Mar 31, 2010
We have audited the attached Balance Sheet of the "iQ infotech Limited,
# 17A, Kumbalagodu Industrial Area, Mysore Road, Bangalore - 560 074,
as at 31st March, 2010 and also the Profit and Loss Account and the
Cash Flow Statement of the Company 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 auditing standards generally
accepted in India. Those Standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis of
our opinion.
As required by the Companies [Auditors Report] Order, 2003 (as
amended) issued by the Central Government of India in terms of
sub-section [4A] of Section 227 of the Companies Act, 1956, we enclose
in the Annexure a statement on the matters specified in paragraph 4 and
5 of the said order to the extent applicable.
Further to our comments in the Annexure referred to in paragraph 3
above, we state 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
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 the
books.
c. The Balance Sheet, Profit and Loss Account and Cash Flow Statement
referred to in this report are in agreement with the books of accounts.
d. In our opinion, the Balance Sheet, the Profit and Loss Account and
the Cash Flow Statement dealt with by this report comply with the
Accounting Standards referred to in section 211 [3C] of Companies Act,
1956.
e. On the basis of the written representations received from the
Directors, and taken on record by the Board of Directors, we report
that none of the Directors is disqualified as on 31st March 2010 from
being appointed as a Director in Terms of Clause [g] of sub-section [1]
of section 274 of the Companies Act, 1956.
f. In our opinion and according to the information and explanations
given to us, the accounts read together with the notes and accounting
policies thereto, give the information required by the companies Act
1956, in the manner so required and gives a true and fair view in
conformity with the accounting principles generally accepted in India
subject to:
i. Note No. 2.1(a) of accounting policies regarding accounting of
Gratuity and Encashment of Leave on cash basis as mentioned in Note 8.2
of accounting policy read
with Note No.12 of Notes to Accounts regarding non provision for
gratuity liability, which is inconsistent with Accounting Standard -15
(revised) notified under the Companies Accounting Standard Rules, 2006.
ii. Note No. 6 regarding disclosure of quantitative particulars and
capacity utilization is not in accordance with Part II of Schedule VI
of the Companies Act.
iii. Note No.13 of Notes to accounts regarding Intangible Assets
disclosure is not in accordance with the Accounting Standard
-26(Intangible Assets) notified by the Companies Accounting Standard
Rules,2006. Further, the Company has not assessed the probability of
the future economic benefits from the research and development
activities.
iv. Note No.15 of Notes to accounts regarding reconciliation of sundry
debtors, bank balance, creditors and VAT and Excise duty balances.
v. Note No. 16 of Notes to Accounts regarding non payment of statutory
liabilities and non provision for interest and penalty payable for
default in payment of statutory liabilities.
vi. Note No. 18 of Notes to account regarding non availability of
share certificates for investments made in equity shares of ASIA HR
Technologies Limited (Formerly known as SMR Universal Softech Ltd).,
and Suntrack Diamond Ltd., amounting to Rs. 6,19,716/- and Rs.
45,00,000/- respectively.
vii. Note No. 18 of Notes to Accounts regarding non provision for
diminution in the value of investments in ASIA HR Technologies Limited
(Formerly known as SMR Universal Softech Ltd), and Suntrack Diamond
Ltd. The amount of diminution value is not ascertained by the Company.
viii. Accounting Policy No 7, with regards to Inventory Valuation of
Raw Materials and Method of Valuation of Inventory is inconsistent with
the Accounting Standard - 2 notified by the Companies Accounting
Standard Rules,2006
a. In the case of Balance Sheet, of the state of affairs of the
Company as on 31st March 2010.
b. In the case of the Profit and Loss Account of the Loss of the
Company for the year ended on that date; and
c. 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 TO THE
MEMBERS OF THE iQ INFOTECH LIMITED FOR THE YEAR ENDED 31st MARCH 2010
1. a) The Company has maintained records showing full particulars
including quantitative details and location of the fixed assets.
b) There is a regular program of physical verification, which in our
opinion is reasonable, having regard to the size of the Company and the
nature of fixed assets. No materials discrepancies have been noticed by
the management in respect of the assets physically verified during the
period.
c) Company has not sold substantial part of fixed assets during the
year.
