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Auditor Report of Umang Dairies Ltd.

Mar 31, 2015

We have audited the accompanying financial statements of UMANG DAIRIES LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to 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 principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules , 2014.This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent ; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. 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 from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures 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 financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, 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 for our audit opinion on the financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid 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, of the state of affairs of the Company as at 31st March, 2015, and its profit and its 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, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, 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 during the course of audit, we give in the Annexure a statement on the matters specified in the paragraphs 3 and 4 of the Order.

2. As required by Section 143 (3) of the Act, we report that:

(a) We have sought and obtained all 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 it appears from our examination of those books.

(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

(e) On the basis of the written representations received from the directors as on 31st March, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

(f) With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - refer Note no. 2.25 to the financial statements.

ii. The Company has made provision, as required under the applicable law or Accounting Standards, for material foreseeable losses, if any, on long term contracts including derivative contracts.

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

ANNEXURE TO THE AUDITOR'S REPORT

Annexure referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date for the year ended 31st March 2015.

1. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets except in case of certain assets where the same is in process of updation.

(b) As explained to us, the fixed assets have been physically verified by the management according to a phased programme designed to cover all the items over a period of three years (except assets lying with third parties read with Note no 2.33) which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. The discrepancies noticed on such physical verification were not material.

2. (a) The inventories of the Company (except stock lying with third parties and in transit) has been physically verified by the management at reasonable intervals.

(b) In our opinion the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) In our opinion and according to information and explanations given to us, the Company is maintaining proper records of inventory (in respect of stock in process, records are updated on physical verification of stock on periodical basis). The discrepancies noticed on such physical verification of inventory as compared to book records were not material.

3. The Company has not granted any loan secured or unsecured to any companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act, 2013. Accordingly, the provisions of Clause 3(iii) (a) & (b) of the Order are not applicable.

4. In our opinion and according to the information and explanations given to us, having regards to the explanations , that some of the items purchased/sold/services rendered are of special nature and suitable alternative sources do not exist for obtaining comparable quotations or where user department has shown specific preference, where, as explained, rates were determined considering the quality, volume, nature of the items and market conditions prevailing at that time, there are internal control systems commensurate with the size of the Company and the nature of its business with regard to the purchase of inventory, fixed assets, services and forthe sale of goods/fixed assets and services where steps have been initiated to strengthen system further(read with note no.2.33). Based on the audit procedure performed and on the basis of information and explanations provided by the management, during the course of audit, we have not observed any continuing failure to correct major weaknesses in internal control system nor being identified by the management.

5. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of Section 73 to 76 of the Act and rules framed thereunder and the directives issued by Reserve bank of India or any other relevant provisions of the Act. We have been informed that no order has been passed by the Company Law Board or National Company law Tribunal or Reserve Bank of India or any Court or other tribunal in this regard.

6. We have broadly reviewed the books of accounts required to be maintained by the company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 148(1) of the Companies Act in respect of the Company's product to which the said rules are made applicable and are of the opinion that, prima facie, the prescribed records have been made and maintained. We have, however, not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

7. (a) According to the records of the Company and

information and explanations given to us, the Company is generally regular in depositing undisputed statutory dues including provident fund, employees' state insurance, income-tax, sales-tax, wealth tax, service tax, duty of customs, duty of excise, value added tax and cess and other material statutory dues with the appropriate authorities to the extent applicable and there were no undisputed statutory dues payable for a period of more than six months from the date they became payable as at 31 st March, 2015 except Sales Tax of Rs. 2,33,677/- and Mandi Tax of Rs. 6,23,000/-.

(b) According to the records and information & explanations given to us, there are no dues in respect of Wealth Tax, Service Tax, Duty of Customs, Duty of Excise or Value Added Tax that have not been deposited with the appropriate authorities to the extent applicable on account of any dispute and the dues in respect of Income tax, Sales tax and Cess that have not been deposited with the appropriate authorities on account of dispute and the forum where the dispute is pending are given below:-

Name of Nature of Amount Period Forum Statute the dues (Rs. in where Lacs) dispute is pending

Sales Tax Sales Tax 1.78 1994-95/ Sales Tax Act Demand/ 1998- Tribunal Penalty/ 2000 Interest 40.65 1995- Appellate 2007 Authorities

3.00 1995-96 High Court

32.57 2010- Appellate 2015 Authorities

UP Krishi Market Fees 162.89 1998-99/ Tribunal Utpadan including 2005-06 Development Mandi Cess Samiti Adhiniyam' 1964

UP Milk Act Cess on Milk 69.25 1994-96 High Court

Income Tax Income Tax 495.28 2011-12 CIT(Appeal) Act

(c) According to the records of the Company and information and explanations given to us, there were no amount due to be transferred to Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act and Rules made there under.

8. The Company does not have accumulated losses at the end of the financial year and has not incurred cash losses in the current financial year & in the immediately preceding financial year.

9. In our opinion, on the basis of audit procedure and

according to the information and explanations given to us by the management, we are of the opinion that the Company has not defaulted in repayment of dues to banks. The company does not have any dues to financial institutions or debenture holders. - Read with foot note (b) of Note No. 2.3.

