Mar 31, 2015
We have audited the accompanying financial statements of Prima
Industries 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 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 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 the maintenance of
adequate accounting records in accordance with the provision of the Act
for safeguarding of the assets of the Company and for preventing and
detecting the 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 internal financial control, 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.
Auditors' 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
thereunder.
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.
Our responsibility is to express an opinion on these standalone
financial statements based on our audit.
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 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 true and fair view 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 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 standalone 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 loss and its cash flows for the year ended
on that date.
Report on Other Legal and Regulatory Requirements
As required by the Companies (Auditor's Report) Order, 2015 ('the
Order'), issued by the Central Government of India in terms of Section
143 (11) of the Act, we give in the Annexure a statement on the matters
specified in paragraphs 3 and 4 of the Order, to the extent applicable.
As required by Section 143 (3) of the Act, we report that:
1 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.
2 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.
3 The company does not have any branches and so provisions of section
143 (8) are not applicable to the company.
4 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.
5 In our opinion, the aforesaid standalone financial statements comply
with the Accounting Standards specified under Section 133 of the Act,
read with Rule 7 of the Companies (Accounts) Rules, 2014.
6 There are no observations or comments on the financial transactions
or matters that have an adverse effect on the functioning of the
company
7 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.
8 There are no qualification,reservation or adverse remark relating to
the maintenance of accounts and other matters connected therewith.
9 The Company does not have any pending litigations which would impact
its financial position;
10 The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable
losses;
11 There were no amounts which were required to be transferred to the
Investor Education and Protection Fund by the Company.
ANNEXURE TO THE INDEPENDENT AUDITORSÂ REPORT
The Annexure referred to in under 'Report on Other Legal and Regulatory
Requirements' section of our report of even date to the members of Prima
Industries Limited on the accounts of the company for the year ended
31st March, 2015
(i) a. The Company has maintained records showing particulars including
quantitative details and situation of fixed assets, but the same
requires to be updated.
b. As explained to us, the fixed assets have been physically verified
by the management at reasonable intervals ; no material discrepancies
were noticed on such verification.
(ii) a. As explained to us, inventories have been physically verified
during the year by the management at reasonable intervals.
b. In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
c. In our opinion and on the basis of examination of the records, the
Company is generally maintaining proper records of its inventory. No
material discrepancies were noticed on physical verification of
inventory by the management as compared to the book records.
(iii) According to the information and explanations given to us and on
the basis of our examination of the books of account, the Company has
not granted any loans, secured or unsecured to companies, firms, or
other parties listed in the register maintained section 189 of the
Companies Act. Consequently , the provisions of clauses 3(iii)(a) and
3(iii)(b) of the Order are not applicable to the Company.
(iv) In our opinion and according to the information and explanations
given to us, there is generally an adequate internal control procedure
commensurate with the size of the Company and nature of its business,
for the purchase of inventories and fixed assets and payment for
expenses and for sale of goods. During the course of our audit, no
major instance of continuing failure to correct any weaknesses in the
internal controls have been noticed.
(v) The Company has not accepted any deposit from public within the
meaning of sections 73 to 76 or any other relevant provisions of the
Companies Act and the rules framed thereunder.
(vi) As per information & explanation given by the
management,maintenence of cost records has been prescribed by the
Central Government under clause (d) of sub-section (1) of section 148
of the Companies Act and we are of the opinion that prima facie the pre
scribed accounts and records have been made and maintained.
(vii) (a) According to the records of the Company, undisputed statutory
dues including provident fund, employees' state insurance, income tax,
sales tax, wealth tax, service tax, customs duty, excise duty, cess to
the extent applicable and any other statutory dues have generally been
regularly deposited with the appropriate authorities. According to the
informations and explanations given to us there were no outstanding
statutory dues as on 31st March, 2015 for a period of more than six
months from the date they became payable.
