| We have audited the attached Balance Sheet of ANU'S LABORATORIES
LIMITED as at March 31, 2012, the Statement of Profit and Loss 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 auditing standards generally
accepted in India. Those Standards require that we plan and perform the
audit to obtain responsible 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 for
our opinion.
1. As required by the Companies (Auditor's Report) Order, 2003 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 paragraphs 4 and 5 of the said
Order to the extent applicable.
2. Further to our comments in the Annexure referred to 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, Statement of Profit and 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 dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of Section 211 of
the Companies Act, 1956 to the extent applicable.
e. On the basis of written representations received from the
directors/ companies as on March 31, 2012, and taken on record by the
Board of Directors, we report that none of the Directors is
disqualified as on March 31, 2012 from being appointed as a director in
terms of clause (g) of sub-section (1) of Section 274 of the Companies
Act, 1956.
f. Attention is invited to Note 2.10 of Notes forming part of the
financial statements relating to the liability of interest and required
disclosures under the Micro, Small and Medium Enterprises Development
Act, 2006. The Company is in the process of compiling information
regarding measurement and disclosures prescribed under the Act. In view
of the above, we are unable to comment on the impact of the same on the
accounts.
g. In our opinion and to the best of our information and according to
the explanation given to us, the said accounts 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 the Balance Sheet, of the state of affairs of the
Company as at March 31, 2012;
ii. in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
iii. in the case of Cash Flow Statement, of the cash flows for the year
ended on that date
i. a. The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
b. The fixed assets have been physically verified by the management in
accordance with regular programme of verification which, in our
opinion, is reasonable having regard to the size of the Company and
nature of its assets. The discrepancies noticed on such verification
were not material and have been properly dealt with in the books of
account.
c. Fixed assets disposed off during the year were not substantial.
According to the information and explanations given to us, we are of
the opinion that the disposal of fixed assets has not affected the
going concern status of the Company.
ii. a. The inventories have been physically verified during the year
by the management. In our opinion, the frequency of verification is
reasonable.
b. The procedure 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 according to the information and explanation
given to us, the Company is maintaining proper records of inventory.
The discrepancies noticed on verification between physical stocks and
the book records were not material and have been properly dealt with in
the books of account.
iii. The Company has not granted or taken loans, secured or unsecured
to/ from companies, firms or other parties covered in the register
maintained under Section 301 of the Companies Act, 1956. Accordingly,
sub-clause (b), (c), (d), (f) & (g) are not applicable.
iv. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchases of inventory and fixed assets and for the sale of goods and
services. During the course of our audit, no major weakness has been
noticed in the internal control system in respect of these areas.
v. a. As per information and explanation and on basis of records
maintained by the Company we are of the opinion that particulars of
contracts or arrangements referred to in Section 301 of the Act have
been entered in the register required to be maintained under that
section.
b. In our opinion and according to the information and explanation
given to us, the transactions made in pursuance of contracts or
arrangements entered in the registers maintained under Section 301 of
the Companies Act, 1956 have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
vi. In our opinion and according to the information and explanations
given to us, the Company has not accepted deposits from the public
during the year. Therefore, the provisions of Clause 4(vii) of the
Order are not applicable to the Company.
vii. In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
viii. We have broadly reviewed the books of account relating to
materials, labour and other items of cost 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 Companies
Act, 1956 and we are of the opinion that prima facie the prescribed
accounts and records have been made and maintained.
ix. a. According to the records of the Company, provident fund,
employees' state insurance, income tax, sales tax, professional tax and
TDS dues applicable to it have not been deposited during the year with
the appropriate authorities. According to the information and
explanation given to us, the above said undisputed amounts payable were
in arrears as at March 31, 2012 of Rs.88.25 million for a period of more
than six months from the date on which they became payable. Details are
as under:
Rs. Million
Particulars Amount as on March 31, 2012
Provident Fund 10.64
ESI 1.56
Income Tax 55.36
Sales Tax 10.64
TDS 9.50
Professional Tax 0.55
TOTAL 88.25
b. According to the information and explanations given to us, the
details of dues of sales tax which have not been deposited on account
of any dispute are given below:
Nature Nature of Amount Period to Forum
of due the statute Rs.Million which where
amount dispute is
relates pending
Sales Tax Sales Tax Act 0.68 F.Y. 2003-04 Sales Tax
Appellate
Tribunal
Sales Tax Sales Tax Act 1.83 F.Y. 2004-05 Sales Tax
Appellate
Tribunal
Sales Tax Sales Tax Act 2.21 F.Y. 2005-06 Sales Tax
Appellate
Tribunal
x. The Company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses during the financial
year covered by our audit and the immediately preceding financial year.
xi. In our opinion and according to the information and explanation
given to us, the Company has defaulted in repayment of dues to a
financial institution or bank and details are as below:
Rs. Million
Particulars Amount as on March 31, 2012
Development Credit Bank Limited 8.56
ING Vysya Bank Limited 6.14
Andhra Pradesh State Financial Corporation 21.76
IFCI Venture Capital Funds Ltd 34.12
TOTAL 70.58
xii. Based on our examination of the records and 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. In our opinion, the Company is not a chit fund or a nidhi/mutual
benefit fund/society. Therefore the provisions of clause 4(xiii) of the
Companies (Auditor's Report) Order, 2003 are not applicable to the
Company.
xiv. In our opinion the Company is not dealing in or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause 4 (xiv) of the Companies (Auditor's Report) Order,
2003 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 bank
or financial institutions.
xvi. In our opinion and according to the information and explanations
given to us, the term loans have been applied for the purpose for which
they were raised.
xvii. According to the information and explanations given to us and on
an overall examination of the Balance Sheet of the Company, we report
that no funds raised on short term basis have been used for long term
investment.
xviii. The Company has not made any preferential allotment of shares
to parties and companies covered in the register maintained under
Section 301 of the Companies Act, 1956.
xix. In respect of the end-use of money raised by public issue as
disclosed in the Notes to the financial statements, in our opinion and
based on the explanations given to us and certified by the management,
the Company has utilized the total funds for the project
implementation, subject to change in utilization of funds in respect of
pilot plant to the extent of Rs.50.82 million, which have been utilized
for new plant.
xx. According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For Karumanchi Associates
Chartered Accountants
Firm Regd. No. 001753S
K. Peddabbai
Hyderabad Partner
May 29, 2012 Membership No. 25036
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