10. According to the information and explanations given to us, corporate guarantee has been issued by the company for loan taken by others {Refer Note No 2.25 (c)} from banks, the terms and conditions whereof are not, prima facie, prejudicial to the interest of the company.

11. In our opinion, on the basis of information and explanations given to us, term loans were applied for the purpose for which these loans were obtained.

12. Based on the audit procedure performed and on the basis of information and explanations provided by the management, no fraud on or by the Company has been noticed or reported during the course of our audit nor we have been informed about any such instance.

For LODHA & CO.

Chartered Accountants

Firm Registration No. - 301051E

N. K. Lodha

Partner

(Membership No. 85155)

Place : New Delhi

Date : 13th May 2015


Mar 31, 2014

1. Report on the financial statements We have audited the accompanying financial statements of UMANG DAIRIES LTD., which comprise the balance sheet as at 31st March 2014, and the statement of the profit and loss and the cash flow statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

2. Management''s responsibility for the financial statements

Management is responsible for the preparation of these financial statements that give a true and the fair view of the financial position, financial performance and cash flows of the company in accordance with the accounting principles generally accepted in India, including accounting standards referred to in sub section (3C) of section 211 of the Companies Act, 1956(the Act) read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and free from material misstatement, whether due to fraud or error.

3. Auditor''s 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 Institute of Chartered Accountant of India. Those standards require that we comply with the ethical requirements and plan and perform the audit to obtain the reasonable assurance about whether the financial statements are free from material misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including assessment of 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, but not for the purpose of expressing an opinion on the effectiveness of the company''s internal control. 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 for audit opinion.

Opinion

In our opinion and best to our information and according to the explanations given to us, the financial statements read together with notes thereon give the information required by Act 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 the balance sheet, of the state of the affairs of the company as at 31st March 2014,

b. In case of the statement of the profit and loss, of the profit for the year ended on that date, and

c. In case of the cash flow statement, of the cash flows for the year ended on that date.

Report on other legal and the 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 the Annexure a statement on the, manners specified in the 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 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, Statement of Profit & Loss and Cash Flow Statement referred to in this report are in agreement with the books of account.

d. In our opinion, the Balance Sheet, Statement of Profit & Loss and Cash Flow Statement referred to in this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of Companies Act, 1956, read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013.

e. On the basis of the written representations received from the Directors and taken on records by the Board of Directors, we report that none of the directors of the Company is disqualified as on 31st March 2014 from being appointed as a Director of the Company in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS'' REPORT

(Referred to in paragraph 1 of our Report of even date of Umang Dairies Limited for the year ended 31st March 2014)

i. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets except in case of certain assets where the same is in the process of updation.

(b) As explained to us, the fixed assets have been physically verified by the Management according to a phased programme designed to cover all the items over a period of three years (except assets lying with third parties read with Note No 2.33) which in our opinion is reasonable having regard to the size of the Company and the nature of its Fixed Assets. The discrepancies noticed on such physical verification were not material.

(c) As per the records and information and explanations given to us, Fixed Assets disposed off during the year were not substantial.

ii. (a) The inventory of the company (except stocks lying with third parties and in transit), has been physically verified by the Management at reasonable intervals.

(b) In our opinion, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of our examination of the records of the Company, we are of the opinion that the Company is maintaining proper records of inventory. (In respect of stock in process, records are updated on physical verification of stock on periodical basis). The discrepancies noticed on such physical verification of inventory as compared to book records were not material.

iii. The company has neither granted nor taken any loans, secured or unsecured to and from companies, firms or other parties as covered in the register maintained u/s 301 of the Act. Accordingly, the provisions of clause 4(iii) (b) to (d), (f) & (g) of the order are not applicable.

iv. In our opinion and according to the information and explanations given to us, having regard to the explanations that some of the items purchased/ sold/services rendered are of special nature and suitable alternative sources do not exist for obtaining comparable quotations or where user departments has shown specific preference, where, as explained, rates were determined considering the quality, volume, nature of the items and market conditions prevailing at that time, there are internal control system commensurate with the size of the company and nature of its business with regard to the purchase of Inventory, fixed Assets , services and for the sale of goods/fixed assets and services where steps have been initiated to strengthen system further (read with note no 2.33). Based on the audit procedure performed and information & explanation provided by the management during the course of our audit, we have not observed and continuing failure to correct major weakness in internal control system nor been identified by the management.

v. According to the information and explanations provided by the management and based upon audit procedures performed, there are no contracts or arrangements that need to be entered in the register required to be maintained under Section 301 of the Act. Accordingly provisions of clause 4(v)(b) of the order are not applicable.

vi. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of section 58A, 58AA and rules framed there under and the directives issued by Reserve Bank of India and other relevant provision of the Act. We have been informed that no order has been passed by the Company Law Board or National Company law Tribunal or the Reserve bank of India or any Court or any other Tribunal in this regard.

vii. In our opinion, the Company has an internal audit system commensurate with the size of the company and nature of its business.

viii. We have broadly reviewed the books of accounts required to be maintained by the company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Act in respect of the Company''s product to which the said rules are made applicable and are of the opinion that, prima facie, the prescribed records have been made and maintained. We have, however, not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

ix. (a) According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom duty, Excise Duty, Cess and other material Statutory dues to the extent applicable with the appropriate authorities and there are no undisputed statutory dues payable for a period of more than six months from the date they became payable as at 31st March, 2014 except Sales Tax of Rs. 2,33,677/-and Mandi tax Rs.6,23,000/-.