(b) According to the information & explanations given to us,there is no
amounts payable in respect of income tax, wealth tax,Service tax, Sales
tax,Customs duty & Excise duty which have not been deposited on account
of any disputes.
(c) According to the information & explanations given to us,there is no
amounts payable in respect of income tax, wealth tax,Service tax, Sales
tax,Customs duty & Excise duty which have not been deposited on account
of any disputes.
(viii) The accumulated losses of the Company at the end of the
financial year is more than fifty percent of the net worth; but the
Company has not incurred cash losses during the current financial year
and in the immediately preceding financial year.
(ix) According to the information & explanations given to us, the
company has not defaulted in repayment of dues to financial
institutions or banks or debenture holders
(x) According to the information & explanations given to us,the Company
has, not given any guarantee for loans taken by others from a bank or
financial institution.
(xi) Based on our audit procedures and on the information given by the
management,we report that the Company has not raised any term loans
during the year.
(xii) Based on the audit procedures performed and the information and
explanation given to us, we report that no fraud on or by the Company
has been noticed or reported during the year, nor have we been informed
of such case by the management.
For G.Joseph & Associates
Chartered Accountants
FRN-006310S
P.Rajagopal
Place : Cochin Partner
Date : 30/05/2015 Membership No .202134
Mar 31, 2014
We have audited the accompanying financial statements of M/s.Prima
Industries Limited ("the company") which comprise the Balance Sheet as
at 31st March, 2014 , the Statement of Profit & Loss and the Cash flow
statement for the year then ended, and a summary of significant
accounting policies and other explanatory information.
Management''s responsibility
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards notified under 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 and in accordance with the Accounting Principles
generally accepted in India. 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 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 conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
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 the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company''s preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, 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 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 our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2014;
b) in the case of the Statement of Profit & Loss, of the profit 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.
Report on other legal and other regulatory requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of the
audit.
b) in our opinion, proper books of accounts 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
dealt with by this report are in agreement with the books of account.
d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and
Cash Flow Statement comply with the Accounting Standards notified under
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
e) On the basis of written representation received from directors and
taken on record by the Board of Directors, we report that none of the
directors are disqualified as on March 31, 2014 from being appointed as
a director in terms of clause (g)of sub-section (1) of section 274 of
the Companies Act, 1956.
f) Since the Central Government has not issued any notification as to
the rate at which the cess is to be paid under section 441A of the Act
nor has it issued any Rules under the said section, prescribing the
manner in which such cess is to be paid, no cess is due and payable by
the Company.
The Annexure referred to in paragraph 1 of the Our Report of even date
to the members of Prima Industries Limited on the accounts of the
company for the year ended 31st March, 2013.
On the basis of such checks as we considered appropriate and according
to the information and explanation given to us during the course of our
audit, we report that:
(I) a The company has maintained records showing particulars including
quantitative details and situation of fixed assets, but the same
required to be updated.
b As explained to us, the fixed assets have been physically verified by
the management at reasonable intervals ; no material discrepancies were
noticed on such verification.
c The company has not disposed off substantial part of its fixed assets
during the year.
(ii) a) Physical verification of inventory has been conducted by the
management at reasonable intervals during the year.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
c) In our opinion and on the basis of examination of the records, the
company is generally maintaining proper records of its inventory. No
material discrepancies were noticed on physical verification of
inventory by the management as compared to the book records.
(iii) According to the information and explanations given to us and on
the basis of our examination of the books of account, the company has
not granted any loans, secured or unsecured to companies, firms, or
other parties listed in the register maintained section 301 of the
Companies Act 1956. Consequently, the provisions of clauses
(iii)(b),(iii)(c) & (iii)(d) of the Order are not applicable to the
company.
e) The company has taken unsecured loans from 6 parties. At the year
end, the outstanding balance of such loans taken aggregated to Rs.
3,05,02,924 and the maximum amount involved during the year was Rs.
