, I enclose in the Annexure a statement on the
matters specified in paragraphs 4 of the said Order.
4) In respect of Note 2.1 of Schedule 14 (Significant Accounting
Policies and Notes to Account) in relation to balances of sundry
debtors, sundry creditors, loans & advances and unsecured loans. Owing
to the inability to obtain confirmations and reconciliations, I am
unable to opine as to the fairness of the amounts depicted as sundry
debtors, loans & advances, sundry creditors and unsecured loans, as
also to their being good and recoverable/due.
5) Further to my comments in the annexure to the paragraph 3 above, and
subject to my observations given in the preceding paragraphs above, I
a) I have obtained all the information and explanations , which to the
best of my knowledge and belief were necessary for the purpose of
b) In my opinion, proper books of accounts as required by law have been
kept by the company so far as appears from my examination of those
c) The Balance Sheet, Profit and Loss Account and the Cash Flow
Statement dealt with by this report are in agreement with the books of
d) In my opinion the Profit and Loss Account, Balance Sheet and the
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.
e) On the basis of written representations received from the directors,
as on 31st March 2010, and taken on record by the Board of Directors, I
report that directors are disqualified as on 31st March 2010 from being
appointed as a directors in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
f) In my opinion and to the best of my information and according to the
explanations given to us, the said 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:-
i) In the case of Balance Sheet of the State of affairs of the Company
as at 31st March 2010, and
ii) In the case of Profit and Loss Account, of the Loss of the Company
for the year on that date.
iii) In the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
ANNEXURE REFERRED TO IN PARAGRAPH 3 OF THE AUDITORS REPORT OF EVEN
DATE ON THE FINANCIAL STATEMENTS AS AT AND FOR THE YEAR ENDED MARCH 31,
2010 RAYMED LABS LIMITED
1) IN RESPECT OF ITS FIXED ASSETS
a) The company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets on the
basis of available information.
b) As explained to me, the fixed assets have been physically verified
by the management during the year in a phased periodical manner, which
in my opinion is reasonable having regard to the size of the company
and nature of its assets. No material discrepancies were noticed and
reported, by the management, on such physical verification.
c) In my opinion, the company has not disposed of substantial part of
fixed assets during the year and as a result the going concern status
of the company is not affected.
2) IN RESPECT OF ITS INVENTORIES
a) As explained to me, by the management, inventories have been
physically verified by the management at regular intervals during the
b) In my opinion and according to the information and explanations
given to me, 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) The company has maintained proper records of inventories. As
explained to me, there were no material discrepancies noticed on
physical verification of inventory as compared to the book records.
3) IN RESPECT OF LOANS
In respect of loans, secured or unsecured, granted or taken by the
company to / from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956;
a) The company has taken loans from Companies, firms and other parties
covered in the Register maintained under section 301 of the Companies
b) The company has not granted any loan to any Companies, firms or
other parties covered in register maintained under section 301 of the
Companies Act, 1956.
c) In my opinion, the rate of interest and other terms and conditions
of such loan are not prima facie prejudicial to the interest of the
4) In my opinion and according to the information and explanations
given to me, there are adequate internal control procedures
commensurate with the size of the company and the nature of its
business for the purchase of inventory, fixed assets and also for the
sale of goods. During the course of the audit, I have not observed any
major weaknesses in internal controls.
5) RELATED PARTY TRANSACTIONS
In respect of transactions covered under section 301 of the Companies
a) In my opinion and according to the information and explanations
given to me, the transactions made in pursuance of contracts or
arrangements, that needed to be entered into in the register maintained
under section 301 of the Companies Act, 1956 have been so entered.
b) The company has not granted any loan to any companies, firms or
other parties covered in register maintained under sec 301 of the
Companies Act, 1956.
6) In my opinion and according to information and explanation given to
me, the company has not accepted any deposits from the public.
7) In my opinion, the internal audit system of the company is
commensurate with its size and nature of its business.
8) The central government has not prescribed the maintenance of cost
records under section 209(1) (d) of the Companies Act, 1956, in respect
of manufacturing activities of the Company.
9) IN RESPECT OF STATUTORY DUES
a) According to the records of the Company, undisputed statutory dues
including Provident Fund, Investor Education and Protection Fund,
Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Customs
Duty, Excise Duty, Cess and other statutory dues have been generally
regularly deposited with the appropriate authorities. According to the
information and explanations given to me, no undisputed amounts payable
in respect of the aforesaid dues were outstanding as at 31st March,
2010 for a period of more than six months from the date of becoming
i) The cases of Sales Tax for the financial year 2002-03, 2003-04,
2004-05, 2005-06. 2006-07, 2007-08, 2008-09 are pending with the
Assessing /Appellate Authorities.
ii) Income Tax Returns for the FY2006-2007, FY2007-2008 and FY 2008-
2009 have not been filed.
b) There are no other disputed statutory dues that have not been
deposited on account of matters pending before appropriate authorities.
10) The company had accumulated losses of Rs. 5,82,63,516 up to the end
of the last Financial Year (2008-09) and has earned a profit during the
Financial Year 2009- 10 of Rs. 70,523.
11) Based on my audit procedures and according to the information and
explanations given to me, I am of the opinion that the company has not
defaulted in repayment of dues to financial institutions, banks or
12) In my opinion and according to the information and explanation give
to me, no loans and advances have been granted by the company on the
basis of security by way of pledge of shares, debentures and other
13) The company is not a chit fund or a Nidhi / Mutual Benefit Fund/
Society. Therefore, clause (xiii) of Section 4 of the Companies
(Auditors Report) Order 2003 is not applicable to the company.
14) The company is not a securities or investment trading company
therefore the applicability of clause (xiv) of Section 4 of Companies
(Auditors Report) Order 2003, insofar as relates to maintenance of
proper records of transactions and contracts in respect of trading in
securities, debentures and other investments is not applicable . The
company has no investments in shares, debentures and other investments
have been held by the company in its own name.
15) According to the information and explanations given to me, that the
company has not given any guarantees for loans taken by others from
banks or financial institutions.
16) According to the information and explanations given to me, that the
Company has not raised a new term loan during the financial year.
17) According the information and explanations given to me, and on an
overall examination of the Balance Sheet of the Company, I are of the
opinion that the company has not utilized short term sources towards
repayment of long-term borrowings and acquisition of fixed assets.
18) During the year, the Company has not made any preferential
allotment of shares to parties and companies covered in the Register
maintained under section 301 of the Companies Act, 1956.
19) The company has not issued debentures during the year.
20) The company has not raised any money by way of public issue during
21) According to the information and explanations given to me, no fraud
on or by the company has been noticed or reported during the year, that
causes the financial statements to be materially misstated.
Membership No. 74641
Place : SAHARANPUR
Dated : 01-09-2010