(b) According to the records and information and explanations given to us, there are no dues in respect of Income Tax, Service Tax, Custom Duty, Wealth Tax and Excise Duty that have not been deposited with the appropriate authorities on account of any dispute and the dues in respect of Sales Tax and Cess that have not been deposited with the appropriate authorities on account of dispute and the Forum where the dispute is pending are given below:

Name of Statute Nature Amount of the dues (Rs. in Lac)

Sales Tax Act Sales Tax Demand /Penalty/Interest 1.78

40.65

3.00

UP Krishi Utpadan Market Fees 162.89 Mandi Samiti including Adhiniyam''1964 Development Cess

UP Milk Act Cess on Milk 69.25

Name of Statute Period Forum where dispute is pending

Sales Tax Act 1994-1995/ Sales Tax 1998-2000 Tribunal

1995-2007 Appellate Authorities

1995-1996 High Court

UP Krishi Utpadan 1998-1999/ Tribunal Mandi Samiti 2005-2006 Adhiniyam''1964 UP Milk Act 1994-1996 High Court x. The Company does not have accumulated losses at the end of the financial year and has not incurred cash losses in the current financial year and in the immediately preceding financial year.

xi. In our opinion, on the basis of audit procedures and according to the information and explanations given to us by the management, we are of opinion that the Company has not defaulted in re-payment of dues to Banks or Financial Institutions or Debenture Holders.

xii. According to the information and explanations 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.

xiii. The Company is not a Chit Fund or a Nidhi / Mutual Benefit Fund / Society, therefore, the provision of clause 4 (xiii) of the said order are not applicable to the Company.

xiv. According to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provision of clause 4 (xiv) of the companies (Auditors Report) Order, 2003 (as amended) 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 others from banks or financial institutions.

xvi. In our opinion, on the basis of information and explanations given to us, the term loan was applied for the purpose for which the loan was obtained.

xvii. On the basis of information and explanations given to us and on an overall examination of financial statements, we are of the opinion that, prima facie, no funds raised on short term basis have been used for long term investment.

xviii. According to the information and explanations given to us, the Company has not made any preferential allotment of shares to any parties or companies covered in the register maintained under Section 301 of the Act during the year.

xix. Based on the examination of the documents and records made available and information and explanations given to us, the Company has not issued any debentures during the year and there is no outstanding debentures as at the close of the year.

xx. The Company has not raised any money through public issue during the year. Therefore, the provisions of clause 4 (xx) of the Order, 2003 is not applicable.

xxi. Based on the audit procedures performed and on the basis of information and explanations provided by the management, no fraud on or by the Company has been noticed or reported during the course of our audit nor we have been informed about any such instance.

For LODHA & CO. Chartered Accountants Firm Registration No. - 301051E N. K. Lodha Partner (Membership No. 85155)

Place : New Delhi Date : 13th May 2014


Mar 31, 2013

1. Report on the financial statements

We have audited the accompanying financial statements of UMANG DAIRIES LTD., which comprise the balance sheet as at 31st March 2013, and the statement of the profit and loss and the cash flow statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

2. Management''s responsibilitv for the financial statements

Management is responsible for the preparation of these financial statements that give a true and the fair view of the financial position, financial performance and cash flows of the company in accordance with the accounting principles generally accepted in India, including 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 presentation of the financial statements that give a true and fair view and free from material misstatement, whether due to fraud or error.

3. Auditor''s responsibilitv

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 Institute of Chartered Accountant of India. Those standards require that we comply with the ethical requirements and plan and perform the audit to obtain the reasonable assurance about whether the financial statements are free from material misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including assessment of 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 for audit opinion.

4. Emphasis of Matter

Attention is drawn to note no. 2.34 regarding balances of debtors, cans (fixed assets) lying with the third parties and current liabilities (including advances from customers) and secured loans as stated in the said note are in the process of confirmation/reconciliation.

Opinion

In our opinion and best to our information and according to the explanations given to us, the financial statements read together with notes thereon give the information required by Act 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 the balance sheet, of the state of the affairs of the company as at 31st March 2013,

b. In case of the statement of the profit and loss, of the profit for the year ended on that date, and

c. In case of the cash flow statement, of the cash flows for the year ended on that date.

Report on other legal and the regulatorv 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 the Annexure a statement on the, manners specified in the 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 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, Statement of Profit & Loss and Cash Flow Statement referred to in this report are in agreement with the books of account.

d. In our opinion, the Balance Sheet, Statement of Profit & Loss and Cash Flow Statement referred to in this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of Companies Act, 1956;

e. On the basis of the written representations received from the Directors and taken on records by the Board of Directors, we report that none of the directors of the Company is disqualified as on 31 st March 2013 from being appointed as a Director of the Company in terms of clause (g) of sub-section (l)ofsection 274 of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS'' REPORT

(Referred to in paragraph 1 of our Report of even date of Umang Dairies Limited for the year ended 31st March 2013)

i. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets except in case of certain assets the same is in process of updation of records.

