SHIVA PAPER MILLS LIMITED
ANNUAL REPORT 2001-2002
the Members of
Shiva Paper Mills Limited
We have audited the attached Balance Sheet of M/s. Shiva Paper Mills Ltd.,
as a 30th September, 2002 and also the Profit & Loss Account 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 have conducted our audit in accordance with auditing standards generally
accepted in India. Those 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. An audit also includes assessing the accounting principles used
and significant estimates made by the management, as well as evaluating the
overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
As required by the Manufacturing and Other Companies (Auditors' Report)
Order, 1988 issued by 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
a) 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.
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 Profit & Loss Account dealt with by this
report are in agreement with the books of account.
d) In our opinion the Balance Sheet and the Profit & Loss Account dealt
with by this report comply with the accounting standards referred to the
sub-section (3C) of Section 211 of the Companies Act, 1956.
e) On the basis of .written representation received from the Directors and
taken on record by the Board of Directors, we report that none of the
director(s) is attracting disqualification U/s 274(1)(g) of the Companies
f) Subject to the foregoing, in our opinion and to the best of our
information and according to the explanations given to us, the accounts
Note No.11(c), (d) & (e) regarding nonprovision of interest payable/
recoverable the impact of which is not ascertainable; and read together
with other Notes appearing in Schedule `21' give iF, the prescribed manner
the information required and also give a true and fair view:-
a) in the case of the Balance Sheet, of the state of affairs of the company
as at 30th September, 2002
b) in the case of the Profit & Loss Account, of the loss for the year ended
on that date.
for B, K. SHROFF & CO.,
3/7-B, Asaf Ali Road,
New Delhi - 110002 O.P. SHROFF
Dated : 06-12-2002 Partner
ANNEXURE REFERRED TO IN PARAGRAPH d OF OUR REPORT OF EVEN DATE
1. The company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets. As explained
to us, all the fixed Assets have been physically verified by the management
during the year according to a regular programme which in our opinion is
reasonable having regard to the size of the company and the nature of its
assets. No material discrepancy was noticed on such verification.
2. None of the fixed assets have been revalued during the year.
3. The stocks of finished goods, spare parts arid raw material except
material in transit have been physically verified by the management during
the year. In our opinion, the frequency of verification is reasonable. it :
our opinion, the procedures of physical
4. In our opinion the procedures verification of stocks followed by the
management are reasonable and adequate s relation to the size of the
company and nature of its business.
5. The discrepancies noticed on verification o' stocks as compared to book
records were not material and these have been properly dealt with in the
books of account.
6. On the basis of our examination of stock records, we are of the opinion
that the valuation of stocks is fair and proper, in accordance with the
normally accepted accounting principles and is on the same basis as in the
7. In our opinion, the rate of interest and other terms and conditions on
which loans have been taken from companies, firms or other parties listed
in the register maintained under Section 301 of the Companies Act 1956, are
prima facie not prejudicial to the interest of the company.
8. The rate of interest and other terms & conditions on which unsecured
loans have been granted to companies, firms or other parties listed in the
register maintained under Section 301 of the Companies Act, 1956 are prima-
facie not prejudicial to the interest of the company.
9. Employees to whom loans or advances in the nature of loans have been
given by the company, are repaying the principal amounts as per
stipulations, wherever such stipulations exist and are also regular in
payment of interest, wherever applicable.
10. In our opinion and according to the information and explanations given
to us, there are adequate internal control procedures commensurate with the
size of the company and the nature of its business with regard to purchase
of stores, raw materials including components, plant & machinery, equipment
and other assets, and with regard to the sale of goods.
11. There are no transactions of purchase of goods and materials and sale
of goods, materials and services aggregating during the year to Rs.50,000/-
or more in respect of each party, made in pursuance of contracts or
arrangements entered in the registers maintained under Section 301 of the
Companies Act, 1956.
12. As explained to us, the company has a regular procedure for
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.
13. In our opinion and according to the information and explanations given
to us, the company has complied with the provisions of Section 58A of the
Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975
with regard to deposits accepted by it from the public.
14. In our opinion, reasonable records have been maintained by the company
for the sale and disposal of realisable scrap. The company has no by-
15. In our opinion, the company has an adequate internal audit system
commensurate with the size and nature of its business.
16. We have broadly reviewed the books of account maintained by the company
pursuant to the order made by the Central Government for the maintenance of
cost records under Section 209(1)(d) of the Companies Act, 1956 and are of
the opinion that prima-facie the prescribed accounts and records have been
17. According to the records of the company, there have been delays in the
deposit of Provident Fund and Employees State Insurance dues with the
appropriate authorities. Arrears of Provident Fund dues of Rs. 19,36,427/-
are still unpaid and arrears of ESI dues of Rs.3,313/- have been paid on
18. According to the information and explanations given to us, no personal
expenses of employees or directors have been charged to revenue account,
other than those payable under contractual obligations or in accordance
with the generally accepted business practices.
19. According to the information and explanation's given to us, no
undisputed amounts payable in respect of income tax, wealth tax,, sales
tax, custom duty were outstanding as at 30th September, 2002 for a period
of more than six months from the date they became payable.
20. The company is a sick industrial company within the meaning of Section
3(1) (o) of the Sick Industrial Companies (Special Provisions) Act, 1985,
reference to B.I.FR. under section 15 is yet to be made.
for B.K. SHROFF & CO.,
3/7-B, Asaf Ali Road,
New Delhi - 110002 O.P. SHROFF
Dated : 06-12-2002 Partner