74,413,311.
f) The rate of interest and other terms and conditions of such loans
are, in our opinion, prima facie not prejudicial to the interest of the
company.
g) The terms of repayment for the above loans have not been stipulated,
but the same are stated to be repayable on demand. Since the company is
stated to have received no demand for repayment of the above loans,
there has been no default on the part of the company.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the company and nature of its business for the
purchase of inventory and fixed assets and for sale of goods and
services.
(v) In our opinion and according to the information and explanations
given to us, there are no contracts and arrangements referred to in
section 301 of the Companies Act, 1956 during the year that need to be
entered in the register maintained under that section. Accordingly,
Clause (v) (b) of the paragraph 4 of the Order is not applicable to the
company for the current year.
(vi) The company has not accepted any deposit from the public covered
under section 58A and 58AA of the Companies Act, 1956.
(vii) The Company does not have an internal audit system.
(viii) As per information & explanation given by the management,
maintenance of cost records ha been prescribed by the Central
Government under clause (d) of sub-section (1) of section 20 of the
Companies Act, 1956 and we are of the opinion that prima facie the
prescribed account and records have been made and maintained.
(ix) a) According to the records of the company, undisputed statutory
dues including Providen Fund, Investor education and protection fund,
Employees'' state insurance, Income tax Sales tax, Wealth tax, Service
tax, Customs duty, Excise duty, cess to the extent applicabl and any
other statutory dues have generally been regularly deposited with th
appropriate authorities. b) As per the information given to us, the
following statutory dues have not been deposited o account of any
disputes:-
Nature of statute Nature of dues Amount
KGST Act KGST 5,149,818
KGST Act KGST 215,211
Nature of statute Period to which Forum where
the amount relates dispute is pending
KGST Act 2007-08 High Court
KGST Act 2008-09 Penalty
(ix) The accumulated losses of the Company at the end of the financial
year are more than fifty percent of the net worth; and it has not
incurred cash loss in the immediately preceding financial year and
current financial year.
(x) As per the information and explanations given to us, the Company
has not availed any loans from banks or financial institutions or
through debentures.
(xi) According to the information and explanations given to us, the
Company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
(xii) The Company is not a Chit Fund or Nidhi/ Mutual Benefit
Fund/Society. Therefore, the provisions of this clause of the Order are
not applicable to the Company.
(xiii) In our opinion and according to the explanations given to us,
the Company is not a dealer or trader in securities.
(xiv)According to the information & explanations given to us,the
Company has, not given any guarantee for loans taken by others from a
bank or financial institution.
(xv) Based on our audit procedures and on the information given by the
management, we report that the Company has not raised any term loans
during the year.
(xvi)Based on the information & explanations given to us and on an
overall examination of the balance sheet of the Company as at 31st
March,2014, we report that no funds raised on short term basis have
been used for long term investment by the Company.
(xvii Based on the audit procedures performed and the information and
explanations given to us by the management, we report that the Company
has not made any preferential allotment of shares during the year
(xviii) Based on the audit procedures performed and the information and
explanation given to us, we report that no fraud on or by the Company
has been noticed or reported during the year, nor have we been informed
of such case by the management.
For G Joseph & Associates
Chartered Accountants
Firm Reg. No. 006310S
Place : Cochin Sd/-
Date : 31.05.2014 P Rajagopal
Partner
Mar 31, 2012
We have audited the attached Balance Sheet of M/s.Prima Industries
Limited ('The company") as at 31st March. 2012 and the Profit & Loss
Account of the company for the year ended 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 have conducted our audit in accordance with auditing standards
generally accepted in India. These standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements and also includes assessing
the accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of financial
statements. We believe that our audit provides a reasonable basis for
our opinion.
As required by the Statement on the Companies (Auditor's Report) Order
2003, as amended by the Companies (Auditors Report) (Amendment) Order,
2004 (together the "Order"), issued by the Central Government of India
in terms of sub-section (4A) of section 227 of the Companies Act, 1956,
and on the basis of such checks of the books and records of the Company
as we considered appropriate and according to the information and
explanations given to us, we give in the Annexure a statement on the
matters specified in paragraphs 4 and 5 of the Order.