(b) As explained to us, the fixed assets have been physically verified by the Management according to a phased programme designed to cover all the items over a period of three years (except assets lying with third parties read with Note No. 2.34) which in our opinion is reasonable having regard to the size of the Company and the nature of its Fixed Assets. The discrepancies noticed on such physical verification were not material.

(c) As per the records and information and explanations given to us, Fixed Assets disposed off during the year were not substantial.

ii. (a) The inventory of the company (except stocks lying with third parties and in transit), has been physically verified by the Management at reasonable intervals.

(b) In our opinion, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of our examination of the records of the Company, we are of the opinion that the Company is maintaining proper records of inventory. (In respect of stock in process records are updated on physical verification of stock on periodical basis). The discrepancies noticed on such physical verification of inventory as compared to book records were not material.

iii. The company has neither granted nor taken any loans, secured or unsecured to and from companies, firms or other parties as covered in the register maintained u/s 301 of the Act. Accordingly, the provisions of clause 4(iii) (b) to (d), (f) & (g) of the order are not applicable.

iv. In our opinion and according to the information and explanations given to us, having regard to the explanation that some of the items purchased / sold / services rendered are of special nature and suitable alternative sources do not exist for obtaining comparable quotation or where user department has shown specific preference, where, as explained, rates were determined considering the quality, volume, nature of the items and market conditions prevailing at that time, there are internal control system commensurate with size of the company and nature of its business with regard to the purchase of inventory, fixed assets, services and for the sale of goods/ fixed assets and services where steps have been initiated to strengthen system further (read with note no. 2.34). Based on the audit procedure performed and information & explanation provided by the management, during the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal control system nor been identified by the management.

v. According to the information and explanations provided by the management and based upon audit procedures performed, there are no contracts or arrangements that need to be entered in the register required to be maintained under Section 301 of the Act. Accordingly provisions of clause 4(v)(b) of the order are not applicable.

vi. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of section 58A, 58AA and rules framed there under and the directives issued by Reserve Bank of India and other relevant provision of the Act. We have been informed that no order has been passed by the Company Law Board or National Company law Tribunal or the Reserve bank of India or any Court or any other Tribunal in this regard.

vii. In our opinion, the Company has an internal audit system commensurate with the size of the company and nature of its business.

viii. We have broadly reviewed the books of accounts required to be maintained by the company pursuant to the rules made by the Central Government forthe maintenance of cost records under Section 209(1)

(d) of the Act in respect of the Company''s product to which the said rules are made applicable and are of the opinion that, prima facie, the prescribed records have been made and maintained. We have, however, not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

ix. (a) According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Investor

Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom duty, Excise Duty, Cess and other material Statutory dues to the extent applicable with the appropriate authorities and there are no undisputed statutory dues payable for a period of more than six months from the date they became payable as at 31st March, 2013 except Sales Tax of Rs. 2,33,677/-and Mandi tax Rs.6,23,000/-.

(b) According to the records and information and explanations given to us, there are no dues in respect of Income Tax, Service Tax, Custom Duty, Wealth Tax and Excise Duty that have not been deposited with the appropriate authorities on account of any dispute and the dues in respect of Sales Tax and Cess that have not been deposited with the appropriate authorities on account of dispute and the Forum where the dispute is pending are given below:

Name of Statute Nature Amount Period Fornmwhere of the dues (R&riLac) dispute is pending

Sales Tax Act Sales Tax Demand /Penalty /Interest 1.78 1994-1995/ Sales Tax

1998-2000 Tribunal

41.80 1995-2007 Appellate Authorities

3.00 1995-1996 High Court

UP Krishi Utpadan Market Fees 162.89 1998-1999/ Tribunal Mandi Samiti including 2005-2006 Adhiniyam''1964 Development Cess

UP Milk Act Cess on Milk 69.25 1994-1996 High Court

x. The Company does not have accumulated losses at the end of the financial year and has not incurred cash losses in the current financial year and in the immediately preceding financial year.

xi. In our opinion, on the basis of audit procedures and according to the information and explanations given to us by the management, we are of the opinion that the Company has not defaulted in re-payment of dues to Banks or Financial Institutions or Debenture Holders.

xii. According to the information and explanations 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.

xiii. The Company is not a Chit Fund or a Nidhi / Mutual Benefit Fund / Society, therefore, the provision of clause 4 (xiii) of the said order are not applicable to the Company.

xiv. According to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4

(xiv) of the Companies (Auditors Report) Order, 2003 (as amended) 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 others from banks or financial institutions.

xvi. On the basis of information and explanations given to us, the Company has not availed any term loans during the year.

xvii. On the basis of information and explanations given to us and on an overall examination of financial statements, we are of the opinion that, prima facie, no funds raised on shortterm basis have been used for long term investment.

xviii. According to the information and explanations given to us, the Company has not made any preferential allotment of shares to any parties or companies covered in the register maintained under Section 301 of the Act during the year.

xix. Based on the examination of the documents and records made available and information and explanations given to us, the Company has not issued any debentures during the year and there is no outstanding debenture as at the close of the year.

xx. The Company has not raised money through public issue during the year. Therefore, the provisions of clause 4 (xx) of the Companies (Auditors Report) Order, 2003 (as amended) are not applicable to the Company.

xxi. Based on the audit procedures performed and on the basis of information and explanations provided by the management, no fraud on or by the Company has been noticed or reported during the course of our audit nor we have been informed by the management about any such instance.

