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SM Finance Ltd.

BSE: 511318 Sector: Financials
NSE: SMFINANC ISIN Code: N.A.
BSE 05:30 | 01 Jan SM Finance Ltd
NSE 05:30 | 01 Jan SM Finance Ltd

SM Finance Ltd. (SMFINANC) - Auditors Report

Company auditors report

ANNUAL REPORT 1998-99 SM FINANCE LIMITED AUDITORS REPORT To The Members of SM FINANCE LIMITED We have audited the attached Balance Sheet of SM FINANCE LIMITED as at 31st March, 1999 and the Profit and Loss Account for the year ended on that date annexed thereto and report that: 1. As required by the Manufacturing and Other Companies (Auditors' Report) order, 1988 issued by the Company Law Board in terms of Section 227(4-A) of the Companies Act, 1956, We annex hereto a statement on the matters- specified in paragraphs 4 & 5 of the said order. 2. Further to our comments in the statement referred to in paragraph 1 above, we state that: 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 accounts as required bylaw have been kept by the Company so far as appears from our examination of such books. c) The Balance Sheet and the Profit & Loss Account referred to in this report are in agreement with the books of accounts. d) In our opinion the Balance Sheet & Profit & Loss Account referred to in this report comply with the accounting standards referred to in Sub-Section (3C) of Section 211 of the Companies Act,1956. e) Subject to Note No.7 of Schedule "Q" regarding "the sale and consequential shortfall of SLR Investments" and Note No. 11 of Schedule "Q regarding "advances and deposits given for Real Estate business not considered for provisioning under RBI norms" in our opinion and to the best of our information and according to the explanations given to us, the said Balance Sheet and the Profit & Loss Account read in particular with Note.No.3 of Schedule "Q regarding suit filed against the Company for alleged underwriting commitment, Note No.8 of Schedule "Q" regarding Investments and Loans & Advances in some Companies including Companies in which Directors are interested in excess of the limits prescribed by the Reserve Bank of India Note No. 9 of Schedule "Q" regarding delay in repayment of fixed deposits, Note No.14Of Schedule Q" regarding rejection of Company's application for registration by the Reserve Bank of India and read together with other notes thereon give information required by the Companies Act, 1956 in the manner so required and give a true and fair view: i) In so far as it relates to the Balance Sheet, of the state of affairs of the Company as at 31st March, 1999, and ii) In so far as it relates to the Profit & Loss Account, of the Loss of the Company for the year ended on that date. For M.BHASKARA RAO & CO For S.K.KAVATEKAR & CO Chartered Accountants Chartered Accountants V.RAGHUNANDAN S.K.KAVATHEKAR Partner Proprietor Place: Hyderabad Date : 31.05.99. STATEMENT REFERRED TO IN PARAGRAPH (1) OF OUR REPORT OF EVEN DATE 1.The Company has maintained adequate records to show full particulars including quantitative details and situation of fixed assets. The fixed assets of the Company other than the assets given on lease have physically verified by the Management during the year and no discrepancies were noticed on such verification, as compared to the register of fixes assets maintained by the Company. 2.None of the fixed assets of the Company have been revalued during the year. 3.The Company has not obtained any loans, secured or unsecured from the companies, firms or other parties listed in the Register maintained under Section 301 of the Companies Act, 1956 or from the companies under the same management as defined under subsection (1-B) of erstwhile Section 370 of the Companies Act, 1956. 4.In our opinion,the rate of interest and other terms and conditions on which loans, secured or unsecured, have been granted to the companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act,1956 are not,as explained to us, prima facie prejudicial to the interest of the Company. No loans, secured or unsecured, have been granted to the companies under the same management as defined under sub-section (1 -B) of erstwhile Section 370 of the Companies Act, 1956. 5. In our opinion in respect of hire money due on stock on hire under hire purchase transactions entered into by the Company in the ordinary course of business and where instalments are over due, reasonable steps have been taken by the Company for the recovery of the same. 6. In our opinion and in accordance with the information and explanation given to us, the internal control procedures need to be strengthened to commensurate with the size of the Company and the nature of its business. 7.In our opinion and according to the information and explanations given to us, the transactions of goods & services made in pursuance of contracts or arrangements entered in the register maintained under Section 301 Of the of 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 similar goods and services . 8. In our opinion and according to the information and explanation given to us, the Company has not accepted deposits from the public during the year. However there are overdue deposits amounting to Rs. 560.63 Lacs (Previous year Rs. 437.64 Lacs) which includes Rs. 510.28 Lacs (Previous year Rs. 370.89 Lacs) deposits matured claimed but not paid. 9. The Company has no internal audit system in vogue during the year. According to the information and explanations given to us, the company is in the process of strengthening its own internal control systems commensurate with the size of the company and nature of its business. 10, The Company is generally regular in depositing Provident Fund and Employees State Insurance dues with the appropriate authorities. 11. There are no undisputed amounts payable in respect of Income Tax, Wealth tax, Sales tax, Customs Duty and Excise Duty as at 31st March, 1999 which are outstanding for period of more than six months from the date they became payable. 12. In our opinion and according to the information and explanations given to us,personal expenses have not been charged to revenue account. 13. The Company is not a Sick lndustrial Company within the meaning of Clause(O) of sub-section (1) of Section 3O1 the Sick Industrial Companies (Special Provisions) Act, 1985. 14. The Company has maintained proper records in respect of transactions and contracts related to dealing in Shares, Securities, Debentures and other investments. As explained to us, timely entries have been made therein. Shares and Debentures have been held by the Company in its own name or are in the process of transfer in its own name to the extent applicable. 15. Item Nos. (4A), iii, iv, v, vi, xii ,xiv, xvi, and 4(D) ii and iii of the said order are not applicable in the case of this Company. For M.BHASKARA RAO & CO., For S.K.KAVATHEKAR & CO., Chartered Accountants Chartered Accountants V. RAGHUNANDAN S.K.KAVATHEKAR Partner Proprietor Place: Hyderabad Date : 31.05.99