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Suashish Diamonds | Auditor's Report > Diamond Cutting & Jewellery & Precious Metals > Auditor's Report from Suashish Diamonds - BSE: 526733, NSE: SUASHDIMON
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Suashish Diamonds

BSE: 526733|NSE: SUASHDIMON|ISIN: INE658A01017|SECTOR: Diamond Cutting & Jewellery & Precious Metals
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Mar 12
Auditor's Report (Suashish Diamonds) Year End : Mar '13
Report on the Financial Statements
 
 We have audited the accompanying financial statements of Suashish
 Diamonds Limited (''the Company) which comprise the Balance Sheet as at
 31 March 2013, the Statement of Profit and Loss and Cash Flow Statement
 for the year then ended, and a summary of significant accounting
 policies and other explanatory information.
 
 Management''s Responsibility for Financial Statements
 
 Management is responsible for the preparation of these financial
 statements that give a true and fair view of the financial position,
 financial performance and cash flows of the Company in accordance with
 the Accounting Standards referred to in sub-section (3C) of Section 211
 of the Companies Act, 1956 (''the Act''). This responsibility includes
 the design, implementation and maintenance of internal control relevant
 to the preparation and fair presentation of the financial statements
 that are free from material misstatement, whether due to fraud or
 error.
 
 Auditors'' Responsibility
 
 Our responsibility is to express an opinion on these financial
 statements based on our audit. We conducted our audit in accordance
 with the Standards on Auditing issued by the Institute of Chartered
 Accountants of India. Those Standards require that we comply with
 ethical requirements and plan and perform the audit to obtain
 reasonable assurance about whether the financial statements are free of
 material misstatement.
 
 An audit involves performing procedures to obtain audit evidence about
 the amounts and disclosures in the financial statements.  The procedure
 selected depend on the auditor''s judgment, including the assessment of
 the risks of material misstatement of the financial statements, whether
 due to fraud or error. In making those risk assessments, the auditor
 considers internal control relevant to the Company''s preparation and
 fair presentation of the financial statements in order to design audit
 procedures that are appropriate in the circumstances. An audit also
 includes evaluating the appropriateness of accounting policies used and
 the reasonableness of the accounting estimates made by the management,
 as well as evaluating the overall presentation of the financial
 statements.
 
 We believe that the audit evidence we have obtained is sufficient and
 appropriate to provide a basis of for our qualified audit opinion.
 
 Basis for Qualified Opinion:
 
 In respect of the stock of finished goods (polished diamonds), cost is
 based on technical estimate by the management to avoid distortion in
 valuation. In view of the nature of variation in the value of
 individual diamonds, the differentials in their costs, it is not
 practical to compute the cost of polished diamonds using either FIFO or
 weighted average cost. In view of the multiple grades, it is not
 practical to use specific cost. The basis of computing cost used on
 consistent basis though in line with generally accepted industry
 practice, is a deviation from the method prescribed by Accounting
 Standard (AS)-2 ''Valuation of Inventories''.
 
 The impact on Profit for the year, reserves and surplus and inventories
 as at 31 March 2013, if any, due to the above deviations is not
 ascertainable.
 
 Qualified Opinion:
 
 In our opinion and to the best of our information and according to the
 explanations given to us, except for the effects of the matter
 described in the Basis for Qualified Opinion paragraph, the financial
 statements give the information required by the Act 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 31 March 2013;
 
 ii.  in the case of Statement of Profit and Loss, of the profit for the
 year ended on that date; and
 
 iii. in the case of Cash Flow Statement, of the cash flows for the year
 ended on that date.
 
 Report on Other Legal and Regulatory Requirements
 
 1.  As required by the Companies (Auditor''s Report) Order, 2003 (''the
 Order'') issued by the Central Government of India in terms of
 sub-section (4A) of section 227 of the Act, we give in the Annexure a
 statement on the matters specified in paragraphs 4 and 5 of the Order.
 
 2.  As required by Section 227(3) of the Act, 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 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, Statement of Profit and Loss and Cash Flow
 Statement dealt with by this report are in agreement with the books of
 account;
 
 d) except for the effects of the matters described in the Basis of
 Qualified Opinion paragraph, in our opinion, the Balance Sheet,
 Statement of Profit and Loss and Cash Flow Statement comply with the
 Accounting Standards referred to in sub- section (3C) of Section 211 of
 the Act;
 
 e) on the basis of written representations received from the directors,
 as on 31 March 2013, and taken on record by the Board of Directors,
 none of the directors is disqualified as on 31 March 2013, from being
 appointed as a director in terms of clause (g) of sub-section (1) of
 Section 274 of the Act.
 
 ANNEXURE TO INDEPENDENT AUDITORS'' REPORT
 
 (REFERRED TO IN PARAGRAPH 1 UNDER THE HEADING OF ''REPORT ON OTHER LEGAL
 AND REGULATORY REQUIREMENTS'' OF OUR REPORT OF EVEN DATE)
 
 (i) (a) The Company is maintaining proper records showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 (b) Fixed assets have been verified by the management in accordance
 with a phased programme of verification, which in our opinion, is
 reasonable having regard to the size of the Company and the nature of
 its assets, though all the assets were not verified by the management
 during the year. No material discrepancies were noticed on such
 verification.
 