2. a. Inventories have been physically verified during the year by the
management.In our opinion, the frequency of verification is reasonable.
b. The Procedures of physical verification of stocks followed by the
management are 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
book records were not material and have been properly dealt with in the
books of account.
3. a. As informed to us, the Company has not granted loans, secured
or unsecured or unsecured to companies, firms or other parties covered
in the register maintained under section 301 of the Companies Act,
1956.
b. As the Company has not granted any loans during the year to the
parties covered in the register maintained under section 301 of the
Companies Act, 1956 clause (b), (c) and (d) are not applicable
c. The Company has taken unsecured loans during the period from
parties covered in the register maintained under section 301 of the
Companies Act, 1956. The company has taken loan from two parties. The
year end balance from both the parties put together is Rs 1.55 lakhs.
d. In our opinion, having regard to the long term involvement with the
parties covered in the register maintained under section 301 of the
Companies Act, 1956 and considering the explanation given to us, in
this regard the rate of interest and other terms and conditions of
loans taken by the company, secured or unsecured, wherever stipulated
are not prima facie prejudicial to the interest of the company.
e. The Company is generally regular in repayment of principal amount
and interest as per the stipulated terms.
4. In our opinion, and according to the information and explanations
given to us, there are internal control procedures commensurate with
the size of the Company and the nature of its business with regard to
purchase of raw materials, stores and spares, plant and machinery,
equipment and other assets. In our opinion, the internal control in the
area of receivables and advances needs to be further strengthened.
5. a. All the transactions with parties covered under section 301 of
the Companies Act, 1956 have been properly entered, if and when
transaction takes place, in the register maintained under section 301
of the Act
b. In our opinion and according to the information and explanations
given to us, the Company has not entered into transactions of sale of
goods, made in pursuance of contracts or arrangements entered in the
register maintained under Section 301 of the Companies Act, 1956.
6.The Company has not accepted any deposits from the public during the
year.
7. The company has an internal audit system. However in our opinion the
same is not commensurate with the nature and size of the business of
the company.
8.Maintenance of cost records as per clause (d) of sub-section (1) of
section 209 of the Companies Act is not applicable to the Company.
9.a. In our opinion and according to the information and explanations
given to us, the Company is not regular in depositing undisputed
statutory dues including Provident Fund, Employees State Insurance,
sales tax, service tax and Excise Duty with appropriate authorities.
The company is generally regular in payment of Income Tax and Customs
Duty.
b.According to the information and explanations given to us, undisputed
amounts payable in respect of the following except income tax, service
tax, customs duty, excise duty and cess were in arrears, as at 31st
March 2010, for a period of more than six months from the date they
became payable;
Tax Deducted at source Rs. 123,560.00
Service Tax Rs. 2,73,387.00
ESI Rs 64,400.00
PF Rs 214,831.00
VAT Rs 10,73,550.00
10. The Companys accumulated losses at the end of the financial year
is Rs.5, 37, 10,088/- . The company has incurred cash losses during the
current year, Immediately preceding financial year company has not
incurred any cash losses.
11. The company does not have any outstanding due to any financial
institutions, banks or debenture holders during the year.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. As the Company is not a chit fund, nidhi, mutual benefit fund or
society the provisions of clause 4[xiii] of the Companies [Auditors
Report Order, 2003 is not applicable to the Company.
14. The Company is not dealing or trading in
shares/securities/debentures and other investments.
15. The Company has not given any guarantees for loans taken by others
from bank or financial institutions during the period under review.
16. In our opinion and according to the information and explanations
given to us by the management, term loans are applied for the purpose
for which the loans were obtained.
17. According to the information and explanations given to us and on an
overall examination of the balance sheet of the company, we report that
neither any short-term funds have been used for long-term purposes nor
any long-term funds have been used to finance short-term assets except
permanent working capital.