Further we report that:-
i. We have obtained all the information and explanations, which to the
best of our knowledge and bejief were necessary for the purpose of the
audit.
ii. In our opinion, proper books of accounts as required by law have
been kept by the company so far as appears from our examination of
those books.
iii. The Balance Sheet, Profit & Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of accounts.
iv. 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.
v. On the basis of written representation received from directors and
taken on record by the Board of Directors, we report that none of the
Directors is disqualified as on 31st March, 2012 from being appointed
as a director in terms of clause (g) of sub-section (1) of section 274
of the Companies Act, 1956.
vi. In our opinion and to the best of our information, and according
to the explanation given to us, the said accounts; subject to:
1. As per the records available, the time granted by State Bank of
India for settling the amounts due to them as per the One Time
Settlement (hereinafter referred to as "OTS") Scheme recognised in
the books in 2006-07 has expired. However the outstandings as shown in
the Balance Sheet are as per the OTS only, whereby the liabilities to
the Banks are understated by Rs. 72,366,372 and Reserves overstated by Rs.
72,366,372.
2. Provision for interest on the outstanding dues to State Bank of
India, if the One Time Settlement amount is not in force, works out to
0,963,965. Out of that provision, interest amounting to Rs. 2,430,000
only has been provided in the financial statements whereby the loss has
been understated by Rs. 8,533,965 and liabilities to Bank are understated
by Rs. 8,533,965.
3. The bank balances (except Bank of India-3528,HDFC, ICICI -18031 and
Loan account with State Bank of India) are subject to Reconciliation
and Confirmation.
4. Certain expenses included under Capital work in progress,freight
inwards,travelling expense,lab expenes,fees and taxes and repairs &
maintenance were not adequately supported by external evidences. 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:
a) in the case of the Balance Sheet, of the state of affairs of the
company as at 31st March, 2012;
b) in the case of the Profit & Loss Account, of the Loss for the year
ended on that date; and in the case of the Cash Flow Statement, of the
cash flows for the year ended on that date.
ANNEXURE TO THE AUDITORS REPORT
Statement referred to in our report of even date to the members of
Prima Industries Limited on the accounts for the year ended 31 st
March, 2012.
i) a) The company has maintained records showing particulars including
quantitative details and situation of fixed assets, but the same
requires to be updated.
b) As per the information and explanations given to us, the fixed
assets have been physically verified by the management at reasonable
intervals and no material discrepancies were noticed on such
verification.
c) The company has not disposed off substantial part of its fixed
assets during the year.
ii) a) Physical verification of inventory has been conducted by the
management, but the frequency of such verification needs to be
improved.
b) In our opinion and according to the information and explanations
given to us, the procedure for physical verification of inventory are
by and large reasonable and adequate in relation to the size of the
company and the nature of its business. The company has taken necessary
steps for strengthening the procedures.
c) On the basis of examination of the records of inventory, in our
opinion, the company has generally maintained proper records of
inventory. No material discrepancies were noticed on physical
verification of inventory as compared to the book records.
(iii) The company has not granted any loans, secured or unsecured to
companies, firms, or other parties, covered in the register maintained
under section 301 of the Act. Clauses (iii)(b) to (iii) (d) of
paragraph 4 of the said Order are not applicable to the company.
e) The company has taken unsecured loans from a Director. At the year
end, the outstanding balance of such loans taken aggregated to Rs.
24,923,363 ana the maximum amount involved during the year was Rs.
24,923,363.
f) The rate of interest and other terms and conditions of such loans
are, in our opinion, prima facie not prejudicial to the interest of the
company.
g) The terms of repayment for the above loans have not been stipulated,
but the same are stated to be repayable on demand. Since the company is
stated to have received no demand for repayment of the above loans,
there has been no default on the part of the company.