For LODHA & CO.

Chartered Accountants

N. K. Lodha

Partner

(Membership No. 85155)

Firm Registration No. 301051E

Place : New Delhi

Date :4th May 2013


Mar 31, 2012

We have audited the attached Balance Sheet of UMANG DAIRIES LIMITED, as at 31st March 2012, the Profit and Loss Statement and also the Cash Flow Statement for the year 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 misstatements. 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.

1 As required by the Companies (Auditor's Report) Order, 2003 (as amended) ("the order") issued by the Central Government of India in terms of sub- section (4A) of section 227 of the Companies Act, 1956 (the Act) 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 during the course of audit, we enclose in the Annexure, a statement on the matters specified in the paragraphs 4 and 5 of the said Order.

2 Further to our comments in the Annexure referred to in Paragraph 1 above, 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 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 Statement and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d) In our opinion, the Balance Sheet, Profit & Loss Statement 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;

e) As per the information and explanations given to us, none of the Directors of the company is disqualified as on 31st March 2012 from being appointed as a director of the company under clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956. However, all Directors of the Company are disqualified to be appointed as Director in any other public Company;

In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with Note No. 2.37 and other notes thereon, 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, 2012;

ii. in the case of the Profit and Loss Statement, 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.

ANNEXURE TO THE AUDITORS' REPORT

(Referred to in paragraph 1 of our Report of even date of Umang Dairies Limited for the year ended 31st March 2012)

i. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) As explained to us, the fixed assets have been physically verified by the Management according to a phased programme designed to cover all the items over a period of three years (except assets lying with third parties read with Note No. 2.37) which in our opinion is reasonable having regard to the size of the Company and the nature of its Fixed Assets. The discrepancies noticed on such physical verification were not material.

(c) As per the records and information and explanations given to us, Fixed Assets disposed off during the year were not substantial.

ii. (a) The inventory of the company (except stocks lying with third parties and in transit), has been physically verified by the Management at reasonable intervals.

(b) In our opinion, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of our examination of the records of the Company, we are of the opinion that the Company is maintaining proper records of inventory. (In respect of stock in process records are updated on physical verification of stock on periodical basis). The discrepancies noticed on such physical verification of inventory as compared to book records were not material.

iii. The company has neither granted nor taken any loans, secured or unsecured to and from companies, firms or other parties as covered in the register maintained u/s 301 of the Act. Accordingly, the provisions of clause 4(iii) (b) to (d), (f) & (g) of the order are not applicable.

iv. In our opinion and according to the information and explanations given to us, there is internal control system commensurate with the size of the Company and the nature of its business (read with Note No. 2.28 and 2.37) for purchases of inventory, fixed assets and for 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. According to the information and explanations provided by the management and based upon audit procedures performed, there are no contracts or arrangements that need to be entered in the register required to be maintained under Section 301 of the Act. Accordingly provisions of clause 4(v)(b) of the order are not applicable.

vi. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of section 58A, 58AA and rules framed thereunder and the directives issued by Reserve Bank of India and other relevant provision of the Act. We have been informed that no order has been passed by the Company Law Board or National Company law Tribunal or the Reserve bank of India or any Court or any other Tribunal in this regard.

vii. In our opinion, the Company has an internal audit system commensurate with the size of the company and nature of its business.

viii. We have broadly reviewed the books of accounts required to be maintained by the company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(1) (d) of the Act in respect of the Company's product to which the said rules are made applicable and are of the opinion that, prima facie, the prescribed records have been made and maintained. We have, however, not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

ix. (a) According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom duty, Excise Duty, Cess and other material Statutory dues to the extent applicable with the appropriate authorities and there are no undisputed statutory dues payable for a period of more than six months from the date they became payable as at 31st March, 2012Z except Sales Tax of Rs. 2,33,677/- and Mandi tax Rs.6,23,000/-.

(b) According to the records and information and explanations given to us, there are no dues in respect of Income Tax, Service Tax, Custom Duty, Wealth Tax and Excise Duty that have not been deposited with the appropriate authorities on account of any dispute and the dues in respect of Sales Tax and Cess that have not been deposited with the appropriate authorities on account of dispute and the Forum where the dispute is pending are given below:

Name of Statute Nature Amount period Forum where of the dues (Rs. in Lac) dispute is pending

Sales Tax Act Sales Tax Demand /Penalty Interest 1.78 1994-95 Sales Tax 1998-2000 Tribunal

41.80 1999-2007 Appellate Authorities

3.00 1995-96 High Court

UP Krishi Utpadan Market Fees 162.89 1998-99 Tribunal Mandi Samiti including 2005-06 Adhiniyam'1964 Development Cess

