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Indore Wire Company Ltd.

BSE: 504784 Sector: Metals & Mining
NSE: N.A. ISIN Code: N.A.
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Indore Wire Company Ltd. (INDOREWIRECO) - Auditors Report

Company auditors report

INDORE WIRE COMPANY LIMITED ANNUAL REPORT 2002-2003 AUDITORS REPORT TO THE MEMBERS OF INDORE WIRE COMPANY LIMITED We have audited the attached Balance Sheet of M/s. Indore Wire Company Ltd, as at 31st March, 2003 and also the Profit and Loss Account of the Company for the year then ended on that date. These financial statements are the responsibility of the company's management, our responsibility is to express an opinion on this financial statement based on our Audit:- 1) We conducted our audit in accordance with the Auditing Standards generally accepted in India. The Standards required that we planned and performed the Audit to obtain reasonable assurance about whether the financial statements are free from any 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 the management as well as evaluating the over all presentation of the Financial statements, We believe that cur Audit provides reasonable basis for our opinion. 2) As required by the Manufacturing and Other Companies (Auditors' Report) Order, 1988 issued by the Central Government in terms of Section 227 (4-A) of the Companies Act, 1956, we enclose in annexure a statement on the matters specified in paragraphs 4 and 5 of the said order to the extent applicable to the company. 3) Further to our comments in the annexure referred to above, 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 purposes of our audit; ii. In our opinion, proper books of accounts as required by law have been kept by the company so far as appears our examination of such books of the company; iii. The Balance Sheet and Profit and Loss Account dealt with by this report are in agreement with the books of accounts of the company; iv. In our opinion, the Profit and Loss Account and Balance Sheet comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956; v. Based on the representations made by the Directors of the company and taken on record by the Board of Directors and the information and explanations given to us, we report that none of the Directors is, as at 31st March, 2003, Prima-facie disqualified from being appointed as Director in terms of under clause (g) of sub-section (1) of section 274 of the companies act, 1956; vi. Attention is invited to the following notes in schedule No. 15 i) Note No. 7 regarding non provision of interest liability Rs.1994.53 Lacs. This is contrary to the accounting practice recommended by the Institute of Chartered Accountants of India. Consequently loss for the year is under stated by Rs.1994. 53 Lacs. ii) Note No. 8 regarding diminution in the value of investment of Rs. 76.23 Lacs and the consequential effect there of in the Profit and Loss Account and Balance Sheet. iii) Note No. 9 regarding non provision of doubtful debts Rs.88.14 Lacs. 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 with significant accounting policies 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 :- a) in the me of Balance Sheet, of the state of affairs of the Company as at 31st March, 2003 and b) in the case of Profit and Loss Account, of the Loss for the year ended on that date subject to the affect of the above notes. FOR R. D. JOSHI & COMPANY CHARTERED ACCOUNTANTS Indore H. L. Joshi 21.08.2003 Partner ANNEXURE TO THE AUDITORS` REPORT (Referred to in paragraph (1) of our report, of even date) i) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. The fixed assets were physically verified by the management during the year. In our opinion frequency of verification is reasonable having regard to the size of the Company' and nature of its business. To the best of knowledge, no material discrepancies have been re-valued during the year. ii) None of the fixed assets have been re-valued during the year, iii) The stocks of finished goods, stores,spare parts, semifinished goods and raw materials have been physically verified during tire year by the Management. In our opinion, the frequency of verification is reasonable. iv) In our opinion and according tea the information and explanations given to its, the procedures of verification of stocks followed by the management are reasonable and adequate in relation to the size of the Company and the natures of its business. v) The discrepancies noticed between the physical stocks as verified and book records were not material and the same have been properly dealt with in the books of account. vi) In our opinion, and on the basis of our examination of the stock records, the valuation of raw materials, works in process, finished goods and stores& spares are fair and proper in accordance with the normally accepted accounting principle and is on the same basis as in the proceeding year. vii) The Company has not taken loans from companies, firms and other parties listed in the Register maintained under Section 301 of the Companies Act, 1956 and from Companies under the same management/ as defined under sub-section (113) of section 370 of the said Act. The terms and conditions on which the loans were taken acre not prima facie prejudicial to the interest of the Company. viii) The Company has not granted any loans, secured or unsecured to companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956 or to Companies under the same management as defined under sub-section (113) of section 370 of then Companies Act, 1956. ix) The Company has not given any loans or advances in the nature of loans except interest free advances to employees who are repaying the principal amount as stipulated. x) In our opinion and according to the information and explanations given to its there tire adequate internal control procedures commensurate with the size of the company and the nature of its business for the purchase of stores, raw materials including components, plant and machinery, equipment and other assets and for the sale of goods. xi) According to the information and explanations given to us, where transactions have been made with different parties, the transactions of purchase of goods and materials and sale of goods, materials and services made in pursuance of contracts or arrangements entered in the Register maintained under section 301 of the Companies Act, 1956 and aggregating during the year to Rs. 50,000/- or more in respect of each party have been made at prices which are reasonable, having regard to the prevailing market prices for such goods, materials or services. xii) As explained to us, the Company has a regular procedure for the determination of unserviceable or damaged stores, raw materials and finished goods. Adequate provision has been made in the accounts for the loss arising on the items so determined. xiii) The Company 'as not accepted any deposits from the Public. xiv) In our opinion reasonable records have been maintained by the Company for the sale and disposal of scraps As explained to us the Company does not have any by products. xv) The company leas appointed an independent firm of Chartered Accountants who do the internal audit periodically. In our opinion, the internal audit system is commensurate with the size and nature of the business of the company. xvi) We have been informed that cost records under section 209(1) (d) are not required to be maintained by the Company in respect of products manufactured by the Company. Xvii) According to the records of the Company, Providend Fund dues have been regularly deposited during the year with the appropriate authorities except Rs.888813/-. xviii) According to the records of the Company and information and explanations given to us in respect of undisputed Wealth Tax, Customs Duty, Excise Duty and Sales Tax, there are no amounts outstanding, as on 31st March, 2003 which have remained unpaid for more than six months from the date on inch they became payable. xix) During the course of our examination of the books of account carried out in accordance with the generally accepted auditing practices, we have not come across any personal expenses which have been charged to Profit & Loss Account. xx) The Company is a Sick Industrial Company within the meaning of Clause (O) of Subsection (1) of Section 3 of the Sick Industrial Companies (Special Provisions) Act, 1985. In respect of trading activity of the Company, there were no damaged goods. FOR R. D. JOSHI & COMPANY CHARTERED ACCOUNTANTS Indore H. L. Joshi 21.08.2003 Partner