 (c) During the year, the Company has not disposed off substantial part
 of its fixed assets.
 
 (ii) (a) According to information and explanations given to us, the
 inventory has been physically verified by the management during the
 year. In our opinion, the frequency of verification is reasonable.
 
 (b) 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 is maintaining proper records of inventory. The
 discrepancies noticed on verification between the physical stocks and
 the book records were not material.
 
 (iii) (a) According to information and explanations given to us, 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 except for interest free unsecured loans granted to
 eight companies during the current year. The maximum amount involved
 during the year was Rs.48,667,367 and year-end balance was
 Rs.42,508,092.
 
 (b) In our opinion, other terms and conditions on which loans have been
 granted to companies are not, prima facie, prejudicial to the interest
 of the Company except that loans are interest free.
 
 (c) In our opinion and according to information and explanations given
 to us, in respect of loans given, there is no fixed given repayment
 schedule.
 
 (d) According to the information and explanations given to us, there is
 no overdue amount of loan of more than rupees one lakh.
 
 (e) According to information and explanations given to us, 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. Consequently, the requirements of Clause (iii)(f) and (g) of
 the paragraph 4 of the Order are not applicable.
 
 (iv) In our opinion and according to the information and explanations
 given to us, there is adequate internal control system commensurate
 with the size of the Company and the nature of its business with regard
 to purchase of inventory and fixed assets and for the sale of goods and
 services. During the course of our audit, we have neither been informed
 nor have we 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 particulars of contracts or arrangements
 referred to in Section 301 of the Act have been so 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 exceeding Rs 500,000 in respect of any
 party during the year in pursuance of such contracts or arrangements
 entered in the register maintained under Section 301 of the Act have
 been made at prices which are reasonable having regard to prevailing
 market prices at the relevant time.
 
 (vi) According to the information and explanations given to us, the
 Company has not accepted any deposits from the public.
 
 (vii) In our opinion and according to the information and explanations
 given to us, the Company has an internal audit system, which needs to
 be strengthened to make it commensurate with the size of the Company
 and the nature of its business.
 
 (viii) According to the information and explanations given to us, the
 Company is maintaining records pursuant to the Rules made by the
 Central Government for the maintenance of cost records under Section
 209(1) (d) of the Act. However we have not made a detailed examination
 of records.
 
 (ix) (a) According to the information and explanations given to us and
 on the basis of our examination of the records of the Company, the
 Company is regular in depositing the undisputed statutory dues
 including provident fund, investor education and protection funds,
 employee''s state insurance, income tax, sales tax, wealth tax, service
 tax, custom duty, excise duty, cess and other material statutory dues
 as applicable with the appropriate authorities. No undisputed amounts
 payable in respect of aforesaid statutory dues were outstanding as on
 the last day of the financial year for a period of more than six months
 from the date they became payable.
 
 (b) According to the information and explanation given to us, there are
 no dues in respect of wealth tax, service tax, customs duty, excise
 duty and cess, which have not been deposited on account of any dispute.
 The disputed amounts that have not been deposited in respect of income
 tax and sales tax are as under:
 
 Name of the 
 statute         Amount Rs.    Period to which 
                               it relates         Forum where dispute is
                                                  pending
 
 Income Tax 
 Act, 1961           791,264   2005-06            CIT Appeals
 
 Income Tax 
 Act, 1961         1,892,667   2006-07            Appellate Tribunal
 
 Income Tax 
 Act, 1961         2,691,962   2009-10            CIT Appeals
 
 Bombay Sales
 Tax Act           1,656,656   1993-94            Appellate Tribunal
 
 Bombay Sales 
 Tax Act             307,748   1994-95            Appellate Tribunal
 
 Finance Act - 
 Service tax      37,341,208   2006-07 to 2010-11 Commissioner
                                                  Service Tax
 
 (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
 banks. The Company has not issued any debentures and there are no dues
 to financial institutions.
 
 (xii) According to the information and explanations given to us, and in
 our opinion, 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) In our opinion, the Company is not a chit fund or a nidhi /
 mutual benefit fund / society. Accordingly, clause 4(xiii) of the Order
 is not applicable to the Company.
 
 (xiv) In our opinion, the Company is not dealing in 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) The Company has given guarantee for loan taken by subsidiary
 company from bank. According to the information and explanations given
 to us, we are of the opinion that the terms and conditions thereof are
 prima facie not prejudicial to the interest of the Company.
 
 (xvi) The Company has not raised any term loan during the financial
 year.
 
 (xvii) According to the information and explanations given to us and on
 an 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
 investment.
 
 (xviii)The Company has not made any preferential allotment of shares
 during the year.
 
 (xix) According to the information and explanations given to us, the
 Company has not issued any debentures during the year.
 
 (xx) According to the information and explanations given to us, the
 Company has not raised any money through a public issue during the
 year.
 
 (xxi) 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
 explanation given to us, we have neither come across any instances of
 fraud on or by the Company, noticed or reported during the year, nor
 have we been informed of any such cases by the management.
 
                                         For Suresh Surana & Associates
 
                                                  Chartered Accountants
 
                                           Firm Registration No.121750W
 
                                                           (Nirmal Jain)
 
                                                                Partner
 
                                                   Membership No. 34709
 
 Mumbai; Dated:30th May,2013
Source : Dion Global Solutions Limited
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