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Shree Rubber Industries Ltd.

BSE: 531908 Sector: Others
NSE: N.A. ISIN Code: N.A.
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Shree Rubber Industries Ltd. (SHREERUBBER) - Auditors Report

Company auditors report

SHREE RUBBER INDUSTRIES LIMITED ANNUAL REPORT 2006-2007 AUDITORS' REPORT To, The Members of SHREE RUBBER INDUSTRIES LIMITED GUJARAT We have audited the attached Balance Sheet of Shree Rubber Industries Limited, as at 31st March, 2007 and also the Profit and Loss Account and 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 reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosure in the financial statement. 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. 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. 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 it appears from our examination of those books. (iii) The Balance Sheet and Profit and Loss Account and cash flow statement dealt with by this report are in agreement with the books of account. (iv) In our opinion, the Balance Sheet and Profit and Loss Account 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; (v) On the basis of written representations received from the directors as on 31st March, 2007 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2007 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956. (vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts subject to observations made in Companies Companies (Auditor's Report), Order, 2003, and read with notes on accounts forming part of the audited financial statements 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 case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2007; and (b) in the case of the Profit and Loss Account, of the loss for the year ended on that date; and (c) in the case of the cash flow statement, of the cash flows for the year ended on that date. For SNK & Co. Chartered Accountants Viral Lokhandwala Partner Place: Surat Date : June 9, 2007. ANNEXURE TO THE AUDITOR'S REPORT (Referred to in our Report of even date an annexure on the matters specified in paragraphs 4 and 5 of the CARO on the Statements of Accounts of SHREE RUBBER INDUSTRIES LIMITED as at and for the Year ended March 31, 2007). 1. Fixed Assets: The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. All the assets have been physically verified by the management during the year, besides there is a regular programme of verification which in our opinion is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such verification. No fixed assets were disposed off during the year and therefore do not affect the going concern assumption. 2. Inventory: The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable. The procedures 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. On the basis of our examination of the records of inventory as maintained under the Central excise regulations and as produced before us, we are of the opinion that the company is maintaining proper records of the inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material. 3. Loans taken / granted by the company: The company has taken unsecured loans of Rs.21.96 lacs from two parties covered in the register maintained under Section 301 of the Act during the year and the year end balance of unsecured loans aggregates to Rs.57.84 lacs. According to the information and explanation provided to us, the terms and conditions on which the loans have been taken from companies, firms or other parties listed in the registers maintained under Section 301 are not, prima facie, prejudicial to the interest of the company. Further, the company is regular in repaying the principal amounts as stipulated. According to the information and explanation provided to us, there is no overdue amount of loans taken by the company. According to the information and explanations given to us, the company has not granted loans to companies, firms and other. parties covered in the Register maintained under Section 301 of the Companies Act, 1956. 4. Internal Control: 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 inventory, fixed assets and with regard to the sale of goods and services. During the course of cur audit, no major weakness has been noticed in the internal controls. 5. Transactions with parties listed u/s. 301 of the Companies Act: In our opinion and according to the information and explanations given to us, there are no transactions during the period exceeding Rs.5,00,000/- with the parties listed under Section 301. 6. Deposits from public: In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from the public and consequently, the directives issued by Reserve Bank of India, provisions of Section 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public are not applicable. 7. Internal Audit System: In our opinion, the company has an internal audit system commensurate with the size and nature of its business. 8. Cost Records: According to information and explanations given to us, the Central Government has not prescribed for the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956. 9. Statutory Dues: According to information and explanations given to us and on the basis of our examination of the books of accounts, the company has not been regular in depositing with appropriate authorities undisputed statutory dues including sales tax, VAT, excise duty, cess, provident fund, service tax and other statutory dues. According to the information and explanation given to us, no undisputed amounts payable in respect of income tax, cess VAT and excise duty were outstanding, as at March 31, 2007 for a period of more than six months from the date they became payable except Provident fund Rs.17,999/-, sales tax of Rs.43,45,789/- and service tax of Rs.45,267/- remaining outstanding till the date of signing of this report. According to the information and explanation given to us, there are no dues of sales tax, VAT, income tax, customs tax / wealth tax, excise duty which have not been deposited on account of any dispute. 10. Accumulated Losses: The accumulated losses of the company exceed fifty percent of its net worth as at the end of the financial year. Company has incurred cash losses of in financial year and in immediately preceding financial year. 11. Repayment of financial dues: According to the records of the company, the company has defaulted in repayment of dues to financial institutions; however in absence of specific information from the management, we are unable to quantify the amount of default and the period of default. The principal amount and interest accrued thereon on the term loan from Gujarat Industrial Investment Corporation Limited & Gujarat State Financial Corporation Limited amounting Rs.1269.28 lacs is outstanding as on 31-3-2007, subject to confirmation from the respective financial institutions. 12. Documentation in respect of loans granted: Based on our examination of documents and records, we are of the opinion that the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. . 13. Guarantee for loans: The company has not given any guarantee for loans taken by others from bank or financial institutions. 14. End use of funds: On the basis of our examination of records and information and explanations given to us the company has not availed any term loans during the financial year. Based on our examination of the balance sheet of the company as at 31-3- 2007 and information and explanations given by the management, we find of the company has not used short term fund for long term investment. 15. Preferential allotment: The company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act. 16. Issue of debentures: During the period covered by our report the company has not issued any debentures. During the period covered by our report the company has not raised any money by public issue. 17. Frauds: On the basis of the audit procedures performed and information and explanations given by the management, we report that no fraud on or by the company has been noticed or reported during the course of our audit. For SNK & Co. Chartered Accountants Viral Lokhandwala Partner. Place: Surat Date : June 9, 2007.