UP Milk Act Cess on Milk 69.25 1994-96 High Court

x. The Company's accumulated losses at the end of the financial year are less than 50% of its net worth. The Company has not incurred cash losses in the current financial year and in the immediately preceding financial year.

xi. In our opinion, on the basis of audit procedures and according to the information and explanations given to us, the Company has not defaulted in re- payment of dues to Banks, Financial Institutions and Debenture Holders in view of Rehabilitation Scheme sanctioned by BIFR.

xii. According to the information and explanations 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.

xiii. The Company is not a Chit Fund or a Nidhi / Mutual Benefit Fund / Society, therefore, the provision of clause 4 (xiii) of the said order are not applicable to the Company.

xiv. According to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments.

xv. 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.

xvi. On the basis of information and explanations given to us, the Company has not availed any term loans during the year.

xvii. On the basis of information and explanations given to us and on an overall examination of financial statements, we are of the opinion that, prima facie, no funds raised on short term basis have been used for long term investment.

xviii. According to the information and explanations given to us, the Company has not made any preferential allotment of shares to any parties or companies covered in the register maintained under Section 301 of the Act during the year.

xix. Based on the examination of the documents and records made available and information and explanations given to us, the Company has not issued any debentures during the year.

xx. The Company has not raised money through public issue during the year.

xxi. Based on the audit procedures performed and on the basis of information and explanations provided by the management, no fraud on or by the Company has been noticed or reported during the course of our audit nor we have been informed about any such instance.

For LODHA & CO.

Chartered Accountants

N. K. Lodha

Partner

(Membership No. 85155)

Firm Registration No. - 301051E

Date : 5th May 2012

Place : New Delhi


Mar 31, 2011

We have audited the attached Balance Sheet of UMANG DAIRIES LIMITED, as at 31st March 2011, the Profit and Loss Account and also the Cash Flow Statement for the year 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 misstatements. 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.

1 As required by the Companies (Auditor's Report) Order, 2003 (as amended) ( the order ) issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 (the Act) 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 during the course of audit, we enclose in the Annexure, a statement on the matters specified in the paragraphs 4 and 5 of the said Order.

2 Further to our compients in the Annexure referred to in Paragraph 1 above, 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 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) In our opinion, the Balance Sheet, Profit & 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;

e) As per the information and explanations given to us, none of the Directors of the company is disqualified

as on 31st March 2011 from being appointed as a director of the company under clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956. However, all Directors of the Company are disqualified to be appointed as Director in any other public Company;

f) Attention is invited to:

i. Note No. B7 of Schedule 16 regarding preparation of accounts on the basis of Going Concern Concept despite negative networth.

ii. Note No. B13 of Schedule 16 regarding management perception about recoverable amount of fixed assets of the company being more than carrying amount as stated in said note.

g) Attention is further invited to Note no. Bib of Schedule 7 6 regarding certain balances of debtors, loans & advances and current liabilities (including advance from customers) and secured loans are in the process of confirmation/reconciliation as stated in said note (impact unascertained).

We further report that the profit for the year, debit balance of profit & loss account, balances of debtors, loans & advances, current liabilities (including advances from customers) and secured loans are without considering the impact of item mentioned in para 2(g) above, the effect of which could not be determined.

Subject to the foregoing, 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 thereon, 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, 2011;

ii) In the case of the Profit and Loss Account, 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.

ANNEXURE TO THE AUDITORS' REPORT

(Referred to in paragraph 1 of our Report of even date of Umang Dairies Limited for the year ended 31st March 2011)

i. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) As explained to us, the fixed assets have been physically verified by the Management according to a phased programme designed to cover all the items over a period of three years which in our opinion is reasonable having regard to the size of the Company and the nature of its Fixed Assets. The discrepancies noticed on such physical verification were not material.

(c) As per the records and information and explanations given to us, Fixed Assets disposed off during the year were not substantial.

ii. (a) The inventory of the company (except stocks lying with third parties and in transit), has been physically verified by the Management at reasonable intervals.

(b) In our opinion, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of our examination of the records of the Company, we are of the opinion that the Company is maintaining proper records of inventory. (In respect of stock in process records are updated on physical verification of stock on periodical basis). The discrepancies noticed on such physical verification of inventory as compared to book records were not material.

iii. The company has neither granted nor taken any loans, secured or unsecured to and from companies, firms or other parties as covered in the register maintained u/s 301 of the Act. Accordingly, the provisions of clause 4(iii) (b) to (d), (f) & (g) of the order are not applicable.

iv. In our opinion and according to the information and explanations given to us, there is internal control system commensurate with the size of the Company and the nature of its business (read with note No. 5 of Schedule 16B) for purchases of inventory, fixed assets and for 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. According to the information and explanations provided by the management and based upon audit procedures performed, there are no contracts or arrangements that need to be entered in the register required to be maintained under Section 301 of the Act. Accordingly provisions of clause 4(v)(b) of the order are not applicable.

vi. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of section 58A, 58AA and rules framed thereunder and the directives issued by Reserve Bank of India and other relevant provision of the Act. We have been informed that no order has been passed by the Company Law Board or National Company law Tribunal or the Reserve Bank of India or any Court or any other Tribunal in this regard.

vii. In our opinion, the Company has an internal audit system commensurate with the size of the company and nature of its business.

viii. We have broadly reviewed the books of accounts required to be maintained by the company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(1 )(d) of the Act in respect of the Company's product to which the said rules are made applicable and are of the opinion that, prima facie, the prescribed records have been made and maintained. We have, however, not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

ix. (a) According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom duty, Excise Duty, Cess and other material Statutory dues to the extent applicable with the appropriate authorities and there are no undisputed statutory dues payable for a period of more than six months from the date they became payable as at 31 st March, 2011 except Sales Tax of Rs. 2,33,677/-and Mandi tax Rs.6,23,000.

