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 and 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 Balance Sheet and the Statement of Profit and
Loss Cash Flow Statement comply with the Accounting Standards referred
to in sub-section (3C) of section 211 of the 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, subject to our observation hereunder:-
During the year, the company has not made full provision for diminution
in value of investments as required by AS-13 issued by the ICAI and the
provision as standing in the books of accounts at the beginning of the
year has been taken into consideration. In our opinion the provision in
value of investment for the year under report should have been made for
Rs. 30,50,450/- but the provision as standing in the books of accounts
is Rs. 21,49,706/-. Had the full provision for diminution in value of
investment been made, the profit would have been reduced by Rs.
9,00,743/- and consequently the negative balance of Reserves and
Surplus carried in the balance sheet would have been increased to Rs.
1,16,95,254/-.
e) On the basis of written representations received from the directors
as on March 31,2014, taken on record by the Board of Directors, none of
the directors is 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 Act.
ANNEXURE REFFERED TO IN PARAGRAPH 1 UNDER THE HEADING "REPORT ON
OTHER LEGAL AND REGULATORY REQUIREMENTS" OF OUR AUDITOR'S REPORT OF
EVEN DATE ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2014
OF M/s PREM SOMANI FINANCIAL SERVICES LIMITED
As required by the Companies (Auditor's Report) Order, 2003 and the
Companies (Auditor's Report) (Amendment) Order, 2004, issued by the
Central Government of India in terms of section 227 (4A) of the
Companies Act, 1956, we further report that:
i. Fixed Assets:-
a. The Company has maintained proper records Showing full particulars,
including quantitative details and situation of fixed assets.
b. According to the information & explanations given to us, the
management on a sample basis during the year has physically verified
the major assets and in our opinion, the frequency of verification is
reasonable. No material discrepancies were noticed on such
verification.
c. There has been no substantial disposal of fixed assets during the
year, so as to affect the going concern status of the Company.
ii. Inventories
In our opinion and according to the information and explanations given
to us, the company does not have any kind of inventory.
iii. Loans to/from the parties covered in the register maintained under
Section 301 of the Act:-
a. The Company has granted unsecured loans to one party covered in the
register maintained under section 301 of the Companies Act, 1956. The
maximum amount outstanding at any time during the year was Rs.
61,28,514/- (outstanding balance as at March 31, 2014 is 59,78,514/-).
The Company has not charged interest on such loan. In our opinion and
according to the information and explanations given to us, the terms
and conditions of the unsecured loans so granted are not prima facie
prejudicial to the interest of the company. There is no irregularity in
the recovery of principal which is as per mutual stipulations.
b. According to the information and explanations given to us, during
the year company has not taken any loan/deposit from the parties
covered in the register maintained under section 301 of the Companies
Act, 1956.
iv. Internal Control System
In our opinion and according to the information and explanations given
to us, we observed that there is an adequate internal control system
commensurate with the scale of business and the size of the Company.
v. Transactions with Related Parties as per Register of Contract u/s
301:
In our opinion and according to the information and explanations given
to us, during the financial year there were no contracts or
arrangements referred to in section 301 of the Act, which needs to be
entered in the register maintained underthat section.
vi. Public Deposits:-
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 or any other relevant provisions of the Companies
Act, 1956 and the rules framed there under. Therefore the provisions of
clause (vi) of paragraph 4 of the Order are not applicable to the
Company.
vii. Internal Audit System:-
In our opinion, the Company has an internal audit system commensurate
with the size of the Company and nature of its business. However, in
our opinion, the system needs to be strengthened further so as to match
up with the growth of the Company.
viii. Cost Record:-
According to the information and explanations given to us, the
maintenance of cost records has not been prescribed by the Central
Government under section 209(1)(d) of the Companies Act, 1956, for any
of the activities of the Company.
ix. Statutory Dues:-
a. Undisputed statutory dues:-According to the information and
explanations given to us and as per the records of the Company, it has
generally been regular in depositing undisputed statutory dues,
including dues pertaining to Investor Education and Protection Fund,
Employees' State Insurance, Income Tax, Sales Tax, Service Tax,
Custom Duty, Excise Duty, Cess and any other statutory dues with the
appropriate authorities.
b. Disputed statutory dues:-According to the information and
explanations given to us, there were no disputed dues which have
remained outstanding as at the end of the financial year.
x. Sick Industry:-
The accumulated losses of the Company at the end of the financial year
2013-14 are less than 50% of the net worth of the Company. The Company
has not incurred cash losses in the financial year 201314 as well as
during the immediately preceding financial year.
xi. Dues to Financial,Institution or Bank or Debenture holders :-
According to the information and explanations given to us and based on
the documents and records produced before us, there are no dues to
banks and financial institutions. Further, there are no dues to
debenture holders as the company not issued debentures.
xii. Loans and Advances granted on the basis of security:-
According to the information and explanations given to us, the Company
has not granted any loans or advances on the basis of security byway of
pledge of shares, debentures or other securities.
xiii. Chit Fund, Nidhi or Mutual Benefit Company:-
In our opinion and according to the information and explanations given
to us, the nature of activities of the Company does not attract any
special statute applicable to chit fund and nidhi / mutual benefit
fund/societies.
xiv. Company dealing or trading in shares, securities, debentures and
other investments:-
In respect of the shares, securities, debentures and other investments
dealt or traded by the Company, proper records have been maintained in
respect of the transactions and contracts and timely entries have been
made therein. All the shares/securities held by the Company are in its
own name.
xv. Guarantees given for loans taken by others from bank or financial
institution:-
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. Application of Term loans:-
According to the information and explanations given to us, the company
had no loans outstanding at the beginning of the year and has not
applied for any loan during the year, therefore this clause is not
applicable to the company.
xvii. Use of short term funds for long terms investments:-
According to the information and explanations given to us and on an
overall examination of the Balance Sheet and other records of the
Company, we are of the opinion that, prima facie short-term funds have
not been used for long-term investments.
xviii. Preferential allotment of shares to parties covered in the
register maintained under Section 301:-
The Company has not made any preferential allotment of shares to the
company covered in the register maintained under section 301 of the
Companies Act, 1956.
xix. Securities and Debentures:-
The Company did not issue any share or debenture during the year.
xx. End use of money raised by public issues:-
The Company has not raised any money by a public issue, during the
year.
xxi. Fraud on or by the company-noticed or reported:-
According to the information and explanations given to us, and to the
best of our knowledge and belief, no fraud on or by the company has
been noticed or reported during the year.
For and on behalf of
S. MISRA & ASSOCIATES
Chartered Accountants
FRN-004972C
CA.MANISH KUMAR
Partner
M. No.-413078
Place: Jaipur
Date: August 26,2014