18. According to the information and explanations given to us, during
the period covered by our audit report, the company has not made any
preferential allotment of share to parties and companies covered in the
register maintained under section 301 of the Act.
19. The Company has not issued any debentures during the year.
20. The Company has not raised any money by way public issue during the
year.
21. Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the course of our audit.
For G.V. SUNDER & CO.,
Chartered Accountants
(ICAI FRN: 007248S)
G.V.SUNDER
Partner
Membership No: 019190
Place : Bangalore
Date : 28/08/2010
Mar 31, 2009
We have audited the attached BaJance Sheet of the "iQ infotech Limited,
# 17A, Kumbalagodu industrial Area, Mysore Road, Bangalore 560 074, as
at 31st March, 2009 and also the Profit and Loss Account and the Cash
Flow Statement of the Company 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 auditing standards generally
accepted in India. Those Standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis of
our opinion.
As required by the Companies [Auditors Report] Order, 2003 (as
amended) issued by the Central Government of India in terms of
sub-section [4A] of Section 227 of the Companies Act, 1956, we enclose
in the Annexure a statement on the matters specified in paragraph 4 and
5 of the said order to the extent applicable.
Further to our comments in the Annexure referred to in paragraph 3
above, we state 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
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 the
books.
c. The Balance Sheet, Profit and Loss Account and Cash Flow Statement
referred to in this report are in agreement with the books of accounts.
d. In our opinion, the Balance Sheet, the Profit and Loss Account and
the Cash Flow Statement dealt with by this report comply with the
Accounting Standards referred to in section 211 [3C] of Companies Act,
1956.
e. On the basis of the written representations received from the
Directors, and taken on record by the Board of Directors, we report
that none of the Directors is disqualified as on 31s March 2009F from
being appointed as a Director in Terms of Clause [g] of sub-section [1]
of section 274 of the Companies Act, 1956.
f. In our opinion and according to the information and explanations
given to us, the accounts read together with the notes and accounting
policies thereto, give the information required by the companies Act
1956, in the manner so required and gives a true and fair view in
conformity with the accounting principles generally accepted in India
subject to:
Note No. 2.1(b) of accounting policies regarding accounting of
encashment of leave on cash basis, and provision made for gratuity made
on estimated basis as mentioned in Note 8.2 of accounting policy read
with Note No. 12 of Notes to Accounts regarding non provision for
gratuity liability, which is inconsistent with Accounting Standard -15
(revised) notified by the Companies Accounting Standard Rules, 2006.
Note No. 15 of Notes to accounts regarding non reconciliation of Sundry
debtors, creditors and VAT and Excise duty balances.
ii. Note No. 16 of Notes to Accounts regarding non payment for
statutory Liabilities.
iv. Note No. 17 and 18 of Notes to account regarding non availability
of share certificates for investments made in equity shares of SMR
Universal Softech Ltd., and Suntrack Ltd., amounting to Rs. 6,19,716/-
and Rs. 45,00,000/- respectively
v. Note No. 18 of Notes to Accounts regarding non provision for
diminution in the value of investments in SMR Universal Softech Ltd.,
and Suntrack Ltd. The amount of diminution value is not ascertained by
the Company.
a. In the case of Balance Sheet, of the state of affairs of the
Company as on 31st March 2009.
b. In the case of the Profit and Loss Account of the Loss of the
Company for the year ended on that date; and
c. 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 TO THE
MEMBERS OF THE IQ INFOTECH LIMITED FOR THE
YEAR ENDED 31st MARCH 2009
1. a) The Company has maintained proper records showing full
particulars
including quantitative details and location of the fixed assets.
b) There is a regular program of physical verification, which in our
opinion is reasonable, having regard to the size of the Company and the
nature of Fixed assets. No materials discrepancies have been noticed in
respect of the assets physically verified during the period.
c) During the year the Company has sold a portion of the land for total
consideration of Rs.130.91 lakhs.
2. a. Inventories have been physically verified during the year by
the management. In ouropinion, the frequency of verification is
reasonable,
b. The Procedures of physical verification of stocks followed by the
management are 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
hook records were not material and have been properly dealt with in the
books of account.