(b) According to the records and information and explanations given to us, there are no dues in respect of Income Tax, Service Tax, Custom Duty, Wealth Tax and Excise Duty that have not been deposited with the appropriate authorities on account of any dispute and the dues in respect of Sales Tax and Cess that have not been deposited with the

appropriate authorities on account of dispute and the Forum where the dispute is pending are given below:

Name of Statute Nature Amount Period Forum where of the dues (Rs. in Lacs) dispute is pending

Sales Tax Act Sales Tax Demand /Penalty Interest 1.78 1994-95 Sales Tax 1998-2000 Tribunal

83.95 1995-2007 Appellate Authorities

3.00 1995-96 High Court

UP Krishi Utpadan Market Fees 162.89 1998-99 Tribunal Mandi Samiti including 2005-06 Adhiniyam'1964 Development Cess

UP Milk Act Cess on Milk 69.25 1994-96 High Court

x. The Company's accumulated losses at the end of the financial year are more than 50% of its net worth. The Company has not incurred cash losses in the current financial year and has incurred cash losses in the immediately preceding financial year (without considering impact of rehabilitation scheme refer note no. BI of schedule 16).

xi. In our opinion, on the basis of audit procedures and according to the information and explanations given to us, the Company has not defaulted in re-payment of dues to Banks, Financial Institutions and Debenture Holders in view of Rehabilitation Scheme as stated in note no. B1 of Schedule 16.

xii. According to the information and explanations 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.

xiii. The Company is not a Chit Fund or a Nidhi / Mutual Benefit Fund/Society, therefore, the provision of clause 4 (xiii) of the said order are not applicable to the Company.

xiv. According to the information and explanations given to us, the Company is not dealing in or trading in shares,

securities, debentures and other investments.

xv. 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.

xvi. On the basis of information and explanations given to us, the Company has not availed any term loans during the year, refer note no. B1 of Schedule 1 6.

xvii.On the basis of information and explanations given to us and on an overall examination of financial statements, we are of the opinion that, prima facie, no funds raised on short term basis have been used for long term investment other than as stated at note no. B14 of Schedule 16.

xviii.According to the information and explanations given to us, the Company has not made any preferential allotment of shares to any parties or companies covered in the register maintained under Section 301 of the Act during the year.

xix. Based on the examination of the documents and records made available and information and explanations given to us, the Company has not issued any debentures during the year, this is to be read with note no. B1 of Schedule 16.

xx. The Company has not raised money through public issue during the year.

xxi. Based on the audit procedures performed and on the basis of information and explanations provided by the management, no fraud on or by the Company has been noticed or reported during the course of our audit nor we have been informed about any such instance.

For LODHA & CO.

Chartered Accountants (N.K. LODHA)

Partner Place: New Delhi (Membership No. 85155)

Date: 25th May 2011 Firm Registration No. - 301051E


Mar 31, 2010

We have audited the attached Balance Sheet of UMANG DAIRIES LIMITED, as at 31st March 2010, the Profit and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto. 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.

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 misstatements. 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.

1 As required by the Companies (Auditors Report) Order, 2003 (as amended) ("the order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 (the Act) 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 during the course of audit, we enclose in the Annexure, a statement on the matters specified in the paragraphs 4 and 5 of the said Order.

2 Further to our comments in the Annexure referred to in Paragraph 1 above, 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 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) In our opinion, the Balance Sheet, Profit & 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;

e) As per the information and explanations given to us, none of the Directors of the Company is disqualified as on 31st March 2010 from being appointed as a director of the Company under clause (g) of sub- section (1) of Section 274 of the Companies Act, 1956. However, all Directors of the Company are disqualified to be appointed as Director in any other public Company;

f) Attention is invited to:

i. Note No. B7 of Schedule 16 regarding preparation of accounts on the basis of "Going Concern Concept" despite negative networth.

ii. Note No. B13 of Schedule 16 regarding management perception about recoverable amount of fixed assets of the Company being more than carrying amount as stated in said note.

g) Attention is further invited to Note no. BI6 of Schedule 16 regarding certain balances of debtors, loans & advances and current liabilities (including advance from customers) and secured loans are in the process of confirmation/reconciliation as stated in said note (impact unascertained).

Subject to the foregoing, 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 thereon, 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;

ii) in the case of the Profit and Loss Account, of the loss 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.