(iv) In our opinion and according to the information and explanation
given to us, there is an internal control system for the purchase of
inventory and fixed asset and for the sale of goods and
services.However, the same is not commensurate with the size of the
company and nature of its business.
(v) As explained to us and according to the information and
explanations given to us, the particulars of contracts or arrangements
that need to be entered in the register in pursuance of section 301 of
the Companies Act, 1956 in respect of each party during the year have
been entered in the register.
(vi) The company has not accepted any deposit from public within the
meaning of section 58A and 58AA or any other relevant provisions of the
Act and the Companies (Acceptance of Deposits) Rules, 1975 framed
thereunder.
(vii) The company has an internal audit system ,the scope and extent of
coverage of which is required to be improved.
(viii) The provisions regarding maintenance of cost records under
section 209(1 )(d) of the Companies Act, 1956 are not applicable to the
company.
(ix) a) According to the information and explanations provided to us,
the company was not regular in depositing with appropriate authorities
undisputed statutory dues including provident fund, investor education
and protection fund, employees' state insurance, income tax wealth
tax, service tax, customs duty, excise duty, cess and other material
statutory dues, applicable to it.
The following were outstanding for a period of more than six months on
the last day of the financial year:-
Amount Period to which
Name of statute Nature of dues (Rs.) the amount relates
Income Tax Fringe Benefit Tax 332,752 2005-06
Income Tax Fringe Benefit Tax 90,997 2006-07
b) As per the information given to us, the following statutory dues
have not been deposited on account of any disputes:-
Nature of statute Nature of dues Amount
(Rs.)
KGST Act Central Sales Tax, 588,540
KGST
KGST Act KGST 1,914,214
KGST Act KGST 5,149,818
KGST Act KGST 215,211
CST Act Central Sales Tax 5,856,104
Nature of Statute Period to which Forum where
the amount dispute is pending
relates
KGST ACT 2005-06 Deputy Commissioner (Appeals)
KGST ACT 2006-07 Assistant Commissioner
(Appeals)
KGST ACT 2007-08 High Court
KGST ACT 2008-09 Penalty
CST ACT 2004-05 Assistant Commissioner
(Assessment)
x) The accumulated losses of the company at the end of the financial
year is more than fifty percent of the net worth; and the company has
incurred cash losses during the current financial year.
(xi) As per the information and explanations given to us, the company
has not availed any loans from banks or financial institutions or
through debentures during the year.
(xii) 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 provisions of any special statute applicable to Chit Fund or
Nidhi or Mutual Fund Society are not applicable to the company.
(xiv) In our opinion and according to the explanations given to us, the
company is not a dealer or trader in securities.
(xv) As explained to us, the company has not given any guarantee for
loans taken by others from bank or financial institutions, the terms
and conditions whereof, are prejudicial to the interest of the company.
(xvi) According to the information and explanations given to us, the
company has not obtained any term loans.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the company, we report
that no funds raised on short term basis have been used for long term
investments.
(xviii) The company has not made any preferential allotment of shares
to parties covered in the register maintained under section 301 of the
Companies Act, 1956 during the year.
(xix) In our opinion.the company has not issued any debentures during
the year.
(xx) The company has not raised any money by way of public issue during
the year.
(xxi) According to the information and explanations given to us, during
the year, no fraud on or by the company has been noticed or reported.
For G Joseph & Associates
Chartered Accountants
Firm Reg. No. 00631OS
Place: Cochin -20
Date : 31 May, 2012 Sd/-
P Rajagopal
Partner
Membership No.202134
Mar 31, 2010
We have audited the attached Balance Sheet of M/s.Prima Industries
Limited ("The company") as at 31st March, 2010 and the Profit & Loss
Account of the company for the year ended 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 have conducted our audit in accordance with auditing standards
generally accepted in India. These standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements and also includes assessing
the accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of financial
statements. We believe that our audit provides a reasonable basis for
our opinion.
