ANNUAL REPORT 1998-99
The Members of SURGIPLAST LIMITED
We report that we have audited the Balance Sheet of SURGIPLAST LIMITED as
at 31st March, 1999 and also the annexed Profit & Loss Account of the
Company for the year ended on that date.
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
kept by the Company so far as appears from our examination of the books.
3. The Balance Sheet and the Profit and Loss Account dealt with by this
Report are in agreement with the books of account.
4. In our opinion and to the best of our information and according to the
explanations given to us, the said accounts read together with notes
thereon and subject to:
a) Note No. 1 (Schedule-19) regarding preparation of accounts on "going
concern" basis despite erosion of its entire net worth and proceedings
pending with BIFR;
b) Note No. 3 (Schedule-19) regarding non-availability of confirmation of
balances in respect of financial institutions, certain banks, loan, debtors
c) Note No. 4 (Schedule-19) regarding provision of interest on term loans
taken from banks/financial institutions having been made on the basis on
various loan agreements;
d) Note No. 10(a) (Schedule-19) regarding non provision of bad and
doubtful debts amounting to Rs.15,90,367 (Previous Year Rs. 15,90,367).
e) Note No. 10(b) (Schedule-19) regarding non provision of disputed Income
Tax/Sales Tax demand of Rs. 103,08,074 (Previous Year Rs 102,78,818) and
interest/penalty thereon as may be determined; give the information
required by the Companies Act, 1956 in the manner so required and give a
true and fair view:
i) In the case of the Balance Sheet, of the state of affairs of the Company
as at 31st March, 1999 and
ii) In the case of the Profit & Loss Account, of the Profit for the year
ended on that date.
5. In our opinion the Profit and Loss Account and the Balance Sheet
comply with the accounting standards referred to in section 211(3C) of the
Companies Act, 1956 to the extent applicable.
6. As required by the Manufacturing and Other Companies (Auditors' Report)
Order, 1988 issued by the Company Law Board in terms of Section 227(4A) of
the Companies Act, 1956, and on the basis of such checks as we considered
appropriate, we further report that:
i) The Company has maintained proper records showing full particulars
including quantitative details and situation of its fixed Assets. As per
information and explanations given to us, the Company has adopted a system
of physically verified of all its fixed assets once in every two years,
Accordingly its fixed assets were verified by the management during the
last year. In our opinion, the frequency of verification of fixed assets by
the management is at reasonable intervals, having regard to the size of the
company and the nature ot its assets. We are informed that discrepancies
noticed on such verification were insignificant.
ii) None of the fixed assets have been revalued during the year.
iii) The stocks of finished goods and raw materials have been physically
verified by the management at the year end.
iv) In our opinion and according to the information and explanation given
to us, 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) Discrepancies between the physical stocks and the book stock which were
not significant have been dealt with in books of accounts.
vi) In our opinion, and on the basis of our examination, the valuation of
stocks is fair and proper and in accordance with the normally accepted
accounting principles except that as per past practice, excise duty on
stocks of finished goods has not been considered as part of cost, as
recommended by the Institute of Chartered Accountants of India in its
revised guidance not "Accounting treatment of excise duty" (Refer Note 9
Sch. 19) The Valuation of stocks is on the same basis as in the previous
vii) In our opinion and according to the information and explanation given
to us, internal control procedures for the purchase of stores, raw
materials including components, plant and machinery, equipment and other
assets and for the sale of goods are commensurate with the size of the
Company and the nature of its business
viii) As explained to us, the Company has regular procedure for the
determination of unserviceable or damaged stores, raw materials, finished
goods. According to information given to us, adequate provisions have been
made in the account for the loss arising on the items so determined.
ix) In our opinion and according to the information and explanation given
to us, scrap generated during the manufacturing process of IV Sets and
Syringes is being used for internal consumption by the Company. As
explained to us, the Company's operations do not generate any by-products.
x) The company does not have an internal audit system.
xi) The Company has been depositing Provident Fund and State insurance dues
with the appropriate authorities fully though slightly late on several
xii) According to the information given to us , there were no undisputed
amounts payable in respect of Income Tax, Custom Duty, and Excise Duty
which have remained outstanding as at 31st March,1999 for a period of more
than six months from the date they became payable. In respect of Sales Tax
Rs. 17,93,023/- (Previous year 17,93,023) have remained outstanding as at
year end for a period of more than six months from the date they became
xiii) According to the information and explanation given to us and on the
basis of the records examined by us, personal expenses of directors or
employees have not been charged to revenue account, other than those
payable under contractual obligations or in accordance with generally
accepted business practice.
xiv) The Company is not a sick industrial company within the meaning of
clause (O) of sub-section (1) of Section 3 of the Sick Industrial Companies
(Special Provisions) Act, 1985 and a reference has been made to the BIFR
U/s 15 of that Act BIFR pursuant to the reference has issued a show-cause
notice for winding up the Company.
xv) Provision of Sun-para (vii) to (ix),(xi) (xii) and (xvi) of para 4A of
MAOCARO do not apply during the year under audit
For M.G. Ved & Co.
Place : Bombay
Date : 14th June, 1999