ANNEXURE TO THE AUDITORS REPORT

(Referred to in paragraph 1 of our Report of even date of Umang Dairies Limited for the year ended 31st March 2010)

i. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) As explained to us, the fixed assets have been physically verified by the Management according to a phased programme designed to cover all the items over a period of three years which in our opinion is reasonable having regard to the size of the Company and the nature of its Fixed Assets. The discrepancies noticed on such physical verification were not material.

(c) As per the records and information and explanations given to us, Fixed Assets disposed off during the year were not substantial.

ii. (a) The inventory of the Company (except stocks lying with third parties and in transit), has been physically verified by the Management at reasonable intervals.

(b) In our opinion, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of our examination of the records of the Company, we are of the opinion that the Company is maintaining proper records of inventory. (In respect of stock in process, records are updated on physical verification of stock on periodical basis). The discrepancies noticed on such physical verification of inventory as compared to book records were not material.

iii. The Company has neither granted nor taken any loans, secured or unsecured to and from companies, firms or other parties as covered in the register maintained u/s 301 of the Act. Accordingly, the provisions of clause 4(iii) (b) to (d), (f) & (g) of the order are not applicable.

iv. In our opinion and according to the information and explanations given to us, there is internal control system commensurate with the size of the Company and the nature of its business (read with note No. 5 of Schedule 16B) for purchases of inventory, fixed assets and for 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. According to the information and explanations provided by the management and based upon audit procedures performed, there are no contracts or arrangements that need to be entered in the register required to be maintained under Section 301 of the Act. Accordingly provisions of clause 4(v)(b) of the order are not applicable.

vi. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of section 58A, 58AA and rules framed thereunder and the directives issued by Reserve Bank of India and other relevant provision of the Act. We have been informed that no order has been passed by the Company Law Board or National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal in this regard.

vii. In our opinion, the Company has an internal audit system commensurate with the size of the Company and nature of its business.

viii. We have broadly reviewed the books of accounts required to be maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(1 )(d) of the Act in respect of the Companys product to which the said rules are made applicable and are of the opinion that, prima facie, the prescribed records have been made and maintained. We have, however, not made a detailed examination of the said records with a view to determine whether they are accurate or complete.

ix. (a) According to the records of the Company, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom duty, Excise Duty, Cess and other material Statutory dues to the extent applicable with the appropriate authorities and there are no undisputed statutory dues payable for a period of more than six months from the date they became payable as at 31s1 March, 2010 except Sales Tax of Rs. 2,33,677 and Mandi tax Rs. 6,23,000 .

(b) According to the records and information and explanations given to us, there are no dues in respect of Income Tax, Service Tax, Custom Duty, Wealth Tax

and Excise Duty that have not been deposited with the appropriate authorities on account of any dispute and the dues in respect of Sales Tax and Cess that have not been deposited with the appropriate authorities on account of dispute and the Forum where the dispute is pending are given below:

Name of Statute Nature of the Amount Period Forum where

dues (Rs.Aacs) dispute is pending

Sales Tax Act Sales Tax Demand/ 1.78 1994-1995/ Sales Tax Penalty Interest 1998-2000 Tribunal

83.95 1995-2007 Appellate Authorities

3.00 1995-1996 High Court

UP Krishi Utpadan Market Fees 162.89 1998-1999/ Tribunal

Mandi Samiti including 2005-2006

Adhiniyam1964 Development Cess

UP Milk Act Cess on Milk 69.25 1994-1996 High Court

x. The Companys accumulated losses at the end of the financial year are more than 50% of its net worth. The Company has incurred cash losses in the current financial year (without considering impact of Rehabilitation Scheme refer note no. B1 of schedule 16) and also in the immediately preceding financial year.

xi. In our opinion, on the basis of audit procedures and according to the information and explanations given to us, the Company has not defaulted in re-payment of dues to Banks, Financial Institutions and Debenture Holders in view of Rehabilitation Scheme as stated in note no. B1 of Schedule 16.

xii. According to the information and explanations 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.

xiii. The Company is not a Chit Fund or a Nidhi / Mutual Benefit Fund /Society, therefore, the provision of clause 4 (xiii) of the said order are not applicable to the Company.

xiv. According to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments.

xv. 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.

xvi. On the basis of information and explanations given to us, the Company has not availed any term loans during

the year read with note no B1 of Schedule 16.

xvii. On the basis of information and explanations given to us and on an overall examination of financial statements, we are of the opinion that, prima facie, no funds raised on short term basis have been used for long term investment other than as stated at note no. B14 of Schedule 16.

xviii. According to the information and explanations given to us, the Company has not made any preferential allotment of shares to any parties or companies covered in the register maintained under Section 301 of the Act during the year.

xix. Based on the examination of the documents and records made available and information and explanations given to us, the Company has not issued any debentures during the year, this is to be read with note no B1 of Schedule 16.

xx. The Company has not raised money through public issue during the year.

xxi. Based on the audit procedures performed and on the basis of information and explanations provided by the management, no fraud on or by the Company has been noticed or reported during the course of our audit nor we have been informed about any such instance.

For LODHA & CO.

Chartered Accountants

(N.K. LODHA)

Partner

Place : New Delhi Firm Registration No. - 301051E

Date : 28th May 2010 (Membership No. 85155)



 
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