As required by the Statement on the Companies (Auditors Report) Order
2003, as amended by the Companies (Auditors Report) (Amendment) Order,
2004 (together the "Order"), issued by the Central Government of India
in terms of sub- section (4A) of section 227 of the Companies Act,
1956, and on the basis of such checks of the books and records of the
Company as we considered appropriate and according to the information
and explanations given to us, we give in the Annexure a statement on
the matters specified in paragraphs 4 and 5 of the Order.
Further we report that:-
i. We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of the
audit.
ii. In our opinion, proper books of accounts as required by law have
been kept by the company so far as appears from our examination of
those books.
iii. The Balance Sheet, Profit & Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of accounts.
iv. 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, subject to the Accounting Standard - 15 on
Employee Benefits, where gratuity is provided on Companys own
computation
v. On the basis of written representation received from directors and
taken on record by the Board of Directors, we report that none of the
Directors is disqualified as on31st 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.
vi. In our opinion and to the best of our information, and according
to the explanation given to us, the said accounts; subject to:
1. As per the records available, the time granted by IDBI Bank, State
Bank of India & Bank of India (hereinafter together referred to as
"Banks") for settling the amounts due to them as per the One Time
Settlement (hereinafter referred to as "OTS") Scheme recognised in the
books in 2006-07 has expired. However the outstandings as shown in the
Balance Sheet are as per the OTS only, whereby the liabilities to the
Banks are understated by Rs. 228,053,150, the Loss by Rs 95,579,120 and
Reserves overstated by Rs 13,24,74,030.
2. Provision for interest on the outstanding dues to the banks if the
One Time Settlement amount is not in force, works out to Rs. 70,234,528
(including the interest for the previous year amounting to
Rs.33,129,494). Out of that provision, interest amounting to
Rs.25,319,250 only has been provided in the financial statements
whereby the loss has been understated by Rs. 44,915,278 and liabilities
to Bank are understated by Rs. 177,389,308.
3. The bank balances (except Federal Bank - 1184020015648, 1(1(1
-026205000292, Indian Overseas Bank A/c No 352 and State Bank of India)
and Loan accounts with Banks are subject to Reconciliation and
Confirmation.
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:
a) in the case of the Balance Sheet, of the state of affairs of the
company as at 31st March, 2010;
b) in the case of the Profit & Loss Account, of the Loss for the year
ended on that date; and in the case of the Cash Flow Statement, of the
cash flows for the year ended on that date.
ANNEXURE TO THE AUDITORS REPORT
Statement referred to in our report of even date to the members of
Prima Industries Limited on the accounts for the year ended 31 st
March, 2010.
(i) a The company has maintained records showing particulars including
quantitative details and situation of fixed assets, but the same
requires to be updated.
b As per the information and explanations given to us, the fixed assets
have been physically verified by the management at reasonable intervals
and no material discrepancies were noticed on such verification.
c The company has not disposed off substantial part of its fixed assets
during the year.
(ii) a) Physical verification of inventory has been conducted by the
management, but the frequency of such verification needs to be
improved.
b) In our opinion and according to the information and explanations
given to us, the procedure for physical verification of inventory are
by and large reasonable and adequate in relation to the size of the
company and the nature of its business. The company has taken necessary
steps for strengthening the procedures.
c) On the basis of examination of the records of inventory, in our
opinion, the company has generally maintained proper records of
inventory. No material discrepancies were noticed on physical
verification of inventory as compared to the book records.
