SHREE POMANI METALS & ALLOYS LIMITED
ANNUAL REPORT 1999-2000
The Members of
Shree Pomani Metals & Alloys Ltd.
We have audited the attached Balance Sheet of SHREE POMANI METALS & ALLOYS
LIMITED as at 31st March 2000 and annexed Profit and Loss Account of the
Company for the year ended on that date and reports that:
1. We have obtained all the information and explanations which to the best
of our knowledge and belief were necessary for the purpose of our Audit.
2. In our opinion, proper books of account as required by law have been
maintained by the company so far, as appears from our examination of these
3. In our opinion the Balance sheet and the Profit and Loss Account dealt
with by this report are in agreement with the books of account.
4. The accounts of the Company has been prepared on going concern
assumption as mentioned in Note 1 of Schedule U, as in the opinion of the
management, the company will be able to recoup the losses during subsequent
years by taking effective measures to the production and profitability.
Subject to above, in our opinion the Balance Sheet and Profit and Loss
Account dealt with by this report comply with the mandatory accounting
standards referred in section 211 (3C) of the Companies Act, except for
Accounting Standards (AS) 15 in so far as it relates to leave encashment
benefits to employees as referred to in the Notes of Accounts item No.4.
5. 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
i) In the case of Balance Sheet on the state of affairs of the Company as
at 31st March 2000 and;
ii) In the case of the Profit and Loss Account of the Loss of the Company
for the year ended on that date.
As required by the Manufacturing and Other Companies (Auditor's Report)
Order, 1988 issued by the Central Government u/s 227 (4A) of the Companies
Act, 1956, on the basis of such checks of books and records as were
considered appropriate and information and explanations given to us during
the course of our audit. We further report that in our opinion:
i) The Company is maintaining proper records showing full particulars
including quantitative details and situation of fixed assets. The assets
have been physically verified by the management at reasonable intervals and
no material discrepancies were noticed on such verification.
ii) None of the Fixed Assets of the Company have been revalued during the
iii) Stock of finished goods, stores, Spare parts and raw materials have
been verified by the management wherever practicable except material in
transit and material sent for job work to other parties certificate whereof
from management were accepted.
iv) The procedures of physical verification of stocks followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
v) The discrepancies noticed on physical verification of stocks as compared
to book records, which in our opinion were not significant, have been
properly dealt with in books of accounts.
vi) On the basis of our examination of stock records, the valuation of
stock is fair and proper in accordance with normally accepted accounting
principles and is on the same basis as in the preceding year.
vii) The Company has not taken unsecured loan from companies, firms and
other parties listed in the register maintained u/s 301 of the Companies
Act, 1956 and / or from companies under the same management as defined u/s
370 (1B) of the Companies Act, 1956.
viii) The Company has not granted any loan secured or unsecured to
companies, firms or other parties listed in the register maintained u/s 301
and sec 370 (1B) of the Companies Act, 1956.
ix) As informed to us, the parties including the employees to whom interest
free advance have been given are repaying the principal amount for which no
terms are stipulated.
x) On the basis of checks carried out during the course of audit and as per
explanation given to us, company has 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's and other assets and for the sale of goods.
xi) According to the information and explanations given to us, the
transactions of purchase and sale of goods, materials and services made in
pursuance of contracts or arrangements entered in the register maintained
u/s 301 of Companies Act, 1956, aggregating during the year Rs. 50,000/- or
more in respect of each party have been made at prices which are reasonable
having regard to prevailing market prices for such goods, materials and
services at the prices at which transactions for similar goods, materials
and services have been made with other parties.
xii) According to explanation given to us and as confirmed by the
management, there are no stocks of unserviceable or damaged stores,
materials, spares, finished goods etc. as on the Balance Sheet date and as
such no provision is necessary in the account for the same.
xiii) The Company has not accepted any deposits from the public to which
provisions of section 58 A of the Companies Act, 1956, and the Companies
(Acceptance of Deposits) Rules, 1975 apply.
xiv) The Companies has maintained reasonable records for the sale and
disposal! of realised by-products and scrap.
xv) The Company has an internal audit system, which is commensurate with
the size and nature of its business.
xvi) We have been informed that the maintenance of cost records has not
been prescribed by the Central Government in respect of the activities of
the Company pursuant to section 209 (1)(d) of the Companies Act, 1956.
xvii) According to records of Company, the Company has been generally
regular in depositing Providend Fund dues and payments under Employees
State Insurance Act with proper authorities.
xviii) As informed to us there are no undisputed amounts payable in respect
of Income-Tax, Wealth-Tax, Sales Tax, Customs Duties outstanding as on 31st
March 2000 for a period of more than six months from the date they became
payable except Rs.62,359 /- towards Sales Tax for 95-96 remaining unpaid
xix) During the course of our examination of the books of accounts carried
out in accordance with the generally accepted audit practices, we have not
come across with any personal expenses of Employees or Directors which h
ave been charged to revenue account other than those payable under
contractual obligation or in accordance with the generally accepted
xx) The Company is a potentially Sick Industrial Company within the meaning
of clause (o) of sub-section (1) of section 23 of Sick Industrial Companies
(Special Provisions) Act, 1985.
xxi) In respect of Company's Service Activity, the Company has a reasonable
system of recording receipt, issue and consumption of material and stores
and allocating materials consumed to the relative jobs are not directly
allocated for billing but are properly considered at predetermined rates
per job. Considering the nature of services rendered there is a system of
reasonable allocation of the stores, the raw materials and labour to the
related service jobs and the system of Internal Control is commensurate
with the size and nature of business of Company.
xxii) According to the information and explanation given to us there were
no damaged goods in the case of goods traded by the company.
For R. T. JAIN & CO.
Place: Mumbai (R. T. JAIN)
Date : 25-11-2000 Proprietor