3. a. The Company has not granted loans, secured or unsecured or
unsecured companies, firms or other parties covered in the register
maintained under section 301 of the Companies Act, 1956.
b. As the Company has not granted any loans during the year to the
parties covered in the register maintained under section 301 of the
Companies Act, 1956 clause (b), (c) and (d) are not applicable
c. The Company has taken unsecured loans during the period from
parties covered in the register maintained under section 301 of the
Companies Act, 1956. The company has taken loan from two parties. The
year end balance from both the parties put together is Rs 1.54 lakhs.
d. In our opinion, having regard to the long term involvement with the
parties covered in the register maintained under section 301 of the
Companies Act, 1956 and considering the explanation given to us, in
this regard the rate of interest and other terms and conditions of
loans taken by the company, secured or unsecured, wherever stipulated
are not prima facie prejudicial to the interest of the company.
e. The Company is regular in repayment of principal amount and
interest as per the stipulated terms.
4. In our opinion, and according to the information and explanations
given to us, there are internal control procedures commensurate with
the size of the Company and the nature of its business with regard to
purchase of raw materials, stores and spares, plant and machinery,
equipment and other assets. In our opinion, the internal control in the
area of receivables and advances needs to be further strengthened.
5. a. All tile transactions with parties covered under section 301 of
the Companies Act, 1956 have been properly entered, if and when
transaction takes place, in the register maintained under section 301
of the Act.
b. In our opinion and according to the information and explanations
given to us, the Company has not entered into transactions of sale of
goods, made in pursuance of contracts or arrangements entered in the
register maintained under Section 301 of the Companies Act, 1956.
6. The Company has not accepted any deposits from the public during
the year.
7. The company has an internal audit system, which in our opinion, not
commensurate with the size and nature of the business of the company.
8. Maintenance of cost records as per clause (d) of sub-section (1) of
section 209 of the Companies Act is not applicable to the Company.
9. a. In our opinion and according to the information and explanations
given to us, the Company is not regular in depositing undisputed
statutory dues including Provident Fund, Employees State Insurance,
Income Tax, Customs Duty, sales tax, service tax and Excise Duty with
appropriate authorities.
b. According to the information and explanations given to us,
undisputed amounts payable in respect of the following except income
tax, service tax, customs duty, excise duty and cess were in arrears,
as at 31st March 2009, for a period of more than six months from the
date they became payable;
Tax Deducted at source Rs. 80,060.00
Service Tax Rs.2,73,387.00
10. The Companys accumulated losses at the end of the financial year
is Rs.4,22,83,712/-. The company has not incurred any cash losses
during the current year. Immediately preceding financial year company
has not incurred any cash losses.
11. The company does not have any outstanding due to any financial
institutions, banks or debenture holders during the year.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. As the Company is not a chit fund, nidhi, mutual benefit fund or
society the provisions of clause 4[xiii] of the Companies [Auditors
Report] Order, 2003 is not applicable to the Company.
14. The Company is not dealing or trading in
shares/securities/debentures and other investments.
15. The Company has not given any guarantees for loans taken by others
from bank or financial institutions during the period under review.
16. The Company has obtained Rs.88,06,342/- term loans from the bank
during the year. According to the information and explanations given to
us same has been applied for the purpose for which the loan was
obtained.
17. According to the information and explanations given to us and on
an overall examination of the balance sheet of the company, we report
that neither any short-term funds have been used for long-term purposes
nor any long-term funds have been used to finance short-term assets
except permanent working capital.
18. According to the information and explanations given to us, during
the period covered by our audit report, the company has not made any
preferential allotment of share to parties and companies covered in the
register maintained under section 301 oftheAct.
19. The Company has not issued any debentures during the year.
20. The Company has not raised any money by way public issue during
the year.
21. Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the course of our audit.
Place: Bangalore. For G.V.SUNDER & CO.,
Date: 01-08-2009 Chartered Accountants
G.V.SUNDER
Partner
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