(iii) The company has not granted any loans, secured or unsecured to
companies, firms, or other parties, covered in the register maintained
under section 301 of the Act. Clauses (iii)(b) to (iii)(d) of paragraph
4 of the said Order are not applicable to the company.
e) The company has taken unsecured loans from 7 parties. At the year
end, the outstanding balance of such loans taken aggregated to
Rs.2,98,07,447 and the maximum amount involved during the year was
Rs.22,98,07,447.
f) The rate of interest and other terms and conditions of such loans
are, in our opinion, prima facie not prejudicial to the interest of the
company.
g) The terms of repayment for the above loans have not been stipulated,
but the same are stated to be repayable on demand. Since the company is
stated to have received no demand for repayment of the above loans,
there has been no default on the part of the company.
(iv) In our opinion and according to the information and explanation
given to us, there is an
internal control system for the purchase of inventory and fixed asset
and for the sale of goods and services.However, the same is not
commensurate with the size of the company and nature of its business.
(v) As explained to us and according to the intormation and
explanations given to us, the
particulars of contracts or arrangements that need to be entered in the
register in pursuance of section 301 of the Companies Act, 1956 in
respect of each party during the year have been
(vi) The company has not accepted any deposit from public within the
meaning of section 58A and 58AA or any other relevant provisions of the
Act and the Companies (Acceptance of Deposits) Rules, 1975 framed
thereunder.
(vii) The company does not have an internal audit system
viii) The provisions regarding maintenance of cost records under
section 209(1 )(d) of the Companies Act, 1956 are not applicable to the
company.
(ix) a) According to the information and explanations provided to us,
the company was not regular in depositing with appropriate authorities
undisputed statutory dues including provident fund, investor education
and protection fund, employees state insurance, income tax wealth tax,
service tax, customs duty, excise duty, cess and other material
statutory dues, applicable to it. The following were outstanding for a
period of more than six months on the last day of the financial year-
Amount Period to which
Name of statute Nature of dues (Rs.) the amount
relates
Fringe Benefit
Income Tax Tax 332,752 2005-06
Fringe Benefit
Income Tax Tax 90,997 2006-07
Fringe Benefit
Income Tax Tax 196,140 2008-09
EPFDues PF Contribution 53,715 2006-07
b) As per the information given to us, the following statutory dues
have not been deposited on
account of any disputes:-
Amount Period to
which Forum where
dispute is
Nature of statute Nature of
dues (Rs.) the amount
relates pending
Deputy
Commissioner
KGST Act Sales Tax 429,795 2004-05 (Appeals)
Deputy
Commissioner
KGST Act Sales Tax 9,007,329 2003-04 (Appeals)
Deputy
Central Sales Commissioner
CST Act Tax 54,406 2003-04 (Appeals)
Deputy
Commissioner
KGST Act Penalty 2,994,080 2007-08 (Appeals)
(x) The accumulated losses of the company at the end of the financial
year is more than fifty percent of the net worth; but the company has
not incurred cash losses during the current financial year but has
incurred so in the immediately preceding financial year.
(xi) As per the information and explanations given to us, the company
has not availed any loans from banks or financial institutions or
through debentures during the year.
(xii) 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 provisions of any special statute applicable to Chit Fund or
Nidhi or Mutual Fund Society are not applicable to the company.
xiv) In our opinion and according to the explanations given to us, the
company is not a dealer or trader in securities.
(xv) As explained to us, the company has not given any guarantee for
loans taken by others from bank or financial institutions, the terms
and conditions whereof, are prejudicial to the interest of the company.
xvi) According to the information and explanations given to us, the
company has not obtained any term loans.
cvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the company, we report
that no funds raised on short term basis have been used for long term
investments.
viii) The company has not made any preferential allotment of shares to
parties covered in the register maintained under section 301 of the
Companies Act, 1956 during the year
xix) In our opinion,the company has not issued any debentures during
the year. (xx) The company has not raised any money by way of public
issue during the year.
xxi) According to the information and explanations given to us, during
the year, no fraud on or by the company has been noticed or reported.
For G Joseph & Associates
Chartered Accountants
Finn Reg. No. 00631 OS
Place Cochin P Rajagopal
Date 30 June, 2010 Partner
Membership No.202134